GEC Allocation and Delivery Explained
Background: Over the last several years, Great Eastern Cutlery has become quite popular. Maybe not on the grand scheme of knife production; but for a small Titusville factory with around 30 employees. For the first several years only the smaller retailers sold GEC knives. I don’t know if the big boys didn’t have faith or just wasn’t paying attention to the market. But eventually it became obvious, even to the big boys, that if you wanted to stock high quality slipjoints you needed to get on board. There were a couple of dealers selling GEC before CollectorKnives; but they are long gone now. We are the earliest GEC dealer currently in business, and have been for a decade. So, in the early days, we pretty much received what we ordered – and the factory would even have some stock for few weeks if we wanted more. But those days are gone. Now, GEC has added a handful of huge retailers which have assisted in consuming the factory capacity to produce knives.
Orders: I have discussed the two types of production runs in the past; but will give a quick overview. First, there are “open orders”, which are when the factory allows the dealer to place a specific order for each given variation. Then they add them all up and plan on producing to that number plus a few for the factory store. Second, there are “allocated orders”, which are when the factory plans on making a certain amount of each variant and the dealer will simply get an allocation. Since we have a fairly robust Early Reserve System, we have a pretty good idea of which knives to order and how many to order to fill our reserves plus keep in stock for a while. Even though these are fairly well defined, they rarely work out as expected.
Open Orders: Even being a small company, we have built an infrastructure that allows us to place fairly substantial orders. But the way the factory handles fulfillment many times aggravates both us and our customers. If we order 50 knives of a certain variant and our competitors X, Y, Z each order 5 – when the factory has 20 knives ready to ship, they generally send all 4 of us 5 knives in the first shipment (this is a rather simplistic example, but indicative). Matter of fact, many times CollectorKnives doesn’t get anything in the first shipment. So, now the knives are showing up online and we have customers wondering why we haven’t contacted them yet to come pick up their reserved knife. So, in order to not keep our customers guessing, when GEC notifies us that they are sending our first shipment we will contact the Early Reservers to go ahead and purchase their reserved knife so they don’t have to worry about whether they will be getting one or not. This is also a process in itself, because we have to first notify the “Sure/Reserved” folks; then the “Sure/Standby” folks; and finally the “Notify” folks. We always confirm with the factory that our count still looks good and barring some tiny chance at catastrophe we can expect a certain number. The other solution is simply to wait until the factory ships all knives of a variation to us and we have them ready to send out. But that gets everyone on edge because they are seeing the knives at other dealers and just assume we have abandoned them. I actually still get responses when a customer sees a knife ANYWHERE else first that they just assumed I couldn’t accommodate their reservation – so they purchased it elsewhere. That it catastrophic to our Early Reserve system and our inventory control; because now the reservations we based our orders on, have gone elsewhere. Finally, one of the additional impacts to us many times is that after the factory takes care of all the smaller dealers, if there are any losses due to defects or parts shortages – the larger dealers get to take the brunt of that loss. But generally the open orders are the most convenient for us because we can generally guarantee that we can take care of all our reserving customers.
Allocated Orders: Many times the factory has a set schedule or are building some knives around a club order / sfo. In these instances they will contact the dealers and simply ask if they are interested; but do not take quantities from the dealers as they will try and fairly allocate them to all interested dealers. Many times I have seen other dealers complain because they didn’t get as many of the allocated knives as they wanted. But, what that means is that as a whole a dealer that orders 2% of all other runs from GEC would like to now have 20% of this allocated run. Somewhere that leaves a 10% dealer that is trying to supply products to their customer base that would now have to take 5% of an allocated order and start apologizing to their customers. Since we have built a good customer base, if we can’t get our fair share of an allocated run; that would be like the factory giving our loyal customers business to another dealer. So, we fully support the allocation system, although we rarely actually get an allocation of these knives that is respective to our overall percentage of general production orders. But, for the most part, when you see a dealer that is not happy with their share of allocated knives; it is typically because they want a much larger portion of short run knives than they are actually buying in general production – and who wouldn’t.
Example: A current example is the #97 Allegheny Coke Bottle in Ebony. The factory shipped some to a couple dealers on 3/29. They shipped our first split (20% of our order) on 4/3 and we are getting them out on 4/6. But they won’t ship our next split until 4/10, which means we get them late 4/12; and we have no idea how long it will take to get our full order. So, the vast majority of our customers will get shipped at least ten days after they start showing up on our competitions sites. And that is just this one variation.
Conclusion: In both circumstances, we typically get our orders well after the first knives start shipping. So, we genuinely ask for a little patience in filling orders. But we must get the orders on the books, so that we can move all the way through the early reserve lists and accommodate all our customers. If we don’t start allocating any knives until they are fully in stock, then the “standby” and “notify” customers have already gone elsewhere – leaving the Early Reserve system useless to us. So, we try really hard to place in the product description itself some verbiage as to whether they are ready to ship or will be coming in over some amount of time. Again, we appreciate your business and will bust our butt to get you taken care of – but sincerely request a little patience.
*Image by Jaunathan Gagnon; this cat just looks like I feel about the subject.