Shopsmith Forums

I'm in charge of pricing at work (a national manufacturer of big ticket items).

People like rebates. Not everyone turns in their rebate. Offering $150 is cheaper than lowering the price by $150. What I like even better is giving free upgrades because that $150 might be $125 at my cost.

The other advantage to rebates is they are used to clear out excess field inventory (Lowe's inventory) and increase inventory turns (how long inventory sits on a shelf), which makes the SS look better to Lowes and leads to better sales and promotions.

You can also use rebates to get people to purchase during the slow season which makes it easier on the factory.

SS can sell cheaper to Lowe's because they get better distribution, higher volume to absorb fixed costs, and the amount of overhead spent on a sale is a fraction of a direct sale.

And yes, that Ron Johnson guy at Penny's defies all logic.

ss50th wrote:Sorry, kids. EDLP (every day low pricing) in consumer retailing just doesn't work without additional deals and couponing. Just ask Ron Johnson at JC Penny.

I totally disagree, JC Penny is a perfect example of bait and switch. The new CEO came in and did lower prices, that is true, but he also severely lowered quality.

My wife shopped Penny's all the time. When they dropped their prices she rushed into the store to drop some cash. She walked out with nothing.

In fact while she still goes into Penny's almost every trip to the mall I can't recall the last time I saw her purchase a thing. She demands getting what she paid for and if something is junk she know it immediately.

Needless to say she is ripped at Penny's, she went from a platium rewards customer to zero customer in less than a year.

While there will always be people that look for the deal and want the "sale" there are many of us that determine what price we will pay for something. If the price of the object is at that price or lower I will buy it. If the price is higher I simply walk away and do without. You would be surprised how much stuff you can live without and still have a really good life.

frank81 wrote:I'm in charge of pricing at work (a national manufacturer of big ticket items).

People like rebates. Not everyone turns in their rebate. Offering $150 is cheaper than lowering the price by $150. What I like even better is giving free upgrades because that $150 might be $125 at my cost.

I don't know who told you people like rebates! Everyone I talk to, hates them and I know many retailers now use instant rebates.

Personally if I'm looking at a product with a rebate and one with out I will usually pay a slightly higher price not to have to do a rebate.

If I do buy something with a rebate I make sure I do the rebate that day when I return home. I track them and frankly many businesses spend more on the rebate processing than the rebate is worth.

Rebates make no sense, incentives, instant rebates and such make far more sense.

Ed in Tampa wrote:I totally disagree, JC Penny is a perfect example of bait and switch. The new CEO came in and did lower prices, that is true, but he also severely lowered quality.

My wife shopped Penny's all the time. When they dropped their prices she rushed into the store to drop some cash. She walked out with nothing.

In fact while she still goes into Penny's almost every trip to the mall I can't recall the last time I saw her purchase a thing. She demands getting what she paid for and if something is junk she know it immediately.

Needless to say she is ripped at Penny's, she went from a platium rewards customer to zero customer in less than a year.

While there will always be people that look for the deal and want the "sale" there are many of us that determine what price we will pay for something. If the price of the object is at that price or lower I will buy it. If the price is higher I simply walk away and do without. You would be surprised how much stuff you can live without and still have a really good life.

Isn't that always the issue with low priced goods? I never liked what Penny's sold, other than Levis because they are a known quantity. Probably because that's where my mom forced us to go when we were kids. When I lived in the South I bought my dress shirts at Belk because their $60 shirt lasted 4x as long as the $30 shirt at Pennys. Sometimes its cheaper to spend more. Buying crap gets expensive.

Ed in Tampa wrote:I don't know who told you people like rebates! Everyone I talk to, hates them and I know many retailers now use instant rebates.

Personally if I'm looking at a product with a rebate and one with out I will usually pay a slightly higher price not to have to do a rebate.

If I do buy something with a rebate I make sure I do the rebate that day when I return home. I track them and frankly many businesses spend more on the rebate processing than the rebate is worth.

Rebates make no sense, incentives, instant rebates and such make far more sense.

I sell vehicles so its an instant rebate (finance companies don't like cash back type deals). But believe it or not, dealers don't do a much better job than customers at turning them in.

frank81 wrote:Isn't that always the issue with low priced goods? I never liked what Penny's sold, other than Levis because they are a known quantity. Probably because that's where my mom forced us to go when we were kids. When I lived in the South I bought my dress shirts at Belk because their $60 shirt lasted 4x as long as the $30 shirt at Pennys. Sometimes its cheaper to spend more. Buying crap gets expensive.

Again I disagree, Penny's had a number of levels of quality. If you bought the Stafford Brand with a silk label you were getting as good as or better quality than Belk for less. I had to wear dress shirts everyday for 40 years. If you bought the lower brands you are right Belks was a better shirt. In fact their lowest level wasn't worth carrying out of the store.

Penny's also wasn't always lower priced goods. They sold some excellent produces at good prices and at great prices when they put them on sale.
Their Stafford Hart Schaffner Marx suits were unbeatable quality and price wise for years.

backhertz wrote:
...If the demo/webinar prices are still $1842 for the new headstock and $1386 for the DIY upgrade, with the $1979 price you get a 6.9% savings. The demo savings on the $1509 price for the DIY is 8.64%.

Hmm?

I just ordered my PowerPro DIY upgrade last Tuesday and picked it up at Poe Ave. on Friday!! Since I live in Columbus, it was cheaper to spend the money on gas and go get it myself (about $35 round trip). I also bought the double tilt kit and the new casters. But, the webinar price sheet I received had the DIY upgrade at $1286.10 vs $1415.00. The Double Tilt was $350.10 vs. $385.00, and the casters were $38.69 vs. $43.00.

As a side note, when I went over to Shopsmith, I talked to both Linda (customer service) and Sue (shipping) and both said that the PowerPro was doing well. Sue has been at Shopsmith since 1977!

I tried to attach a PDF of the Webinar prices...hopefully it did..

ss50th wrote:Sorry, kids. EDLP (every day low pricing) in consumer retailing just doesn't work without additional deals and couponing. Just ask Ron Johnson at JC Penny.

Guys, Ron Johnson isn't at J.C.Penny's any more. I think EDLP had something to do with that.

steve

skou wrote:Guys, Ron Johnson isn't at J.C.Penny's any more. I think EDLP had something to do with that.

steve

Yeah, he probably took his bonus money and hit the road. It must be nice. Get relieved of duty and get a big check for doing so. I'll never understand that mentality. Yes, I know. It was in his contract. I still don't understand the theory.

At that level, those "Golden Parachutes" are engineered in the employment contracts up front.