Monday 17 February 2014

A new route to market - The no-middlemen group in Greece

According to the New York Times, the feisty owner of a small family business that makes detergents in Northern Greece, struggling to keep his business afloat under the weight of unpaid invoices and constant demands for bribes, started selling his products directly to consumers for cash at fixed prices through a non-profit collective – the no-middlemen group – instead of through shops and traders as he had always done.

In their search for solutions to the economic crisis, the Greeks are tinkering with a new type of economy with little precedent in Europe. The movement seeks to cut out wholesalers, shop managers, state officials and anyone else between producers and consumers, and who once took a share of profits and added to the costs of goods.

The group runs a website that takes orders for goods that are then distributed at car-park markets for a fixed price paid in cash. Staffed by volunteers, the group takes a small cut to cover expenses.

Trade investment:
  • The owner of the detergent company says that traditionally the purchasing managers of supermarkets, whether local or foreign owned, demanded bribes for agreeing to a meeting where he presented his products!
  • They also asked for money to ensure an attractive display for his products!
  • The price varied according to shelf height!
  • On average he paid $1,300 a transaction plus gifts at Christmas and other holidays…!
The key issue is not the fact that in the face of increasing demands, the worm finally turned, but that the elimination of all intermediaries and incentives has been so comprehensive, and it appears to be working……

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