I ended up buying from the LDS - here's why...

[Addict]

Can't we all just get along?

Being a frugal consumer, I will shop for the best price.
Being a capitalizing businessman, you will try to make a decent profit margin.

We can both come together to some sort of agreement - a little give-and-take from both ends.

The fact of the matter is that I had planned on buying from leisurepro. I never even thought my LDS would come close. I figured they would come up with a bunch of crap: throwing in little knick-knacks (with inflated prices) that I don't NEED to try and make up the difference. This is not what happened.

They made a true attempt to get the sale. They marked their prices down as much as they were allowed, then threw in products (like luggage, console bags, and annual service) to make up the difference between their low price, and LP.

I ended up already having the luggage, and don't feel that console/reg bags are a necessity at this point. Still planned on going to leisurepro. But made a counter-offer on the way out... "Forget the luggage, etc., would you be willing to offer the AOW classes instead?" After some calculations, they agreed.

I know for a fact that I cut their profit margin lower then they would have wished, but it still remained a decent profit on a decent sized purchase. I also spent a little more than I would have wished for the products that I got, but the added incentive *The little extras* provided enough value to me to support the LDS.

And to be quite honest, I was a little more assertive in creating a deal that I felt slightly favored me. This was due to the fact of being misled in the first place about the outrageously high 'set-up' fee. This made me reluctant to purchase from their shop at all. But now, by-gones are by-gones, and I am happy with my purchase.

 

[Genesis]

is exactly what you did Addict.

Just beware that you'll have to KEEP doing it, because your LDS isn't going to do you any favors in the future without being held to it.

Its one of the realities in any competitive situation, which all buyer/seller situations are.

My ONLY complaint is when a seller steps over the line to either restrain trade or lies to attempt to get a sale. THAT irritates me and will lead me to try to do something about it, because that leaves the realm of fair negotiation and fair play and enters the realm of force and fraud.

 

[Ontario Diver]

Mike - You are perfectly correct.

Addict - You are perfectly correct.

There is no contradiction here. You both have excellent points but slightly differing viewpoints.

I have had the opportunity to make several very large deals in the computer services field ($8 million plus). In that time I have dealt with businesses/vendors/suppliers/consultants etc. that take each of your viewpoints.

It works out into cost management issues. When you purchase a combination of services and products - the purchaser is only interested in the bottom line price (ignoring quality of both services and product for the moment). The vendor usually percieves them as separate sales. Services (due to thier nature and margin) are always cheaper to discount - without resulting in any reduction of quality.

An obvious example is in this case, if the LDS is fairly certain that it will always have sixteen spots filled on an eighteen spot course - than giving away two spots has minimal negative impact on the LDS' bottom line.

Anyway, you are both right.

Oh yes, and Genesis is right too! Addict, to maintain the LDS' goodwill, you have to be of value to them as well. That can be taking more courses, buying more gear, reccomending them to friends, or even just hanging out there.

 

[Genesis]

the problem with your analysis is that it takes place in a marketplace where there is no vertical price restraint.

My issue with what Addict was told and went through is that there is such a reality in the scuba marketplace at the present time, and there will be until and unless people get their acts together and put a stop to it.

If Mike does not adopt the "price fixing" mentality and method then he gets hurt. He cannot attempt to price at the market (rather than at an artificially restrained pricepoint) for his hardware, since the other guy is subsidizing his training with these sales.

The consequence is that Mike's offering of services is debased and ultimately may be destroyed.

I object to this because it coerces Mike to either (1) engage in a conspiracy to restrain trade and maintain retail prices on hardware, or (2) get out of the service business entirely due to an inability to compete on the services side alone!

I argue that Mike should object to this whether he engages in the price restraint or not, because whether he complies or not his business is harmed by these practices.

I have run a computer-industry-related business for more than a decade, and have done many deals with value well into 7 significant digits. I would have never accepted a cross-subsidization attempt based on price-fixing from a competitor, and in fact have gone to war in the past with suppliers who were not playing by the rules in an attempt to favor one bid over another (Clayton Act issues) for various political reasons.

These practices are damaging to the entire industry, except perhaps for the manufacturers engaging in both it and "back door" sales. That those who do not practice it don't get involved in making a stink about it puzzles me, particularly when they come here (and elsewhere) and lament how their training services have been devalued.

Wake up folks!

Those services are devalued because of the price supports that are in place on equipment! Get rid of that and training no longer can be cross-subsidized - and you will find that you can make an honest profit doing just training.....

 

[Addict]

Well, I certainly must thank those who pulled the 'wool' OFF of my eyes.

Without the knowledge that was provided by the participants of this board, I would've accepted the LDS word as law. And probably regreted any purchase decisions, as I became more fully informed.

When it comes down to it, I feel I supported my LDS, and no harm came from the transaction. They made a reasonable profit, and I took some their service for the extra money I paid.

It is not like I am out on their front step with a sign that is advertising the deal I made with them. Each customer is a different deal, and if they didn't find it beneficial - they wouldn't have done it.

 

[zboss]

You know... I also went with buying my BCD through the LDS last night. The discount I got was minimal - maybe 10 to 15% but I did get the warranty and am sure that it will be honored.

Also - my maintenance includes parts and labor... so with that said... I fell good that I am in a position to not only get my BCD serviced at regular intervals but that it's not going to cost me.

All in all - buying from my LDS has been a good experience if not just a little bit more expensive up front. After spending months hemming and hawing about which way to go (LDS vs. LP) I determined that having someone available that is familiar with the equipment was more important to me than saving $100 bucks. I think the expertise of people working in the store plus the added exposure to other divers (face to face) also contributed to my decision.

I am NOT saying that LP is out of the question for things like luggage and nick-nacks...

 

[sdexcalibur]

WOW, I asked my lds that me and 3 other people were interested in taken the open water class, but another dive shop gave us 25 dollar off coupons to take it their. could we use them here they said NO. So after spending 1400 on classes they couldn't even let us use the coupons. Even worse most people bought their stuff from the shop. I don't think 100 would of broke them