Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

One-Stop Shop

What it is:

A one-stop shop is a single location where all of the needed services for a particular activity are provided.

How it works (Example):

One-stop shopping is a popular concept for packaging products and service oriented businesses. In the financial sector, for example, commercial lending and mortgage brokerages offer one-stop shops. The marketing, origination, underwriting, inspection, appraisal, documentation, settlement, escrow management, and servicing are all handled under a single entity for the client.  Real estate companies often set up one-stop shop operations to handle brokerage and property management services, along with all of the lending and service activities needed to service real estate buyers and sellers.

Why it Matters:

One-stop shops are convenient for buyers and sellers.  However, the one-stop shop can sometimes hide the true costs of each service and then limit the competition for the lowest cost provider.  In addition, having all of the function in a single "shop", even when certain services such as inspection and appraisal are required by regulation to be contracted out, may pose a conflict of interest between the clients and the one-stop shop operator.

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