And another sale gone, another one down... another one bites the dust!

[TCDiver1]

yknot once bubbled...
ScubaPro would offer stuff at a good discount and dive pros could do what they wanted with it, like resell to their dive buddies, no questions asked. Why is this any different if the intermediate buyer is LeisurePro? Companies like ScubaPro are the winners in all of this anyway.

It's called "keyman pricing" and many manufacturers have such a program. Most have restraints such as one set of gear a year and/or the receipient can not sell it, must use it, for a year before selling it or trading it in on a new set. Hardly a high volume deal.

It's different because of volume and because in theory, the dive-pro is promoting their gear by using it in front of students.

By the way not all LDS offer keyman pricing to their dive-pros, so don't assume all dive-pros are getting a sweet deal.

 

[TCDiver1]

Genesis once bubbled...
Go back and read the original post again if you must.

Its about value received for the price paid.

Here are some things the LDS could do that would make that equation work:

1. During the warranty for "X" (e.g. the transmitter in question) we will instantly swap a failed unit for a replacement, and we will keep one in stock just in case such happens (no return to manufacturer necessary)

2. Here, have an air (nitrox) card to go with that transmitter (thereby adding value, but adding far less cost to them than the "face value" of the card)

3. "Your first two overhauls on that regulator are free - yeah, the manufacturer throws in the parts, but we'll eat the labor. And your overhauls will be put in front of our service queue."

I can come up with a bunch more, but those just popped into my head immediately as things the shop could do to tilt the value scales in their favor.

(2) is particularly difficult for the mail order folks to emulate (1) and (3) can be emulated (overnight shipping makes it possible for (1) anyway), but its nowhere near as effective.

Its overly simplistic to say that its just a matter of "price". The truth is that its never just about price. Its about value received for the price paid, and if the customer receives only the original product, and no additional value, then why are they paying the premium price? Just to be "nice" to the retailer? Why would you do that?

Blah, blah, blah ..... and i just climbed out of the cabbage patch this morning G-man. I understand all that, now suck it up and suggest some of those things to your LDS. Just do it and see what happens. I'll begin to feel your pain if you get nowhere after trying this approach.

 

[yknot]

Has anyone ever tried a membership fee LDS, like a Sam's Club? The LDS's I enter seem to be an offshoot of someone's hobby (I really love to dive and I think I'll open a scuba shop). This has to be one of the worst reasons to open a business. What seems to offend so many of you is that companies like LP are run as a for profit business. By removing the emotional aspect of the industry from the equation they can do what they have to do to make money. If you had to buy a membership maybe you could feel more loyalty for your LDS (as well as get better prices). When some posters suggest we need to build better relationships with an LDS to get the good deals just remember that those relationships tend to come after we buy thousands in overpriced gear. I would rather buy that relationship upfront for a yealy fee.

 

[cmay]

yknot once bubbled...
Has anyone ever tried a membership fee LDS, like a Sam's Club? The LDS's I enter seem to be an offshoot of someone's hobby (I really love to dive and I think I'll open a scuba shop). This has to be one of the worst reasons to open a business. What seems to offend so many of you is that companies like LP are run as a for profit business. By removing the emotional aspect of the industry from the equation they can do what they have to do to make money. If you had to buy a membership maybe you could feel more loyalty for your LDS (as well as get better prices). When some posters suggest we need to build better relationships with an LDS to get the good deals just remember that those relationships tend to come after we buy thousands in overpriced gear. I would rather buy that relationship upfront for a yealy fee.

I'm not offended that places like LeisurePro are operating for profit. I am offended at the fact that places like LeisurePro are slowly putting people out of business using, frankly put, dishonest business practices. My point is that it is easy to make money when your overhead cost per customer is as low as LeisurePro's has to be based on volume. There is no way for local shops to be able to compete with that. Local shops are trying to operate for a profit also. It just costs much more to reach the black ink and stay away from the red.

 

[Genesis]

in fact, I just got off the phone with them not 30 seconds ago.

The answer was "sorry, but no", along with an explanation of how hard it is these days to keep the doors open.

I talked to one of the owners, so there's no possibility of a misunderstanding or someone who lacks the authorization to make the deal being the person I had on the phone. Unlike the first person I talked to the other day, who is an employee (albiet a high-placed one), this time I insured I was speaking with one of the partners in the operation.

Immediately following that conversation, I placed the order with Simply Scuba. With customs fees and air shipping, the total came to over $100 less than the LDS - with their 10% discount - was willing to sell the same item to me.

Given that shipping and customs fees came to nearly $75, the LDS in this case left at least $100 (assuming their "nitrox card" has a zero profit margin) on the table, and more likely left about $150 on the table, all dependant on their actual cost for the product, of course.

$150 in profit on a $450 sale is pretty damn good.

Turning it down? Heh, its a choice and one they're entitled to make.

You gotta wonder how it helps to keep the doors open to turn down a quick $150. I bet that pays for quite a few hours of electricity to run their compressor and keep the lights on in the shop.

But what do I know?

 

[TCDiver1]

Okay G-man, feeling your pain now. I can share with you that i have similar problems with some LDS's too. However, i've always felt and still feel it's in my best interest as a diver and instructor to take a step or two more than i normally would with dive shops.

If it works, better for both of us. If it doesn't, no skin off my back, i go elsewhere. This mentality comes from years of having only one LDS choice within 120 miles. That LDS was not a poster child of Customer Service Annual in those days if you know what i mean. Oh, and the internet did not exist .... small detail.

 

[yknot]

cmay once bubbled...


I'm not offended that places like LeisurePro are operating for profit. I am offended at the fact that places like LeisurePro are slowly putting people out of business using, frankly put, dishonest business practices. My point is that it is easy to make money when your overhead cost per customer is as low as LeisurePro's has to be based on volume. There is no way for local shops to be able to compete with that. Local shops are trying to operate for a profit also. It just costs much more to reach the black ink and stay away from the red.

Those "dishonest" practices are to the consumer's benefit (at least in terms of price) and at the expense of the competition. Since the dawn of commerce businesses have been cutting each other's throats but you don't often find a customer feeling sorry for someone's inability to compete. I work in the auto industry. Our competitors in Asia have resorted to far more than dishonesty when it comes to competative practices. All the whining in the world on my part won't change the fact that people will still buy Asian brand 'X' if they perceive that the value is more than domestic brand 'Y'. All I can do is keep sharpening my pencil and doing my best to compete even when it means lowered earnings. Some at an LDS need to do one of two things: copy the LeisurePro example and thrive or close up and get a job like mine where you can not only starve but don't have a forum like this one to cry to.

 

[redacted]

gedunk once bubbled...
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Many of us have taken a different tack and choose to work with some LDS in suggesting ways to make our relationship such that both sides perceive value. It can work, i do it with several shops in our area and buy from the net from time to time. Your ego can take it Genesis, try it, you might be surprised at how it turns out.

I'd been doing air, tank service, and small stuff with him for a couple years. His stockage was small and his lines were not what I was using. He recently expanded his line so I went to him for a diverite wing. I asked him outright if he could compete with (not match), the LP price. He looked it up and told me no. We discussed it a bit and, as I suspected, the LP price was less than his wholesale price. And there was no sense in trying to round it out with service items. I'm going to him anyway for service so free service would still be money lost in the long run. That wing with a $20.00 air card to put the sale in the black is just $20.00 that he would not get from me later.

I'd rather do all scuba business locally. But until LDSs get big enough and free enough to comtete with online operations like LP, I'm going for the best deal. Not just money, but it's hard offset a couple hundred dollar price difference on a $600.00 regulator with a friendly smile and a cup of coffee.

And I'm not saying that the LDS is the bad guy. Although some (maybe even most) seem to try to hide behind the dealer agreements, mine seems to do what he can to put packages together that camouflage item sale prices. But I'm past the stage of packages and when LDS wholesale costs are less the online retail because of wholesale volume discounts (controlled by the manufacture), it just doesn't work out. The manufacturer seems to be in the driver's seat and until he has difficulty distributing his goods due to a lack of LDSs, he really doesn't have much economic reason to change anything.

 

[Genesis]

is that I didn't buy it from LP.

I bought the transmitter, ultimately, from Simply Scuba.

They are an authorized Suunto dealer (as is DiveInn.)

One that lives, however, in a nation where anti-trust law and retail price maintenance is STRICTLY illegal - and the law is actually enforced.

The funny thing about it is that even after paying the shipping and import duties, which are substantial, its STILL cheaper by over $100 than the "best" LDS price here! And they'll get the product here, to my door, in a couple of days.

Without price maintenance Simply Scuba could not compete in the US, simply due to the shipping costs (the customs duties aren't the big deal, the air freight, on the other hand, is!)

Funny how a retailer - a real retailer - can manage to send product halfway around the world and is STILL cheaper by over 25% than the "best price" the LDS can offer on what is, for them, a nearly $500 product.

 

[Pez de Diablo]

But if I did, I think dealing with Genisis would be a never ending battle. I would look forward to the day he buys a compressor.

I negotiate on all the gear I buy and never pay list or marked price. A couple of shops that I deal with automaticaly discount to me about 15%. If I don't feel that this is fair, I tell them what I am willing to pay (or credits I will accept) and in good faith we negotiate something that will keep them in buisness and me happy.

I deal with them (2 shops) regularly and never pay for air, no one keeps track - I don't have an air card.

Good faith is like respect, both parties need to earn it.