Buying Gear at your LDS VS internet!!!

[yknot]

While price-fixing is illegal in the US, manufacturers are still able to decide which dealers they wish to sell to.

If they don't want to sell to dealer xyz, they simply don't have to. All they need to do is decide that selling to a particular dealer isn't beneficial to them, and decide to not do it.

I'm not saying it's right, I'm just saying it's reality.

Terry

I've never once suggested that a manufacturer should have to sell, for purposes of resale, to anyone they don't want to sell to. What is a fact, however, is that when you execute an agreement to restrict access to your product or not sell below a minimum price you are guilty of price fixing. You would open yourself to action from two fronts. A private class action lawsuit could cost millions, including punative damages. An action from the goverment could include a fine as well as further action to halt any illegal practices. I suggest you do a little research into a company known as "Nine West". It is also illegal to require a consumer, as part of maintaining warranty coverage, to do periodic service from a specific source, such as an "authorized dealer" using specific parts unless both parts and service are provided free of charge. It is also illegal to require that only certain brands of parts be used for warranty coverage. The fact that an LDS goes along with this also implicates them in these illegal practices.

 

[Web Monkey]

illegal to require a consumer, as part of maintaining warranty coverage, to do periodic service from a specific source, such as an "authorized dealer" using specific parts unless both parts and service are provided free of charge. It is also illegal to require that only certain brands of parts be used for warranty coverage. The fact that an LDS goes along with this also implicates them in these illegal practices.

I haven't seen any SCUBA dealer contracts, but I would suspect it doesn't say any of that.

If it's anything like the Appliance & Electronics Dealer contracts, which I have seen, it just says that the manufacturer can terminate the contract with no reason needed. And they do.

It's not exciting and there's nothing you can call a lawyer about. All that happens is that the manufacturer says "we no longer will sell to you" and the sales rep stops taking your orders.

I know you're all in favor of anything that will drive down prices, (I like a bargain too), however, nothing exciting is likely to happen in the near future, especially in regard to internet sales.

In fact, I was reading recently in a study (I beleive) by the FTC that the consumer's ability to instantly compare prices from a large number of dealers on the internet has actually increased prices in many cases, or at the worst leveled them off, since not only can the consumer see what each dealer's price is, so can the other dealers (and manufacturers)

Terry

 

[yknot]

I haven't seen any SCUBA dealer contracts, but I would suspect it doesn't say any of that.

If it's anything like the Appliance & Electronics Dealer contracts, which I have seen, it just says that the manufacturer can terminate the contract with no reason needed. And they do.

It's not exciting and there's nothing you can call a lawyer about. All that happens is that the manufacturer says "we no longer will sell to you" and the sales rep stops taking your orders.

I know you're all in favor of anything that will drive down prices, (I like a bargain too), however, nothing exciting is likely to happen in the near future, especially in regard to internet sales.

In fact, I was reading recently in a study (I beleive) by the FTC that the consumer's ability to instantly compare prices from a large number of dealers on the internet has actually increased prices in many cases, or at the worst leveled them off, since not only can the consumer see what each dealer's price is, so can the other dealers (and manufacturers)

Terry

I still have to disagree with a couple of points. As I haven't actually seen an actual dealer's agreement I also can only go by what has been said many, many times previously by posters claiming to be either LDS owners or employees, which is that they can't, by agreement, sell on line or below minimum prices. If these claims aren't true then these LDS representatives are liars and as such don't deserve my business anyway. Any agreement between manufacturers, distributors and retailers that restricts access to a product or restricts pricing, thru minimums for example, amounts to price fixing and is illegal. There is also specific language currently in the manufacturer's warranties that is illegal. There is nothing vague about this. Do these appliance sales agreements contain any restrictions as to how the products can be sold?

 

[TheRedHead]

"If it's anything like the Appliance & Electronics Dealer contracts, which I have seen, it just says that the manufacturer can terminate the contract with no reason needed. And they do."

That's true, but I can also buy a Maytag washer or an HP printer from any number of local dealers and buy the printer on the internet if I wish. While dealers sign contracts which restrict pricing, they don't sign exclusive contracts in these industries. They sell other brands and other stores in the area sell the same brand.

In a free market, the least restrictive policies always win. Just look at the history of the computer industry. I 1982, Apple Computer had the market share. IBM instroduced a computer which was the equivalent to the Apple IIe in functionality and features, and both at that time had a open architecture in that you could buy peripherals from other manufacturers. You could run a third party OS on the Apple IIe. Apple then introducted the Mac with a proprietary architecture, operating system and parts.

I was working at a university at that time and Apple computer gave our department over 100 Macs. The bummer was that we couldn't work on this equipment without a special Mac tool just to open the case. The parts were expensive. Everything became such a hassle and so expensive we found it was cheaper to buy IBM compatible PCs. We made aquariums out of those "free" Macs. Apple has around 4% of the personal computer market now.

Another example is in high-end audio where a pair of speakers can cost from $5,000 to $100,000 and saving even 1% on price can influence a buying decision. The companies who have the non-exclusive policies have the lion's share of the market. The companies that insist on exclusive dealerships are going out of business or changing their policies.

Given time, most manufacturers realize that they will make more money by gaining more market share with non-exclusive agreements. Others will simply go out of business or become an exotic, boutique brand with little market share. It happens in all industries.

 

[aabond]

I just bought dive gear from my LDS, and to say the least, the owner took care of me. Buying my whole package which included the seaquest balance with surelock, the aqualung titan lx, oceanic veo 200 dive console with compass, real nice black skirted mask with 45 angle side windows, and the mares volo power fins. He installed everyhting for me, gave me weights, and pretty much got me ready to dive at no extra cost. In total i spent ~ $1250. I did a price check on Leisure pro, and it was more expensive online. I'm sure this had to do with my buying the whole package, but it would have been well worth buying it from the LDS because the owner gave me excellent information regarding the different gear. The other thing he told, which I'm not sure is true or not, but sounds logical, is the fact that alot of the gear you buy online does not carry warranty in the US, and instead, you have to send your gear to Europe in order for it to be serviced. And finally, I'm sure if anything goes wrong with my gear, he will fix it for me or tell how to fix at.

Anyways, I hope this helps, and by the way, my gear is fantastic. The only thing I might possibly upgrade to in the future is to the suunto cobra which has the Air Integration which I kind of like, but I'm not entirely sure the money is worth it for my recreational diving.

Sincerely,
Andrew Bond
andrew@daysite.net

 

[Web Monkey]

The other thing he told, which I'm not sure is true or not, but sounds logical, is the fact that alot of the gear you buy online does not carry warranty in the US, and instead, you have to send your gear to Europe in order for it to be serviced.

The actual answer is both better and worse than he told you, depending on the product and manufacturer.

For some brands, you get a warranty no matter where you bought it. For others, if you bought it outside the area it was sold for, you don't get any warranty, anywhere.

Terry

 

[bwerb]

You know...big picture thinking here...isn't it totally STUPID that a manufacturer can build a product. Seal it in a shipping carton, send it to "retail location A" and agree that the product is under warranty BUT...send it to "distributor location B" who then sends it to "retail location A" and now claim that there is no warranty.

Either you build a product and stand behind any manufacturing defect or you don't. If the item has been abused...it isn't under warranty anyway so this is a totally moot point.

See...the long and short of it is...the factory gets the money to build said item regardless of where it is eventually sold at retail (hence the reason they don't really care to shut-down "unauthorized retailers"). If they can reduce the number of possible "returns" and keep the "suggested retail price" high (hence the dollars in the till for the retailer) for their "authorized dealers" then they have a total win-win. They are still selling tons of product, their authorized dealers are making margins, and they can wash their hands of any "warranty" issues on half the stuff they sent out the door...again...better corporate profitibility.

The whole thing is really kinda funny.

 

[Web Monkey]

You know...big picture thinking here...isn't it totally STUPID that a manufacturer can build a product. Seal it in a shipping carton, send it to "retail location A" and agree that the product is under warranty BUT...send it to "distributor location B" who then sends it to "retail location A" and now claim that there is no warranty.

It's a gamble for the consumer, but not always completely stupid.

On some products, the warranty is funded by the distributor. By selling outside of their territory and voiding the warranty, the distributor can undercut the normal priice, since there's no chance that they'll have to pay for any kind of warranty claims.

If you're buying gray-market fins (what could go wrong?), you'll probably never send them back under warranty anyway.

If you're buying a gray market Smartcom, which needs a $300+ battery every few years, it means you just got screwed.

Terry

 

[melfox26]

My most recent purchase:

Underwater Kinetics HID Light Cannon:

LDS: $250 plus tax

Online: $160 no tax

Though I would never buy any life support equipment online, other things, like lights, fins, etc, are just fine to buy online. I am more than happy to put the saved cash in my kid's college fund than pad an LDS owner's pocket.

Mel

 

[bwerb]

Terry, I'm curious, what widely distributed "brand name" products do you know of which are warranty funded by the distributor (other than OEM items they have specifically had built to their own specs). I'm just not that familiar with the concept of the distributor being on the hook for manufacturing defects from my own occupation...unless they are covering it off under the terms of a "defective allowance" from the manufacturer which again puts the money back to the manufacturers pocket.

(I'm a manufacturer's agent...I sell to both retailers and distributors on behalf of over 25 multinational corporations)