eBay as a channel

We’ve been running an experiment recently –
putting computers up for sale on eBay
. We’ve been doing it for a couple reasons.

First, to get an unvarnished view of the ‘market’ price for our systems (where system is defined by hardware, operating system and service contract – not the “assemble in your own garage” premium that Dell charges). Which is why we’ve started listing them with reserve prices of $1.

Second, to start working out the kinks in selling our systems as a web service. Given how our supply chain is architected, we’ve got a serious price advantage over companies that lack our design expertise (ie, those masquerading as computer companies that are really just reselling other people’s computers). Our view is that by adding an operating system, we ought to be able to directly connect our outsourced manufacturers to eBay, sell through our entire capacity with a reserve price at $1 — and never touch a box.

How do our partners play? We connect them directly into the supply chain, so they know about the orders before we do – they’re in the pole position to manage the customer experience, and systems arrive with their branding at the customer site.

Good for us, good for customers, good for partners.

So far, so good 🙂

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