"Ground Zero" <
[email protected]> writes:
> "Alex Rodriguez" <
[email protected]> wrote in message
>
news:[email protected]...
>>
>> I see a problem with price fixing. Not all people need
>> the same level of service, so not all should be paying
>> the same price. If I can install and adjust the parts I
>> buy, why should I pay the same as the guy who thinks a
>> pair of vice grips, screwdriver, hammer and duct tape are
>> all the tools you need to fix anything?
>
> Interesting argument... one person should pay less for a
> part because he doesn't want the bike shop to install it.
> What does that have to do with price fixing/distribution
> control?
Where do you pay less for parts for your car- at an auto
parts store, or at the dealership? Uh huh. If you have the
skills to do it yourself, you also normally buy parts where
you can get them cheaper (or get better quality parts at the
same price). Why should bicycles be exempt from this?
> In the case of a bike shop, it can make additional profit
> by installing the parts it sells. Therefore, under Alex's
> argument, our friend with the vice grips and hammer should
> pay LESS for his parts because he is ultimately
> contributing more toward the shop's profitability.
Sorry Stuart, but that's really quite a non sequitor.
<Note that I rearranged the preceeding and following
paragraphs>
> Any retail business, bike shop or otherwise, needs to make
> a legitimate profit on the sale of the product. This is an
> indisputable fact of business.
Well, the business *needs* to break even at the bottom of
the P/L statement. It's *nice* to make a profit and is good
for the long term health of the business. There are
thousands of non-profit companies that have been in business
for years, even with revenues in the hundreds of billions of
dollars (HMOs, for example, are required to be non-profits
to operate in the state where I reside).
> The profit generated by parts sales is independent of any
> additional revenue the store can generate by servicing the
> customer's particular needs.
From an accounting perspective perhaps, but not from the
customer's perspective. I just write one check for all of
it. Since I have the technical knowledge I need to do just
about anything I need to on a bike, I buy my parts where I
can address that need most effectively. Sometimes that's
mail order, frequently it's at the LBS because I can cash-and-
carry the item rather than waiting for delivery. A few extra
bucks is worth it for the conveneince. Frequently what I
want is only available via mail order.
> The error of most arguments regarding the economics of
> retail sales is the reliance on emotions and good
> intentions rather than the hard, cold facts of a supply-
> demand economy.
Your argument didn't seem all that factual either. And BTW,
I have operated one successful small business and have been
on the board of another for years, so like many people in
this forum I am familiar with the principles.
