Super Star in & as LINGAA ♠Anushka ♠ARR ♠KS Ravikumar

[Saai]

Smartphone eduthukalam..
Apple Iphone - $650
Samsung smartphone with more capabilities then iphone - $550
Amazon fire phone with good config like iphone when launched - $650

Both Apple and Samsung are successful in their model,
but amazon with not popular fire OS sold the phone at $650 at launch..

In this situation I call Amazon as greedy.. they are selling the phone now less than $200(within 6 months from the launch date)
Even though iphone is overpriced do you call Apple as Greedy??? definitely not because people ready to pay $650 for iphone.

Let me explain:

A distributor is not an end consumer. End consumer is the movie-goer, who pay for ticket and watch the movie. So, the $550 example doesnt suit here. A distributor is a part of the business. In Samsung's case also there will be distributors and wholesalers who will sell to retail stores, which will sell to customers. Among the contracts between the manufacturer and distributor , it could be a buy-back contract, where the seller will buy back the unsold goods or revenue sharing contracts etc. In Linga's case Manufactuer = producer and distributor = distributor.

In this case of Linga, there is a clear case of one-sided contract, where the risk-sharing and profit-sharing is completely benefiting producer, where the risk is pushed to distributor and the distributors are not getting benefits for taking the risk. There is a chance to call that in a environment where the corporate guys do business with small time distributors, they can exploit.