Worst lowball you've ever been dealt?

[eddododo]

Originally Posted by truckin88

My old man always said you can always go up, but you can never come down, and the seller can just say no. The words insulting and business really have no place being in the same idea.

BY FAR THE BEST POINT MADE IN THIS THREAD

[mpdd]

nice, my father told the salesman at the toyota dealership that every time he goes into the office to talk to the manager he will be taking another 500 off the four runner

[michael_atw]

Originally Posted by mpdd

nice, my father told the salesman at the toyota dealership that every time he goes into the office to talk to the manager he will be taking another 500 off the four runner

HAHA!

[michael_atw]

Originally Posted by edbass

That type of logic heads down a very slippery slope indeed.
Is 50% gross actually a "high margin"? What do you imagine the fixed overhead is for a large retail store in a major market? How about advertising, employee costs, shrinkage (theft), etc.?

I don't know exactly what they are either, but regardless of the brass tacks numbers that "slippery slope" I refer to is when outside entities feel that they can dictate what is a "good enough" margin for any business.
If you don’t like the way a business does their “business”, don’t patronize them; or better yet open a store and give 50% of retail on trade in and purchased used gear. Heck, make it 75%; just imagine all the business you would get!
Besides; I think 25% “should be good enough” for you, particularly since everyone would only go to your store because you would be beating out everyone else, don’t you agree?




Yeah, how would they know? They only do it for a freekin' living, seven days a week, almost 365 days a year.
They feed, house, and cloth their families by engaging in; living and breathing the retail MI gear business professionally, day in and day out.

Obviously amateur hobbyists posting on an internet forum would have a much better handle on market values...





Way to go man; that'll teach them! Make those heartless bastards give their dirty cash to some other seller! Of course... Now that you have let the cat out of the bag, the people on your "naughty list" may now realize you have deemed them unworthy, be shocked into seeing the light, change their heathen ways and start sending you checks for your full asking price; then what?
Or; is it a case that once you've judged one as morally bankrupt there just is no redemption?



WHAT!?! In this day and age there are still people who sell items for PROFIT??? Who are these rascals? They should be deported to a Capitalist country immediately!

Good for you! Not everyone has the grit to play hardball, and it sounds like you are resolved to stay in that camp.
Let those "other guys" keep the market moving by lowering themselves to negotiating price, stick to your guns and just leave that money on the table for the next guy to pick up!





Thanks for the chuckles guys, and please don’t anyone take my comments personally.
I’m just having a little fun! Feel free to fire right back; keep 'em coming!
I think pretty much everyone enjoys a good laugh.
This IS the "Bass Humor & Gig Stories" forum, is it not?

You might want to lay off the coffee

[sleepy_monkey]

Originally Posted by Chebass88

The buyer has NO idea what is forcing the seller to sell something. It could be that rent is due, someone's drug habit requires cash, or some medical bills need to be paid. Some sellers will take low offers - you never know until you ask.

I am positive I have supported many habits while buying from dudes on Craigslist. Sometimes you can just tell.

Lowballs don't bother me...sometimes that is all the guy has.....and I love wheeling and dealing or being creative with trades. sometimes they will offer something I had never considered having but it makes sense.

[baileyboy]

Originally Posted by matti777

He was talking about buying investments. Sure, if you can't get something on terms you can live with then you should be prepared to walk. I don't think buying something you want for a fair price is like being dead.

haha, yeah, I think my choice of words was poor... it's a good deal if both parties are happy

[Jon_H]

Originally Posted by michael_atw

Never said it wasn't fair - but take a look around at all the music stores biting the dust and that mentality might be one of the smaller reasons.

So, you're saying, part of the reason retail stores are going out of business is because they're paying too little for merchandise? Here's a tip for you - don't ever go into the retail business

The difference between what a store pays for merchandise (used or new) and what they sell that merchandise for has to pay for a sh!tload of expenses.

Rent on cheap retail space starts at $1/sq. ft. per month. A small mom and pop music store will easily be 5,000 sq. ft. So that's $5,000/mo just on rent. If want a nice, modern store in a decent location, triple that.

Have you seen what it costs to heat 5,000 square feet in winter? When the front doors are opening and closing all day long? Any idea what it costs to keep the store comfy in the heat of summer?

Do you like your music store to be well lit so you can easily see the gear? The electric bill on even a small shop would make you vomit in your mouth.

Since you're a commercial entity, the utilities will charge you a higher rate than they do residential customers. So will everybody else you deal with.

Now let's talk about liability insurance in case some numbnuts trips over an instrument cable, sprains his ankle and decides to sue the owner for $2,000,000 just because he can. Add in inusurance for the structure of the store (shelves, fixtures, etc). Add in insurance for the $1,000,000 of new and used gear you have to keep in stock because your customers want great selection and immediate delivery.

Now you need to hire a few employees so your customers get great customer service or else they'll go bitch about your store on an internet forum. The law says you have to pay them a minimum wage. The law says you have to pay half of their social security tax. The law says you have to pay an unemployment premium. The law says you have to have workers compensation insurance for your employees. The law might even say you have to pay for medical insurance for your employees.

Now your finances are so complex you need to hire the services of an accountant. Also wise to have the services of an attorney.

What about a point-of-sale system, so your customers can check-out quickly and efficiently? What about inventory tracking systems?

Now you have to hire a cleaning service so your customers don't complain about what a dump your store is on the internet.

Every time one of your customers use a credit card, you get dinged $0.30 plus 3% of the transaction total.

Since you're an commercial entity, your bank won't give you a free checking account. In fact, they're very likely going to charge you a fee for every transaction, including deposits. That's right, your bank will charge you for depositing money into your account. Every check you wright? Another fee.

Eventually the flooring in your store is going to wear out. Shelves will break or wear out. The ambience in your store will become dated. So you better be socking away some money in savings to cover repairs, maintenance and remodeling.

yada, yada, yada....

A small mom and pop retail store will cost at least $15,000-20,000 per month just to break even. That doesn't even cover the owner's salary so he/she can pay their mortgage, clothe their children, put food on the table, etc.

The general rule of thumb is a retailer must charge 3 times what they pay for an item in order to stay in business. So your 50% margin is off quite a bit.

So yeah, if you try to sell gear to a retail store, they're going to pay you a ton less than the current market value. They have to or else they won't be around the next time you need to sell gear. They aren't being greedy bastards, they're just trying to keep their doors open. They have expenses that the transaction needs to cover. An individual has no such expenses so they can afford pay fair market value.

If you want fair market value for your gear, sell to a private party. If you desperately need cash and are looking to dump your gear quick, hit up a retail store.

Jon

[Munjibunga]

Originally Posted by Jon_H

So, you're saying, part of the reason retail stores are going out of business is because they're paying too little for merchandise? Here's a tip for you - don't ever go into the retail business

The difference between what a store pays for merchandise (used or new) and what they sell that merchandise for has to pay for a sh!tload of expenses. {and much more}

Thanks for posting this. I've made these points many times here, but there's always the guy who arbitrarily says, "They're ripping us off." I ran a business in which just our errors and omissions (malpractice) insurance cost $400,000 a year (and that's with a $200K deductible). Add another $100K a year for general liabilty and another $15K for employment liability. Pop another $600K on there for employee health insurance. And that's just the insurance. You know, $100K here, $100K there, it starts adding up.

Your post should be stickied so we can refer the all-knowing ripoff detectors to it.

[michael_atw]

Originally Posted by Jon_H

So, you're saying, part of the reason retail stores are going out of business is because they're paying too little for merchandise? Here's a tip for you - don't ever go into the retail business

No. I said a possibly SMALL reason they're going out of business is because they reject patrons automatically by trying to reap a maximization of profit when they otherwise could have offered more, received an item, make a profit, and have inventory. Instead, they drove a person away and are then going to make NOTHING on account of it.

Your post neglects to realize that it doesn't cost a store any more money to post up bass #23 if they already have #22. That bass doesn't suck more light and heat. So making the case that taking in a good deal (paying more or cutting margin) on something that would look good or bring people into a store is foolish. You can't make money on everything - one could call such an instrument a "loss-leader".

For example: I might run a store with a few licenses for new goods, but also bring in used ones. My new licenses might be low-end products like Peavey, Dean, etc. My used inventory is important because it draws people in looking for something unique. I might get MIM Fenders or Schecter or some low-end G&L. Those are nice, I might get great deals on them. But then I should be looking for loss-leaders - popular items that draw people into my store. And they don't even have to be loss-leaders, but they can take that position. If I have 50 instruments hanging on my walls bringing in a popular, rare, or otherwise at a lower margin DOES NOT raise my costs of doing business. Adding instrument #51 to a wall DOES NOT, i repeat, DOES NOT, raise costs.

But, it might just draw people in. That's what a local music store here does. They sell new Rickenbackers at cost. They don't do it to make money, they use it as a loss-leader because they're probably the only music store within 75 miles to hold such a license. $1500 for a new Rickenbacker 4003, the last time I saw one there. So having this mentality that "I need to make maximum money off everything" is the kind of mentality that drives someone away when they bring in a $1500 guitar and get offered $500 for it. Especially in the age where there are 10 ways to skin the cat. The antiquated view of "take my offer, I'm the only music store around. You can't take it anywhere else" is dead and gone.

Obviously, I do not claim to own a store nor do I claim that my view is correct or substantial but from my point of view, it makes sense.

[logicman69]

Originally Posted by michael_atw

. Adding instrument #51 to a wall DOES NOT, i repeat, DOES NOT, raise costs.

.

Actually, it does. You pay tax on all gear in your store, plus mainenecne fees for that instrament. So the longer an instrament sits there, the more the actual cost goes up, and the less profit you make.

Now I did not low ball EVERYONE that walked through the door of my store. Several TB members have delt with me and know I worked hard to give fair prices whenever I could. Average trade value was 60% of what I was going to sell it for. That's not too bad, but still people would think I was low balling them. So that guitar you got for $500 new, yes I offered $210 in trade for it. Rip off, right?? Well, I'll put it on the wall for $350 initially, after restring/setup/cleaning (about $50 worth of parts al labor there). Now it sits on the wall for about 30-60 days, and I have changed the strings aout 2 times (add about $10) due to kids banging away at it on the weekends. Finally someone comes in and makes me an offer of "$300 out the door plus a couple of fresh sets of strings". We dick arround for a bit and finally settle on "$320 out the door, plus a pack of strings". Doesn't seem like an unreasonable discount and your thinking I madea decent ammout on the guitar, but lets take a look.

Origional cost= $210
Setup + Strings = $50
2 String changes from sitting on the floor = $10

Final cost of the guitar = $280

Sold for $320 out the door, plus a pack of strings.
Tax in RI is 7%, so the actuall cost of the guitar is $299 + Strings ($5) = $295.

So, using the above example, I made a whopping $15 after that deal. And this happens every day at a music store. What would have happened if I paid even 70% of what I would have tagged it for... I would be loosing money. And a store that looses money, goes out of business.

[Munjibunga]

Originally Posted by michael_atw

Obviously, I do not claim to own a store nor do I claim that my view is correct or substantial but from my point of view, it makes sense.

Your view is not correct. It does cost money to put the other bass on the wall. It's the pro-rata cost per square foot of wall space included in the lease. That's why you don't see every product of a certain type on your grocery store shelves. It makes sense only to put products out that will generate profit. Manufacturers compete for shelf space, and even pay premiums to get into certain stores. I know - my wife was a buyer and merchandise manager at Price Club for 18 years.

Using loss leaders may be a legitimate business practice for warehouse stores with huge inventories and large volume, but it's not viable for a small music store that may have, say, 20 basses on the wall. They need to generate profit on every single instrument. It's unrealistic to think that someone is going to take a loss on their balance sheet for you, a stranger. That's exactly the same as you asking them to go to the register, take some money out, and give it to you.

The simple fact is that the purpose of every commercial enterprise is to increase the wealth of its shareholders. There is a balancing act between pricing and volume. Don't worry, if the prices are too high, sales will decrease and the merchant will have to drop prices until the increased volume restores the desired income.

The best merchants are the ones who find the highest price possible while still maintaining the desired volume. They don't have any inherent obligation to make something affordable to you. If their price is too high, go somewhere else. That's the power of the consumer.

Ultimately, the most successful merchants (including people like "booteek" bass builders) give added value to their product. Excellent customer service and a friendly attitude go a long way toward easing the pain of high cost. Face it - there are just some things we can't afford. It's not because someone is ripping you off or refusing to do you a favor. It's just because it's expensive.

But maybe I should ask Jason if I can get my new Fodera for $3,000 because I'm am such a nice guy.

[infamusblkdeath]

Originally Posted by Munjibunga

Your view is not correct. It does cost money to put the other bass on the wall. It's the pro-rata cost per square foot of wall space included in the lease. That's why you don't see every product of a certain type on your grocery store shelves. It makes sense only to put products out that will generate profit. Manufacturers compete for shelf space, and even pay premiums to get into certain stores. I know - my wife was a buyer and merchandise manager at Price Club for 18 years.

Using loss leaders may be a legitimate business practice for warehouse stores with huge inventories and large volume, but it's not viable for a small music store that may have, say, 20 basses on the wall. They need to generate profit on every single instrument. It's unrealistic to think that someone is going to take a loss on their balance sheet for you, a stranger. That's exactly the same as you asking them to go to the register, take some money out, and give it to you.

The simple fact is that the purpose of every commercial enterprise is to increase the wealth of its shareholders. There is a balancing act between pricing and volume. Don't worry, if the prices are too high, sales will decrease and the merchant will have to drop prices until the increased volume restores the desired income.

The best merchants are the ones who find the highest price possible while still maintaining the desired volume. They don't have any inherent obligation to make something affordable to you. If their price is too high, go somewhere else. That's the power of the consumer.

Ultimately, the most successful merchants (including people like "booteek" bass builders) give added value to their product. Excellent customer service and a friendly attitude go a long way toward easing the pain of high cost. Face it - there are just some things we can't afford. It's not because someone is ripping you off or refusing to do you a favor. It's just because it's expensive.


But maybe I should ask Jason if I can get my new Fodera for $3,000 because I'm am such a nice guy.

never knew you were capable of being serious about anything/not using sarcasm. same with that jimmy guy.. then again what more could i expect from a monkey man wearing sunglasses and a little plastic doll that looks like a prune with a face?

[guy n. cognito]

Originally Posted by Munjibunga

Your view is not correct. It does cost money to put the other bass on the wall. It's the pro-rata cost per square foot of wall space included in the lease. That's why you don't see every product of a certain type on your grocery store shelves. It makes sense only to put products out that will generate profit. Manufacturers compete for shelf space, and even pay premiums to get into certain stores. I know - my wife was a buyer and merchandise manager at Price Club for 18 years.

Using loss leaders may be a legitimate business practice for warehouse stores with huge inventories and large volume, but it's not viable for a small music store that may have, say, 20 basses on the wall. They need to generate profit on every single instrument. It's unrealistic to think that someone is going to take a loss on their balance sheet for you, a stranger. That's exactly the same as you asking them to go to the register, take some money out, and give it to you.

The simple fact is that the purpose of every commercial enterprise is to increase the wealth of its shareholders. There is a balancing act between pricing and volume. Don't worry, if the prices are too high, sales will decrease and the merchant will have to drop prices until the increased volume restores the desired income.

The best merchants are the ones who find the highest price possible while still maintaining the desired volume. They don't have any inherent obligation to make something affordable to you. If their price is too high, go somewhere else. That's the power of the consumer.

Ultimately, the most successful merchants (including people like "booteek" bass builders) give added value to their product. Excellent customer service and a friendly attitude go a long way toward easing the pain of high cost. Face it - there are just some things we can't afford. It's not because someone is ripping you off or refusing to do you a favor. It's just because it's expensive.

But maybe I should ask Jason if I can get my new Fodera for $3,000 because I'm am such a nice guy.

Not to mention the opportunity costs. With every higher priced favor they do for their customers, that physical space and capital can't be used for more profitable ventures.

[Munjibunga]

Originally Posted by guy n. cognito

Not to mention the opportunity costs. With every higher priced favor they do for their customers, that physical space and capital can't be used for more profitable ventures.

Exactly.

[Munjibunga]

Originally Posted by infamusblkdeath

never knew you were capable of being serious about anything/not using sarcasm. same with that jimmy guy.. then again what more could i expect from a monkey man wearing sunglasses and a little plastic doll that looks like a prune with a face?

Before I quit working, I had a very serious job. I'm almost over that now.