Dealership greed ?

I think you will find dealerships are doing all they can to reduce their costs. They are laying off staff, cutting costs wherever possible.

OK, thats not what you meant by "cutting costs". the pricing model includes amounts to cover home installation, setup etc. Thats part of the contract of being a Naim dealer.

Do you think a price war would benefit *anyone*? Including you?

Hi Jon
I understand what you say but still maintain that small independent shops whilst tied in to manufacturers RRP's currently have stock that is not moving (for example locally to me 3 Keels for Aro have been gathering dust for at least a couple of months). I am not suggesting that we need a price war but am concerned that these small dealerships will vanish from our high streets if they refuse to consider becoming more competitive.

Another issue is undisclosed price "maintainance", which is the highly dubious practice of requiring retailers to sell at RRP or face not being supplied.

Levis and Sony were dragged through the courts by the supermarkets over the refusal to supply them as the supermarkets would discount the goods.

Jono

I heard the dealer you write about makes its money from Linn, and now Naimnet, system installations. A 30 to 40K home installation will make their ears prick up. However I cannot see that trend continuing in this economic climate. I hope I am wrong.

quote:

Originally posted by TerryFranks:
Hi Jon
I understand what you say but still maintain that small independent shops whilst tied in to manufacturers RRP's currently have stock that is not moving (for example locally to me 3 Keels for Aro have been gathering dust for at least a couple of months). I am not suggesting that we need a price war but am concerned that these small dealerships will vanish from our high streets if they refuse to consider becoming more competitive.

Dealers need to maintain a demonstration stock level. And maybe a bit more than that. Much more than that is just bad buying.

Having 3 keel/aros for a couple of months (despite mine being the first customer sale a few days before xmas...) is just carelessness, unless there are customers who have ordered them.

i believe at the level of hifi prices we are talking about (Aro/Keel etc), reducing the price by a bit will probably not make that much difference. then the issue is, do you sell at a loss? sounds suicidal, but these are difficult decisions in a very difficult economic climate. there is also the danger of pissing off people who bought at the original RRP.

I would have thought with the bru ha ha and excitement over Aro/Keel that there would have been a long queue of people elbowing each other to buy this -- but it doesn't look so. its really tough out there

enjoy
ken

The problem with reducing the retail price is that second hand values will drop too. I think that the retail price needs to be maintained as I would hate to see the bottom drop out of the second hand market.

quote:

Originally posted by Rob B:
The problem with reducing the retail price is that second hand values will drop too. I think that the retail price needs to be maintained as I would hate to see the bottom drop out of the second hand market.

good point rob,

enjoy
ken

This subject does create a bit of a dilemma. There are Naim dealership who will offer a discount. I know of one chap who recently auditioned a system (at least 2 demo's) then phoned another dealership outside his area, they offer a substantial discount, so he bought it from them. No demo facilities used, no home installation, no hastle for the 2nd dealer - of course they can discount, but the first dealer who has done all the work has lost out.

I don't blame the guy for doing this, although I hasten to add, I couldn't do it and would rather pay the premium (if you want to call it that?) for the knowledge that the dealer has made a profit and will be there in the future when I need him.

I'm not sure what Naim's position is on these shananigans - they have made a sale, so I don't suppose their bothered either? Although somehow it doesn't seem right.

It's the inconsistency which is the problem.

Gary

Are RRP's still allowed in the UK? I thought there was some court case a while ago regarding consumer electronics etc.

Martin

quote:

Originally posted by Gary S.:
I know of one chap who recently auditioned a system (at least 2 demo's) then phoned another dealership outside his area, they offer a substantial discount, so he bought it from them. No demo facilities used, no home installation, no hastle for the 2nd dealer - of course they can discount, but the first dealer who has done all the work has lost out.

I do blame him - I think he should have announced that he would buying solely on the basis of available discount and the dealer could have decided whether to bother with him or not.

You can well say that, if he was even offered the opportunity, he should have matched the price. This is quite similar to saying that British workers (that's probably you) should reduce their wages to match those of China or other countries with lower labour and production costs.

All to the good - eventually we will have a surfeit of wonderfully cheap products, our services will be wonderfully cheap (handled off-shore), your children can work in Theme Parks - Mining Town, Farming World, the City of London (spare us a copper guv) and suddenly the bargain will look like the one-sided selfishness it ultimately is.

quote:

Originally posted by TerryFranks:
How is it that in the current economic climate Hi Fi dealerships refuse to reduce their costs?

I am pleased to hear that London Taxi Drivers have elected to reduced their fares. By what proportion has this been done and is this all black cabs and minicabs or just one group?

quote:

I am pleased to hear that London Taxi Drivers have elected to reduced their fares. By what proportion has this been done and is this all black cabs and minicabs or just one group?

I'd be more than happy if after dark they would travel south of the river.

quote:

Originally posted by Gary S.:
This subject does create a bit of a dilemma. There are Naim dealership who will offer a discount. I know of one chap who recently auditioned a system (at least 2 demo's) then phoned another dealership outside his area, they offer a substantial discount, so he bought it from them. No demo facilities used, no home installation, no hastle for the 2nd dealer - of course they can discount, but the first dealer who has done all the work has lost out.

I don't blame the guy for doing this, although I hasten to add, I couldn't do it and would rather pay the premium (if you want to call it that?) for the knowledge that the dealer has made a profit and will be there in the future when I need him.

I'm not sure what Naim's position is on these shananigans - they have made a sale, so I don't suppose their bothered either? Although somehow it doesn't seem right.

It's the inconsistency which is the problem.

Gary

I agree with you. I try to get quotes from dealers before I ask for a demo. I always buy from the dealer who provided the demo.
I don't think my conscience would let me do otherwise.

Adam, don't shoot the messenger! As I said, I couldn't have done this.

The problem is that as soon as one dealer starts doing it (discounting significantly), the whole system falls over.

Gary

getting a demo from one dealer and buying from another seems morally wrong to me, unless you announce upfront that you will be buying on price, then the dealer can decide whether and how much time to allocate ...

enjoy
ken

I fear that the only sensible option for selling merchandise like Naim that requires extensive effort on the part of the retailer is to enforce the RRP. I'm not sure where I stand though on goods that don't require significant time and effort to sell e.g. CD's. It worries me that as more and more music is bought for the cheapest price over the internet, the pleasure of visiting a high street record shop will be gone for ever. I would miss HMV were they to disappear - so should RRP be protected there too?

Jonathan

I can understand when a dealer tries to maintain the RRP and does not discount valuable goods like Naim equipments.

I do not think selling high-end audio product(s) from a manufacturer with more than 30 years of history would require the same way of doing business like Tesco. High-end audio is luxury and it means the dealer needs to maintain the value of the goods, if it is publicly heavily discounted it will loose value not the price only.

Sorry for my English, I am not sure I could explain properly what I wanted.

“What is a cynic? A man who knows the price of everything and the value of nothing.”

ferenc - I think you have grasped the difference very well.

A good relationship with a dealer is essential to get the most from your music/system.
But IME the issue isn't as simple as some posts here suggest,
because the quality of service from Naim dealers can be as variable as the price.

When seeking my current system I was concerned with the attitude & service of the 1st dealer I had a demo with.
He didn't listen to my feedback, & was clearly trying to steer me to specific kit that wasn't of interest to me.
I said thanks, but no thanks to him.

I went to another dealer & we made good progress during a couple of demo' sessions.
I was told a very different time scale to demo my 1st choice of LS by these two dealers (4 or 12 weeks),
so I contacted the distributor to check.
The distributor suggested arranging a demo at a couple of other dealerships,
where the LS was currently available to audition & fully run in.

A couple of hours later I received a bizarre grumpy 'phone call from the 2nd dealer,
who IMO used a highly inappropriate manner to challenge me for arranging a demo with another dealer.
I explained why I had contacted the LS distributor,
& pointed out that the distributor had suggested alternative dealer dems' although I hadn't arranged one.
I found this experience to be a complete turn off, so that was the end of my relationship with that dealer.

On the positive side this resulted in me encountering my current dealer,
& the service I now enjoy means I wouldn't consider shopping around (Although I do haggle - sorry for being a pain James! ).

quote:

I think that the retail price needs to be maintained

History is littered with companies that failed because they couldn't stay competitive,
& the economic landscape along with consumer purchasing power has changed massively.
I'm confident Naim has a bright future, because of their recent equipment developments,
& it has a great track record of coping with wider economic challenges.

Hi Adam
What I initially was talking about was that the dealers who sell taxi's have reduced their prices. However its funny that you should talk about the fares as currently the annual increase is being decided and looks likely to be frozen this is in addition to the fact that each driver had to swallow the petrol price rises last year without being able to increase fares. Even the london black taxi trade have to consider the economic downturn

quote:

Originally posted by TerryFranks:
Hi Adam
What I initially was talking about was that the dealers who sell taxi's have reduced their prices.

Even the london black taxi trade have to consider the economic downturn

I was aware of that - just prompting you to realise that you should be subject to the same wage per job reduction as you want to impose on others.

Of course - if prices go down and we all earn less - we'll really have changed things.

ha roy t just a small note that i will go to south london kind regards tel

quote:

I was aware of that

quote:

if prices go down and we all earn less

Not 'if' as many markets are deflating.

quote:

Originally posted by Adam Meredith:
Of course - if prices go down and we all earn less - we'll really have changed things.

Naim prices to come down?

Yeah right!

Question is, will there be the usual price rises this year?

Among the audio retailers I know, I cannot think of one who is getting rich out of it already.

To stack 'em high, and sell 'em cheap is a route to an early bankruptcy for most I am sure. As far as I know the Business Rate [of local authority taxation] is not about to come down ...

The actions of dealers wishing to mainatin prices and stay in business cannot in any way be described as "greedy" IMO.

If on the other hand you cannot afford the best pieces, then learn to enjoy what you can afford.

I find this a very satisfying way forward, and perhaps one day the high end dealers will still be there for me to get to the best ..

In the meantime, I shall have to make do and live with what was the best twenty and more years ago ...

ATB from George