Re: X-10 on eBay and our prices.

["Mark Hetherington" <mark.egroups@xxxxxxx n.co.uk>]

--- In ukha_d@y..., "steve" <steve@b...> wrote:
>   No UK supplier has lost any sales from me by buying overseas. I=20
simply wouldnt buy them.
>=20
>   As I said having worked in retail where 30% min mark up is the=20
norm. I doubt homebase have lost money overall. They also buy in=20
quanaties far larger than the internet retailers mentioned here.

Homebase original price for a module was =A329.99.=20
Homebase clearance price was =A314.99
Homebase further clearance price is =A37.49

Assuming your 30 % markup t  create the original price gives a cost=20
price of ~ =A323 giving a ~ 35% loss on the clearance price and a ~ 66%=20
loss on the current price.=20

Using simple numbers, if Homebase bought 1000 products and sold 500=20
at full price (profit =A33500), 300 at reduced price (profit -=A32400)=20
and 200 (profit -=A33000) at final reduction price that represents an=20
overall loss of =A31900.=20

Measure the amount of dust on the stuff that Homebase are getting out=20
of the store room and my estimate is likely t  be over optimistic.=20

Factor in the cost of storage and display per store and the loss=20
increases. Add in the "running costs" depending on their
accounting=20
model and the losses increase more.=20

Multiply this by the actual quantities and put in the proper sales=20
figures and you will be hard pressed t  find a decent break even=20
point let alone a profit point for Homebase in this venture. (Too=20
late at night t  work out the break even point especially on assumed=20
figures :) )

>   Most retail seems t  be - why sell 2 items at 1/2 X mark up when=20
you can sell one at X mark up. Less goods t  handle. Less=20
wharehousing - but the public is screwed.

Loss leaders. Supermarket principle originally but is used in all=20
large retail establishments that I am aware of. Watch any major=20
electrical chain (e.g. Currys or Comet). They will have a couple of=20
items in each section that are sold at a loss. Using toasters as an=20
example, they will sell a 2 slice single slot toaster for =A310 while=20
the 2 slice double slot is =A320. 4-6 weeks later they swap them over.=20
Sales at =A320 are negligible and at =A310 it is at a loss. But it looks=20
good in the ads and it gets people int  the stores t  buy other=20
stuff.=20

If you go t  a store that applies full hard sell, whatever you buy=20
they will try and sell add ons through accessories or warranties.=20
That is where the profit lies, not in the original goods. Most goods=20
have very low margins due t  the price wars between competitors and=20
the loss leader principle, accessories are vastly over priced t =20
bring in a steady stream of income. Plugs used t  be a major source=20
of income for Electrical Retailers since they cost next t  nothing to=20
make but it was almost =A31 pure profit per item sold. C nsumables=20
brings in more profit than the item it is maintaining. Warranty=20
represents almost pure profit since the risk factor is extremely low=20
hence the increasing demand for warranty sales to meet a target=20
percentage of sales for stores.=20

>   Also i am not saying the x10 retailers d  this but take an item=20
which is bought in at 69p and M****N and there competitor sell them=20
at 9.99 If the public pay it and they do. Why would they not cut=20
prices ? No need - but the public get screwed.=20

Um where did 30% come from in your earlier arguement when you choose=20
an example of 1400%?=20

Mark.




____________________________________
Automated Home UK
http://www.automatedhome.co.uk
____________________________________=20

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