Offtopic: Retail Ripoff?

07Apr08

So the other day I was at work.  I’m currently doing part-time retail for gas (I really need to sell my Taurus ><) and spending money.  An older gentleman was looking a telephone duplex jack adapter which was about seven dollars where I work.  When he found out, he flipped out and complained about the price.  Now, I’m pretty use to customers being disgruntle about something I can’t control (return policy, price of iPods, tax rate, etc).  However, this guy actually answered his own question in his rant. 

“I’m going to buy this.  But once I have the time to dig around and find a cheaper seller, you are losing my business!”

Good job answering your own question.  Could be due to the fact that the store I work is a national retailer that have many common item instock all the time that the our prices might be higher than a internet warehouse?

Here’s a few reasons why the store is “ripping you off”.

1. Don’t get me wrong.  I love online stores with everything I could ever need at a good price.  I love Newegg and Amazon.  But comparing an online store’s prices with a physical national retail store’s is incredibly stupid.  Online stores have to maintain warehouses, call centers, administration centers, and shipping.  National retail stores tend to have to do all that and more.  The localized structures like regional offices, district offices, and local stores all have to be bought and maintained.  Someone has to pay the bills and real estate and that is covered by the cost of the products.

2. Online stores don’t have salespeople.  I personally love online stores because I know what I need.  However, if you go into a physical store, ask the staff for help, and expect warehouse prices, you are insane.  Speciality stores tend to have better trained staff than WalMart, Sam’s Club, or CostCo.  Where I work, we often have people come in wanting an answer to problems and then go to WalMart to buy the products.  Either way, that training, online or otherwise, costs money.

3. To be an authorized dealer for certain products like iPods, the retailer has to sell the product at the prices specified by Apple.  Sure you could find the product cheaper online on EBay or something but often those are just retail resellers, people that buy the products on sale and/or with a mail in rebate at a retail store.  They often clip off the UPC for mail in rebates and make it harder to use manufacteur warranties.  But most importantly they don’t have to worry about a company like Apple revoking their right to sell Apple’s products.

4. Internal theft is a problem at all stores, online or physical.  But online store do not have to worry about customers walking in and stealing.  In the area I work, people buy $400 iTouchs for their kids all the time but we still have people stealing FM Transmitters and iPod cases.  Unlike employees, there is very little tracking information for customer theft.

5. The prices are higher because you are paying for the product selection, service and product availibility.  At the AT&T store, they have almost everything you could possibly need for your phone.  At a retailer like Best Buy or RadioShack, the prices tend to be lower but a far smaller selection.  Also, stores like Best Buy and RadioShack will not have services like SIM card data transfer to iPhone.  In the case of the gentleman buying the telephone duxplex jack adapter, he was paying more for the store being local and stocked up.  It costs money to always have product that people might or might not need.  Overtime, items that did not sell well actually will keep falling in price until the store actually lose money when the product is solded.

6. Just because you won’t pay the price doesn’t mean ten other customers won’t.  In the end, it’s all about money and capitalism.  If ten people will pay $100 for the Monster cable, it more than covers the people that won’t.  Is it moral?  Is it immoral?  I have no idea, but companies that do this are still around so something must be working.

 

The moral of the story.  If you are going to go buy product from a place that has a higher markup and cost than an online warehouse, atleast don’t bitch about it to the people working there.  We don’t really give a crap.

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