My business is not asking for pity purchases, and we do not fear competition. We do ask that people pay the true and fair value for items because there is more to life than low prices. And we cannot have fair competition when online dealers price their items at or below cost.
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This is veering off-topic, but I want to put in that I buy from Amazon frequently and reflexively, but there are two types of places I try to frequentâbookstores and music instrument stores. (In fact, by a neat coincidence, the music store I go to is @Biggie_McNeilâs place in Vestal, NY.) I want those sorts of places to continue to exist, very much.
But it does confuse meâis Amazon actually selling Snark tuners below their cost? Or just below what an independent reseller has to pay?
Yes, butâŚ
We have a local kitchen goods store. Independently owned, been around for forever. Why? Because they are friendly and helpful and will special order for you. Going into the store is a pleasant experience which makes a shopper want to buy something.
Other independently owned stores on the same street have come and gone, because they relied on locals who didnât have other options (such as a car) to get what they needed. Those are the businesses that are failing to Amazon, etc.
It is not the customerâs job to make a business succeed.
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Nah, smells like a trap. If itâs not pity then itâs guilt. Iâd shop at your store if it offered something unique that no big-box store could provide, say even if that something is a musical atmosphere. I wouldnât be buying the snark tuner there. Iâd buy something that is harder to get, and look for something locally produced. Or stick to services instead of goods. Iâll hang onto my money, thank you very much.
@Enkidu: Amazon can buy 1,000,000 snark tuners for $7 and sell them for $8. Small stores cannot buy a million of them. They could buy a few hundred or a few thousand, and will pay, say, $12 each then mark them up accordingly.
Also, sometimes Amazon buys a million of them for $9 and sells them for $8 because capturing the purchasing activity is more valuable than making a $1 profit on the thing itself. For many reasons, but often because they know that people donât just buy a snark tuner then close their browser. Theyâll buy a snark tuner and then six other things, and possibly make a big purchase like a guitar or something, due to how they market things in your face while you are browsing. So theyâll take a loss on the small thing in order to hook you for a much bigger thing, and therefore make more money.
This is the opposite of the strategy hinted at by @Biggie_McNeil. In his strategy, he wants to sell $10 items for $20, just like in 1962. And even if people react and say, âYour prices are too high!â He will counter by saying, âDonât you want small mom & pop music stores like ours to keep existing?â Which, to me, is like guilting you into buying stuff. If he has the local market to support it, I think he should continue selling Snarks for $20, and even shoot for $30 and see if people will bite. Why make only $10 on a thing when you could be making $20? Thatâs one business strategy. I think itâs less than optimal.
There is another strategy that he could employ, which is to find stuff amazon and wal-mart donât have, and never will have, like accessories made by local craftspeople. Locally made guitar bags, embroidered straps, laser cut stuff, things like that. And also to accentuate services like tuning, teaching and repairs that no online place could ever provide effectively, it has to be face-to-face for that stuff. To me, thatâs a superior strategy, because it plays to strength not weakness. But who am I? I got 20 dollars in my pocketâŚ
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I donât know if the Snark product line is made by robots or by 3rd world slave labor.
But at $8 a pop, I doubt itâs made by anyone who earns minimum wage.
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I worked at several music stores from 1995 till 2002ish. I still remember the day Musicians Friend plopped a store in our town, it bankrupted all bit three shops (high end guitar shop, ethno/vintage shop, high end woodwind/brass shop survived, all the others failed).
It is a tough business, the margins suck, and everyone screws everyone else. That said I still buy local when I can.
Oh, and snarks suck. Well, all tuners suck. They get your instrument to a mediocre, half assed level of intonation that drives many of us mad. (Why does that third sound like shit!? Why are my diminished chords the sonic equivalent of garbage?!? Oh the assholes who foisted equal temperament on us are to blame)
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Heheh! You just perhaps inadvertently gave a huge strategy to Biggie McSmalls⌠âWeâll sell you this Snark for 20 bucks, but we will show you how to actually use it and get your thirds sounding good.â Thatâs the value-added aspect that I was writing about. Sell shit that no online retailer can.
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As a small PC OEM a decade ago, I used to struggle with this very factor. I couldnât outprice GoogleGear or NewEgg or TigerDirect on my systems. I could whitebox them, but then Iâd be supporting crap PCs with cards hot-glued in place and other such nonsense.
But, for just a little bit more money, I could build a superior system and warranty it myself through my suppliersâ RMA processes and my own bench time.
I focused on small businesses, and my clients liked the service that came with systems from me as well. Thatâs really what sold the PCs and servers at prices that justified my time.
@Biggie_McNeil, youâre in a very tough spot and I do sympathize. In the end, @awjt is correct about lasering in to where you can excel. You can serve customers like Amazon never will. I play electric bass, and I know that you just have to be there sometimes.
But Amazon will kill you in product sales, every time. Theyâve got a bully pulpit.
Cheers, and good luck in our evolving market.
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