So, I ask him how much was it on sears.com, and he says $1,229.00. (I verified the price on my own). Retail in the catalog was $2,600+, Sears.com retail price $1,229.00, my cost from Stuller as a complete is $893.00. So, I have to decide if it is worth even trying to match the price or try to sell my service’s value.
Poly member 88405
That's a pretty standard markup for drop-shipped web goods. The Sears website is a marketplace where other sellers push goods under the Sears banner.
Poly member 141140
Take out your operating expenses and you are left with nothing.
Poly member 5412
Yes that profit sucks but there is profit. Most of your time in the sale is already invested, with no inventory costs. Your overhead costs are the same regardless if you make the sale or not. Match it, with same terms, pay up front, etc. additional time to do the deal is what you are looking at, 20min? for $300 +/- … Take the $300 profit; go buy a really nice dinner for you and your wife.
Poly member 59213
Doing this one is not a commitment to lower your margin on all future sales. There's nothing wrong with the customer doing due diligence; you'd do that if you were in his shoes. I don't like working for customers who brag "I never pay more than wholesale" -- but I like dealing with customers who think we're a better value than Sears.
Poly member 8693
I wouldn't do it. It takes too much time away from other things. Add up the time to find the ring, talk to the guy, maybe a free sizing, talk to him again, put it in a box, pay your taxes on the accounting, profit, etc ... You're working for free. It's a lesson I had to learn the hard way. The first few years I was in business I was basically a jewelry charity.
Poly member 141140
The problem is with service down the road. He will expect free everything from you and will not from Sears. No doubt. It will end up costing in the long run. I have no problem with a small profit margin. I, too, will take it every time.
Poly member 5412
Combine the trade-up to a diamond and explain the after-sale service on a diamond purchase, the trade-in value of a diamond and let him choose service vs price -- you may get the larger sale and you have limited the service concerns for the future if he chooses price. I know for many years I always made the margin choice over “making the sale at the lower margin.” I have found getting a new customer and making a smaller margin beats losing the sale and losing the customer. Certainly you can't survive on a small margin on every sale but if this is considered an extra sale or an added sale it is worth making.
Poly member 3669
If I could make $336 dollars for every 10-minute phone call I made, 8 hours a day that’s 16,128 bucks a day! If you worked every day of the year that’s $5,886,720.00 a year! Count me in! Sorry, just having fun.
Poly member 133971
Take a lesson from the coin dealers. A profit with no investment is 100% income. Is there a higher margin?
Poly member 2991
I would do wholesale business at those margins, but not retail. You're married to a retail customer and they'll bad mouth your store if they don't feel satisfied.
Poly member 141140
I would make the sale. Get paid before you order it, and move on. Make the customer happy. They came to you and wanted to do business with you. If they are happy, they should keep coming back. And, Smile.
Poly member 5124
