Position in 2008: 7
Consumers undercutting retailers' quotes by sourcing their own products online is a huge everyday problem. But whose fault is it?
You can't really blame the consumer. If you were thirsty, wanted to buy a Coke, and there were two shops next door to each other, but one was selling that can for 40% less than the other, what would you do?
We are all consumers, after all.
Of course, there's huge differences in terms of service, skill and experience when it comes to kitchen, bedroom or bathroom sales, but it's difficult for consumers on a budget to see past the perceived discrepancy in prices between your quote and what they've found themselves online.
This has been a constant source of gripe and grumble from the independent retailer since the internet first became a viable shopping place, and for kitchen studios in particular, it stings hard.
But the fault doesn't lie with the internet itself, it is simply a method of communication. No, the blame lies squarely with the suppliers.
If a very good kitchen independent says he's losing appliance sales to the internet because customers can order the same products he's offering for less than he can buy them for from his supplier, then there's something about the system that's not working.
History, unfortunately, plays its part. The internet has exposed just how much of a variation in trading terms there has always been between different retailers and yet many suppliers have continued to doggedly try to maintain this system.
The internet makes these variations available to the public with a few clicks of a mouse and a credit card. But in terms of getting a cheaper deal, is the information really that different from what a patient consumer could get with a telephone and the Yellow Pages in pre-internet days?
The only difference is the sheer speed. A few clicks can get the consumer a list of a dozen or more stores, and a dozen or more prices for the same product, in an instant.
The real issue is not the method by which consumers find these price variations, but the variations themselves. Unless some major suppliers change their entire pricing structure, this argument has got a long way to run yet.
For one thing, suppliers have a legal obligation not to restrict free trade and they cannot control the prices their customers charge the consumer. The system has always been that if one retailer - internet or otherwise - is selling 10 times as much product as another, then the per-item cost to that retailer will be cheaper. The only way to prevent the online retailer taking advantage of this is for everyone to pay the same trade price per item, and no high-street retailer would want that if they sold more than the guy down the road.
Of course, there are some who would say that retailers only have themselves to blame by thinking they can hold back the internet. They might as well throw out the fax, telephone and book of stamps. The real solution is to embrace it and use it as a legitimate extension of normal business.
If your target customers are looking for kitchens and bathrooms online and your business doesn't feature high up in the search results, whose fault is that?
Online shopping went up by 21% in 2009 and that figure is only going to get bigger, so while there are serious issues to resolve over pricing and supply - that much is certain - the internet itself shouldn't be seen as an enemy, but more the world's biggest window display.
