General

[iq666]

KEE is just a distributor, aren't they? I understand the argument regarding sole distributorship, and the demands they might make on Crossfire for the sake of maximizing margins, but I didn't think they (edit: *they* being KEE) produced any products.

Crossfire has had a reputable name in the business for a long time. Why would they get into a deal for distribution if this was somehow going to hurt that reputation, or their business? I am willing to admit that I am not as informed in the ways of paintball business and the industry as I'd like to be, but I must say I don't understand the argument. If KEE can put these tanks in the hands of more players through their distribution, what's the harm?

[PJ]

Kee probably threaten Crossfire with lowering the price on the tanks they do sell so no one would buy Crossfire, thus putting them out of business. Too bad Crossfire didn't realize that is what Kee will do anyway, causing Crossfire to make crappy tanks and then eventually go out of business.

[iq666]

I find it interesting that the middleman, namely KEE, is somehow in a position to be dictating pricing. As a manufacturer with a solid reputation, like Crossfire's has been, how do you let anyone else tell you what you are willing to sell your product for, or what it is worth. I realize a company must stay competitive, but if the cheaper tanks are garbage, one should presumably have KEE in a corner. If you have a solid product and good reputation, people will pay what you ask, within reason. That being the case, Crossfire presumably should be in a position to tell KEE to shove it if they try to dictate business practices, no?

[Mr. Furious]

Originally Posted by iq666

As a manufacturer with a solid reputation, like Crossfire's has been, how do you let anyone else tell you what you are willing to sell your product for, or what it is worth.

Ask the folks who deal with Walmart.....

[iq666]

Originally Posted by Mr. Furious

Ask the folks who deal with Walmart.....

I know. I am not denying that this happens. I just don't understand why! What motivation could you have as a manufacturer to sell yourself short that way. It seems like people are volunteering to get screwed, and let someone else make money on their backs. I don't get why a company would agree to a deal with companies like this. At least with Walmart, the argument could be made that these deals provide more outlets for consumer purchase to the end user (my own opinion aside). In the case of Kee, the retailer just deals with KEE instead of Crossfire. KEE isn't opening stores for the end user to shop at, right? Perhaps it gets tanks into a few more existing reailers, but what is the BIG benefit for Crossfire?

This kind of deal very well may be happening with Crossfire and KEE. I don't deny the possibility. As I said, I am unfamiliar with KEE's past. Until now I just thought they were a distributor, and they did that; distribute.

[tarakian]

If you need an example of KEE's business practices, see FEP,makers of the Quest marker. They had a distribution deal with KEE got into a disagreement, so KEE dumped the remainder of the the stock they had in their warehouse for $99 each, effectively destroying the price point on Quests. Companies sign these deals because it's easier and more cost effective to self distribution. A national presence like KEE does get you into more locations and you only have to ship to KEE. Hopefully, Crossfire and any other manufacturers that sign with KEE will make sure to protect themselves contractually.

[Harbinger[TG]]

They didn't help ICD either.

[iq666]

Perhaps a distributorship like this is more cost effective than self-distribution in the short term, but if you can eliminate one form of outside pressure on your bottom line by electing NOT to put a part of your business in someone else's hands, why bother with the headache. This has got to be the reason that Dye, by and large, self distributes. They make the rules concerning their product, period.

I don't know, I guess I just don't get it. If KEE is as bad as everyone says, then this may indeed be a foolish move on the part of Crossfire. Time will tell, I guess.

[Mr. Furious]

I think the situation is that KEE and the other big players approach these smaller companies(while Crossfire is big in paintball it is a one trick pony compared to the likes of Dye, PE, Smart Parts and the like) and basically make them an offer they can't refuse: "Deal with us exclusively or we will run you out of business in 6 months or less." . KEE has the money and power to do that. Imagine if they started selling their brand of tanks at $65 for the system comparable to Crossfire's $200 system. After a little while Crossfire either drops their price below cost which will run them out of business or just shuts it's doors due to lack of product sales. Either way they're out of business. Dealing with KEE is simply a way to delay the inevitable and hopefully find a place for some of their employees to land when the business crumbles. It's what happened to ICD and what has a very good chance of happening to Crossfire and any company like them that gets involved with KEE. People believe Smart Parts is the devil but I think KEE makes Smart Parts look like a bunch of saints.

[cockerpunk]

see, i dont think KEE is the big bad guy many say they are. they arn't necessarily good for the industry, but in tough economic times, you see this kind of contraction of costs. KEE is a direct result of the other two big guys (smart parts and dye and the up and comming PE) holding down the little guys. KEE is gonna try to use a ton of small brands to compete with the big single brands. so far, i think KEE has done a good job of that.

my bet is crossfire knows what they are doing, and they think they can control the situation within reason. pure energy tanks arn't that bad anyway ... i always thought crossfires were overpriced.