Mail-order business

Definition

Mail order is a term which describes the buying of goods or services by mail delivery. The buyer places an order for the desired products with the merchant through some remote method such as through a telephone call or a mail in form. Then, the products are delivered to the customer. The products are typically delivered directly to an address supplied by the customer, such as a home address, but occasionally the orders are delivered to a nearby retail location for the customer to pick up. Some merchants also allow the goods to be shipped directly to a third party consumer, which is an effective way to send a gift to an out-of-town recipient.

Mail order businesses often put out catalogs called mail-order catalogs which are publications containing a list of general merchandise from the company. The business can be described as a commercial enterprise. Companies who publish and operate mail-order catalogs are referred to as catalogers within the industry. Catalogers buy or manufacture goods then market those goods to prospects (prospective customers). Catalogers "rent" names from list brokers or cooperative databases. The catalog itself is published in a similar fashion as any magazine publication and distributed through a variety of means, usually via a postal service. Sometimes supermarket products do mail-order promotions where people can send in the UPC code plus shipping and handling to get a product made especially for the company. Mail-order businesses have gradually shifted from the traditional mail use to telephone orders, citing lower long-distance rates and the popularity of cellular phones. It is also more convenient for the consumer to place an order over the phone rather than mailing in order forms, it cuts off several days from the wait for the product. Recently, mail-order companies have instituted internet ordering options for customers.

History

Mail-order businesses are evidenced throughout American history. Early catalogs allowed farmers to order seeds through the mail before the Revolutionary War. Several of America's modern-day retailers established themselves as mail-order enterprises in the nineteenth century. The first official mail-order catalog was the Montgomery Ward catalog which launched in 1872 in the United States. The early catalogs had single-sheet listings of goods but eventually they became the illustrated books seen today, containing all kinds of equipment for everyday life.

Another pioneering company in the field was the Chicago-based R. W. Sears firm that launched its services in 1891, soon joining with Roebuck to form Sears Roebuck & Co. The fact that both Sears Roebuck and Montgomery Ward were based in Chicago was significant as the city was at the hub of the extensive American railway system, enabling the transfer of goods from source of production to rural communities throughout the United States. In parallel, the American postal system, which had undergone extensive modernization before the First World War, enabled orders to be placed easily and efficiently. Mail order catalogues were often known as ‘wish books’, providing insights into American life at different periods. Such publications also provided immigrant settlers with a means of viewing the ‘American way of life’.

By the latter half of the twentieth century, several socioeconomic factors had further contributed to the growth of "at-home shopping." Possibly the single most important factor was the dramatic increase in the number of women working outside the home. This change gave some families more discretionary income, but perhaps more tellingly, the trend also meant that women had less time to make purchases. Shopping convenience subsequently became a larger concern, and mail-order purchases that could be executed at home—without driving to a mall or other retail outlet—became more attractive. The emergence of credit cards and telephone-based ordering systems also helped mail-order businesses.

Social Aspects

Mail-order businesses contribute to two different social spectrums. On the one hand, it is one of the earliest components of globalization. A person was able to pick out a product and have it sent anywhere in their country, and later, internationally. This means that products that may be difficult or unavailable in one community are easily attainable through a mail-in order form. On the other hand, it presents a loss of contact. Some sociologists suggest that living in closer proximities to each other, such as in urban settings, causes people to isolate themselves further and withdraw from daily human contact. No longer do people have to go to the store for products, through mail-order businesses they can send in an order form, make a phone call, or use the internet to send out their request. This contributes to the decrease of human interactions, resulting in peoples value of monetary value over human exchanges.

Mail Order in Different Countries

United States

According to the National Mail Order Association (NMOA.org) Benjamin Franklin is believed to have been the first cataloger in the United States. In 1744, he formulated the basic mail-order concept when he produced the first catalog, which sold scientific and academic books. He is also credited with offering the first mail-order guarantee: "Those persons who live remote, by sending their orders and money to B. Franklin may depend on the same justice as if present."

The earliest surviving mail-order business, now known as Hammacher Schlemmer, was established by Alfred Hammacher in New York City in 1848. Offering mechanic's tools and builder's hardware, its first catalog was published in 1881. [1] Now known for offering an eclectic, premium assortment of "The Best, The Only, and The Unexpected," it is America's longest running catalog.

In 1872, Aaron Montgomery Ward produced the first mail-order catalog for his Montgomery Ward mail order business. This first catalog was a single sheet of paper with a price list, 8 by 12 inches, showing the merchandise for sale and ordering instructions. Montgomery Ward identified a market of merchant-wary farmers in the Midwest. Within two decades, his single-page list of products grew into a 540-page illustrated book selling over 20,000 items. Another early mail-order catalog was published in 1884 by the Eaton's department store in Toronto, Canada. Almost a decade later, the first Sears catalog was published in the United States. CENCO dominated the field of selling science education equipment through their mail-order catalog.

Other mail order catalogs include JC Penney, The Noble Collection, Wal-Mart, Spiegel catalog, Welco.

catalog cover

With the invention of the Internet, a company's website became the more usual way to order merchandise for delivery by mail, although the term "mail order" is not always used to describe the ordering of goods over the Internet. It is more usual to refer to this as e-commerce or online shopping. Nowadays however most traditional mail order companies also sell over the internet, which makes these two varieties to merge.

In the United States, an advantage of this type of shopping is that the merchant is typically not required by law to add sales tax to the price of the goods, unless they have a physical presence in the customers' state. Instead, most states require the resident purchaser to pay applicable taxes. There has been periodic discussion about amending the law to make these sales taxable.

In the European Union, the EU VAT union has the principle that the merchant adds the VAT of his own country to the price, and the buyer does not have pay any more tax. If the buyer is a company it deducts that VAT like inside its own country. This makes the EU look more like one country than the US in this respect.

References

ISBN links support NWE through referral fees

• Keup, Erwin. 1993. Mail Order Legal Guide. Oasis. ISBN 978-1555711900.
• Sroge, Maxwell. 1987. Inside the Leading Mail Order Houses. NTC Business Books. ISBN 0844236594.
• Woodham, Jonathan. 2004. A Dictionary of Modern Design. Oxford: Oxford University Press. ISBN 0192800973.

External links

• Mail-order history
• UK places where home shopping is most prevalent
• Hammacher Schlemmer Company History
• C. F. Orvis Company history
• Mail-Order Catalogs for Teens

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