Flat Screen Mounts, AV Furniture, Stands & Trolleys Sales & Consultancy
We were recently asked to price-match an incredibly-low price, listed on a website, the price being £199 + VAT.
Whilst we’re proud to offer high quality products inexpensively, and whenever possible we will endeavour to ‘price-match’ another retailer, there are some circumstances where this is sadly impossible.
Given that our pricing was and still is significantly higher than the £199 + VAT ‘advertised’ price, we asked the customer why he had come to us to buy the product, when it was listed for a much lower price elsewhere?
“Ah, said the customer, I’ve spoken to the other company and they can’t deliver one at the moment as they’ve got no stock”
Our reply was the obvious one…”when we’ve got no stock then ours are £199 + VAT too”
As always when shopping on-line, there will always be one or two vendors advertising products at pricing way below the average pricing you may find. As an example, an average selling price for a product might be around £300 with + or – 10% variation, then suddenly a website pops-up advertising the same product for £200. If you’re offered a price that’s too good to be true, then it might just be that!
Ask yourself the following questions :-
Is everybody else selling the product on-line, really making that much profit?
As you’re aware, the internet is a very transparent buying platform, if you know a model number then with a simple Google search, you can pretty quickly find the range of prices that are realistic.
Having sold into this market for many, many years, we can assure you that in these tough trading times, we dream of making the profit margins hinted at by this ‘advertised’ pricing.
Is it a scam to get my money?
If you’re dealing with an on-line reputable retailer, then buying on-line is in many ways safer than going down to your local retailer. Your payment is usually protected, and of course you’re covered by the Remote Purchase Legislation. You’ve certainly got more consumer rights to return a product that you purchased on-line, rather than from a High Street shop. Of course if you wish to collect a bracket from our trade-counter, then by all means give us a call.
Companies sometimes offer products at or below their cost price, this is of course to get you through the door to buy more products. As you know, ‘loss leaders’ are of course used by many supermarkets. But ask yourself the question, if a company is pretty-much only selling mounting hardware, what else are you going to buy off the back of their ‘loss leader’? Even as a trade supplier, selling hardware to installation businesses, even we can’t see this working for us, we’d much rather offer samples and then retrospective discounts.
So why do companies offer products at their buying price, or in some cases below their buying price, it doesn’t make sense?
1) Disruptive marketing – an attempt to prevent another dealer who may have stock, from making a fair margin, by trying to force them to drop their prices. This works well with large companies, when one motor company is about to launch a new model, another may heavily advertise their own price reductions, or free upgrades.
2) To prop-up cash flow – there are times of the year, where business is tight for everyone, and a little cash injection into the bank account may be just what the bank manager ordered. But as anyone who has ever spent more than 10 minutes in a business knows, although cashflow is king, it is actually only flattery, only profit can sustain a business.
On auction websites such as Ebay, companies can benefit in the very short-term by offering stock at below cost or with very little profit, this is because most Ebay customer pay instantly using Paypal. The supplier may have 30 days to pay their supplier for the product you purchased, hence they’ve got that time to attempt to generate more money before having to settle their eventual bill. Clearly, this can only ever be a short-term cash flow gamble, eventually the ‘roulette wheel’ will stop, and the company will find itself in trouble. It’s a bit like a company taking out a ‘payday’ loan, it can only ever work as a very short-term measure.
3) Clearance lines – sometimes companies fail, it’s a sad fact of life, through no fault of their own, some business cannot continue to trade. If a company does fail, then a liquidator or administrator may sell any remaining stock to raise as much money as possible to pay the company’s debts. This is where bargains can be had, often a liquidator may offer a warehouse full of stock to the highest bidder, indeed there are companies whose business models are built around buying stock this way. Sometimes hidden is a warehouse full of returned products are a few ‘golden nuggets’, these find themselves back in the supply channel very quickly as the buyer attempts to recoup their outlay as quickly as possible. Well, as the hospital TV arm has always been in short supply, as of September 2012, Flat Screen Support is the only company who has ever sold it in the UK, so we know for an absolute fact that these items have not found themselves in the clearance specialists. Also, ask yourself the question, can a none-specialist company, one which only buys clearance products, really offer you the same level of guidance, support and product knowledge as a specialist supplier?
Should I care if a company is no-longer trading? I’ve already got my product.
True, if you’re not the poor unfortunate that was left out of pocked when the ‘roulette wheel’ stopped, then you’re probably going to be OK, unless of course you need after-sales service, spare parts or a warranty repair. Always have in mind that your ‘purchase contract’ is with your supplier, not the manufacturer or distributor somewhere down the line, the only party responsible for your on-going support is the company you purchased the item from. To be fair, being reputable world leaders in the mounting hardware business, our manufacturers would usually step-in as a goodwill gesture and try and resolve any problems that may arise, or steer you to somebody who could help, however they have no legal responsibility to do so. Only the company to whom you pay your money, is responsible for the product you purchased.
Once or twice a week we’re asked by one of our manufacturers to try and help a customer who’s supplier is no-longer in business, of course we will always try.
All we’re trying to get across here, is the age-old adage :-
“…if it sounds too good to be true, then it probably is”
Know your supplier
Know who you’re buying from, use on-line tools such as Google or Google Earth to checkout a ‘business’ address or search for customer experiences. Just because a company is listed at the top of the Google search results, it does not mean that it’s necessarily a great company. Some of the on-line buyers forums have pages and pages of customer complaints about companies you may be about to buy from. As an example, we are aware of 3 ‘independent’ companies selling mounting hardware, all operating from the same office.
If the company lists a phone number, give it call, reputable ones will always have the time, the experience and the information to hand to ensure that you buy the most suitable product. If they don’t clearly show a phone number but insist you contact them by e-mail, ask yourself why?
By law you have the right to return any product that you buy over the phone or on-line, for whatever reason you like. That said, it’s usually left to you to return it to the supplier. Do you know how much it costs to send an 11kg bracket via the Post Office? Well let me tell you, as of September 2012 it would cost you £21.90.
Nobody likes ‘product returns’, from a supplier’s perspective they are a pain, from a customer’s perspective they are an unnecessary inconvenience and expense. We would much rather speak with you to ensure you’re buying the most appropriate mounting hardware for your particular requirement.
For more information on our range of stock and our pricing for both available and ‘unavailable’ products, please call us on 0845 835 0266.