You say you are a "hobby knife dealer". What is that? Someone who just sells knives for fun? If so, then YOU and other hobby dealers ARE the problem.
Let me explain. I am a knife dealer in southern California. I don't have another job to pay the bills and subsidize my inventory. I have to charge enough for the products I sell to not only buy more stock and meet business expenses, but to also buy incidentals, like food and pay the mortgage, etc., etc.... This is not a hobby, its my livelyhood.
You're right when you say customers don't know what a knife costs a dealer. Why should they? With the WalMarts and Costcos and other discount stores out there, not to mention mail order catalogs and internet dealers, convincing buyers that if they pay serious money for a product, they are getting ripped off, its no wonder that they beat you up on prices.
Too many buyers think that if you make more than ten bucks on a knife that retails for $200.00 they are getting taken advantage of. No retail business can survive on that kind of margin with individual sales. The problem is the customers don't care, as long as they get the lowest price. (I think that is where the old fable about killing the goose that laid the golden eggs comes from).
It gets worse when "hobby dealers", such as yourself, decide to jump into the pool and play with the sharks. Overhead is low when you start so you figure you can maake it on a slim margin. You see the competition and tell yourself that you can match it or even beat it. By the time you realize that you are losing money, it is too late to recoup and, since its only a hobby anyway, you cut your losses and go on to something else. Behind you is a wreck of super discounted prices and a market that has been totaly destroyed for legitimate businesses. You are just getting into the mess at a time when those before you have already done the damage.
I suppose that I have totally pissed you off by now and I don't mean to, really. I don't know you and you are probably a nice person. I don't even begrudge you the right to do what you are doing. It's still a free market out there and you have as much right to try and tap it as do the rest of us. It just struck me as strange that someone, doing what you are doing would be so surprised at the situation.
If you are serious about your business, you have to control it. You say that customers are offering you less and less for your knives. Aren't you setting your prices? You know what you have to make to stay in business. If you let your customers set your prices, you will be paying them to take your stuff. Set your prices and stick with them.
The first thing you have to understand is that you aren't going to get ALL of the buyers out there. Don't even try. There are enough buyers out there for everyone.
Customers are loyal to dealers they like. The good dealers, the successful ones, provide more than products and prices. They build relationships with their clientel. Its ok to give deals and discounts, but reserve them for your best customers, and don't advertize the fact that you do that. Word will get around, and when it does you will find that you have more people coming to you. When you do discount, don't go below your break point. You have to make money on everything you sell or you will fail.
Your core clientel will be small but they will draw others in for you.
Don't advertize that you have the losest prices in town. You don't. Someone will always come along and beat you.
Don't gouge your customers. They will know if you do. They aren't stupid. As a business, you live and die by your reputation.
Make friends with other dealers. Even though we are in competition, we don't all hate each other. You would be surprised at how much information and advice you might get. (Maybe even more than you want
If you carry a line, carry the full line, or at least a large majority of it. Nothing turns a customer off more quickly than to come in or call looking for a certain model and have it not be in stock or not carried. if you advertize yourself as a knife dealer, make sure you have KNIVES. Inventory is everything in retail. If you don't have it they won't come, to paraphrase an old movie line. You won't make it if you just try to carry the latest and greatest new cuttenstabber. It changes, sometimes overnight. You will chase the market right into bankruptcy if you try that.
I could go on, and on... but its late and I have to go in to the store tomorrow. I'm closed on Mondays, but I have to go in anyway. Bills to pay orders to fax, etc., etc.
If you haven't gotten angry and cut this off by now you have probably figured out that what I'm trying to get across here is that business isn't a hobby. I read your frustration with the situation and I understand it. Imagine mine. Like I said, this is my livleyhood. It is frustrating when a customer shows me a Sportsman's guide or Cabela's catalog or a printout of a web page showing prices sometimes 20 or 30% below mine. After I explain that I can't meet that price they either go away or they buy from me. The thing is...you would be surprised at the number of people who do buy.
Good luck in your hobby or business or whatever it is. As I said earlier, you have a right to try, and if you succeed, then good for you. There's always room for one more.
Make lots of money
Isn't it amazing how 2 cents worth of opinion takes up a quarter's worth of paper???