The state of things

[Chippygeoff]

We all go out and buy tools and machines from time to time and if you are like me you shop around to get the best price before you part with your hard earned cash. The competition among retailers is fierce and they are all eager to take your money, being the buyer you have everything in your favour, you hold all the cards.

Again if you are like me then you want to see what you are buying in the flesh. Looking at a picture of the item I would like to by on an online web site does little to encourage me to part with my cash, unless of course I have an intimate knowledge of the item in question or have maybe see and used a friends one.

I am fortunate in having a number of retail outlets reasonably close to home where I can go and view products and maybe even try them out before I buy. When I bought my Dewalt cross cut mitre saw I spent ages online and there was about £10 difference between all the sites I looked at, which is neither here nor there really when you are looking to spend £650 on a new machine.

I went to a tool shop I have been a customer of for many years and they had the saw I wanted on display so I had a gander, checked the capacities the saw was capable of and had a word with the owner, whom I knew very well. I explained that I could get the saw for £10 less online and could he match the price. The guy went from being cordial and customer friendly to a raving loony before I could say Dewalt. He really hit the roof and afterwards I could understand why.

The shop I went to has been is business for many years and the owner told me it was unlikely he would be in business the same time next year. The problem is that retailers have to compete with each other in order to keep their customers, and none of them sell at the RRP (recommended retail price) anymore so not much profit is made on a single purchase. The owner told me that if he sold me the saw for £10 less he would not be making any profit at all and I was very surprised at this.

He went on the explain that for a while now many online shops have appeared on the internet. A lot of these guys work from home so they do not have the overheads that a shop does. A shop has to have insurances, to get insurance you have to have a burglar alarm fitted; if the shop employs staff there are wages to be paid. On top of this there are extortionate council business rates to be paid and several other things to be paid out on a regular basis so it is easy to see that the retailer needs to take quite a bit of money each week before he starts to see a profit.

The shop owner told me that the online stores approach a manufacturer and are prepared to spend £200,000 at a time with them in order to get huge discounts thereby undercutting the local tool shop. The online buyer can store his stock in his garage and sell it all in a very short space of time. This situation is starting to grow out of all proportion and it won’t be long before the tool shops we have come to love will be a thing of the past. What I like about my local tool shop is that whenever I go I spend time walking round looking at lots of other things, you get to see the latest wood working equipment and meet other wood workers as well.

I ended up buying the saw from him and in my heart I felt like giving him another tenner. I previous years I have bought some heavy wood working machines from this guy and he and a staff member have not only delivered it to me but set it all up as well. It will be a sad day if I ever visit his shop again to find it has closed down. I would rather pay an extra £10 just for the opportunity of looking round his shop and the atmosphere in the shop as well rather than buy online. Maybe in years to come that’s the way things will be, high streets will become a thing of the past and all shopping is done on the computer.

 

[ChrisR]

Geoff.

I fully agree with your post, but I think it all started going wrong many years before internet/computers etc.

It was about the late nineteen fifties, when I was an apprentice electrical engineer, the only time that you could get any discount by LAW, was when purchasing tools of your trade, I think the max discount permitted was 20%. Purchase tax on most goods then was thirty three and a third percent.

It was at this time that there was retail price maintenance by LAW, product (X) was the same price the country over, your choice of retailer was customer service alone.

It was also about this time that the retail price maintenance was abolished, my apprentice master (the person I worked for) stated that this would lead to the end of any integrity within the retail market, his voice still rings in my ears, but how right he was.

We no longer know the true price of anything, because the price is falsely inflated in order to make a massive discount, so that it appears the product is being sold cheap, in fact it is probably around the price it should have started at.

Take care.

Chris R.

 

[jonluv]

We had an independent tool supplier in my nearest Town who sadly has ceased trading, he once sold me a Green River knife for £5

I think that the Internet is destroying " Fixed Trading" and I have developed the attitude that if the price I pay for any goods is less than I value those goods then I have a good deal.

Now I've written it it sounds complicated !!

 

[finneyb]

It was about the late nineteen fifties, when I was an apprentice electrical engineer, the only time that you could get any discount by LAW, was when purchasing tools of your trade,....
Chris R.

Chris,

That explains something that goes way back. When I passed the 11+ my father, a joiner, bought me a transistor radio. He got a letterhead from his work and we went shopping on the Saturday. I know he got discount, but I never understood why we had to get the letterhead or go to this particular shop. A transistor radio was a tool of trade - I don't think so!!! But he got the discount.

Brian

 

[RobinBHM]

Retail shops are no longer a viable business model for many sectors of the market.

Councils have made rates extortionate for retail shops and they wonder why high streets are full boarded up windows (or replaced by a costanerobucks..........)

I am in manufacturing and located on an industrial estate, rates have increased hugely over the last 10 years. They are £8,000 this year.

 

[scrimper]

As someone who spent most of his life involved in the retail electrical trade and being the owner of an electrical business for over 30 years I do have a little experience in this subject.
Yes the internet does make a difference but the problems for smaller traders started back in the 1960's and 1970's when resale price maintenance was abolished.

When RPM was in force you generally paid the same price whoever you bought the product from so the essence was on service to the customer and people bought not on price but from the company who looked after them best.

For example the first company I worked for was a smallish independent radio and TV dealer and the customer received a fantastic service, if they wanted a TV we would deliver it to their house, erect aerials on their roof, set up the TV and spend time explaining it's use to the user. If the customer had any problems later on (TV's were unreliable in those days) we had a service van and came out to make sure they were sorted out same day.

Later on of course small traders were hit again with the rise of the discount chains such as Comet who could buy in huge quantities at low prices whilst the small trader who was not able to buy in large quantities and could not compete on price. What we did was diversify and switched more to providing repairs and servicing rather than selling new but many traders just went out of business.

I could go into more details but don't wish to bore forum members, but ask yourself are we better off today? Personally I don't think so, in many cases most of today's leading traders sell at the same prices and if you want something you either have to order and have it delivered or go to a store (more a warehouse nowadays) either way you have to set the item up yourself and often when it does not work you have to phone up a helpline when after listening to menus and tin can music for 20 mins are connected to a person in India and you often cannot understand what they are saying!

In my day when you went into a TV/Radio shop the person you spoke to had knowledge of what they were selling and would give you good honest advice, now we go into somewhere like Sainsburys who do not employ people who have any knowledge of the products on the shelves.

That is one of the problems today, shops sell anything and do not have experienced staff whereas before shops specialised in selling items that they had experience of.
I think I will end here as members will now be falling asleep!