Local Tuner Mad Over Forum Prices & Calls Supplier
11-23-2012, 12:39 AM
#21
Good Gals Drive It Hard
Thread Starter
It blows me away that the OP complains about the shop guy making a profit.
There is a thing in marketing called "perceived value" There are those who will sell something at or slightly above what it cost them to get sales.
Whoever has the "lowest price" sets the perceived value and anyone else is a ripoff thief. That is the way the public thinks.
As I am in the aftermarket business I had a conversation with the REP of a well known company. He told me about this. He stated that one of the large mail order companies was buying at the lowest level and advertising the product very cheap in lots of publications, thus setting the perceived value.
What the supplier did was to back order all popular part numbers on this seller until they quit screwing things up.
Here is what I think the OP should get. His parts from the tuner for the same as the online shop. Then an added "facilities charge" which would include his share of the rent, salaries, equipment usage, workman's comp, lights and power, water, shop towel service, insurance, etc.
Then he could not complain about getting ripped on the actual selling price.
There was a company that advertised on this site and had prices so low that they were actually selling at their cost or barley above. Then they added a shipping and handling charge that was huge. All their profit was in that charge.
Thing was, if you had to return something, you were only refunded the price of the item, they still made their profit.
There is a thing in marketing called "perceived value" There are those who will sell something at or slightly above what it cost them to get sales.
Whoever has the "lowest price" sets the perceived value and anyone else is a ripoff thief. That is the way the public thinks.
As I am in the aftermarket business I had a conversation with the REP of a well known company. He told me about this. He stated that one of the large mail order companies was buying at the lowest level and advertising the product very cheap in lots of publications, thus setting the perceived value.
What the supplier did was to back order all popular part numbers on this seller until they quit screwing things up.
Here is what I think the OP should get. His parts from the tuner for the same as the online shop. Then an added "facilities charge" which would include his share of the rent, salaries, equipment usage, workman's comp, lights and power, water, shop towel service, insurance, etc.
Then he could not complain about getting ripped on the actual selling price.
There was a company that advertised on this site and had prices so low that they were actually selling at their cost or barley above. Then they added a shipping and handling charge that was huge. All their profit was in that charge.
Thing was, if you had to return something, you were only refunded the price of the item, they still made their profit.
BTW- a shop charges an hourly fee that covers the costs that you aformentioned.
11-23-2012, 01:10 AM
#22
Melting Slicks
In business we do that all the time. Call the other guy out for lowballing stuff. I have been called by manufacturers that didn't like prices I had on my site for their product.
Your shop tuner guy did nothing that everyone else doesn't do.
Your shop tuner guy did nothing that everyone else doesn't do.
11-23-2012, 01:54 AM
#23
Race Director
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I recently closed my business, but I was manufacturing a product and being my own distributor. I set a minimum retail price and a higher suggested retail price. My dealers were not allowed to post prices on their websites. Every dealer was required to have a brick and morter store and a floor sample for demos and the touch and feel customers. The dealers who stocked product got discounted pricing based on volume. Any dealer who violated the agreement was warned only once and shut off for a second offense.
Dealers never complained that XYZ was selling at a lower price, unless it was below the minimum.
Manufacturers and wholesalers need to set standards that their dealers must follow to keep a reasonable level of fairness, so everyone has the opportunity to make a profit.
If a manufacturer allows sales at any price, including on the internet, then the brick and morter stores who sell the product have to accept who they are competing with and adjust pricing accordingly. Of course, not carrying those products is also an option.
Dealers never complained that XYZ was selling at a lower price, unless it was below the minimum.
Manufacturers and wholesalers need to set standards that their dealers must follow to keep a reasonable level of fairness, so everyone has the opportunity to make a profit.
If a manufacturer allows sales at any price, including on the internet, then the brick and morter stores who sell the product have to accept who they are competing with and adjust pricing accordingly. Of course, not carrying those products is also an option.
11-23-2012, 07:42 AM
#24
Drifting
Hey, before you go blowharding, re-read what I wrote. The issue is NOT WHAT THE SHOP OWNER WAS CHARGING, RATHER, THE NERVE OF THE SHOP OWNER TO CALL THE SUPPLIER OF PARTS AND COMPLAIN THAT HIS COMPETITION - ANOTHER RETAILER, DID NOT ARTIFICIALLY INFLATE THE PRICE LIKE THE SHOP OWNER DOES.
BTW- a shop charges an hourly fee that covers the costs that you aformentioned.
BTW- a shop charges an hourly fee that covers the costs that you aformentioned.
I've been wondering how this shop knows all about the part(s) you purchased. Is it possible you bought parts online to save a couple bucks and then went to him to install them? Or simply went to him to tell him how much money you saved by not supporting the local business? Either way, he appears to be in the position to say that he couldn't sell said part(s) for that, and needed to call the supplier to see what could be done to his cost to make him more competitive. Or simply complain if they wouldn't accomodate him.
11-23-2012, 08:11 AM
#25
To me it sounds like the manufacturer of the product in question was informed due to the online supplier selling below the minimum selling price and the b&m was rightfully warning them of the shenanigans going on..
11-23-2012, 08:46 AM
#27
Drifting
Get this guys... (without mentioning
names... yet)
There are two local Vette shops that I/we have dealt with and when I found out who it is, I'll certainly have a word with them and let local Vette drivers know about their "mark up" tactic. We pay enough for the "Covette tax" without having a local shop tax more for their personal gain.
names... yet)
There are two local Vette shops that I/we have dealt with and when I found out who it is, I'll certainly have a word with them and let local Vette drivers know about their "mark up" tactic. We pay enough for the "Covette tax" without having a local shop tax more for their personal gain.
Hey, before you go blowharding, re-read what I wrote. The issue is NOT WHAT THE SHOP OWNER WAS CHARGING, RATHER, THE NERVE OF THE SHOP OWNER TO CALL THE SUPPLIER OF PARTS AND COMPLAIN THAT HIS COMPETITION - ANOTHER RETAILER, DID NOT ARTIFICIALLY INFLATE THE PRICE LIKE THE SHOP OWNER DOES.
11-23-2012, 08:49 AM
#28
Le Mans Master
I think most us realize that buying online will always (or should) be cheaper then going into a shop for parts. But if you factor in the cost of shipping and handling plus the wait on the parts, I think it all evens out in the long run. I mean I have ordered parts from different vendors and had to wait 2-3 weeks for the part. If I needed it right away and it was available locally I would have paid the shop prices and been on my way.
11-23-2012, 09:07 AM
#29
Team Owner
11-23-2012, 09:37 AM
#30
Burning Brakes
The parts original supplier usually has 2 prices. One for customers and one for sellers. It usually has an agreement with sellers about what the price will be to the customer so that all sellers are selling the same price as the others, so the original supplier doesn't make enemies between sellers and keep the products moving. Higher volume sellers can usually get a better deal and in turn sell for cheaper.
If this place the OP mentions, called the original parts supplier to complain, maybe it's because he has an agreement with the supplier and thinks he's being sold the parts an a price he feels are unfair and can't compete with others selling the same parts. The end goal in this case is to lower his prices and still make a profit.
Before going on an all out rage, you might want to find out more about the situation. Knowing the real motivation could appease your sentiments.
If this place the OP mentions, called the original parts supplier to complain, maybe it's because he has an agreement with the supplier and thinks he's being sold the parts an a price he feels are unfair and can't compete with others selling the same parts. The end goal in this case is to lower his prices and still make a profit.
Before going on an all out rage, you might want to find out more about the situation. Knowing the real motivation could appease your sentiments.
11-23-2012, 09:47 AM
#31
Le Mans Master
It blows me away that the OP complains about the shop guy making a profit.
There is a thing in marketing called "perceived value" There are those who will sell something at or slightly above what it cost them to get sales.
Whoever has the "lowest price" sets the perceived value and anyone else is a ripoff thief. That is the way the public thinks.
As I am in the aftermarket business I had a conversation with the REP of a well known company. He told me about this. He stated that one of the large mail order companies was buying at the lowest level and advertising the product very cheap in lots of publications, thus setting the perceived value.
What the supplier did was to back order all popular part numbers on this seller until they quit screwing things up.
Here is what I think the OP should get. His parts from the tuner for the same as the online shop. Then an added "facilities charge" which would include his share of the rent, salaries, equipment usage, workman's comp, lights and power, water, shop towel service, insurance, etc.
Then he could not complain about getting ripped on the actual selling price.
There was a company that advertised on this site and had prices so low that they were actually selling at their cost or barley above. Then they added a shipping and handling charge that was huge. All their profit was in that charge.
Thing was, if you had to return something, you were only refunded the price of the item, they still made their profit.
There is a thing in marketing called "perceived value" There are those who will sell something at or slightly above what it cost them to get sales.
Whoever has the "lowest price" sets the perceived value and anyone else is a ripoff thief. That is the way the public thinks.
As I am in the aftermarket business I had a conversation with the REP of a well known company. He told me about this. He stated that one of the large mail order companies was buying at the lowest level and advertising the product very cheap in lots of publications, thus setting the perceived value.
What the supplier did was to back order all popular part numbers on this seller until they quit screwing things up.
Here is what I think the OP should get. His parts from the tuner for the same as the online shop. Then an added "facilities charge" which would include his share of the rent, salaries, equipment usage, workman's comp, lights and power, water, shop towel service, insurance, etc.
Then he could not complain about getting ripped on the actual selling price.
There was a company that advertised on this site and had prices so low that they were actually selling at their cost or barley above. Then they added a shipping and handling charge that was huge. All their profit was in that charge.
Thing was, if you had to return something, you were only refunded the price of the item, they still made their profit.
z51vett
11-23-2012, 10:18 AM
#32
Racer
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I own a business myself and I am one of the busier stores in the metroplex. I charge a flat 100% mark up and that doesn't stop my customers from coming in. Other dealers sell at $25 over cost online without a storefront which can be as little as a 1% mark up with the products that we sell. Customers come to me because i take care of them and get products quickly. Do i get every single customer? NO, and in my busienss EVERYONE complains about everyone else's prices to the sales reps and mfgs because they think that's why they aren't making any money... People even complain about my prices blindly because they think (just like my customers) that people are getting goods at cost or close to cost. The manufacturers hardly care about the sob stories anymore. They just want they money.
Small business should not try to compete based on price because we cant win ( start competing soley on price and your business won't be profitable) focus on what makes you different than the online guy and explain to your customer why your price is higher..
Best of luck to the local corvette shop, if he is crying about online prices that means his shop is struggling right now. Maybe he should cough up the dough become a CF vendor and work some online magic... Stay ahead of the curve.. Don't CRY about it when the curve is passing you up...
My .02 cents
Small business should not try to compete based on price because we cant win ( start competing soley on price and your business won't be profitable) focus on what makes you different than the online guy and explain to your customer why your price is higher..
Best of luck to the local corvette shop, if he is crying about online prices that means his shop is struggling right now. Maybe he should cough up the dough become a CF vendor and work some online magic... Stay ahead of the curve.. Don't CRY about it when the curve is passing you up...
My .02 cents
11-23-2012, 10:32 AM
#33
Melting Slicks
Screw that shop owner.....screw higher prices and mark ups. I thought everyone has been bitchen about free enterprise this and free enterprise that. Part of free enterprise is being competitive ...supply and demand etc. If the demand is going to the internet and lower prices...too bad. This is being competitive if you cant be competitive too bad. Thats part of free enterprise if you cant handle it then get out of the business....
Also they are making money....they just want to make more and more...if you guys really new the mark ups on some of the crap you "think" you are getting for rock bottom prices...LOL... you would vomit. Thats why the stock market is a good investment (overtime ----) because you can rely on three things, death - taxes - and the variable of greed. The greedy business owner is a given...making himself 100k net net to himself...then it is not enough needs 150k...etc etc.
Also they are making money....they just want to make more and more...if you guys really new the mark ups on some of the crap you "think" you are getting for rock bottom prices...LOL... you would vomit. Thats why the stock market is a good investment (overtime ----) because you can rely on three things, death - taxes - and the variable of greed. The greedy business owner is a given...making himself 100k net net to himself...then it is not enough needs 150k...etc etc.
Last edited by Cor430vette; 11-23-2012 at 10:40 AM.
11-23-2012, 10:49 AM
#34
Melting Slicks
Ah but this hourly charge is only for work done on your vehicle, not applicable to the selling of parts.
I've been wondering how this shop knows all about the part(s) you purchased. Is it possible you bought parts online to save a couple bucks and then went to him to install them? Or simply went to him to tell him how much money you saved by not supporting the local business? Either way, he appears to be in the position to say that he couldn't sell said part(s) for that, and needed to call the supplier to see what could be done to his cost to make him more competitive. Or simply complain if they wouldn't accomodate him.
I've been wondering how this shop knows all about the part(s) you purchased. Is it possible you bought parts online to save a couple bucks and then went to him to install them? Or simply went to him to tell him how much money you saved by not supporting the local business? Either way, he appears to be in the position to say that he couldn't sell said part(s) for that, and needed to call the supplier to see what could be done to his cost to make him more competitive. Or simply complain if they wouldn't accomodate him.
11-23-2012, 11:36 AM
#36
Melting Slicks
if he is crooked or poor quality the market place will take care of it, but I don't see where that has been said, and only prices too high. You have the right to buy there and he has the right to set the price that the market place will support.
11-23-2012, 12:03 PM
#37
Good Gals Drive It Hard
Thread Starter
Perhaps this will shed some light. I just don't want to say names.
--Common parts found online and sold by almost every retailer in this forum (many have storefront and sell online). Online price range $490 to $550 and INCLUDES shipping, no tax.
Local shop owner: $699 plus tax for the exact same part that he DID NOT have in stock and would have to order, non-expedited delivery.
So the local shop calls the supplier and complains that other retailers are selling the exact same part for less, but he adds at least another $150 to the part. He really has no grounds to complain about in the first place with such inflated prices. As for the convienence factor, that's a moot point since the shop owner didn't stock the parts.
Look, if the shop owner had the parts in stock and added a reasonable markup, I agree and would pay a bit more. But to markup the price for parts that aren't in stock and far beyond what other retailers are selling the parts for is bad business.
In the end, guess who got the business?
--Common parts found online and sold by almost every retailer in this forum (many have storefront and sell online). Online price range $490 to $550 and INCLUDES shipping, no tax.
Local shop owner: $699 plus tax for the exact same part that he DID NOT have in stock and would have to order, non-expedited delivery.
So the local shop calls the supplier and complains that other retailers are selling the exact same part for less, but he adds at least another $150 to the part. He really has no grounds to complain about in the first place with such inflated prices. As for the convienence factor, that's a moot point since the shop owner didn't stock the parts.
Look, if the shop owner had the parts in stock and added a reasonable markup, I agree and would pay a bit more. But to markup the price for parts that aren't in stock and far beyond what other retailers are selling the parts for is bad business.
In the end, guess who got the business?
11-23-2012, 12:46 PM
#38
Melting Slicks
I believe we all know that the cost of running an internet business is usually less than the cost of running a store front business. Buying an item from an internet business is usually less expensive because of this, although you do incur shipping costs. With a store front business, you can go there and actually see what you are buying and receive advice to help you select the right item. There are benefits to using both types of businesses.
What I consider an important part of owning a business is knowing your competition and what they are doing so you can adjust business to compete. This shop owner apparently wasn't doing this and what amazes me is that now he is upset with the internet business? The shop owner needs to adjust or he will be out-of-business.
What I consider an important part of owning a business is knowing your competition and what they are doing so you can adjust business to compete. This shop owner apparently wasn't doing this and what amazes me is that now he is upset with the internet business? The shop owner needs to adjust or he will be out-of-business.
11-23-2012, 03:23 PM
#40
Drifting
I guess I just don't get the whole thing. Someone buys something at a price they like. Then they are mad at someone else because they are priced higher for whatever it is they bought. Then they get mad at the higher priced seller again because they contacted their supplier with a pricing issue, which is their business within the seller / supplier relationship. Then they want to damage the higher priced sellers business by telling everyone that they charge higher prices (duh) and will contact suppliers if there appears to be an issue.
Is there something else going on here that we don't know about?
Is there something else going on here that we don't know about?