And another sale gone, another one down... another one bites the dust!
- Thread starter Genesis
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..and just like the LDS you probably do a low volume of business. Your number of missed bids goes down but so does your number of accepted bids.
Say I want to re-roof my home or build on an addition or something. I look in the yellow pages, see your add, and wonder if you are qualified to do quality work on my home. There's NO WAY I'm going to pay you to have you come out to my house only to find out that maybe YOU are the Joe Shmoe who is some guy operating out of his garage and is not up to the job.
When you come out to my house I am evaluating YOU just as you are evaluating me. You are just as big a waste of my time as I am of yours...maybe you should pay me to give me the estimate...after all I am having to take time out of my workday to go home and meet you there.
The message you send me by charging for your estimate is that money is more important to you than getting the job and making a happy customer...especially when everyone else in your profession gives free estimates. Sure there are missed bids but that's the nature of the beast. If you are not willing to take a chance on me (not being a two-timing cheapskate), there is no way I would take a chance on you (not being an incompetant contractor).
Yeah, I'm a smart consumer and I am going to "shop your bid" but just as Genesis has said repeatedly "low price does not necessarily get the job". It's about VALUE. Can we have a good relationship where I get quality work done in a timely fashion, or do I end up with you folding on me or something, leaving my new addition half complete and me scrambling to find another contractor to finish the job while I'm having to live in a home with a gaping hole in it where you demo'd out the back of my house? I would MUCH rather pay a few thousand dollars more to know for sure that this won't happen, because if it does happen the few thousand I saved is now lost by having to go to the trouble to find another contractor who will almost certainly charge me more because he is walking into somebody else's mess instead of getting to start fresh.
My point is... Genesis is right. Value means much more than just the best price. If you can't go out of your way enough to come by and give me a free estimate, I can't go out of my way enough take a chance on you not being a quality contractor.
P.S.
You all are making good arguements on BOTH sides, but I don't see Genesis making any personal attacks or calling you all names...Maybe it's because his points are valid and he doesn't need to stoop to namecalling to give his statements credibillity.
yknot
Guest
Yes. The one in low cost Manhatten.
Does anyone honestly think there is really such a thing as free estimates? Whether you believe it or not someone pays for the overhead it takes any business to provide "free estimates." It might not be you if you don't accept the estimate and purchase the goods or services but it will be the next person who does.
No for profit business can truely provide free anything and still stay in business. The cost of doing business has to be paid for or sooner or later ..... no more business.
This is simple really, LP - high volume, low overhead can operated on lower margins than most, LDS - low volume, higher overhead businesses. Make your choice and move on. Don't try to make LDS something they can't be. Unless the manufacturers do something to protect their licensed dealers, by offering them lower prices than LP can purchase gear for, the LDS will never compete with LP on cost of the same gear. That is a basic business fact.
in the highest-cost-of-overhead market in the United States.
Ever price real estate (for sale or commercial lease) in NYC? I have. Ever investigated NYC's extraordinarily punitive tax structure? I have. Ever looked into putting a business there? I have - and damn near threw up.
If LP wanted a "low cost" marketplace they'd be in Omaha or, gasp, somewhere in the boonies in Florida.
Ever price real estate (for sale or commercial lease) in NYC? I have. Ever investigated NYC's extraordinarily punitive tax structure? I have. Ever looked into putting a business there? I have - and damn near threw up.
If LP wanted a "low cost" marketplace they'd be in Omaha or, gasp, somewhere in the boonies in Florida.
No argument there G-man but the flaw in your reasoning is market exposure. LP reaches out to more customers per dollar revenue than any small LDS could ever hope for. More power to LP for finding a niche, i have no problem with that, it's the American way.
Makes you wonder why they don't reside in podunk junction Nebraska though doesn't it?
Makes you wonder why they don't reside in podunk junction Nebraska though doesn't it?
Why did the camera places reside in NY? LP is an offshoot of one, 'ya know...
Two reasons - easy access to import/export facilities (the NYC area is a major port) and walk-in traffic - both of which they really do have and profit from.
For many firms the cost of being there "works".
Two reasons - easy access to import/export facilities (the NYC area is a major port) and walk-in traffic - both of which they really do have and profit from.
For many firms the cost of being there "works".
djhall
Guest
Here is a question for everyone: Are the "intangibles" so often cited by LDSs as the added value to justify their higher prices really worth the extra cost? Are they truly an added "value?" By "intangibles", I don't mean things like a free drysuit class if I buy a drysuit. That is quite "tangible", and I can easily factor the cost of the class into the price of the suit. But things like advice? Or spending half an hour looking at computers?
Take advice... How can a dive shop owner or salesperson be unbiased in their advice? Of course they are going to recommend what they sell. What ScubaPro dealer is going to tell you to go buy a Dacor regulator down the street for half the cost? And what Dacor dealer is going to tell you ScubaPro is a superior product at a higer price? Of course the Dacor dealer says ScubaPro is the same quality at a brand name price, and the ScubaPro dealer says Dacor is crappy and you get what you pay for. Utterly predictable and completely worthless. The truth? I don't know, and I suspect they don't really know for sure either. Look at the debates that rage about the subject here. People even disagree over the validity of the Rodale's test reports. Personally, by the time I'm done independently researching and verifying everything the LDS told me to know if they are correct or not... I no longer need their advice. Conversely, if I need their advice, then I don't know enough to know if their information is correct or not, and then I need to go research it independently, which brings me back to not needing their advice again.
How about spending half an hour looking at computers in the store. Valuable? I don't know. I think you find more information faster by finding an online source to quickly review the essential features of a large number of models and manufacturers, then downloading and reading the users manuals of the ones you find yourself interested in. Free, very informative, and no wasting of a salesperson's time. Interested in a drysuit? $11 at amazon.com will buy you "Dry Suit Diving: A Guide to Diving Dry" which will explain how the suits work, suit manufacturing, materials pros & cons, seals, valves, fitting, repairs, and how to dive with the suit. How is a salesperson supposed to compete with that???
I am certainly NOT arguing with those who claim value is often, though not always, more important than price. Of course it is... otherwise we would all buy the cheapest crap at the lowest price we could find. The fact that most everyone here is willing to pay more for better quality is evidence that most people are willing to pay a higher price for a greater value. It simply seems to me that what many people see as an "added value" is somewhat hard for other people to see as having much "value" at all. So my question to the group... what is the value of the intangilbe items the LDSs offer? Are they providing a "valuable service," or simply adding an extra layer of "middleman markup and information control" between the manufacturers and consumers?
Take advice... How can a dive shop owner or salesperson be unbiased in their advice? Of course they are going to recommend what they sell. What ScubaPro dealer is going to tell you to go buy a Dacor regulator down the street for half the cost? And what Dacor dealer is going to tell you ScubaPro is a superior product at a higer price? Of course the Dacor dealer says ScubaPro is the same quality at a brand name price, and the ScubaPro dealer says Dacor is crappy and you get what you pay for. Utterly predictable and completely worthless. The truth? I don't know, and I suspect they don't really know for sure either. Look at the debates that rage about the subject here. People even disagree over the validity of the Rodale's test reports. Personally, by the time I'm done independently researching and verifying everything the LDS told me to know if they are correct or not... I no longer need their advice. Conversely, if I need their advice, then I don't know enough to know if their information is correct or not, and then I need to go research it independently, which brings me back to not needing their advice again.
How about spending half an hour looking at computers in the store. Valuable? I don't know. I think you find more information faster by finding an online source to quickly review the essential features of a large number of models and manufacturers, then downloading and reading the users manuals of the ones you find yourself interested in. Free, very informative, and no wasting of a salesperson's time. Interested in a drysuit? $11 at amazon.com will buy you "Dry Suit Diving: A Guide to Diving Dry" which will explain how the suits work, suit manufacturing, materials pros & cons, seals, valves, fitting, repairs, and how to dive with the suit. How is a salesperson supposed to compete with that???
I am certainly NOT arguing with those who claim value is often, though not always, more important than price. Of course it is... otherwise we would all buy the cheapest crap at the lowest price we could find. The fact that most everyone here is willing to pay more for better quality is evidence that most people are willing to pay a higher price for a greater value. It simply seems to me that what many people see as an "added value" is somewhat hard for other people to see as having much "value" at all. So my question to the group... what is the value of the intangilbe items the LDSs offer? Are they providing a "valuable service," or simply adding an extra layer of "middleman markup and information control" between the manufacturers and consumers?
LP has more rvenue for the overhead than I do. In fact we have just found out we are losing our lease. As of yet I havent found a place to rent that my business will support PERIOD. Even if I do with the money we have recently put into trying to start an online store I don't know that I have the cash to move even with someplace to go. I would assume that LP can pay the rent. For many LDS's relying on a walk in market it's a monthe to month thing. Charge too little on a couple of sales or pay too much for a couple of things or buy too much of the wrong inventory and your done. Any idea what I spend just traveling to teach classes? Agency fees, instructor and dive shop insurance a compressor. All expenses that LP doesn't have. I spent a bunch of money the other day on a new 3rd stage seperator. Yesterday my first stage presure gauge went out. If I didn't have those expenses and had a world wide market I'll bet I could rent LP's space and then some.
The examples you cite, which many dive shops use as "justification", are IMHO worthless - because the data is tainted of necessity as you noted.
However, the value of instant gratification (that is, have it in STOCK!) is real.
So is the value of a store policy on instant swap-out for defectives - no warranty hassles.
Those two things alone are real and worth something, and with some creativity you can come up with some more.
But most shops offer NEITHER! On many items they want to order it in, which not only destroys their argument on inventory carrying costs (since they didn't) but also destroys their value for "instant gratification", since you can get it from LP just as quickly.
And when it comes to warranty issues, MOST shops want to ship it back to be fixed. That's flatly unacceptable in this day and age of even the BIG BOX places like WalMart offering instant swap - or return - for defectives!
If shops are going to make a value claim, then they actually have to provide some.
So far I've yet to see it.
Mike, you have NO IDEA what costs are like in NYC. I've done work there. Let me give you just a small example - while working on a satellite uplink install over on Broad Street at the ITT building I WILDCATTED the entire construction team by plugging in an oscilloscope. Yes, you read that right - every union worker on the site literally dropped his tools and walked out. How come? Because the union boys doing the construction work - the electricians - were required to do ALL electrical "connecting" - yes, even plugging in a piece of test equipment! They literally walked off the job - all of the trades - and refused to come back until the next day - because I plugged in a piece of hardware that I needed to do my job.
That's the kind of IDIOCY that NYC is famous for when it comes to business costs.
I had a policy when I ran my place that I would not do contract work in NYC, would not attend conferences there, and would not exhibit at trade shows there. This kind of stupidity is why. It was just WAY too expensive, all-up, and the costs were so far out of reasonable control or even ability to predict that it simply wasn't worth whatever possible profit I could have garnered by being there.
However, the value of instant gratification (that is, have it in STOCK!) is real.
So is the value of a store policy on instant swap-out for defectives - no warranty hassles.
Those two things alone are real and worth something, and with some creativity you can come up with some more.
But most shops offer NEITHER! On many items they want to order it in, which not only destroys their argument on inventory carrying costs (since they didn't) but also destroys their value for "instant gratification", since you can get it from LP just as quickly.
And when it comes to warranty issues, MOST shops want to ship it back to be fixed. That's flatly unacceptable in this day and age of even the BIG BOX places like WalMart offering instant swap - or return - for defectives!
If shops are going to make a value claim, then they actually have to provide some.
So far I've yet to see it.
Mike, you have NO IDEA what costs are like in NYC. I've done work there. Let me give you just a small example - while working on a satellite uplink install over on Broad Street at the ITT building I WILDCATTED the entire construction team by plugging in an oscilloscope. Yes, you read that right - every union worker on the site literally dropped his tools and walked out. How come? Because the union boys doing the construction work - the electricians - were required to do ALL electrical "connecting" - yes, even plugging in a piece of test equipment! They literally walked off the job - all of the trades - and refused to come back until the next day - because I plugged in a piece of hardware that I needed to do my job.
That's the kind of IDIOCY that NYC is famous for when it comes to business costs.
I had a policy when I ran my place that I would not do contract work in NYC, would not attend conferences there, and would not exhibit at trade shows there. This kind of stupidity is why. It was just WAY too expensive, all-up, and the costs were so far out of reasonable control or even ability to predict that it simply wasn't worth whatever possible profit I could have garnered by being there.
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