Price fixing buy tackle manufactures fai or unfair ?
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10,097 Posts
Well, maybe.
The stated reason for the strict enforcement of the list price selling is to protect the "Little Guy" from predatory large catalog and internet sellers.
I think its some of that, but mostly the desire of the tackle makers (And I'm thinking most specifically about Shimano here) to want to keep the "Perceived" value of their products up high, along with their profit margins.
Funny how the reels from those companies go for nearly as much used (On eBay) as new off a shop's shelf. I guess artifcially-created perceptions really are powerful.
rgds, Leprechaun
The stated reason for the strict enforcement of the list price selling is to protect the "Little Guy" from predatory large catalog and internet sellers.
I think its some of that, but mostly the desire of the tackle makers (And I'm thinking most specifically about Shimano here) to want to keep the "Perceived" value of their products up high, along with their profit margins.
Funny how the reels from those companies go for nearly as much used (On eBay) as new off a shop's shelf. I guess artifcially-created perceptions really are powerful.
rgds, Leprechaun
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27,335 Posts
I don't believe it is illegal to force retailers to not discount a manufacturer's prices. I work for a cosmetics company that only sells through high end outlets. Our pricing is uniform & we don't allow retailers to sell at a discount.
This does prevent discounterrs however from buying on a seconday market & selling them at whatever price they want.
This does prevent discounterrs however from buying on a seconday market & selling them at whatever price they want.
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4,148 Posts
Penn - minimum price fixing
Until someone recently said it was illegal, as far as I knew, it was legal and something that Penn is guilty of. I was told by a local tackle shop that Penn has minumum prices (not the retail, but rather something under it) that their dealers must abide by. They can charge as much over it as they want, but not under.. also I was told that supposidly there is a very small profit margin on Penn reels.. no idea as to the truthe of any of this though.
My .02 on it, I could care less. In a free economy, these problems will fix themselves; if no-one was willing to pay the $$, then Penn would die or evolve etc..
Jon
Until someone recently said it was illegal, as far as I knew, it was legal and something that Penn is guilty of. I was told by a local tackle shop that Penn has minumum prices (not the retail, but rather something under it) that their dealers must abide by. They can charge as much over it as they want, but not under.. also I was told that supposidly there is a very small profit margin on Penn reels.. no idea as to the truthe of any of this though.
My .02 on it, I could care less. In a free economy, these problems will fix themselves; if no-one was willing to pay the $$, then Penn would die or evolve etc..
Jon
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2,756 Posts
I was told by a tackle shop owner
that if discounted any of Shimano's
top shelf reels that they would pull his dealership and top shelf reels and rod come directly from Shimano not a wholesaler so they can control the flow of products to the market
He say said he dosn't like it because he looses alot of sales to the internet because can't discount a Stella to make up the sales tax for the customer and that the customer can get the reel from the net without tax and free shipping
Example
Net $600 Delivered
tackle shop $600
Tax $ 49.50
total $649.50
that if discounted any of Shimano's
top shelf reels that they would pull his dealership and top shelf reels and rod come directly from Shimano not a wholesaler so they can control the flow of products to the market
He say said he dosn't like it because he looses alot of sales to the internet because can't discount a Stella to make up the sales tax for the customer and that the customer can get the reel from the net without tax and free shipping
Example
Net $600 Delivered
tackle shop $600
Tax $ 49.50
total $649.50
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1,548 Posts
I deal with alot of electronics manufacturers and they have a MAP policy...minimum advertised pricing, which means that a store/outlet can not advertise a price below MAP which is usually lower than MSRP, but in the end the dealer can sell the item for whatever they want to. On the internet, most prices are the MAP...alot of the companies I deal with have people that "police" the internet and try to "bust" places that sell below that price.
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67,033 Posts
Guys,
I can tell you that its not true with Penn. I know several tackle shop owners and they tell me that the prices that places like fisherman's outfitter and shark river charge are less than what they can buy the for from Penn. Its is true that when things are in short supply Penn will put all of its dealers on allocation, which is a red flag to tell them that they can get more for those reels. But in the end, the dealers can sell them for whatever they want.
I can tell you that its not true with Penn. I know several tackle shop owners and they tell me that the prices that places like fisherman's outfitter and shark river charge are less than what they can buy the for from Penn. Its is true that when things are in short supply Penn will put all of its dealers on allocation, which is a red flag to tell them that they can get more for those reels. But in the end, the dealers can sell them for whatever they want.
THE LOW DOWN ON REEL PRICES-
Many of you are close to what is going on here. Let me fill you in.
First, most reel manufacturers want their product to be sold for 'FAIR MARKET VALUE', which is basically MSRP. Shimano tries very hard to enforce this with their tackle dealers. And as a matter of fact, Shimano does not want any internet sales of their reels. They are trying to protect both large and small, store front sellers. Now for a store front seller to become a authorized shimano dealer, he must send them information on their shop (sales, income, etc), plus a picture of their tackle shop. Again they do not want any 'out of the garage sellers' of their reels. If a tackle shop is caught selling shimano reels under the MSRP, they are placed on the 'DO NOT SHIP LIST'. Does it happen? From time to time, but many tackle shops, to move product will cut deals with customers they know.
What has also happened to the reel market, is that profit margins for tackle dealers are extremely tight on new reels. Reel manufacturers, raise their cost to the wholesale who passes it along to the retailer. But the MSRP remains the same, so a smaller profit margin for the tackle shop. Another phenomena is the internet, especially eBay which has created a number of private at home sellers who deal in high end reels from Shimano, Accurate, Duel and now Diawa. Some of these dealers are purchasing their reels overseas, due to a favorable exchange rate and getting them shipped here. They are undercutting many tackle shops who only buy a handful of reels during the season, thus the better price you consistently see on the internet. One person mentioned reels from Australia, and yes, their prices were mind boggling. A few tackle shops on the west coast complained to Penn directly, who raised their price to tackle dealers in Australia, to lessen this price advantage. This company though is still doing very well, and please, if anyone knows the name, do not mention it here on the board for obvious reasons.
As you can see it has become very hard for small tackle shops to make money on new reels. One retailer out on the Island, told Togmaster and myself, that he has to charge tax on his penn reels, or he losses money on the purchase. He said that with Sports Authority and Bass Pro Shops now around, who buy in such bulk they pay a lower price per unit then he does, and passing this savings to the customer . So you have to understand your local tackle shops perdicament when it comes to selling new reels. Many of our board members have a good idea on where to shop to get the best prices on their new reels. But before you make a purchase, go down to your local tackle guy and talk to them. Give these guys a fair chance to sell you a reel.
EC NEWELL MAN*
Many of you are close to what is going on here. Let me fill you in.
First, most reel manufacturers want their product to be sold for 'FAIR MARKET VALUE', which is basically MSRP. Shimano tries very hard to enforce this with their tackle dealers. And as a matter of fact, Shimano does not want any internet sales of their reels. They are trying to protect both large and small, store front sellers. Now for a store front seller to become a authorized shimano dealer, he must send them information on their shop (sales, income, etc), plus a picture of their tackle shop. Again they do not want any 'out of the garage sellers' of their reels. If a tackle shop is caught selling shimano reels under the MSRP, they are placed on the 'DO NOT SHIP LIST'. Does it happen? From time to time, but many tackle shops, to move product will cut deals with customers they know.
What has also happened to the reel market, is that profit margins for tackle dealers are extremely tight on new reels. Reel manufacturers, raise their cost to the wholesale who passes it along to the retailer. But the MSRP remains the same, so a smaller profit margin for the tackle shop. Another phenomena is the internet, especially eBay which has created a number of private at home sellers who deal in high end reels from Shimano, Accurate, Duel and now Diawa. Some of these dealers are purchasing their reels overseas, due to a favorable exchange rate and getting them shipped here. They are undercutting many tackle shops who only buy a handful of reels during the season, thus the better price you consistently see on the internet. One person mentioned reels from Australia, and yes, their prices were mind boggling. A few tackle shops on the west coast complained to Penn directly, who raised their price to tackle dealers in Australia, to lessen this price advantage. This company though is still doing very well, and please, if anyone knows the name, do not mention it here on the board for obvious reasons.
As you can see it has become very hard for small tackle shops to make money on new reels. One retailer out on the Island, told Togmaster and myself, that he has to charge tax on his penn reels, or he losses money on the purchase. He said that with Sports Authority and Bass Pro Shops now around, who buy in such bulk they pay a lower price per unit then he does, and passing this savings to the customer . So you have to understand your local tackle shops perdicament when it comes to selling new reels. Many of our board members have a good idea on where to shop to get the best prices on their new reels. But before you make a purchase, go down to your local tackle guy and talk to them. Give these guys a fair chance to sell you a reel.
EC NEWELL MAN*
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5,302 Posts
The Australia and New Zealand prices were incredible two years ago. We were talking 25% discounts or more, all the time, even on US made products. There are tremendous taxes on fishing equipment, here and abroad, and by exporting to another country, many of those taxes were avoided. And the US currency was very strong on the global market.
Since then a couple things have happened.
-Old inventories got cleared out, and stock was replaced at prices, which ECNM mentioned, are more acceptable to US distributors.
-The US economy tanked and foreign investments were pulled out. The dollar lost tremendous value on the global market. Between February and July of this year, I think that the dollar lost 15%+ to the Euro for example.
-9/11 - One byproduct was that goods being shipped into the US are scrutinized more than ever and that it became much more likely that you would be hit with a customs surcharge.
-US retailers dropped prices and offered rebates.
-Ebay became popular. No longer a domain of nerds and coupon cutters, it matured into a competitor of internet sellers.
So can you save money buying offshore? Sometimes. But not to the degree that you once could, with additional risk of customs surcharges that could make prices higher than domestically available, and with a level of inconvenience, which to my mind, no longer makes it worth it. Just my opinion and if I were outfitting a charterboat, I might feel differently than if I were buying 2 or 3 reels a year. What you can get offshore are products that are not made to be imported into the US. For example. The Shimano Trinidad existed in Japan for many years before it was ever imported here. Even today, Shimano has 2 or 3 times the variations of Calcuttas, Stellas, etc. that are available in Japan, but which may never be imported to the US. If you buy the products there and use them here, good luck if they break. But if you are the curious sort, there are a lot of toys out there just a click or two away, especially if you read Kanji
Back to the topic. I believe that there is less room for discounting than there ever has been. Once in a while, when a manufacturer has a hard time moving product, there may be additional discounts available to the dealer (just like automobiles) that can be passed on, but by and large, your local tackle shop is making less money on a reel than you spend on lunch. If you find a deal, good for you. If you are going to spend the same money for a product from the internet/mail order (Cabela's) or at a big chain (Sports Authority), you would be helping yourself in the long run by spending it at your favorite local bait and tackle shop.
Since then a couple things have happened.
-Old inventories got cleared out, and stock was replaced at prices, which ECNM mentioned, are more acceptable to US distributors.
-The US economy tanked and foreign investments were pulled out. The dollar lost tremendous value on the global market. Between February and July of this year, I think that the dollar lost 15%+ to the Euro for example.
-9/11 - One byproduct was that goods being shipped into the US are scrutinized more than ever and that it became much more likely that you would be hit with a customs surcharge.
-US retailers dropped prices and offered rebates.
-Ebay became popular. No longer a domain of nerds and coupon cutters, it matured into a competitor of internet sellers.
So can you save money buying offshore? Sometimes. But not to the degree that you once could, with additional risk of customs surcharges that could make prices higher than domestically available, and with a level of inconvenience, which to my mind, no longer makes it worth it. Just my opinion and if I were outfitting a charterboat, I might feel differently than if I were buying 2 or 3 reels a year. What you can get offshore are products that are not made to be imported into the US. For example. The Shimano Trinidad existed in Japan for many years before it was ever imported here. Even today, Shimano has 2 or 3 times the variations of Calcuttas, Stellas, etc. that are available in Japan, but which may never be imported to the US. If you buy the products there and use them here, good luck if they break. But if you are the curious sort, there are a lot of toys out there just a click or two away, especially if you read Kanji
Back to the topic. I believe that there is less room for discounting than there ever has been. Once in a while, when a manufacturer has a hard time moving product, there may be additional discounts available to the dealer (just like automobiles) that can be passed on, but by and large, your local tackle shop is making less money on a reel than you spend on lunch. If you find a deal, good for you. If you are going to spend the same money for a product from the internet/mail order (Cabela's) or at a big chain (Sports Authority), you would be helping yourself in the long run by spending it at your favorite local bait and tackle shop.
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2,756 Posts
Yes I agree go buy your reels from the local tackle shop
You might save a few bucks buying reels from bass Pro or over seas but you can't put a price on personal service and a smiling face
And next time worms or fresh bunkers are scarce Pro Bass isn't goning to say don't worry I'll hook you up but your local tackle guy will.
And I disagree Manfacturers like Shimano are not looking out for you or the little tackle shop they are
looking out for their bottom line
The tackle shop owner should be able to decide what he will sell his inventory for not Shimano.
The money he looses by cutting the price on lets say a stella to beat pro bass he can make up on a happy return customer who now turns around and buys a custom made pole from him to match his new stella plus maybe a surf bag and a few plugs
You might save a few bucks buying reels from bass Pro or over seas but you can't put a price on personal service and a smiling face
And next time worms or fresh bunkers are scarce Pro Bass isn't goning to say don't worry I'll hook you up but your local tackle guy will.
And I disagree Manfacturers like Shimano are not looking out for you or the little tackle shop they are
looking out for their bottom line
The tackle shop owner should be able to decide what he will sell his inventory for not Shimano.
The money he looses by cutting the price on lets say a stella to beat pro bass he can make up on a happy return customer who now turns around and buys a custom made pole from him to match his new stella plus maybe a surf bag and a few plugs
MakoMatt...i hope the Togmaster chimes in on this, but this tackle shop owner, is working on the tightest margins when he sells penn products. He is not pocketing the tax money, since he has to account for it at a latter date. Guys are always looking for deals at tackle shops, and some shops absorb the tax to sell a product. But since a tackle shop owner is working on a few buck margin on say a 150 dollar reel, does it pay for him to buy a reel wholesale at 120 dollars to make 30 dollars? Maybe i am missing something here, since in business you usually double the wholesale price on a item. Rent, electric/heat/ac, salaries, insurance takes a big chunk out of the gross. How many tackle shops now have to work a few months just to break even and make a slight profit. Our fishing seasons are not like they were in the past, with regulations dictating the opening and closing seasons on many fish species. Their is only a limited amount of time for these shops to earn a living.
So SeaSlug, thats your secret on getting all those good prices on reels!
Finally skatemaster mentioned how many reel companies will now blowout certain reels for unbelieveable prices. Pro Gear about a year ago, heavily discounted their Pacifica, and all aluminum framed reels, and their price were below their old wholesale price to the public. Diawa, blows out their discontinued 'top line' spinners for prices of upto 60 percent off their msrp. This is how i bought a number of tournament diawa spinners. And Accurates boss reels have been heavily discounted off their msrp at some tackle shops around the area.
EC NEWELL MAN*
So SeaSlug, thats your secret on getting all those good prices on reels!
Finally skatemaster mentioned how many reel companies will now blowout certain reels for unbelieveable prices. Pro Gear about a year ago, heavily discounted their Pacifica, and all aluminum framed reels, and their price were below their old wholesale price to the public. Diawa, blows out their discontinued 'top line' spinners for prices of upto 60 percent off their msrp. This is how i bought a number of tournament diawa spinners. And Accurates boss reels have been heavily discounted off their msrp at some tackle shops around the area.
EC NEWELL MAN*
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