Re: razor thin profit margins

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Posted by Gerry Smith on September 14, 2000 at 09:05:29:

In Reply to: Re: razor thin profit margins posted by Eins on September 13, 2000 at 23:16:55:

Eins asks:

"Are you indicating that despite the big difference in sales price between local and mail order shops, the local's markup is still not high enough?"

In some cases I am. It is important that local (read within half an hour's drive time) shops remain viable. If the markup is not sufficient to provide for the cost of doing business and a reasonable profit, then for that shop the markup is not high enough.

I value a small shop, one where I can know the owner and deal with him/her directly. An hourly sales person is much less likely to have my best interest in mind because their investment is too small. The owner can make decisions that the employee can't, can commit the store to a course of action where the employee has to consult the boss. The owner can find the box of 3/16 inch thingamajigs when I need one.

Since this small shop is important to me, I have to be willing to pay a little more to keep it viable. The difference is usually minimal.

The local cases I referenced, where the markup apparantly wasn't high enough to maintain viability include Scuba Schools of Long Beach, National Scuba in Huntington Beach and lots of other defunct dive shops that I'm sure all of us can recall.


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