A National Trend- "Everyone on My Website" Boom or Bust? Depends

At the LVCCM we not only blog about the coffee industry but we also are shop owners. Since I'm a shop owner I too get all the same calls, frustrations with employees and vendors as any one else. That is why we can write about subject with some sense of empathy for you the coffee shop owner. This week we are going to talk about a trend more than an issue in the coffee industry but one that is potentially more disturbing because it can affect your bottom line.

As I was outlining this blog I received a call from the company that I wrote a termination letter to this morning. The representative never told me who she was. I had to figure it out during the conversation. I told her that I was going to blog about my experience. I did let her know that I would not divulge her company name but because I believe it will benefit everyone, especially in the Las Vegas area, I will tell you that they have a green sign that says on it "Bite". You can figure out the rest. This isn't even the website. These guys are just the delivery guys. They are the second level of profit skimmers.

Here's how it works.
You, the entrepreneur, sink 100k-300k into your dream business. You, spend a few years working day and night to build it up, until one day, Along comes a guy who says, "Hey, let me help you by putting you on my website, where I will throw you in with a bunch of other shops? If someone calls and orders something from your page, I'll forward the order over to you and you fill the order. Oh and by the way I have a partner who has another company that will do the delivery for us both. He and I  will each take 10-12% per transaction and we'll all become rich. Sound good? Screech.... Are you kidding me. With margins in the restaurant business as close as they are, taxes, employees, inventory, etc... and now here comes some "Tick" with a slick website. I think not.
Here's what I see wrong with these sort of operations

1. They are filled with restaurants (not just you but your competitor also)
2. They (the website) promise you the moon (you may get one call a month, while they get hundreds because they have everyone else on their site also)
3. They take a percentage of everything you already sell online (and a percentage off of everyone else on their site)
4. They partner with other companies to take yet another percentage (They probably get a percentage off of them too)
5. Their real aim is to populate a website that they can sell because of advertising on that website. (That's what I would do. Sell the whole site for millions)

In the end, the shops only benefit a percentage of 1% on these type of sites. That is their plan. It only takes a percentage from thousands of businesses to make a killing. This should be a crime but heck to tell you the truth it is a brilliant idea. Only in America can someone come up with such a brilliant and legal concept.

My suggestion to all of these businesses that have been contacted by these sort of sites, "Charge them if they want your business on their site." Charge them a licensing fee just like you would a franchisee. If they believe in your company so much then they shouldn't have a problem paying a small fee to offer your products on their website. I can bet that any large corporation that is on their sites is charging them a licensing fee already. It is the small shops that don't know any better that are populating these sites and not being compensated.