Typical markup on bass or guitar?

[jaymeister9195]

Anybody know the typical markup for a new bass and/or guitar? Just out of curiosity more than anything, and to hopefully improve my skills when I need to buy another bass!

 

[Benjamin Strange]

The general rule in manufacturing within the music instrument community is a 5-1 ratio. Meaning that MSRP (manufacturer's suggested retail price) is 5 times what it cost to develop and produce a product. This isn't as bad as it sounds. Take a P-Bass, for example: let's say it costs $1000 MSRP. It costs Fender roughly $200 to make, then they sell it to a store for roughly $500, who then discounts them about 30%, which comes to $700. Sure, it may feel a little funny to pay $700 for a $200 instrument, but when you consider all that's involved with running both a factory and a retail store (paying employees, keeping the lights on, R&D, advertising, etc.) it's really not a bad deal at all.

 

[mccartneyman]

Markup varies by dealer. Larger dealers usually get some kind of break if they pay their bills early or buy over a certain dollar amount. Very good customers may be able to get 40% off retail on items. Very very good customers might get something at cost +10% or cost plus shipping. Walk-in customers usually can get 30% off pretty easily. However, there are "B discount" items that the dealer pays more for, and these typically carry no more than a 20% discount.

So, it depends on the size of the dealer, what kind of volume they do and how often you shop there. Back before the Internet made deep discounting available to everyone, it wasn't unusual for a buyer to willingly pay 30% off and be satisfied that he was getting a great deal. Now,of course, you can order from almost anywhere and get 30-40% off. I still prefer to buy locally if they have a decent service department, even if the price is higher.

 

[jaymeister9195]

Im suprised its more a percentage than a usual dollar amount. I used to buy rifles wholesale and they were rarely more than a $100 markup from the wholesale price regardless of price.

Is there a dollar amount that big retailers (ie GuitarCenter, Sam Ash) typically expect? Like say for a hypothetical example: sub $200 guitars might expect $50-75, $200-$500 say $100, $500-1000 say $150, anything over $1000 usually a 20-30% markup from their wholesale price?

 

[Benjamin Strange]

Im suprised its more a percentage than a usual dollar amount. I used to buy rifles wholesale and they were rarely more than a $100 markup from the wholesale price regardless of price.

Is there a dollar amount that big retailers (ie GuitarCenter, Sam Ash) typically expect? Like say for a hypothetical example: sub $200 guitars might expect $50-75, $200-$500 say $100, $500-1000 say $150, anything over $1000 usually a 20-30% markup from their wholesale price?

The cheaper the guitar, the greater the percentage of profit. I used to import classical guitars from China, which cost me a total of about $15 each to have built and shipped all the way to California. I turned them around for $100 each. Not a bad investment, no?