Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Distributor cancelled an order and we need to move 30k bags of coffee [updated]

modest.coffee

Post reply on HN
Print view View original

91–100 of 386 posts

Re: Distributor cancelled an order and we need to move 30k bags of coffee [updated]

#91

Post by Enginerrrd »

sva_ wrote: post #54
asah wrote: post #21

It's 101 that wholesale buyers order by the case and for producers to specify the casecount and price, and for errors like this to be caught when the prices/etc don't line up. This is equivalent to not knowing that URLs can redirect, or that http:// and https:// aren't the same thing. Distributors work with 1000 brands each and don't have time (or margin) to babysit. Also, when a company gets a much larger and differ…

> It's 101 that wholesale buyers order by the case and for producers to specify the casecount and price, Not sure why you're being downvoted because thats standard in wolesale. Not sure how they couldn't catch that when looking at the price either. Maybe they thought they'd sell a lot less for the same price and aren't talking about this?

Reading their description, there is no real point in which anyone takes real ownership of this mistake and so something like this is probably likely to catch them again.

Did the consultant drop the ball? Yes, but so did they, in a pretty big way.

Still, I've run businesses and when you're trying to bootstrap without experience this kind of thing does happen.

Re: Distributor cancelled an order and we need to move 30k bags of coffee [updated]

#92

Post by brookst »

okr wrote: post #55
brookst wrote: post #10

Earlier quoted context omitted.

And yet, if you’re a big company, transactions are expensive. If small companies need frequent payments and won’t float AP, why would you buy from them? Would you rent an apartment that insisted on daily payments? (Ok, bad analogy, but you get the idea). I don’t have a good answer, but this isn’t a one-sided thing where the big guys are taking advantage of small companies. This is also small companies agreeing to ope…

I liked the example, it illustrates it from a different perspective. However, why not paying daily? Hourly? Minutely? In the age of computers...

Even in the age of computers each transaction has a cost and a risk associated. And there is no upside to large companies. They don’t want to receive per-minute payments any more than they want to send them. So if 95% of a business’ volume works one why, why invest in making 5% different just to deal with smaller vendors, who are already more difficult to deal with (for 100% good reasons).

Re: Distributor cancelled an order and we need to move 30k bags of coffee [updated]

#93

Post by meowmeowmoo »

Waterluvian wrote: post #34
jjeaff wrote: post #24

Earlier quoted context omitted.

I remember in a corporate finance class in college, we did a lot of calculations comparing prepayment to net 30, net 90 terms, etc. The game is to maximize cash flow, though in the end, it doesn't make a lot of difference except in very thin margin businesses. But the general wisdom is to always try to take maximum advantage. I always felt that it is a silly strategy considering that it strains your suppliers, provid…

It sounds like that classic “focus on the things that can be measured easily” business finance attitude that causes things like “don’t kill your customers” to be missed.

The customers of distributors are retailers. They’re not killing the retailer. They’d be killing the supplier in this scenario.

Re: Distributor cancelled an order and we need to move 30k bags of coffee [updated]

#94

Post by memco »

ThunderSizzle wrote: post #18
jraby3 wrote: post #7

Earlier quoted context omitted.

That’s more specific to the food business. I run an advertising company and we always take payment in advance and work with several large (publicly traded) companies.

I don't believe it's "the food business" as much as "suppliers" in general. I know non-food industries that operate this way, and it's common enough that accounting classes I've taken covered some of the basics of these. Advertising or informational industries (e.g. non-tangible goods industries) seem to operate differently, as you've said.

Maybe not even suppliers and just organizations. I once offered tutoring services to someone who was working with the VA to get their degree. Since it was a subject outside of their normal scope and I was not a contractor with the VA I had to fill out paperwork and even then it took a year to get approved and paid for the services. Thankfully I wasn’t doing this for a living but as a favor and the person I was working with was very persistent in following up with his have supervisors otherwise I would given up long before.

Re: Distributor cancelled an order and we need to move 30k bags of coffee [updated]

#95

Post by Ekaros »

analog31 wrote: post #89
georgeburdell wrote: post #3

One thing that irks me about dealing with big businesses, that the post touches on, is payment terms. If I buy an item, I pay for it immediately (or if it’s large enough, a creditor pays for me). Big companies pay with IOUs that say they’ll give you cash later, say 30-90 days from now or after criterion X is fulfilled. They do not care if you’re a small company with poor liquidity. I think it’s absolutely abusive beh…

It's worse than that because they will drag out payment after the term has passed. My first job out of school was for a mom-and-pop manufacturing company. I got an inquiry one day from a very well known company, and mentioned it to the boss. He gave me a long lecture about why we didn't work with that industry. They were notorious for stringing their suppliers along and holding them in a sort of debt bondage. I remem…

That to me sounds like we might lose revenue, but at least we are unlikely to lose money.

Re: Distributor cancelled an order and we need to move 30k bags of coffee [updated]

#96

Post by legitster »

asah wrote: post #21

It's 101 that wholesale buyers order by the case and for producers to specify the casecount and price, and for errors like this to be caught when the prices/etc don't line up. This is equivalent to not knowing that URLs can redirect, or that http:// and https:// aren't the same thing. Distributors work with 1000 brands each and don't have time (or margin) to babysit. Also, when a company gets a much larger and differ…

> I would expect any CEO to pickup the phone and talk with peers about how to manage the process.

The "Think Different" mentality. I think there are too many CEOs who are only CEOs because they refuse to take advice from others. In this case, all they had to do was literally have a single person on the staff with some experience.

Re: Distributor cancelled an order and we need to move 30k bags of coffee [updated]

#97

Post by brookst »

lesuorac wrote: post #38
brookst wrote: post #10

Earlier quoted context omitted.

And yet, if you’re a big company, transactions are expensive. If small companies need frequent payments and won’t float AP, why would you buy from them? Would you rent an apartment that insisted on daily payments? (Ok, bad analogy, but you get the idea). I don’t have a good answer, but this isn’t a one-sided thing where the big guys are taking advantage of small companies. This is also small companies agreeing to ope…

Where have you been renting that didn't insist on payment up front? Everywhere I've seen you've payed that months rent by the ~5th of that month or they come after you for interest.

Almost like I acknowledged the specific analogy wasn’t great because rent is typically pre-paid.

Fine, let’s talk post paid. Electric bills. How you would you feel about an electric company that sent you an invoice and wanted to be paid daily? Yes, yes, the analogy is also imperfect because consumer electric companies can do auto-pay and walmart generally does not for small vendors. But please try to see the point even with a less than totally perfect analogy to consumer life.

Re: Distributor cancelled an order and we need to move 30k bags of coffee [updated]

#98

Post by xivzgrev »

asah wrote: post #21

It's 101 that wholesale buyers order by the case and for producers to specify the casecount and price, and for errors like this to be caught when the prices/etc don't line up. This is equivalent to not knowing that URLs can redirect, or that http:// and https:// aren't the same thing. Distributors work with 1000 brands each and don't have time (or margin) to babysit. Also, when a company gets a much larger and differ…

A brokers main job is to get the deal done. But ostensibly they’re also there to advise and build trust. It’s easier to be a broker if people like working with you and refer you.

It sounds like the broker made a mistake on the point around payment terms.

I do agree the confusion on “units” should’ve been caught by the roasters, given order $ amount.

Re: Distributor cancelled an order and we need to move 30k bags of coffee [updated]

#99

Post by mindslight »

viburnum wrote: post #16

I can't put my finger on it exactly but there's something about this story that isn't making sense.

The obvious reason the details of their story don't make full 100% correct post-facto sense is because they hired someone specifically to facilitate their interaction with the larger market. They trusted this person to get these details right, so that they could focus on their actual business of making coffee. It turns out that person was some kind of incompetent, and they themselves were left holding the bag(s).

I'd guess that the reason they don't name names is that most of their ire is directed at this facilitator, their attorney has advised that naming them could end them up in a nasty libel suit, and the last thing they want is any more "excitement". I'd also guess that the title/narrative puts the focus on the big company for better virality.

Re: Distributor cancelled an order and we need to move 30k bags of coffee [updated]

#100

Post by elondaits »

johnchristopher wrote: post #4

> Then, 3 weeks into the process, with the orders still coming, Marcus pointedly asked him about why they were ordering so much more than the 6,000 bags they had originally predicted. The food broker laughed and said “I wondered why you’ve been so upset and concerned. When they said ‘units’, that was cases. They’re right on target so far.” You can imagine how we felt in that moment, realizing that the person we hired…

I HATED people saying “we want to add a shopping cart to the website” (i.e. we want to implement a full e-commerce solution for our business that currently has none). Not because the term was wrong, but because they thought about the icon in the corner and not the logistics, legal considerations, plus whole new tech platform. Often it was mentioned almost as an afterthought… a line item in the feature list for a quote for the development of a new website.
Post reply on HN