In another gimmick, Australian online retailer Ruslan Kogan is now trying to convince consumers that they should buy a product before it is made by a Chinese factory in an effort to improve his business cashflow.Describing it as a “revolution in online shopping” the concept appears to be another gimmick by Kogan to get consumers to part with their cash earlier than they would with a finished product in an effort to boost his cash flow.
Dubbed LivePrice, Kogan claims that the concept provides a pre-order option for electronics.
He said customers will be able to buy some products before they have come off the Chinese factory floor at a “rock bottom price”. Currently most Chinese factories supplying products to the likes of Kogan, demand that goods are paid for before they are manufactured or as soon as they are manufactured with retailers forced to supply a bank guarantee or bill of credit to the manufacturer.
Kogan said that the price will increase during the different stages of development and manufacturing until it becomes available to customers at full price.
“Even though no other manufacturers or retailers are upfront about it; every product you purchase has a cost of finance included in its price,” says Kogan.
“We’re not scared to admit that manufacturing new products means that money needs to be spent up front, which typically means a hidden cost of finance. We just don’t want the customer to have to foot that bill.”
Kogan has not said whether he is having cashflow problems, but he is refusing to declare his revenues or profits after initally claiming that his company had 48% growth during the last quarter.
