Local dive shops are really taking the pi$$!

[Freeflyer]

OK, this opened a bigger can of worms than I had expected and didn't mean to rehash the arguments again. I was really only venting publicly.

It seems to me that we're going to see more LDS going out of business as the internet sales take over, unless something changes dramatically. The manufacturers are going to have to change their ways, because their regular outlets are going to disappear. It also doesn't make sense when I can often buy cheaper from an authorised retailer in one country than another, even after paying shipping and taxes (or buying on vacation). And I still get a proper warranty.

I can't see how this price 'fixing' can continue, when so many other businesses can't get away with it. You don't see best buy being told by canon that they can't sell printers cheaply. There is huge competition online, and that results in better service and prices all round.

Anyhoo, I'm going to be out of town for a few day, and look forward to seeing the other comments that get posted. As always on this board, they're bound to be eductional.

Cheers,

J.

 

[OneBrightGator]

The way things are setup it would be near impossible to form that kind of "union" the majority of major brand retailers are 50some miles apart, logistically difficult and even if they did "band together" one of the local shops that is not a dealer would pipe up and the original shop would lose thier dealership the the other shop and if you think every dive shop in the country would band together to do this I've got a bridge in NY to sell ya.

And as a dive shop employee I am on your side, but I'm on my side first, I need to protect my dealership and my bottom line to make a living, if being on your side causes me to lose my dealership (which is what benefitted you) where does that leave BOTH of us?

Ben

 

[OneBrightGator]

Genesis once bubbled...


More than one way to skin this cat.

Keep a S-XL of ONE of the suit types (say, the TLS350) and ONE suit of each of the others (in whatever is the most common size needed) and have them available for rental.

After 2 years, sell them (at cost) and buy new ones; the rental fees make a decent profit, and you'd have no problem selling the used ones at cost (which, for DUI, is basically HALF the MSRP) If one or more sizes doesn't get rented much (or at all), then just keep that one around if nobody wants to buy it at that price.

Lose money? You gotta be kidding. Your investment cost is covered by the rental charges, you also get to offer the "suit specialty class" (since now you have the suits, which you can rent for that purpose as well) and at the end of the day your investment is returned to you so you can buy new stock.

If I try one on and it seems to fit, I can then rent it and go try it for a day for a reasonable cost. If I like it, I can have a new one in a few days, or, if its near the end of the cycle, I can buy the rental right now at a significant discount.

How do you lose money under this scenario?

You don't.

You not only make money, you provide the service that these dealers and manufacturers CLAIM as their justification for their 100% mark-ups.

It's a great idea, and it would benefit both the customer and shop if it would work, but it doesn't. If there's no demand to buy the suits, who is going to rent them from you and who is going to want to take a specialty involving them? (we have enough problems getting enough people for a nitrox class and we all know how valuable that is). In my two years of being a dive shop employee in Florida I've seen one drysuit sold, you just can't make money doing things your way with this kind of sales record.

Ben

 

[Genesis]

It's a great idea, and it would benefit both the customer and shop if it would work, but it doesn't. If there's no demand to buy the suits, who is going to rent them from you and who is going to want to take a specialty involving them? (we have enough problems getting enough people for a nitrox class and we all know how valuable that is). In my two years of being a dive shop employee in Florida I've seen one drysuit sold, you just can't make money doing things your way with this kind of sales record.

Then the suits would be effectively brand new.

In a year (if they don't rent out at all) you put them on eBAY at 20% over cost.

Let's say you made ZERO on rentals (you never rented them!) You're still several hundred dollars UNDER the minimum "discounted" price, you can legitimately sell them at that price since they're "used", and you've got a guaranteed 20% return on your money.

This is a bad investment? Where can 'ya find a near-guaranteed 20% annualized return?

Yes, you can make money doing this this way with that kind of sales record. If you actually rent the suits a lot then of course their residual value goes down, but your profits go up, since you make money on the rentals too and that offsets the cost.

For the mark-up that the retailers demand and support, this kind of system is a no-brainer, does not violate any dealer agreement (or "policy") and is quite profitable. It also fills the customer service void.

BTW, a big part of why you don't sell the suits is that you don't have the suits to sell. You might get a pleasant surprise if the suits were actually there. But if even if you did not, you've still got a hell of a nice business there in the turnover annually.....

BTW it doesn't take much of an organization effort to make this work if your shop and a few others wanted to do something about it. Even if you only reached 10 or 20% of the retailers for a given brand you'd crack the egg and it would never be able to be "uncracked", especially if you can get a few of the larger shops (in volume) involved - the threat of a 25% loss of volume by a manufacturer would put most of them out of business permanently.

And by the way, there ARE manufacturers without these restrictions that still make very high quality gear. Abyss comes to mind.... so the "threat" of the guy across town giving YOU a dirt nap is pretty toothless.

The simple fact, Gator, is that the shops LIKE this. It is only through their collusion in acceptance of these policies that they are able to stand.

 

[netmage]

Freeflyer once bubbled...

So what have I learned.

LDS's don't necessarily have skilled, knowlegable staff. I'm a technically savvy purchaser, and I learn way more about stuff by asking questions here than by going into the shops.
...
General consensus, LDS's are ripping me off. Bottom line, my money's going to Leisurepro when I next buy my gear. I coudl buy a 3rd set with the differnce in cost and have a full back up of everything.
...
Thanks for giving me room to sound off, and for all the great advice and education that I get here.

Cheers,

J.

Welcome to the board - glad you figured it out early. I just don't comprehend the degree of loyalty LDS owners assume they deserve when they offer lousy pricing and poor customer service... I havn't met a shop that has delivered on a promise, delivery date, service date, or class schedule.

 

[flw]

I come from an area that is too small to support a local dive shop, so we don't have the benefit of one.
We get by, you do have to learn to organise your own dives, work out the fit of a new dry suit by mail-order ( Otter are great btw), carry a far bigger set of spares than you would normally need, buy a compressor, and learn to run ( and service) it etc etc etc - and then, like happened this week, the nexk o-ring went on 2 (!!) separate cylinders and we only had one spare left - I ordered more from the mainland, felt a bit of a twit ordering 10p worth of o-rings, so ordered a dozen, plus a couple of other bits I might just need sometime, and it'll take 3 days to get here.
On the other hand, one of my d-timers is definitely dying, so I needed a new one, rang round a few of the big dive stores who all recomended I get either a vr3 or a vytec as nothing else would fit my needs - completely failing to pick up on the fact a vytec doesn't work out rb deco anyway - try and sell me something £100's more than I actually needed.

f

 

[MikeFerrara]

Genesis once bubbled...


Then the suits would be effectively brand new.

In a year (if they don't rent out at all) you put them on eBAY at 20% over cost.

Let's say you made ZERO on rentals (you never rented them!) You're still several hundred dollars UNDER the minimum "discounted" price, you can legitimately sell them at that price since they're "used", and you've got a guaranteed 20% return on your money.

This is a bad investment? Where can 'ya find a near-guaranteed 20% annualized return?

This isn't a 20%return on investment. It would be if it was a mutual fund or something but here there's overhead. Having this much money tied up for two years for a 20% markup is nothing short of a disaster.

BTW, a big part of why you don't sell the suits is that you don't have the suits to sell. You might get a pleasant surprise if the suits were actually there. But if even if you did not, you've still got a hell of a nice business there in the turnover annually.....

No. We don't sell suits because only a very small percentage of local divers ever buy a dry suit. Just like with other equipment around here strangers don't just come walking in looking to buy equipment. 98% of them are students, former students or some other form of regular. The few who buy, buy from us without having thousands of dollars tied up in rentals that do nothing but rot on the wall.

Certainly if we had a rental that fit a person we might be able to interest a few more people in getting started in a dry suit but that's a big gamble.

Besides that, look around. How many people fit in a stock size? At the very least you end up changing seals out for every other person that rents the suit. What do you think that costs?

I think in 4 years we maybe sold maybe 2 or three stock suits and at least one of those was an over the phone sale.

BTW it doesn't take much of an organization effort to make this work if your shop and a few others wanted to do something about it. Even if you only reached 10 or 20% of the retailers for a given brand you'd crack the egg and it would never be able to be "uncracked", especially if you can get a few of the larger shops (in volume) involved - the threat of a 25% loss of volume by a manufacturer would put most of them out of business permanently.

How many people have shown interest in your Divers Union? You should see the looks I get when I just mention teaching trim to OW students. These are not people to buck the system and they believe that what they're doing is the right way. A couple weeks ago I talked to another shop owner. He's been in business for 30 years. When I mentioned selling dive equipment online he looked at me like I had two heads. You'd of thought he cought me burning down a church.

And by the way, there ARE manufacturers without these restrictions that still make very high quality gear. Abyss comes to mind.... so the "threat" of the guy across town giving YOU a dirt nap is pretty toothless.

There are a few. Unfortunatly Abyss only has a few products and they can't keep a dive shop open. Do you have any idea what you have to spend just to get a decent selection of fins? You need huge opening orders for each company. Abyss just adds to the list and what's their selection like?

Oxychek is another one.
I guess that's the oposit problem of the other manufacturers

The point is you don't deal for these companies as an alternative you do it as an adition.

 

[OneBrightGator]

Genesis once bubbled...


Then the suits would be effectively brand new.

In a year (if they don't rent out at all) you put them on eBAY at 20% over cost.

Let's say you made ZERO on rentals (you never rented them!) You're still several hundred dollars UNDER the minimum "discounted" price, you can legitimately sell them at that price since they're "used", and you've got a guaranteed 20% return on your money.

This is a bad investment? Where can 'ya find a near-guaranteed 20% annualized return?

Yes, you can make money doing this this way with that kind of sales record. If you actually rent the suits a lot then of course their residual value goes down, but your profits go up, since you make money on the rentals too and that offsets the cost.

For the mark-up that the retailers demand and support, this kind of system is a no-brainer, does not violate any dealer agreement (or "policy") and is quite profitable. It also fills the customer service void.

BTW, a big part of why you don't sell the suits is that you don't have the suits to sell. You might get a pleasant surprise if the suits were actually there. But if even if you did not, you've still got a hell of a nice business there in the turnover annually.....

BTW it doesn't take much of an organization effort to make this work if your shop and a few others wanted to do something about it. Even if you only reached 10 or 20% of the retailers for a given brand you'd crack the egg and it would never be able to be "uncracked", especially if you can get a few of the larger shops (in volume) involved - the threat of a 25% loss of volume by a manufacturer would put most of them out of business permanently.

And by the way, there ARE manufacturers without these restrictions that still make very high quality gear. Abyss comes to mind.... so the "threat" of the guy across town giving YOU a dirt nap is pretty toothless.

The simple fact, Gator, is that the shops LIKE this. It is only through their collusion in acceptance of these policies that they are able to stand.

Until you actively participate on this side of the argument you claim to know everything about you're speaking out of ignorance. If it was so easy to carry out your drysuit plan why hasn't every shop in the state done it and why doesn't every manufacturer (drysuit or otherwise) actively work to set this up in everyone of thier dealerships? The simple answer is because it's not, there's a lot of money involved in creating and maintaining a drysuit rental fleet and it would be extremely difficult to turn a profit from it and it does not directly effect drysuit sales.

Most shops that carry SP and AL (two of the major players in this issue) are totally dependent on them for business, so cracked or uncracked without thier product line the shop is F'ed and bringing in a manufacturer such as Abyss won't do squat (they do make quality equipment, but have all most no name recognition).

The simple fact is you're preaching an argument built on experience from one side and your bad attitude toward everything retail hurts everyone. Shops are dying, how can they like that?

Ben

 

[Dive Source]

netmage once bubbled...


Welcome to the board - glad you figured it out early. I just don't comprehend the degree of loyalty LDS owners assume they deserve when they offer lousy pricing and poor customer service... I havn't met a shop that has delivered on a promise, delivery date, service date, or class schedule.

Netmage I used your quote as I found it disingenuous, I do not know you and I hope you will not find my post a personal attack as it is not meant as one.

As a shop owner I find it very sad that your experiances have been bad enough to generate this much distrust of the LDS structure.

I work hard to earn my customers business everyday and as a human being I make mistakes as well as have successes and resent being labelled or grouped.

I don't assume I am owed anything in the scuba business or in life and if you walked through the door of my shop I would welcome you and work hard for your business. If I fail it is my fault.

Before anyone flames me for being to delicate to handle crirticism of my industry please take a moment and rephrase this statement:

"I haven't met a ( insert nasty racial streotype name here) that has delivered on a promise, delivery date, service date, or class schedule."

Prejuduced statements like this don't work in life why should they be valid when directed against a group of people who own a particular type of business even if some of them are not doing what some percieve as a perfect job.

There are LDS's out there that are great and their are those who can improve just like every business or person in the world and assuming all of them are bad is selling them and yourself short in life.

 

[Genesis]

Here are folks in a dying industry talking about how horrible it is, and yet they are choosing as a response to do more of what is causing their own demise.

And I love the "20% ROI annually is horrible" crowd. Uh, Mike, no its not. Yeah, yeah, I know all about marginal costs and fixed costs, and all that. But what does having the suits available for rental and then turning them over in this fashion cost you beyond the static investment in the shop?

Nothing.

Seals need replaced every few rentals? Every 2 or three? C'mon. You're telling me that every five or six dives you're replacing seals? You're kidding me, right? Set the rental price high enough to cover the maintenance, of course, plus the depreciation in value as you perceive it to be on eBAY or similar.

Even just buying the suits, sitting on them for a year ON A SHELF and selling them at 20% over cost is a nice money maker. And oh, by the way, tying up money isn't bad - its called investment, when you have a reasonable rate of return.

Many times I had a product that we sold at "only" 10 or 20% over cost. Would I make an entire business out of that? No; I had better margin things to sell too. But on balance was it a bad investment to do this? No way. Not unless I needed the money for something else. At some point if you have a successful business you have free cash flow that can be "parked" in investments like this, which earn a nice return, and are still fairly liquid if you need the cash for some reason. While this kind of investment isn't as liquid as, say, QQQs, its a hell of a lot less volatile and in 7-10 days you can be out with your hide intact if you need to.