2. misc-audio
  3. 1354682622

Why are dealers so scared to sell product out of

state. I was calling a few dealers out of state looking for better pricing on a product. Another reason I'm trying to buy out of state is to save the high sales tax in Southern California. A couple of dealers I talked to refused to sell product out of state.They said they have an agreement with the distributor not to sell out of state. It's amazing how distributors have such a hold on the retailer. High-end audio Isn't exactly setting the world on fire yet they have all these restrictions for the retailer. I can buy a rolex watch out of state or even a ferrari. Why can't I buy audio equipment out of state if I choose to? Yes, I know there are mail order companies that carry lines they can sell across state lines. The problem is these firms sell at list price and I'm not going to pay list for anything including audio equipment.
taters
mt10425
1,138 posts
 
Onhwy61-you're right. I'm very sorry.
zd542
5,339 posts
 
Bifwynne,

With regards to markup, generally speaking, the markup on electronics is about 40%. Speakers and cables/accessories is about 50%. Markups do change, however, as the cost of equipment goes up. When you get into very expensive equipment, the markup is usually lower. Keep in mind that the info I'm giving you is not absolute; its just a general picture of the industry as a whole.
bifwynne
2,206 posts
 
Thanks Zd. If your right about mark-up, which I would have guessed you are, I'm surprised that every dealer I spoke to about pricing my new speakers acted like he was cutting his throat with the absolute minimum price he could offer. One dealer told me that the margin on my new speakers is thin and there just wasn't that much he could do. If it was only one guy telling me this, I'd take it with a grain of salt. But for three dealers to come up with practically the same price discount causes me to raise an eyebrow. As I said, the dealer I usually work with doesn't even carry the speakers in inventory. He orders them from a factory warehouse and then flash transfers title as soon as they are delivered. Seems to me, that with so little risk, he would have more to work with in terms of dealing. OTOH, my speakers are a tad pricey for the general market. Maybe the dealer figures that my speakers are not a volume, typical supply and demand type item. Which may mean that the time to make his margin is when he makes a sale since the volume is thin. Just guessing.
pgawan2b
122 posts
 
ZD542, I assume you are referring to the manufacturer's markup and not the dealer's, right?

Bifwynne, I imagine the dealer probably buys the product from the manufacturer at a 30% discount. This leaves a 10% markup for the manufacturer. When the dealer sells the product to you at a 20% discount, he too is making a 10% markup. Shipping and insurance can be costly so unless the dealer passes this additional cost directly on to you, it can really eat in to his markup.
swampwalker's avatar
swampwalker
5,138 posts
 
There's too much blind acceptance of financial complexities and monetary entitlement.
Agree completely.
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