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Messed up marketing


JMG

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I have been looking at small box brakes this past week, and ran across what seems to me to be an odd posting for a Shop Fox 24" unit by Factory Authorized Outlet.

 

image.thumb.png.79bbb918b47d37cccf5dce295baa548d.png

 

On the Sears site they list the unit in question for $272 including shipping...

http://www.sears.com/shop-fox-shop-fox-m1011-24-inch-box/p-SPM8828292602?sid=IDx20110310x00001i&gclid=EAIaIQobChMIneLQlezN1QIVl7rACh2JVgg-EAkYASABEgI3uvD_BwE&gclsrc=aw.ds&dclid=CKGArc-VztUCFVaBaQodNQMOmA

 

On their own company site they list the same unit for $328.99 including shipping...

https://www.factoryauthorizedoutlet.com/shop-fox-m1011-24-box-pan-brake-with-removable-and-adjustable-fingers?google=1&CAWELAID=230005750000007249&CAGPSPN=pla&CAAGID=42179799592&CATCI=pla-365468527397&gclid=EAIaIQobChMI3ZiD6ZXO1QIVSlmGCh2sRwhAEAkYAyABEgIkhfD_BwE

 

The $272 is far and away the best price found for the brake, but I am confused as to why a company would offer such a discounted price on a site that would cost them extra if they sold it there and not offer a similar or close price on the primary site. Seems messed up to me.

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That's actually pretty common. There are really three ways companies work with retailers.

1) No direct sales, only retailers sell and markup is generally 50 to 100%(markup is carried out through the next two as well)

2) Direct sales with and without MAP. MAP is minimum advertised price. What this does is protect smaller retailers from larger retailers, smaller buy in less volume so they get less of a discount and make less profit. That means a larger retailer can beat them in price, every time, MAP solves this. Sometimes they consider MAP to be less flexible than others. This is why sometimes you'll see "See price in cart" or "Call for price". You can also see MAP cover international shipping, normally in North America it means no shipping to Canada to get around Duties and Taxes...this sucks for Canadian customers but it helps Canadian businesses a lot in some industries.

3) Direct sales with inflated pricing. This gives a false retail cost of the item because really, they just don't want to sell direct. Some companies don't want to ship one item they want to send out pallets. This marketing allows the retailer to claim a higher MSRP and have a constant sale...personally, I think this should be as illegal.

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@BMack37 Not certain that the MAP issue applies here. This is more of a retailer (FAO) selling through another retailer (Sears) for a lower price than what they sell on their home site and paying for the privilege of selling at a reduced rate. Compared to other online retailers, FAO already has about the lowest price on the tool, with the exception of their own listing on the Sears site. To me, that is simply screwball.

 

The problem I have is that I do not trust Sears...

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5 hours ago, JMG said:

@BMack37 Not certain that the MAP issue applies here. This is more of a retailer (FAO) selling through another retailer (Sears) for a lower price than what they sell on their home site and paying for the privilege of selling at a reduced rate. Compared to other online retailers, FAO already has about the lowest price on the tool, with the exception of their own listing on the Sears site. To me, that is simply screwball.

 

The problem I have is that I do not trust Sears...

 

Missed the part about them selling through Sears not Sears as a retailer.

 

Marketplaces offer a wider audience, remember, anything over wholesale is profit. Sometimes they'll also want to test the waters of any given online marketplace, mostly when they're sitting on excess inventory. Some marketplaces offer incentives for companies to offer sales in forms of advertising...probably not the case here. You see it sometimes when CPO or whomever is on eBay's Daily Deals.

 

Some companies also just have terrible online stores, which may be a different division or simply not be the focus of their marketing/sales departments. They keep the site up with whatever pricing, if a sale comes through, great...there is little upkeep needed, AND it sets the MSRP(Because it's through their official site). Which protects smaller distributors without having a MAP agreement for distributors. The last thing any company wants to see is an item being sold direct cheaper than they can sell it, that's a quick way to lose your distribution.

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