Business - how to work with your competitor?

[Mr. Wolf]

You guys know that I sell DVDs and been in a death struggle with my competition..

We talked today over IM. Well, he wants to work together so we both make money..


I wonder how is it possible to work together so both make money? Please give me ideas.



So far my idea is as follows. Both sell at the same price and shipping. Then only contents matter.

 

[Aboleo]

Maybe you two could get married?-- you could split everything 50/50 that way.:yes:

 

[AgonyUncle]

You guys know that I sell DVDs and been in a death struggle with my competition..

We talked today over IM. Well, he wants to work together so we both make money..


I wonder how is it possible to work together so both make money? Please give me ideas.



So far my idea is as follows. Both sell at the same price and shipping. Then only contents matter.

Specialise if you can? Provide a niche maybe.

I dont know, but working with the competition is only going to give him breathing space. If he is suggesting you work together, then may he is feeling the pinch more then you are?

There are a gazillion guys selling DVD's. Why is he your only competition?

**** it. Give details man

 

[Francisco d'Anconia]

You never work with your competitor when you both sell the same service. You buy out your competition to increase market share. The only possible non-service collaboration is possibly combining shipping through a common carrier if you can achieve a large enough volume discount. That's how Amazon gain additional revenue by doing that for all of its retail partners it provides distribution services for.

 

[Mr. Wolf]

None of that is possible. Right now it's price war. I'm selling cheaper.


Would this help things? If we decide to sell that the same price and same shipping? However, contents are different..

He also sells other DVDs, and it looks like he is the only one on the market. I have access to every one of those DVDs.

 

[Francisco d'Anconia]

Market share, that's the key to competition. You need to do something that will make you more noticeable. Remember what Microsoft did with their web browser which got them in trouble with the Justice Department? They saturated the market and thus mastered the market.

Consider cutting into his market by focusing on the key purchaser's likes and give them a better deal. Then go after another market, then another. You will continue to spin your wheels if all you are doing is undercutting across the board, you'll eventually end up losing revenue. With market share your margin per unit may be lower but you'll make it up with volume. Think about the XBox.