National Industry
Overview
National computer retailers buy computers in bulk and mark-up the
wholesale price. The retailer is at the mercy of the computer manufacturer
and content to order generic computers with random specifications designed
to sell quickly and depreciate so that they may soon be replaced. Likewise,
with regard to computer services/upgrades, the corporate retail approach is
designed to move massive amounts of hardware, with the primary focus being
to maximize profits, and thereby shareholder value. This focus on a generic,
“one size fits all,” approach to computer sales and services results in a
relative lack of choices for the consumer. Funtech offers an alternative;
truly personalized, limitless, guaranteed computer solutions.
Details
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When examining the national computer retailers’ business model, it is
important to understand several key points. First, large scale computer
manufacturers do have one large advantage over FunTech Computers. This
advantage is what economists refer to as “economies of scale.” This is
simply the ability of large-scale operations to decrease the manufacturing
cost per unit of good produced. This occurs in the national computer sales
industry in a couple of ways. First, a large, well known computer
manufacturer receives discounts on parts from suppliers, simply because they
order hundreds or thousands of an identical component at a time. Second, due
to their large share of the market demand for these parts, these companies
are in a position to negotiate contracts with suppliers. These are two
advantages which national computer manufacturers have over a smaller company
such as FunTech.
Another key advantage they have is in marketing. These companies have
budgets allowing for saturation of the media outlets—tv, radio, internet,
and what most of us refer to as “junk mail.” This allows these companies to
manufacture products that are often lacking in quality because an average
consumer is often not aware that other alternatives, such as FunTech, exist,
due to the domination in advertising markets by large scale computer
manufacturers. We rely on word of mouth, our website, and other affordable
media for our advertising. The realization that our best advertising is a
completely satisfied customer, gives us even more incentive to provide the
absolute best service at an affordable price, and in a professional manner.
Although large companies do have advantages over FunTech Computers, we are
not completely helpless. Other than relying on our network of satisfied
customers to help advertise for us, FunTech saves money by having lower
fixed costs. For example, large scale manufacturers must purchase or lease
giant warehouses to store their thousands of computer components. By FunTech
offering a truly customized computer, designed and built uniquely for each
customer, we avoid the need to keep such a large inventory of parts on hand.
We operate on an “order as needed” basis, only ordering those parts which
will actually be used.
Although this is an important advantage for FunTech,
our biggest advantage is actually our size. We are a small company. As such,
we deal with the local market, and can offer a level of personalized service
for customers from the community that a nation-wide computer company simply
cannot match. Most of us have dealt with this fact at some point in our
lives. The computer you bought from one of these large companies develops a
problem. You call tech support, get put on hold, often talk to someone in a
foreign country, and hours later are usually left right where you began—with
a malfunctioning computer. With FunTech, just a simple phone call or email
allows us to set up a time for us to come to you and pick up the computer,
bring it back to our office, diagnose and fix the problem, and have it back
to you in a fraction of the time it would take a large company.
