Lots of Vendor Talk, here's my Jerry McGuire

[bret]

[FONT= " Courier New"]Back in the day, you had to have a brick and mortar location to become a dealer for some manufacturers. Now, you can buy Ridetech from a dude sitting at a laptop in his boxers in the comfort of his own living room just cuz he has a website. Hell, I’ve even caught manufactures selling product direct for less then what dealer cost is?? WTF is that about? That just isn’t ethical to me." [/FONT]

Jon...just trying to clarify...are you saying that you have seen RideTech sell product direct at less than retail price? Or are you saying that Some RideTech dealers may be mostly internet based?...or are you saying both?

[camcojb]

OK, I edited the original post. I don't want to lock the thread. The frustrations and info regarding this industry, vendors, and customers is great. But let's keep individual company names out of it. Everyone still gets the point and most know who the edited name is anyway. This way hopefully the thread stays constructive instead of turning into a cluster that has to be locked.

[Track Junky]

Truth of the matter....it is dog eat dog out there right now. I talk to fellow contractors every once in awhile when picking up materials and it's the same old story everywhere...there's always someone out there to do it for less. I personally stick to my guns with my prices. Quality and customer service has allowed me to have repeat clientel and get referrals. I've learned that If I allow myself to take a job for no or low profit the product I deliver suffers. Is this what I want when someone walks in to this prior customers home and asks who did the work? Of course not. Lesson learned!!

My motto, honesty and hard work will get you moving forward. Listen to your gut and God willing, you'll pay your bills, feed your family, and with todays economy, if your lucky be able to make a little extra. The only thing being in business for yourself can promise you today is the freedom to do it your way.

We all make mistakes one time or another but lesson's learned from prior experiences should allow you to forsee and choose how to maneuver forward with your new business and next customer. Stick to your guns, provide quality service in a timely manner, and thats all you can do.

I personally wish the best for you in your new venture. Good Luck!!

[dhutton]

Just wondering how many folks here pay full MSRP when they buy a new car...

Don

[NewGenWheels]

Originally Posted by bret

[FONT= " Courier New"]Back in the day, you had to have a brick and mortar location to become a dealer for some manufacturers. Now, you can buy Ridetech from a dude sitting at a laptop in his boxers in the comfort of his own living room just cuz he has a website. Hell, I’ve even caught manufactures selling product direct for less then what dealer cost is?? WTF is that about? That just isn’t ethical to me." [/FONT]

Jon...just trying to clarify...are you saying that you have seen RideTech sell product direct at less than retail price? Or are you saying that Some RideTech dealers may be mostly internet based?...or are you saying both?

No Bret, its just to get the POINT across. I will however say that some dealers are mainly internet based, you and I both know that is true though.

And to be clear: I said I've even caught "manufactures" selling for less then dealer cost not you specifically. How did I do it? I called them and pretended to be a retail customer, and they priced me out at 15% back from what retail is on their website.

And how did I price match my competitors? I did the same thing. I called them, or had Justin call them from his cell phone, and pretend to be a retail customer, and got 15% off brand X without even trying.

To everyone reading my midnight thoughts, read it as this: Look for the underlying theme, and think about what the point is, and take something away from it that is constructive. Maybe the next time you go to buy a part you'll think about who your spending your money with, and what you are going to get in return from that transaction. And please, PLEASE, have some integrity and some loyalty to the guy working his arse off for you. If you spent countless hours working with him on backspace for your wheels, don't turn around and call wheels for less .com to buy them for 50 bucks cheaper. (As an example, and you can apply it as you see fit).

Todd, I did, and still do have very loyal customers. The business that was lost was to new guys, who found us on the web, or met us at a show, and then called in to price match us. We lost those bidding wars, but they didn't hesitate to take all the free tech info Justin and I could dish out until we were blue in the face.

Thanks for letting me speak my mind Lat-G. I plan to take more of the DSE route myself from here on in as NewGen.

[Matt@BOS]

Originally Posted by ratman67

i am running a full dse set up in my camaro, sub frame, quad link, subframe connectors wiper motor, mini tubs and other dse products as well as a bunch of other parts i needed for my build. i called dse and they will not budge on their list prices and i understand that they can't compete with their distributors, i ended up calling matts told them what i intended to buy for my car and asked what he could do for me if i ordered all my parts from him, he told me he would knock off 15% accross the board. my first order was 15k in parts, they were very knowledgeable, i felt it was win win for us both, i did get great service, great pricing, and fast delivery. so don't tell me you can't have all three. i will be making another order with them soon for 6 or 7 k to finish up my car and will do so with confidence...rm

As someone that has a number of close relationships with companies on this forum, I'm slightly removed from this, since parts aren't paying my bills. However, I do know what is going on, and I hope that if I say it, maybe a few business owners won't have to, because this isn't exactly pretty, or nice, and I'm sure they would rather not have to say it themselves.

First, I'm glad you got a good deal. I remember the first time I purchased expensive 3 piece wheels. It was from Jon at Driverz about four years ago. I bought them because he was running a sale, and he was semi-local to me so that I could pick them up. That was important to me. Had Jon not been around, I probably would have purchased from Frank, which would have been $200ish cheaper. Glad I didn't and not because I would be worried about Frank's business practices. I'm glad I bought from Jon because he has been willing to stay late at the shop waiting for me, mount and balance countless tires, some of which I didn't even buy from him, oh yeah, and he put me up at his house for a night so that we could trailer my car up to SEMA, leaving at 3am, using his truck and trailer. I almost hate to think that is all because I spent $200 more on my first order. Hell, that almost seems like I've taken advantage of him in a criminal way. For that level of service I should have paid retail plus (a lot).

Ratman You probably don't realize it, so please don't construe this as me calling you out for doing something wrong, because you haven't really done anything wrong, but this exact scenario is what is killing dealers like Jon, or any of the others on this site. DSE doesn't offer a big profit margin to dealers who sell at retail. AT RETAIL. DSE supports their vendors, not by refusing to undercut them, but rather by attempting to keep prices even, no matter if you're buying directly from DSE or through their dealer network. That is something I hated about DSE at first, but have come to respect immensely. I can't believe Matt's took 15 percent off for you. You might have gotten a great deal, and the pricing cut probably won't affect you. However, that pricing cut directly affects the vendors mentioned in this thread. As Jon said earlier, it sets this precedent that everyone now needs to sell for 10-15 percent off with free shipping, etc. This is the real life example of the dealer making $350 on the $7000 subframe. Not only that, it affects all of the shops like Ironworks, or HPI or Best of Show, just to name a few - the shops who build cars, but who have also established dealer status with manufacturers. These shops are small outfits that are dealers primarily because they have built well made cars, and often manufactures make them dealers because they know the manufacturer's product inside and out, and represent it well in magazines, or at shows like Good Guys, or SEMA. These small shops never set out to make a living selling parts, they set out to make a living building cars. They can't compete on pricing because it isn't worth their while. In many cases, they don't even care if you buy parts from them anymore because the profit margin is too small. When they factor in the cost of their time, it just isn't worth it. That might not seem like it will affect the end customer, but it does. Hell it also affects the manufacturer. For example, if a customer is having a car built at a shop, and they are dealers for DSE, and have installed plenty of DSE subframes, but the customer decides to install a Morrison subframe because it was cheaper. Well, by the time that Morrison subframe goes into the car with the engine and headers, etc, it might end up costing more because of the time the shop spent figuring out how to install it. That is just an example of how cross shopping or finding the "best" deal, isn't always the cheapest in the end. In the same scenario, if the customer buys a DSE frame from someone other than the installer, then what is the point of the installer being a dealer for DSE. In the future they might not sell as much DSE product, and when it comes time for a customer to have the latest and greatest DSE product installed, it will take more hours for the shop to install it because they aren't familiar with it. You better bet that cost gets passed on to the customer. As for how that affects the manufacturer... Earlier I wrote that a lot of shops attained dealer status because a manufacturer wanted them to be. If the shops have no incentive to run the manufacturers products, then it hurts the manufacturer.

Matt

[68protouring454]

great post jon!!!
Non of us are perfect, however with that said beating prices further and further down doesn't help anyone but the end consumer, and thats ONLY when he gets his parts on time.
Nothing better then a customer who wants to do business with you, doesn't care about discount(not that he is going to overpay, but knows going prices) and just expects on time delivery and support.
great thoughts!!

[Bryce]

Originally Posted by 64pontiac

You will be thoroughly disappointed if we all start lowering our costs to manufacter so that the parts are cheaper.

I work for an aerospace company as a test engineer but we are very versed in lean manufacturing. There are always ways to continuously improve and remove waste from any process, sometimes it means buying new equipment sometimes it means moving around less and co-locating certain operations. There are always wasy to make things take less time therefore less cost and less parts and materials on the shelf. Which will help overhead and cashflow.

Jon, GREAT post!

[Ron in SoCal]

Originally Posted by NewGenWheels

To everyone reading my midnight thoughts, read it as this: Look for the underlying theme, and think about what the point is, and take something away from it that is constructive. Maybe the next time you go to buy a part you'll think about who your spending your money with, and what you are going to get in return from that transaction. And please, PLEASE, have some integrity and some loyalty to the guy working his arse off for you. If you spent countless hours working with him on backspace for your wheels, don't turn around and call wheels for less .com to buy them for 50 bucks cheaper. (As an example, and you can apply it as you see fit).

Thanks for letting me speak my mind Lat-G. I plan to take more of the DSE route myself from here on in as NewGen.

Jon the part I quoted is probably the best thought out, most articulate thing you've written in this thread. Although there is a certain amount of cost/benefit discussion that will take place with any customer, NO ONE should milk a vendor for free tech and turn around and take the business elsewhere.

Conversely, no customer wants to hear vendors complain about the deal that didn't go their way. It sucks for sure, but is also a part of our world today. Vendors need to have a unique value propostion that will attract and retain customers. I know Jon has brand loyalty with many. The challenge is to create that realtionship with all even though it is next to impossible.

[Stuart Adams]

If I were a vendor or a dealer I would be very upset at Dealers that hold others money to pay for parts ordered before. THAT is the real problem.

Think about it, if the bad dealer is selling parts at cost then the other dealers are not selling at all because of this ploy. Bad dealer doesnt need a profit because he is using this current money minus his cut to pay for the previous orders. That is what is killing the ethical dealers. Profit on the order is NOT the way BAD dealer makes money.