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Europes Largest Metal Detector Distributor Gives Minelab The Boot


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49 minutes ago, cudamark said:

聽In this global market, I'm actually surprised cutting out the middleman hasn't happened already.

Me too.

I can't see how it makes financial sense for a manufacturer to pay distributers in a global market, for a very niche product.

When Minelab used to dominate the global market, they could maintain a very high mark up without having any concern of profit loss due to a distribution network. However, Minelab no longer has that dominance since the likes of Nokta, XP, and probably Quest. Further to that, is Amazon selling a plethora of cheap detectors made in China.

It's cut throat time in this industry, so it wouldn't surprise me in the least if the manufacturers start to eliminate the distributers and ship directly from their manufacturing site.

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They are taking those steps already selling direct in some part of the world and experimenting with cutting out the middle men, baby steps to get it right I guess.聽聽 They would need large local warehouses staffed to ship goods which takes time, and sales have to be viable in the region to make it happen. Europe would be one of those regions you would think however other brands seem more popular there.聽 Spend many millions setting up and you would want to have good strong continuous sales, that's where distributors help, you piggyback off their business so you don't have all that expense yourself and they can survive as they do multiple brands to keep them busy.

When sales are good right after a new model for example staff would be run off their feet and you'd possibly need more staff, it times between models and sales slow to a crawl staff are sitting around twiddling their thumbs with nothing to do yet you're still paying their wages and paying the expenses of having the active distribution center.

In house warranty repair is something that could be done from the same location, likely needing different staff to do the repairs than package the parcels though and unless they have a crazy amount of faulty stuff they often wouldn't have enough to do either which is why often service agents also service other products and brands too.聽 In saying that with Minelab's quality lately they maybe extremely busy full time.

Customers wouldn't put up with ordering a detector and waiting weeks for it to arrive from an international destination, they need local warehouses to do it. 聽

It sounds all nice and easy until you think about it a bit more and would possibly only be viable in some markets.

They could distribute to dealers from overseas, dealers would have to be very organized with stock though as if it takes weeks to arrive they'll run out and have no stock to sell often, you never know when you'll be busy so it would cause sales interruptions and loss of sales often.聽 Now they just contact the local distributor and have stock quickly if the stock exists, again with Minelab it often doesn't 馃檪

They'll never want to get rid of the retail dealers and sell only direct as the retail stores give them a different type of exposure to online and they would lose a lot of sales if they did so, so all they can cut out is distributors which for the points above is not as easy as it sounds.

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15 minutes ago, phrunt said:

They'll never want to get rid of the retail dealers and sell only direct as the retail stores give them a different type of exposure to online and they would lose a lot of sales if they did so, so all they can cut out is distributors which for the points above is not as easy as it sounds.

I'm not so sure about that Phrunt.

I mean, when someone is researching detectors, they might look at retail shops and distributors for pricing, but they'll quickly move to the forums, Facebook, and You Tubers, to get user information on detectors. As such, I don't think distributers play a role in increasing detector sales. Social media does all that, and does so at no cost to the manufacturers.

Shipping time is of course a factor, but when one has decided what detector to buy, I don't think waiting a little longer to receive it, would be a deterrent to the buyer. Although, the manufacturers could go with just one distributor in North America, and one distributer in Europe for everyone else.聽

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Well other countries exist that are very large for sales such as Africa and Asia that couldn't rely on Europe for distribution, Africa has long been their biggest market for detectors, here is their 2020 sales from different parts of the world, I couldn't find a 2022 version without a lot of effort and can't be bothered 馃檪聽 Sales in Africa have slowed though with their gold rush appearing to slow right down as gold gets harder to find and political turmoil.

minelab-global-footprint-2020.jpg.039d95bbd46ff61499f6159e5e660f16.thumb.jpg.b93a02675af653bf4ddef941cb5b8f5f.jpg

At the moment they mostly do only have one distributor they partner with in many countries and the dealers feed off them, I can't see this changing in a hurry, to deal direct with little dealers for them would be nothing but a hassle, and it's better to let a distributor/wholesaler do it.聽 They would certainly have to cull off a lot of the dealers especially the ones with low sales volumes as they'd be more hassle than they're worth when shipping to them internationally direct.

Selling direct from Minelab along with keeping distributors and dealers seems the more logical approach and that's what they've done in Indonesia where you can buy direct off Minelab at Minelab's Indonesia website here https://minelab.co.id/, or you can go to your usual places to purchase where they buy it off the distributor that buy it off Minelab.

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I still appreciate the Dealers I buy from and look down at direct-from-the -manufacturer purchase. Dealers are people we can meet or call and talk to, willing to help with problems, offer training, offer many other detecting products that you would have a hard time finding on your own or even knowing they exist. No, often manufacturers seem to be non-caring about individuals but look at us as numbers, it will be a shame if we loose our dealers and a big mistake for the manufacturers to ruin a good working relationship as it is now.聽

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36 minutes ago, MSC said:

I still appreciate the Dealers I buy from and look down at direct-from-the -manufacturer purchase. Dealers are people we can meet or call and talk to, willing to help with problems, offer training, offer many other detecting products that you would have a hard time finding on your own or even knowing they exist. No, often manufacturers seem to be non-caring about individuals but look at us as numbers, it will be a shame if we loose our dealers and a big mistake for the manufacturers to ruin a good working relationship as it is now.聽

Hi MSC.

Dealers played a valuable role...before the internet. Information such as you described, is achieved in a far more unbiased, thorough, and varied manner, via internet metal detecting platforms.

In todays internet world, manufacturer sales are obtained with free advertising and information from online users and metal detecting websites. Once the new or experienced potential purchaser gets that information from those sources, they find a dealer and place an order. In other words, it isn't the dealer that generates sales anymore. As such, it makes zero financial sense for a metal detecting company to keep giving a decent portion of their sales money to dealers.

In regards to your comment of, "often manufacturers seem to be non-caring about individuals":

That may be true, but it typically only occurs when one company has monopoly. There is no longer a monopoly in the metal detecting industry. More importantly however, and more specific to this discussion, is that whether or not a company has dealers, is irrelevant to how a company treats their customers.聽




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Money talks. That is all Minelab cares about. They don't appear to care about people & us the consumer of "their" products. Their silence is deafening on product quality issues. They are bound by law on warranty replacement but when there are so many continued issues without a peep from minelab, that is a concern. Their PR sucks.

D4G

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11 hours ago, dig4gold said:

Money talks. That is all Minelab cares about. They don't appear to care about people & us the consumer of "their" products. Their silence is deafening on product quality issues. They are bound by law on warranty replacement but when there are so many continued issues without a peep from minelab, that is a concern. Their PR sucks.

D4G

Those are textbook symptoms of a monopoly, especially when shareholders are involved.

In general, a monopoly results in planned obsolescence, price gouging, poor customer service, and denial of quality issues.

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On 5/26/2023 at 11:52 AM, phrunt said:

couldn't find a 2022 version without a lot of effort and can't be bothered

Sales in Africa down, up in other places. Remember as the report notes these numbers are 52% metal detecting, 48% communications.

https://codan.com.au/wp-content/uploads/2022/09/Codan-Limited-Annual-Report-2022.pdf

IMG_4513.jpeg
IMG_4516.jpeg

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Thanks Steve, that's the chart I could find too but they combined metal detectors with communications in that one and communications was having the biggest growth according to their shareholder report so it's hard to know by that one how well the detectors are doing.聽 I was hoping to find one on metal detectors alone with communications being 48% of sales and having the highest growth.

I guess the previous chart is based on them combined too so it's all relative, either way my point was there are other significant markets outside of North America and Europe. 馃檪

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