Shopping around

[howie]

I took my daughter shopping this morning as she needed a new freezer to fit under her worktop.

First stop was Currys, where the model she wanted (Hotpoint rzav21p) was on offer at the sale price of just under £150. She was put off by the delivery charge of £20 which was the amount knocked off in the sale.

Back home, I spent half hour checking through the prices on the web and she eventually bought one from Kitchen Science (Tescos) for £139.85 delivery included.

The same freezer was priced at £200 exactly from R.T.D. and while this is the first time i,ve compared prices on the web, a possible saving of almost one third has made me realise the benifits of shopping around this way, and something i,ll keep in mind with future purchases. Howard.

 

[Forester]

Very good advice Howie.  8-$

[chas]

Wish it could apply to motorhomes in this country, save haggling with dealers. Choose the one you want from a dealers showroom and then click the mouse from the list on the internet, Someday perhaps..... chas

[Guest Frank Wilkinson]

chas - 2007-01-04 10:03 AM Wish it could apply to motorhomes in this country, save haggling with dealers. Choose the one you want from a dealers showroom and then click the mouse from the list on the internet, Someday perhaps..... chas

So what happens when the dealers are no longer in business because everyone thinks like you? Where do you go then to look at motorhomes?

As a retailer I've no problem at all with people who want to buy on the web but there's something unfair and immoral about those who go to a store and spend half an hour looking at products when they know along along that they're going to go home and buy it online.

Regrettably, in ten years time there may well be nowhere for you to go to look at a camera or similar product and everything will have to be bought without the pleasure of first handling it and comparing it with other models.

And going back to the motorhome that you'd like to buy online, where will you take it for servicing and repairs?

[howie]

Hi Wayne. Looking at the e.mail confirmation, it seems there,s a extra 10% off if you buy more than 3 items, and although p+p sometimes knocks the edge off a bargain, especially with smaller purchases, if you take into account all the running around and parking fees etc. then there.s still room for saving a fair bit of money, and a lot less hassel as well. The only problem i,ve got at the moment is a reluctance to give out card details over the web, but it seems the way forward and most probably i,ll come round to it eventually.

I don,t know how you fare when it comes to part exchange or buying new cars or vans Chas, but after 50 years or so I don,t think I can say i,ve ever got a real bargain, and although you may get a small difference by going around the various dealers, the impression I get is that they would rather see their stock rot away on the forecourt before cutting to far into their profit margins. Buying and selling is not my strongest point, and maybe i,m at fault for not being more pushy with my dealings. Howard.

[howie]

Frank Wilkinson - 2007-01-04 10:26 AM

chas - 2007-01-04 10:03 AM Wish it could apply to motorhomes in this country, save haggling with dealers. Choose the one you want from a dealers showroom and then click the mouse from the list on the internet, Someday perhaps..... chas

So what happens when the dealers are no longer in business because everyone thinks like you? Where do you go then to look at motorhomes?

As a retailer I've no problem at all with people who want to buy on the web but there's something unfair and immoral about those who go to a store and spend half an hour looking at products when they know along along that they're going to go home and buy it online.

Regrettably, in ten years time there may well be nowhere for you to go to look at a camera or similar product and everything will have to be bought without the pleasure of first handling it and comparing it with other models.

And going back to the motorhome that you'd like to buy online, where will you take it for servicing and repairs?

Hi Frank. I see your point, and i,m afraid that going to a store simply to look the product first hand before buying elsewhere (in our case over the web) is exactly what we did with this new freezer. But the bottom line is that as individuals, we are entitled to buy where we want, and at a price that suits us. Not in my opinion unfair or immoral, but I do sympathise with your position. Howard.

[Guest Frank Wilkinson]

howardtcz - 2007-01-04 11:04 AM

Frank Wilkinson - 2007-01-04 10:26 AM

chas - 2007-01-04 10:03 AM Wish it could apply to motorhomes in this country, save haggling with dealers. Choose the one you want from a dealers showroom and then click the mouse from the list on the internet, Someday perhaps..... chas

So what happens when the dealers are no longer in business because everyone thinks like you? Where do you go then to look at motorhomes?

As a retailer I've no problem at all with people who want to buy on the web but there's something unfair and immoral about those who go to a store and spend half an hour looking at products when they know along along that they're going to go home and buy it online.

Regrettably, in ten years time there may well be nowhere for you to go to look at a camera or similar product and everything will have to be bought without the pleasure of first handling it and comparing it with other models.

And going back to the motorhome that you'd like to buy online, where will you take it for servicing and repairs?

Hi Frank. I see your point, and i,m afraid that going to a store simply to look the product first hand before buying elsewhere (in our case over the web) is exactly what we did with this new freezer. But the bottom line is that as individuals, we are entitled to buy where we want, and at a price that suits us. Not in my opinion unfair or immoral, but I do sympathise with your position. Howard.

I'm sorry Howard, but we're never going to agree here.

Of course it's unfair and immoral! If you know in advance that you are going to buy it online and then go into a shop, often on a busy day, and waste half an hour of a sales assistant's time when he or she could be dealing with a customer who actually wants to buy something, then how can it be fair?

If for instance, you decide to sell your house privately, do you think that it's fair and moral to get three local estate agents to spend an hour or so of their time giving you valuations and the advantage of their expertise so that you can then save some money by advertising it yourself? But this is exactly the same as what you're saying is fair and reasonable behaviour.

I have very strong views about what is fair and what isn't. If I decided to sell my house privately for instance I would first of all research the market for similar homes and then to get a final confirmation I would then ask a good estate agent for a valuation and would agree a price with him beforehand for that valuation. But unfortunately I'm in the minority I think.

I do find it ironic that all the 'consumer' types who are the first to start bleating about how terrible businesses are in this country, are precisely the ones who resort to the kind of underhand tactics that they would despise if done to them by a company.

I always think that the acid test for people who are anti-business is to watch them when they have something to sell - such as the aforementioned house. You will then see the sort of greed and double dealing that would make even the most hardened capitalist blush!

Finally, buy on line with pleasure. It's a free market and I support the free market but please don't ever try to convince me that deliberately wasting another person's time when you've no intention of doing business with them, is either fair or moral!

[howie]

Hang on now Frank. First off let me say that we had every intention of buying the freezer from Currys, and it was only after all the details were confirmed that the assistant casually mentioned the £20 delivery charge.

Both myself and my daughter thought this far to much considering she only lives 10 minutes from this store, and what annoyed us both was that there was nothing stating this extra charge until the deal was almost done, and may I suggest that wasting peoples time works both ways.

I see nothing wrong employing 2 or 3 estate agents when selling your home, as I know from past experience having just the one encourages them to sit back and expect potential buyers to make the first move, where by when you let them know you are using another estate agent ,this does wonders for their competitive nature.

I am in no way "anti business", and may I suggest, with the greatest respect, that you may possibly be out of touch with the needs of the buying public.

 

[chas]

Hi Frank- You do have a valid point in what you say, but my feeling is that dealers make to big a profit, and in the majority of cases offer a lousy after service. It may be fine for some people to pay top price for things, but for others they have to watch their budget . This may explain why more and more people go to the continent to purchase and save £1000s.

 

 

I bought new from a dealer and if they continue to treat me right I shall perhaps use them again when the time comes, but I feel I do not owe them a living and they must provide me with a good deal. At the motorhome shows one looks at all the dealers offerings, but One does not feel guilty if you purchase elsewhere. When you hear of what is offered in part exchange, and see that same vehicle for sale later at the inflated price, then I shed no tears for them if they go under. IMO they will have brought it on themselves. chas

[Guest Frank Wilkinson]

howardtcz - 2007-01-04 12:15 PM Hang on now Frank. First off let me say that we had every intention of buying the freezer from Currys, and it was only after all the details were confirmed that the assistant casually mentioned the £20 delivery charge. Both myself and my daughter thought this far to much considering she only lives 10 minutes from this store, and what annoyed us both was that there was nothing stating this extra charge until the deal was almost done, and may I suggest that wasting peoples time works both ways. I see nothing wrong employing 2 or 3 estate agents when selling your home, as I know from past experience having just the one encourages them to sit back and expect potential buyers to make the first move, where by when you let them know you are using another estate agent ,this does wonders for their competitive nature. I am in no way "anti business", and may I suggest, with the greatest respect, that you may possibly be out of touch with the needs of the buying public.

In your case I accept that you went to Currys with the intention of buying and that's fair enough. It should have been perfectly clear that I wasn't talking about cases like that but about people who have no intention of buying at all and are cynically using a retailer for a free demonstration before finding the lowest price online.

Secondly, please read my post properly. My estate agents' example was for people who are selling privately and simply using the agents for a free quote. I too would get three quotes from agents if I was selling my house through an agent, but at least one of them would get the business.

As for 'not being in touch with the needs of consumers' I am totally baffled. Are you saying that if consumers want something then it's alright to try to get what they want by any means, without regard to the morality of what they are doing? I really am genuinely puzzled by this comment.

As for not knowing about consumers, if you actually knew what I did for a living you'd realise that such comments are totally wrong. I've spent most of my working life trying to find out what best pleases consumers, and with some considerable success I might add.

[Guest Frank Wilkinson]

chas - 2007-01-04 12:26 PM Hi Frank- You do have a valid point in what you say, but my feeling is that dealers make to big a profit, and in the majority of cases offer a lousy after service. It may be fine for some people to pay top price for things, but for others they have to watch their budget . This may explain why more and more people go to the continent to purchase and save £1000s. I bought new from a dealer and if they continue to treat me right I shall perhaps use them again when the time comes, but I feel I do not owe them a living and they must provide me with a good deal. At the motorhome shows one looks at all the dealers offerings, but One does not feel guilty if you purchase elsewhere. When you hear of what is offered in part exchange, and see that same vehicle for sale later at the inflated price, then I shed no tears for them if they go under. IMO they will have brought it on themselves. chas

Actually, this 'part-exchange' price is a common myth! Dealers know that customers like to bargain and you yourself give the impression of someone who always likes to haggle and get a bit knocked off, which is absolutely fine.

This is why a dealer will give, say £20k for a motorhome and put it on display at £25K. When he comes to sell it the buyer will usually get a good discount if there's no part-ex or again, the extra margin he's making allows him to quote over the odds on the part-ex.

It always amazes me that people who would never pay the list price automatically assume that, when they see their traded-in motorhome on the dealer's forecourt, the dealer is always going to get the price that's displayed on the windscreen!

People may not be anti-business but they often have a very blinkered view of it!

This morning two massive chains have gone into receivership, Music Zone, a DVD/record company with 100 shops and the Greeting Cards Group with 470 stores. The Little Chef chain was saved at the last minute by a cash injection from an investment company which hopes to turn around the company's fortunes.

Yes, it's easy being in business!

Finally, it is true that at present, caravan and motorhome retailers are having a fairly good time owing to very strong growth in the market as more and more families eschew flying and are switching to our hobby. But things change. The first thing that people stop buying in a recession is luxury goods and businesses have no union to protect them or no gold-plated guaranteed pensions, but no one ever thinks about the downsides. You notice when firms do well but somehow fail to spot the ones who go bang or struggle!

[Guest Frank Wilkinson]

I thought that I'd expand on this part-exchange pricing theme as it's one thing that people do not really work out properly. I'm sure that no one is being malicious or anything but, in my opinion, they don't really think it through properly.

If a dealer sells a new motorhome (MH) he will get a certain amount of credit from the manufacturer and if he's lucky, will sell it before he even has to pay for it. Or he may take an order for a MH that isn't in stock and even get paid by the customer before he pays the supplier. This is when we can usually negotiate a decent discount as the dealer has not invested capital in the MH. Remember though, nice as this sounds, he still has overheads in the shape of expensive premises, staff, advertising etc. etc.

Finally, with a new MH, he has no repair costs as the warranty is borne by the manufacturer.

Now let's look at a used MH, which is a totally different kettle of fish!

The dealer's capital is invested in the MH from day one. If it takes six months to sell, a £20,000 investment will cost him £700 in overdraft charges at 2% over base.

He has to thoroughly valet it and service it to ensure that everything is perfect, particularly gas and electric appliances. He has to guarantee it and if anything goes wrong within a reasonable period, he foots the bill. So it is obvious that selling a used MH is a much more costly business than selling a new one. And of course if he has a two-year-old XYZ MH in stock in excellent condition he may lose the sale of a new one because most people will prefer the used one with a big saving.

Now the finances - which is what seems to irritate most people. Let's assume that you're selling your house and you need to get £300K and you know that £300K is a fair price. What do you advertise it at? £300K? Do you bl**dy hell! You advertise it at £330K because you just know that everyone wants to knock you down and most buyers want to feel that they've got something off.

It's no different in the used car and used MH business. People are brainwashed into thinking that everyone is going to rip them off and they must screw down the price.

So let's do the sums: A dealer buys a used MH for £20K. He really wants to sell it at £23 which will give him a 15% mark-up.

So if he's any sense he puts it on sale at £25K and then along comes the bloke who's traded it in for £20K who immediately jumps to the conclusion that the dealer is making five thousand quid out of him!

But of course he will rarely sell it for the £25K. The customer will want a discount or the dealer will inflate the part-exchange to make it attractive. So let's assume that he gets his target of £23K and makes £3000 profit. That's great but first of all if it takes just three months to sell that will be £350 in bank interest. Let's assume £100 for servicing, valeting, electrical and gas checking, which he must do if he's going avoid getting sued later and finally we'll assume £50 per motorhome for advertising, a total of £500 before he even starts to sell it. 

So suddenly, this mythical £5000 profit is down to £2500. He must now hope that nothing major goes wrong, especially if the MH is not still under the maker's warranty or he'll be in for an even bigger bill.

So there you are, what at first glance looks like a £5K profit on your old MH is now actually £2.5K, a mark-up on cost of 12.5% or a margin on the retail price of 11%!

I have just spoken with a MH retailer who tells me that he rarely sells a used MH at the sticker price and doesn't really expect to - it is as I said earlier, a starting price only!

[howie]

Thank you for that Frank, and its always welcome to hear the other point of view, as in your case, the retailer.

I did misunderstand re. the estate agents, and I do agree that using their knowledge simply to get a valuation when planning a private sale, with no intention of employing their professional services is both cynical and uncalled for, although I believe this is quite widespread.

The problem here is that rightly or wrongly, the buying public always feel they are getting less than a fair deal, which even though you have addressed this previously, is a perception that will remain regardless of what you say.

Going back to my original comment, a saving of almost 33% on one single item is still a strong incentive for shopping around, and while I admit I see nothing wrong in visiting these stores to view goods at first hand, I would not like to think that this as you say, is wasting other peoples time, but merely a convenient way of seeing exactly what i,m buying, and who knows, if the price and service is right, then I may even buy from that store just as i,ve done in the past.

Buying over the web will never account for everything we buy, and it would be a sad day if we lose the variety and services these smaller outlets provide, but unless they adjust and compete with this way of shopping, and though they lack the advantage of bulk buying etc, many will disappear unless they address the problem facing them now.

For most of my working life I was self employed, and i,m pleased to see that you at least are making a success of it whatever your line of business may be. Howard.

 

 

[Guest Frank Wilkinson]

Howard, regrettably, there are certain products that will always be cheaper on the Internet. By this I mean branded products, which are the same in any type of supplier. A Canon XYZ camera is the same product in a specialist camera shop as it is from a warehouse online. The paradox is, that no one makes any money selling online because the only thing that matters if you are buying it on the web, is the price. So the people who strive to come out lowest on the price-comparison sites are, by definition, the ones making the tiniest profit and the ones most likely to go bust, as as happened in some very high profile cases already.

I am as it happens, a retailer of photographic equipment. I have a number of very well-run, beautifully fitted and well-stocked camera shops in N.W. England. I have had a very successful business over many years by trying harder than the competition and whilst 75% of this country's independent camera dealers have gone out of business in the last ten years, we have survived.

How long we'll survive now is another story. In the last couple of years it has all changed. As an example I have a shop in Preston in Lancashire. It's in a prime spot in the main shopping centre and its combined rent, service charge and rates is over £80,000 per annum.

I have nine staff in this branch and in the windows I have about £20,000 of stock, which is on display and available for demonstration and which will eventually have to be sold cheaply as it becomes soiled.

On the other hand, my head office building, which is a typical warehouse and offices on a modern industrial estate is about six times the size of the shop in Preston but its rent and rates is less than a third of the shop.

Now, most Internet businesses are run from warehouse-type operations. They've no stock tied up for display that is going tatty. They don't have to spend thirty minutes or more showing cameras to customers (who often will not buy anyway as they just want a free demo before buying online) and they need fewer staff as a result of this.

So the bottom line is that ultimately, we cannot compete and can only hope that many customers will pay a modest amount more for the service that we provide. Our margins on cameras are wafer-thin anyway and we only survive because for every camera that we sell, we'll also sell accessories on which we have a higher margin. So you tell me, what would you do in my circumstances?

You may now be able to appreciate why we get a little cheesed off when someone spends a great deal of time looking at equipment and then tells us that they have found it at some Internet operation that we've never heard of, at a price that's a little less, and if we don't match it they'll buy online. And then they have the gall to imply that because we're a tenner extra we're ripping them off!

Regrettably, I see no long-term future for my business or for any others like it - even Jessops will eventually be seen off by the Internet as High Street shops selling branded goods simply cannot compete with this kind of operation. Now please note that I say 'branded goods'. There are certain businesses that will still survive in town centres. Fashion and food for instance are hard to buy online and if for instance there was a shop where I'm no longer making money, but where I'm tied in to a long lease, I would have a go at another kind of business. But it would only be the kind of business that cannot be affected by the Internet.

Personally, I'm not really affected too much as I'm 61 and set for life. I've been prudent and always put quite a bit into a private pension and other investments but I've a junior partner who's 45 and another forty-odd staff to worry about and I'll fight like hell to keep my business going for their sake. But it's going to be a tough fight!

[howie]

Hi Frank. I,ve been going over your last posting hoping to find some points that would contradict what you have to say, but you have stated your case, not only for yourself, but for other retailers in a similar situation, so well that I find it impossible to disagree with any of the issues you have raised.

This is not to say that I will stop shopping around to ensure that I get the best value for money, or that there are other traders, with less scruples than yourself, would, given half a chance, take unfair advantage given the chance, but my whole perception of how small, or medium businesses handle the competition from the bigger operators and still survive has now been changed.

I imagine you know yourself how hard it is to admit when you are wrong, and given your financial standing, i,m quite willing to let you treat the wife and myself to a free dinner and drinks if we ever meet up on a camping field, if only to ease any guilt you may feel. Howard.

[Guest Frank Wilkinson]

howardtcz - 2007-01-04 11:36 PM Hi Frank. I,ve been going over your last posting hoping to find some points that would contradict what you have to say, but you have stated your case, not only for yourself, but for other retailers in a similar situation, so well that I find it impossible to disagree with any of the issues you have raised. This is not to say that I will stop shopping around to ensure that I get the best value for money, or that there are other traders, with less scruples than yourself, would, given half a chance, take unfair advantage given the chance, but my whole perception of how small, or medium businesses handle the competition from the bigger operators and still survive has now been changed. I imagine you know yourself how hard it is to admit when you are wrong, and given your financial standing, i,m quite willing to let you treat the wife and myself to a free dinner and drinks if we ever meet up on a camping field, if only to ease any guilt you may feel. Howard.

It will be my pleasure Howard, with some decent wine as well!

[howie]

Red for myself and a small keg of scrumpy for the wife if you don,t mind Frank. *-)

[colin]

I have a 'system' for price matching.

At Curry's and similair nationtional chains I offer them the oppertunaty to price match best internet price, my rationale being they offer not much better service, the assistants rarely know about products, and larger items often have a fixed delivery charge.

At our 'local' shops I offer them to price match Curry's or similair, as I believe they usualy offer a good service and realise they cannot be expected to match internet prices.

[michele]

Frank ,

please can you help do they still make an Olympus IS 3000 SLR Film cammera 35ml.....

[Guest Frank Wilkinson]

michele - 2007-01-05 10:31 PM Frank , please can you help do they still make an Olympus IS 3000 SLR Film cammera 35ml.....

No, it was discontinued years ago - there's no real market now for 35mm film cameras, except for a few budget ones and the specialist Leicas.

[michele]

Frank,

I loved that camera so much i can't quite remember whats wrong with it something simple If i remember rightly. No i am not chipping away at your brain with no intention of buying and would gladly visit your shop .

 

Is this specailist elicia camera are we talking thousands .

and is it anything as easy and simple which takes beautiful pics like the olympus ?

*-) Thankyou frank

[chas]

Hi Michele- Dont forget its the person behind the camera that takes great pictures, the camera is mearly a tool. chas

[Guest Frank Wilkinson]

michele - 2007-01-05 11:13 PM Frank, I loved that camera so much i can't quite remember whats wrong with it something simple If i remember rightly. No i am not chipping away at your brain with no intention of buying and would gladly visit your shop . Is this specailist elicia camera are we talking thousands . and is it anything as easy and simple which takes beautiful pics like the olympus ? *-) Thankyou frank

Michele, Leicas are very expensive, maybe £1500 - £3000 but if you really want another SLR film camera, Ebay has hundreds of them at really silly prices. Specialist photo shops have no market now for this kind of thing.

[Guest Frank Wilkinson]

chas - 2007-01-06 10:22 AM Hi Michele- Dont forget its the person behind the camera that takes great pictures, the camera is mearly a tool. chas

Not strictly true. Whatever our artistic abilities are, we are stuck with them, but there is no doubt that anyone's photographs can be improved by better equipment. Just snapping on automatic will show little improvement, whatever the camera but, if you have a better camera with more control you can improve pictures dramatically by over-riding auto-exposure, using fill-in flash and back-lighting etc. A few minutes with a basic manual or photography book will pay dividends.

One example - when my daughter was young she had lovely long blonde hair. Most people would take pictures with the sun behind the photographer, which guarantees safe photos. I would always shoot directly into the light and use flash to fill-in the shadows. The result was beautiful, with the sunlight streaming through her hair while her face was exposed normally.

[chas]

Hi Frank- You say what ever our artistic ablities are we are stuck with them, and that my whole point, we are not. Learning to see a picture and knowing what it will print like is the sign of a good photographer.

 

One only has to see some of the award winning photographs from photographers from say the old eastern block countrys, taken on Russian equipement using just a standard lens to understand this.

 

Admittingly cameras that have adjustable settings ie aperature and shutter speeds are needed, exposure is created in the eye of the photographer.

 

There was once a famous photographer who was talking to a famous game hunter , and the hunter was admiring the photograhers work to which he said you must have a marvelous camera to produce such good pictures. The photographer looked at all the animal trophys on the walls and said , you must also have a marvelous gun !

 

 

The point I am making is you can have a perfectly exposed technicaly correct picture which is boring and does not excite anyone. chas