Guys - this isn't rocket science. Benchmade distributes knives through a very broad range of retailers. These range from the very high volume online knife stores to smaller mom and pop brick and mortar stores. Both play an important roles for Benchmade. The online knife stores help Benchmade hit their bottom line - lots of units sold. They help support the scale of economy that justifies purchasing all those expensive robots and CNC machines they use to make those shiny bits in Oregon.
The smaller stores are equally critical to Benchmade. They help Benchmade market it's brand name and maintain a presence in stores that aren't exclusively knife dealers. The smaller, retail stores give Benchmade exposure to a much wider demographic. As for myself, I wasn't particularly into knives and I didn't know anything about Benchmade until recently. I just saw all the pretty blades and blue boxes in the display case at my local gun store enough times to prompt me to say one day, "Hey, I'd like to see some of these in the case over here".
As with pretty much any manufacturer, dealer wholesale pricing is going to be tiered according to the volume of knives sold. You can bet that the big online knife shops are getting much better pricing than the smaller mom and pop brick and mortars. How much of a margin gap? I'd bet it's easily 20 - 25% (hmm - kind of like the discounts we've seen).
Without MAP pricing, what happens? The handful of extremely high volume dealers have sufficient pricing margins that they can easily undercut the little guys. The little guys simply can't compete. If you're a small retailer, it becomes too expensive to keep a nice selection of costly merchandise sitting in a display case that's not selling. Or, how about when the potential buyer has the potential purchase in hand, then Googles a 25% discount on his smartphone. "Hey can you match the pricing with this place online?" For the smaller dealer, not a chance. They lose their margin. They effectively lose money. Ultimately, the smart business owner will stop carrying unprofitable merchandise.
That's the issue facing Benchmade. Without the smaller dealers they lose market presence and the brand suffers. They originally put in place MAP pricing to give the smaller dealers opportunity to make enough of a margin to make it worth carrying. However, they didn't enforce the pricing and it's devolved into a farce that's barely been a "wink and nod" on some of these web stores.
I love discounts, and yes, I hate losing 25% off pricing. However, I get it. I don't like it, but I understand.
I don't expect Benchmade to directly address this here in this forum. What would they gain? Will that somehow make anyone feel any better? I really don't think so. I mean, while they're at it, should they go ahead publish their wholesale dealer pricing structure as well? Would that make everyone feel a whole lot better? I don't think so.
For as much whining that's going on in this thread, I predict that ultimately, it's going to have almost zero impact on Benchmade's sales. Why? If there wasn't already a huge amount of loyalty and fan base for Benchmade out there, people wouldn't be raising such a stink. People are raising a stink because they are so passionate about their knives and the brand. We hope that all of our collective foot stomping, pouting, and holding our breath will make difference. It won't. At the end of the day, most of us are going to save a little extra and spend the coin on what we want to buy regardless. C'mon - this is a hobby. Did anyone get into this thinking this was good for their finances?
Elisabeth
Yeah, uh hey Liz, with your 3 posts and all. No need to talk to a collective us, as if we just got out of 2nd grade. I would be more than willing to bet a few bucks, that there are plenty of people here that are business savvy, and have the education to back it.
That said, let me give you an education in economics. When the price of something exceeds the value, the sales will not, and cannot be sustained. The biggest and primary reason this will occur, is when the "need" is filled by a competitor, for a product, that is either cheaper for the same quality, or better quality for the same price. That is a very simple matrix to follow, now wouldn't you agree??? Bottom line, there are two other players in the ballgame, that both offer GREAT customer service, and are fair on prices. We are not talking about a couple of hundred people on this forum either. Johhny Q. Public, has a whole lot harder time spending the difference in a $65 knife, and a $100 knife. Don't believe me? Hide and watch.
That said, I could care less about BM. They will either get it together, or get the same lesson that you need. I've spent plenty of money on them, I've liked them quite a bit, but I'm not married to them. I also love how you tout the "foot stomping, and pouting". That's absurd, to say the least. So I like how you think that you will roll up in here, and speak as if you are some authority, and we shall follow like good children. Buy what you want woman, and we will do the same.
