Thursday, Jul 02, 2009 at 08:13
Hi all, I don't want to defend the actual prices of caravan parts, but let's be fair about it.
The actual manufacturing cost of an item is almost immaterial to the sale price. For the manufacturer, he has to recoup the costs of setting up and running his/her business and make a profit. So a part costing 3 cents will need a wholesale price which, when multiplied by the number sold, will cover all of those costs.
The same goes for retail outlets. The costs of a facility to hold the items, the cost of the parts, the cost of the stock control system, the cost of staff, the fixed costs of running a business and the normal operating costs (freight, insurance etc), plus the cost of the money to finance the business, quickly add up and have to be apportioned across the board to each part. So if you are not selling many parts, the margin has to be very much higher just to cover the actual cost of being able to stock the part.
When we purchase the more expensive parts on-line, where they are almost invariably cheaper, that just makes it harder for walk-in shops to stock and supply the low cost items at a reasonable cost, because the higher the cost of the item, the greater the earning potential. But we tend to do it because we also have to make ends meet.
On-line outlets are cheaper primarily because they have access to a much larger customer base (national or even global) than a
shop front, so their costs can be apportioned across a much larger turnover, and the individual margins can be proportionately lower.
Does this mean that the days of the walk in
shop are close to an end? It depends on how much we are prepared to pay for the convenience of being able to walk in and buy on
the spot, instead of ordering on line and waiting for the part.
Hope this helps understand why a 3 cent part costs so much at the
shop.
AnswerID:
372734
Follow Up By: Member -Pinko (NSW) - Thursday, Jul 02, 2009 at 08:47
Thursday, Jul 02, 2009 at 08:47
Hello Terry
I sincerely appreciate where your coming from.
I was a pastrycook with a
shop and a staff of six when the supermarket chains started making packet cake mixes and the Lions Clubs made fruit cakes.
This was the beginning of the end for us.
However the clip that is being discussed is surely from a Dometic fridge.
With absolutely no rough handling my fridge has broken clips, the freezer door return spring mechanism as all been replaced, cost over sixty dollars. Built in obsolescence ??? yet the Engel is much older and gets lifted in and out car to car and not a cent spent.
Stan
FollowupID:
639980
Follow Up By: olcoolone - Thursday, Jul 02, 2009 at 10:58
Thursday, Jul 02, 2009 at 10:58
Well put Terry, most people don't see the hidden costs.
We mark up cheaper parts by more and dearer parts less.
If we have a customer come in and want a $1.00 part we loose money, our guys might spend 5 to 15 minutes or more serving a customer and our guys get payed mid $20.00 per hour so when we sell this $1.00 part it might costs us $5.00+ the price of the part and we sell it for $1.00.
And don't forget our overheads, admin, warehousing and stock on shelf costs.
FollowupID:
639997