Federated retail (aka distributed retail) is a business concept in which independent retail operations work together like stores in a retail chain using distributed software nodes in order to gain many of the advantages possessed by larger retail chains while providing a number of additional benefits.
The core idea is to provide resources that will enable certain types of less-privileged businesses to be able to better compete against larger businesses that use less socially-beneficial practices (due to their ability to insulate themselves from accountability and competition).
How it works
The primary service would be to merge the catalogs of all member-retailers (MRs) into a single search engine database, of which all MRs would have a copy. They could choose to allow searching the entire database via their site (as an sort of "loss-leader" to bring in users), or could restrict it to only their particular company's offerings, or could in other ways filter the content. Anyone could copy the database and provide search interfaces, whether or not they were members of the network.
The search feature would include the ability to filter by distance from a given location, so that users could find items closest to them.
A secondary service would be to aggregate restocking into larger wholesale orders in order to get better pricing and have more clout with suppliers.
Once the network is in place, it seems likely that further services will suggest themselves. Third parties will be free to create new services using the standard open-source APIs and distributed database that will be created and maintained by network members.
There are several possible revenue models for maintaining the network infrastructure.
Federated retail is intended to serve the following goals:
- distributing retail profits more equitably and meritocratically (rather than going solely to the owners of a few large chains)
- better serving the public good
- increasing economic resiliency and local autonomy
- reducing tight dependencies on particular supply-chains by creating more of a supply ecosystem
- starving the corporate beast
- promoting alternatives to business neo-standard practices (e.g. big-box retail, chain stores, bottom-line worship)
- encouraging open, democratic, accountable, transparent, and sustainable processes in every aspect of public life, especially business
- encouraging sustainability in the manufacture and delivery of products and services
- providing support services to those who conduct business in a sustainable way
- e.g. legal support for dealing with regulations designed to favor large-scale enterprises over smaller ones
- rating products and services according to their sustainability using supply-chain sousveillance
- providing support services to those who conduct business in a sustainable way
- exploring the use of new tools for commerce, especially those that the mainstream have been reluctant to adopt (e.g. in-store search stations)
The types of businesses this concept would aim to support would include:
- businesses whose practices are sustainable or encourage sustainability (primary goal)
- businesses who do a substantial amount of business locally (because this promotes local autonomy, economic resiliency, sustainability, and accountability)
- businesses who seek to minimize their dependency on businesses that do not meet these qualifications
- businesses not primarily owned by members of the investor class (profit should not go to those who already have more than enough)
The initial resource to get this network off the ground would be an online database and web site that would serve as an interface between the various entities (buyers and sellers) in the network:
- sellers (whether businesses or not) could enter in lists of items they have for sale
- customers could enter shopping lists (which could be anything), and the web site would let them know where it is available. (The site could even plan a shopping trip to minimize travel distance, expense, etc.)
- sellers would be aware of what items customers were looking for, and could investigate the possibility of selling those items (via making connections with new suppliers, special orders to existing suppliers, or creating items in-house)
Member businesses would receive assistance, to the extent that resources are available, with:
- connecting their inventory systems to the online database
- systematizing and streamlining their inventory and ordering processes
Members would probably offer each other discounts, to encourage repeat business and knowing that they are all serving some common goals that benefit everyone.
- There would be no rigid distinction between "buyers" and "sellers"; anyone in the network can be either, at any time.
- There would be no fixed membership fee; the means for gathering resources needed to keep the network running and healthy would be decided on in a democratic way. This could be a transaction fee or percentage that would be adjusted regularly by popular vote, voluntary contributions from individual buyers and sellers in exchange for name recognition or advertising, or by any other method the members decide upon at any given time.
The software to run the web site and database will be:
- open-source, free for anyone else to use and adapt
- designed so that multiple instances can network
- designed to ease replication of member data
This has the following benefits
- if any particular co-op node becomes corrupt, "taken over" by powermongery, members can take the code and member data and go start a new one.
- multiple nodes designed to appeal to different markets or mindsets can co-exist and network together
- nodes primarily serving different geographic areas can network together to find the nearest provider for a given item, when it is not available within the purview of a particular node
- if one node experiences technical difficulties, this will only affect a relatively small number of people
- other nodes should be able to "fill in" for a node that is "down", allowing people affected by an outage to continue doing business in some capacity
Target businesses might see the co-op as competition rather than a mutually beneficial project, and be reluctant to suggest it to their customers.
At some point, this project will likely face stiff opposition from the unsustainable business community. This will probably take the form of everything from regulatory changes to surprise government inspections or even arrests of members on trumped-up charges, depending on the level of government corruption in various areas served by the co-op.
There are three main aspects to implementation of this idea:
- business plan (for the first node, anyway)
- software (design and coding)
- a standard for business data exchange is probably the first design requirement
- people interfacing (i.e. getting people interested in using it)
- This would not be just a "price search engine" like PricePi.
- Value Network (wiki)
- Worker's Self-Directed Enterprises - How do I form a WSDE?
- Phyles are "business-empowered communities: they are not companies linked to a community, but transnational communities that have acquired enterprises in order to gain continuity in time and robustness"
- Bazar "is like a social network. Each company has its tab, publish your news for businesses that may be interested in their products or provide you with reliability at higher prices." ... "has a structure used to generate distributed markets. .. The Bazaar distributed structure makes it possible that multiple Bazaars interconnected. You can download the software , and integrate businesses in your environment or you can offer business services and develop, based Bazar, your own business model."
- 2017-04-10 Of course, a bunch of Twitter users want to buy the company and turn it into a co-op: it's not going to happen, but the details are of interest
- 2015-01-02 The 1 Search Trend You Can’t Ignore Anymore in 2015: Google's increasing monetization of search makes it difficult for small operations to be found
- 2012-12-11 Decentralize Big-Retail: How to Uproot Walmart and Bring Jobs Back Home
- 2013-08-23 Okay, folks, here's how we can start fixing things: a post in which I explain some of the ideas here