Samuel Des
Supporting Actor
- Joined
- Feb 7, 2001
- Messages
- 796
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I own a custom installation business. I don't deal with Internet buyers or shoppers. What we do is worth the price of admission and the level of service and support we provide is far beyond that of any retailer.You offer a service that includes(I presume) installation, set-up, decoration, control etc.. of hometheaters. All the initial poster wants is a pair or multiple speakers(not any type of service from the retailer). The nature of the consumer retail business as pointed out before is such that most retailers do discount. And yes, consumers do have a God-given right to find the lowest price possible.
Chas thinks that selling at list price is likened to highway robbery. Does he have any idea how much of the margin is eaten up by overhead? Not likely.I was once given the numbers by a major brick and mortar dealer here in the northeast. It was over a year ago and those essential life blood elements escape me right now. However, the sales rep was more then willing to discount my Paradigm's at a nice rate.
You are correct, I don't know YOUR business plan, overhead costs and ROI. Perhaps you could post your financials for us to examine??
However, I do have a business management degree and have worked in the financial field for many years. Each business is unique in nature depending on product lines, overhead and taxes which cut into profits which sustain any company, large or small. I DO understand your situation.
You describe your business as a "I own a custom installation business," but personally I do not need to pay your price for service and support.
I've been able to purchase components in a non-custom install system as I am able to take care of my own needs myself. Granted, you may be doing professional installs which would dwarf my mid-hifi system, which consists of Paradgim, Sherbourn, Modial, Anthem, etc. With that independence in mind, I would never pay full retail as you write is necessary for your business to remain viable.
Everyone has different needs and your custom market share is contingent upon full retail price. That's fine. However, my best guess is living in the VA area, your market share is also based in a high income area where people can/will be more then willing to pay those prices for your services and expertise.
Most of the people on this site I would estimate have the ability to choose and install components in their own systems and it is expected you would receive flames as you write. I wish you much success in your future plans.
Charles
The truth is that most companies in this business operate at an after tax profit of about 8% after all expenses are paid IF they sell at full list price.There are plenty of BMW's parked in front of this store (NOT customer cars), so they don't seem to be doing too badly making "only 8% profit".
There are plenty of BMW's parked in front of this store (NOT customer cars), so they don't seem to be doing too badly making "only 8% profit".I had a similar experience at a Phila. high end shop where there were reserved parking spots for the owners or sales rep's Boxters', Audi's, Benz's and so on and so forth. Think they paid retail for those cool cars??
However, maybe they were business deductions????
It has nothing to do with your markup theory.I think it has everything to do with my theory, though it may not apply to all dealers. If some dealers go that "extra mile" (as you may very well do) then that has to be paid for somewhere, usally upfront with the original purchase. But some dealers (like my local one) sell at that same "snob" price without giving you anything for it. They act like they are doing you a favor. Paradigm's policies enables these thieves.
BTW, I'll post my financials the day you post your personal financial information.Naw, I would not want to make you feel bad Bill.
Does anyone get a discount when they buy something at McDonalds? Do you haggle over the price of nails or lumber at Home Depot? I fail to understand why people think it is their God given right to get a discount off of list price on stereo equipment. The dealer is under no obligation to give a discount nor do they need to give a reason as to why they don't discount. The consumer on the other hand has the right to not make the purchase. That's it.Your restaurant example is a bad one, because the pricing at franchised restaurants can and often does vary from location to the next. The customer may not haggle on pricing, but business owner will set the pricing at an appropriate level to make a profit. That pricing can vary because a restaurant in a prime location in downtown LA for example, is going to have much higher overhead than a restaurant in an out of the way location.
So the notion that one MSRP should globally apply to all stereo dealers is a bit absurd. The fact is, many dealers are able to discount off of MSRP without losing money. Besides, if I know for a fact that a dealer is flat-out lying to me when he's says Paradigm won't let him discount, then what else is he going to lie to me about?
Oh, I don't think you'd make me feel bad at all.As I suspected. Those full MSRP's have their advantage's don't they??