I recently had a frame rep come into my office and complain that we had his frames priced too low. We have some frames that are $400+ and his were only $130-180. He grumbled that his should be the most expensive....we set the prices so it's our call. Then he asks if he can buy a $400+ frame at our cost from us...it wasn't even a Monday....So the point is, how many actually take the manufacturers' MSRP recommendations?
Nobody really has to....................a suggested retail price is only here so that ther wont be to many discreptancies from on store to another. Otherwise some stores refuse to work with products that are sold at too many different prices.Originally Posted by pauly47
How much you sell a frame for really shouldn't matter to him, he still gets paid based on the wholesale price that everyone pays. Now unless your dramatically undercutting your competetion (selling for just over wholesale), I wouldn't worry about it. Though, you may want to consider what others are selling the same product for, as you may be able to improve your margins on it.
As far as him requesting another frame at cost from you, I would seriously consider his reasoning. Why would he want to wear a competitors product, and let an account know about it. If he wants a frame so bad he should call the other rep for that.
I feel that the MSRP can be a good guideline for pricng product that a consumer has easy access to, specifically sunglasses. Oakley and Maui Jim have set pricing, so when we go to price a sunglass like a RayBan we tend to fall in line with what is recommended (Sunglass Hut). With RX frames that have limited distribution (Alain Milki, Lafont), we follow the MSRP because they have good margins and people are unable to shop around for those products. In our area Nikon has come out with an MSRP on most lenses, so it is a good fallback for us if we have a client say, "why are the lenses so expensive". We can tell them it is the pricing from the supplier. (In the case of lenses, we had actually found our original prices to be too low, so the MSRP was a benefit to us.)
Each manufacturer has the right and decision to make regarding MSRP. The points to each are:
Example item: Wholesales cost-$XXX and MSRP is $250
Mfg. who do not require their customers to follow MSRP: This gives every retailer the right to charge what they want. If one retailer pays $XXX for a frame or sunglass and wants to charge $400, they can. Another may try to sell the same item for $180. (Big chains who want to discount have a big advantage here as the independent can't compete at retail because they can not compete on purchasing due to the volume discounts large chains receive.)
Mfg. who do require their customers to follow MSRP: The manufacturer requires to have the product sold at MSRP except for brand wide promotions. The product costs the retailer $XXX and the retailer must sell it for $250. This policy helps many smaller retailers and the manufacturer by keeping value in the brand. You can not keep a premium image for a brand once it is heavely discounted at mass market type of stores. My company, ICE-TECH, follows this policy and although it is more difficult to build your business this way in the long run I believe the brand will have value for the brand itself, the retailer of the brand and the end consumer.
It is a matter of choice that starts with the manufacturer. There are plenty that allow discounting and the brands that don't won't support you long if they determine you are discounting. (Ask an Oakley retailer how easy it is to sell at a discount.)
Last edited by Joann Raytar; 07-26-2005 at 08:39 PM. Reason: Wholesale price posted
I would if they ever called me back...21 phone calls to Oakley and never a call back...brutal!
Pauly47; I did not say to call Oakley, I said call or go by an Oakley retailer and ask them about MSRP and their pricing. Since you are an optical retailer why don't you visit a non-optical Oakley retailer and tell the manager your interest in learning about Oakley price guidlines or ask if they have the local Oakley reps telephone number and call the rep, they may or may not help you understand their policy.
I assume if you called Oakley that many times they must have a retailer near your or for some reason they already know that they are not interested in your location and do not wish to discuss the issue.
I would have gotten the message after the 3rd phone call. They dont want you...........and they dont want to talk to you.
Therefore they lack a grat deal of politeness and you did right to post it on the Optiboard and make it public. Other Optiboard viewers and poster will be able to make up their own mind if and how to deal with a company that does not show the simple curtesy towards past, present or future customers.
It's easy to sell Oakleys at a discount. It's usually easier just to close the account yourself, though.
Costa Del Mar rep has told me that accounts have been threatened with cut off of the account if they didn't stay real close to their MSRP, and they have followed through too. Everybody benefits by this. The big boys will always sell more than the smaller privates, even if they sell a little less than their potential if it was discounted, what they are selling is at a mucher nicer percentage of profit. WIN for the big boys, Win for the local private guy buy being able to be competitive and obviously a Win for the brand. Sounds good to me.
:cheers:
I used to work at a sunglass shop where--this was one time, mind you-- someone discounted a pair of Oakleys below MSRP. Oakley found out, and pulled the account for, I think, eight years. Only relentless haranguing, a killer location, and ridiculous store sales got it back. Being in Oakley's back yard didn't hurt, either.
Which is why my previous comment should be read with tongue firmly in cheek.
MSRP-when followed levels a playing field and also has restrictions as to the promotion of merchandise. No sales/no co-op Sometimes reps seem to have their head up their butt because they don't really get it. It also seems that we have more and more unknowledgeable reps than ever before. I had one tell me to merchandise their frames in the center areas-eye level of my boards. They were generic non recognizeable and instead of grouping wanted me to display them through the middle of all of our boards. Average price retail would have been under $100. My average selling frame price is $149. This is with frames that retail from 69-249. My higher end are at MSRP and that is $420. Not for everybody but definetely hitting their mark.
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