ASI cites going direct as major problem

Trevose PA - October 2, 2007 ASI (Ad Specialty Institute) issues warning to suppliers and distributors regarding “going direct”. ASI cites that the 16 Billion dollar promotional Products industry could be threatened by the actions of its own members.

The industry’s leading voice, ASI http://www.asicentral.com/ has issued a stern warning in its latest issue (Sep 2007) to its nearly 30,000 members regarding the practice of going direct to the overseas manufacturers that currently work with their 2000 member supplier base and to suppliers going direct to the end-user.
“We have seen a large increase in the number of distributors going direct to China in order to bypass the ASI suppliers” states an ASI spokesperson. “Many of these direct transactions overseas have had disastrous consequences, in the short-term (no shipments, money stolen etc) but in the long term they are forgetting that this direct to the manufacturer action on their behalf further increases the likelihood of the current ASI supplier selling direct to the end-user (the actual corporate customer).”
Nowhere has this behavior been seen more than in the electronics sector of the ad specialty business. A good example is the increasingly competitive and desirable Flash Drive market.
The Good, The Bad and the Unruly.
Not every supplier is breaking the rules. In fact there are some exemplary suppliers who work hard to keep from selling direct to the end-user. In the Flash Drive Sector of the promotional products industry suppliers such as http://FlashDriveDirect.com and http://www.iclickusb.com are extremely stringent in vetting any end-users from purchasing directly. Meanwhile others such as http://www.customusb.com openly disregard the ASI code of ethics and sell to any company willing to pay the cost.

Also seen are some distributors bypassing the ASI supplier chain. A Tribeca account executive recently stated the following ‘With respect to the PPAC” (the Canadian ad specialty governing body), We as members are free to buy from whomever we wish .In fact; many overseas guys have become members themselves. I don't see the PPAC stopping them.” The PPAC did not comment on this story. However, the charter states a PPAC member must operate on Canadian or US soil.

The possible end result of all of this is a decline for the need of the promotional products reseller. Given the power and access of the internet it is easy to see that the end-user may eventually start to seek out suppliers and manufacturers directly and the actions of the distributor that bypass the supply chain will in fact work to hasten this cutting out of the ASI distributor from the overall sales process. ASI plans a seminar on this at their upcoming AGM.

Contact ASI
4800 Street Road
Trevose, PA 19053
866-564-6274