On Mon, 30 Nov 2009 08:21:48 -0800, Daniel Prince
wrote:

Jeff Liebermann wrote:

The problems start when there are competing products. I call it the
Walmart effect. Walmart, Kmart, and many online vendors specialize in
selling solely on the basis of price. If there are two competing
products, differing only a few pennies in selling price, *ALL* their
orders will go to the lower priced product, with nothing to the higher
priced equivalent. Walmart aggravates the effect by setting the price
at some artificial low level, and challenging their vendors to meet
their price goal.

It seems to me that there is a good opportunity here for other
retailers. If a retailer sold only electronic goods that were well
made and well designed, they could sell them for ten to thirty
percent more than the junk sold at Walmart and Kmart.

There are such businesses. However, they are small and the number is
shrinking. I've lived in the same area for about 35 years and have
observed that number of such retailers decreasing. Few have grown in
size over the years, which is a good indication of their viability. I
discussed the quality and service issues with the former owner of one
of these businesses. He noted that competition from the "big box"
stores was a problem, but that there were usually those that were
willing to buy from a locally owned business for a variety of reasons.
However, with the introduction of online shopping, the situation
changed. Online vendors offer the same premium products, but without
the overhead inherent in maintaining a retail store. Some online
vendors don't even have an inventory and simply drop ship from the
factory or a fulfillment house. The result is that consumers that
know exactly what they want, will tend to buy online. Much as I like
the idea of supporting a local business, it's difficult to justify
when there's as much as a 30% difference in price.

I don't know anything about Walmart, but Kmart experimented with
stocking premium products next to the usual cheap junk about 10 years
ago. The idea was to give shoppers an expanded choice. At the time,
I took one look and predicted disaster. For all I know, it may have
been intentional. What Kmart did was mix the junk and the quality
together on the same isles. You could tell the difference by the name
and price, but otherwise they were indistinguishable. Unfortunately,
Joe Sixpack couldn't tell the difference despite national advertising
indicating that Kmart was now selling "name brand merchandise". The
idea bombed. It might have worked if Kmart had implemented some form
of "product differentiation" where the distinction between cheap junk
and name brand was more apparent. There were also other factors, such
as consumers tend to buy at retail stores that match their buying
habits. Most shoppers would not intentionally shop at a "nothing but
the cheapest" store, if they were looking for quality or brand name.

I think many consumers would be willing to pay a little extra for
devices that would probably last four to ten times as long. This
would be especially true if they had two (or more) cheap-junk brand
devices fail.

I'm sure there are those out there. Whether they can support a retail
business is debatable. I spend far too much time at the local
electronics recycler:
http://www.greybearscomputers.org
I literally cry (for real) when I see the stuff that gets tossed. Most
of it can easily be fixed. Much of it is still working, but only
needs a cleaning. Grey Bears has a minimal retail store to sell some
of the refurbished equipment, but it barely breaks even. The only
buyers are other dealers and hackers both of whom know exactly what
they're buying and what it's worth. Joe Sixpack and bargain hunters
are usually lost.

If you want to see how someone lives, just look at their trash. You'll
learn more about their buying habits from the trash than from anything
you see in their house or business. It's the same with eWaste. It's
not unusual to see a complete multifunction inkjet
printer/scanner/copier/fax, in the box with the disks and docs, tossed
because it "died". Closer inspection finds that someone forgot to
remove the plastic tape from the inkjet cartridge.

The buying habits of Joe Sixpack are evident (to me). He assumes that
electronics will have a short lifetime and treats it accordingly. As
soon as something gets a bit old, he'll be in line at the local
Walmart or Cosco for a replacement. He has no technical abilities and
is unable to distinguish between quality and crap. I've seen this
first hand as some of my more astute friends enlist my help to decide
which HD TV is appropriate. It takes me at least an hour or two of
reading reviews and looking at the FCC ID site, to make a
determination. Joe Sixpack might spend a few minutes with a sales
droid.

Bottom line: You're giving far too much credit to the average
consumers abilities to benefit from long life products.

The retailer could require vendors to only use non-junk capacitors
with voltage ratings at least three times the voltage the capacitors
would be exposed to. They could also require that no part of the
device ever get more than 30 degrees warmer than the temperature of
the room it is used in.

Welcome to Realityland. A former ladyfriend was a buyer for a large
department store. The problem is that models change faster than the
order cycle. Coupled with just-in-time delivery, what was ordered by
the buyer is often quite different from what was ordered. The stores
actually benefit from this practice as they always want the "latest
model" and not it's predecessor, which was on the original order. If
you compare the original orders, with the stocking inventory, my guess
is that perhaps 30% is the same. If they reject the delivery, then
they have nothing to sell. The usual compromise is that the
manufacturer is required to accept all returns, no matter the reason.
That's suppose to give them an incentive not to ship junk.

The devices could have much longer warranties and the store could
advertise itself as "The quality store". I do not think this would
require excessive advertising, especially after the first few years.

More reality. The name of the game in big retail is turnover. My
guess(tm) is that the TV section at Costco is expected to turnover
*ALL* their inventory in perhaps 60 days. Warehouse and floor space
are expensive. If products just sit there, there's no revenue and the
space becomes even more expensive. This is one reason why stores have
"clearance" sales. They want the space to be used for products that
move, not for storage.

You can't run a quality based retail business, selling long life
established products, in large quantities, that way. Reliability
takes some time to produce. You can just toss in more expensive caps
and expect the overall reliability to instantly improve. There may be
other parts that are running at the bitter edge of premature failure.
By the time the bugs get shaken out of a production product, the next
two or three replacement models will be in the production pipeline.
The result is that old problems with older products never really get
fixed. They get fixed in the design of the replacements. As a
result, most products are permanently stuck at Rev 1.0. If you're
going to sell quality, the inventory turnover will need to be
stretched.

The good part about all this is that problem products just don't last
very long. Soon after the problems are found, the replacements appear
in the stores. The replacements have all the latest features, use all
the latest designs, and follow all the latest fashion trends. Since
inventory is minimal, the prices tend to be low. This is what
consumers really want; features and price. Quality is assumed or
tolerated.

Back to the original topic... I think there will be widespread use of
solid polymer caps in place of small electrolytics despite the price.
However, it's not because of some mythical search for an improvement
in quality. It's because the crappy counterfeit electrolyte is still
in the system now 10 years after it was first introduced and shows no
indication of going away. Respected manufacturers are starting to see
their reputation go down the drain over these parts and are probably
looking for a fix, which solid polymer caps offer. If they advertise
the new and improved replacement, they can also justify the increased
retail cost.


--
Jeff Liebermann
150 Felker St #D http://www.LearnByDestroying.com
Santa Cruz CA 95060 http://802.11junk.com
Skype: JeffLiebermann AE6KS 831-336-2558