MAP pricing: Has it affected your buying habits (i.e. buying less, switching brands, etc.)?

[Belly]

There is the perception that tons of people are complaining about these things, because people who complain about things get noticed more easily.

Who is going to start a thread that says, "Well, today I am still not minding current trends in the knife world. Yep, not bothered today, last week, or the week before that. Things are okay. "
No one does that; they start threads that complain about something, or rave about something, but not to say "Meh, things are fine."

You certainly have a point there. No one would do that.

But I see hundreds of replies in many, many threads over the years where people complain about not just MAP, but also fit and finish, and price increases, and value. Even if you put aside specific threads about those topics, in every thread that discusses a new model, there is always a number of people who find issues. Think about how many threads there are for every new model for every year, for, say, the last 10 years, for just, for example, Benchmade. Certainly, there many people who have a good experience, and it's tough to tell what percent they make up. I can't tell because of the exact reason you described. Each year, I just keep thinking that more people will say "that's just too much for what you get". But all I'm saying is that this just doesn't happen. The majority of knife people are willing to spend the $500 for the model 87, and Benchmade continues to thrive. And good for them, because their business is not mine, and if others really like to spend that kind of money, that's their business too. Hence I say that MAP and the other topics don't really bother people, even though there are many that express displeasure about them.

 

[SpySmasher]

... The majority of knife people are willing to spend the $500 for the model 87, and ...

I think a lot of us are expecting a bubble to burst as the market slows down due to inflated pricing and collectors and knife flippers find the value of their small-run-high-price knives drop on the secondary market. The manufacturers and makers of good value-for-money knives will continue to do fine but others may not.

It's happened before in other industries.

 

[Pomsbz]

You certainly have a point there. No one would do that.

But I see hundreds of replies in many, many threads over the years where people complain about not just MAP, but also fit and finish, and price increases, and value. Even if you put aside specific threads about those topics, in every thread that discusses a new model, there is always a number of people who find issues. Think about how many threads there are for every new model for every year, for, say, the last 10 years, for just, for example, Benchmade. Certainly, there many people who have a good experience, and it's tough to tell what percent they make up. I can't tell because of the exact reason you described. Each year, I just keep thinking that more people will say "that's just too much for what you get". But all I'm saying is that this just doesn't happen. The majority of knife people are willing to spend the $500 for the model 87, and Benchmade continues to thrive. And good for them, because their business is not mine, and if others really like to spend that kind of money, that's their business too. Hence I say that MAP and the other topics don't really bother people, even though there are many that express displeasure about them.

Or is it possible that the forum is only a microcosm of the knife buying world and market and those who decide to base their purchases on principle an even smaller microcosm?

 

[Knife Outlet]

There's another MAP thread; or maybe it's this one (so hard to tell; so many MAP threads lately) stating that sticker prices in store must confirm to MAP. Any take on that?

I don't think that has been adjudicated. It gets down to the definition of advertising. My wild guess is that it is not advertising. If I were a B&M knife store and this was true, I would simply put the MAP on the ticket with a line through it for products that I wanted to discount. As I said earlier, there is no risk in asking for a lower price. The worst that can happen is a denial.

 

[Belly]

Or is it possible that the forum is only a microcosm of the knife buying world and market and those who decide to base their purchases on principle an even smaller microcosm?

That too is a good point. I'd love to better understand what percent of a particular knife company's customers are represented here. Are we simply just the tiniest fraction, or are we big enough to affect sales?

 

[FortyTwoBlades]

A common business rule of thumb (to which there are always exceptions) is that 20% of the consumers buy 80% of the product.

 

[Cory Hess]

That too is a good point. I'd love to better understand what percent of a particular knife company's customers are represented here. Are we simply just the tiniest fraction, or are we big enough to affect sales?

I think we're a very tiny fraction. Like small enough that if we disappeared most of the companies we're talking about here wouldn't even notice. Some of these companies are pumping out millions of knives a year. This site has just over 300,000 members. In 2015 I called KAI and asked how many knives they make in a year. They wouldn't give me an exact number, but said that it was in the tens of thousands per day. I don't know what percentage of members here are actually active, and I don't know what percentage of active members are interested in KAI products. I suspect that the number of KAI knives purchased annually by active members here is less than the number that they make in any given week. If you further reduce that to the active members that care about MAP pricing you're looking at a tiny, tiny fraction of their business. I'm assuming that other manufacturers have a similar percentage of knives sold to members here. I could be wrong. Heck, they could have been lying when they told me the number of knives that they make. I don't see why they would, though.

 

[K.O.D.]

I think that us knife enthusiasts make up maybe 20% of the market. About 35% just look for something cheap that they will replace when it gets dull like a razor knife. Most people are buying at big box stores, or local gun stores. This vast majority is completely unaware of MAP and usually pays MSRP.

I remember looking at knives a few years ago at one of the local gun shops, and a guy paid $305 for a ZT 0300. I nearly pissed my pants. He had already paid or I would have said something.This was 2013 or 14 and I think they were going for around $200 online, maybe less. I generally don't go to that place, prices are bad and the people who run it are awful.

 

[Pomsbz]

A common business rule of thumb (to which there are always exceptions) is that 20% of the consumers buy 80% of the product.

I wonder though, it seems like the majority of these MAP-ed knives are those bought by general 'users' rather than enthusiasts. In hardware stores for the Benchmade, by professionals for ZT and everyone else and their cousin for Spyderco. Yes perhaps their more exotic offerings might only be known by the kind of knife buffs who frequent online communities but their bread and butter sales are probably bought well outside the sphere of the knife community and by people for whom a knife like this and a Leatherman/SAK might be the sum total of their entire collections. Somewhat like knives used to be in the days when everyone had an anonymous slipjoint in their pockets, bought cheaply, used to death then replaced. I'm just not sure we are all that relevant to the majority market for these big names.

Would be interesting to see the sales figures for a company like Spyderco (due to their size and popularity), how many knives sold in a year and specifically, which types. Then compare that to the amount of Spyderco knives bought by forum members in a year and which types. Would be some interesting statistics.

 

[Hackenslash]

I think we're a very tiny fraction. Like small enough that if we disappeared most of the companies we're talking about here wouldn't even notice. Some of these companies are pumping out millions of knives a year. This site has just over 300,000 members. In 2015 I called KAI and asked how many knives they make in a year. They wouldn't give me an exact number, but said that it was in the tens of thousands per day. I don't know what percentage of members here are actually active, and I don't know what percentage of active members are interested in KAI products. I suspect that the number of KAI knives purchased annually by active members here is less than the number that they make in any given week. If you further reduce that to the active members that care about MAP pricing you're looking at a tiny, tiny fraction of their business. I'm assuming that other manufacturers have a similar percentage of knives sold to members here. I could be wrong. Heck, they could have been lying when they told me the number of knives that they make. I don't see why they would, though.

Based on your claim of "tens of thousands per day", you're claiming that KAI makes over 3 million knives a year? That doesn't even begin to sound right...

 

[Insipid Moniker]

I think we're a very tiny fraction. Like small enough that if we disappeared most of the companies we're talking about here wouldn't even notice. Some of these companies are pumping out millions of knives a year. This site has just over 300,000 members. In 2015 I called KAI and asked how many knives they make in a year. They wouldn't give me an exact number, but said that it was in the tens of thousands per day. I don't know what percentage of members here are actually active, and I don't know what percentage of active members are interested in KAI products. I suspect that the number of KAI knives purchased annually by active members here is less than the number that they make in any given week. If you further reduce that to the active members that care about MAP pricing you're looking at a tiny, tiny fraction of their business. I'm assuming that other manufacturers have a similar percentage of knives sold to members here. I could be wrong. Heck, they could have been lying when they told me the number of knives that they make. I don't see why they would, though.

Your numbers are pretty certainly vastly off. The only knife companies producing that kind of quantity are Victorinox and Opinel. Even the ubiquitous Buck 110 has sold fewer than 20 million units in it's lifetime.

 

[Cory Hess]

Like I said, I'm just going off of what they told me. I don't really have any basis of comparison to know whether or not to believe them, and I don't see any reason for them to lie to me. It's also possible that the person I spoke to had no idea what she was talking about. She put me on hold so that she could check the numbers for me, but it's quite possible that she just sat their and played with her hair for a minute then came back on and fed me some BS.

 

[Hackenslash]

Like I said, I'm just going off of what they told me. I don't really have any basis of comparison to know whether or not to believe them, and I don't see any reason for them to lie to me. It's also possible that the person I spoke to had no idea what she was talking about. She put me on hold so that she could check the numbers for me, but it's quite possible that she just sat their and played with her hair for a minute then came back on and fed me some BS.

I might buy the concept of "tens of thousands" knife making "activities" per day; i.e., stamp 1000 clips = 1000 activities...heat treat 500 blades = 500 activities...Titanium nitride coat 1000 handles = 1000 activities...maybe that might add up...

Nah, I still don't really see how that could add up to tens of thousands day after day, ~250 times a year. I'm going with whoever told you that didn't know what they were talking about.

 

[ToddM]

Over the last 30 years we've seen all kinds of pricing tactics in business to even the brick & mortar and internet. I'm sure there are good points and bad both as a seller and a buyer. One thing that's always bothered me though is the idea that MAP helps the small business by fixing a minimum selling price, however as we know the more you buy as a dealer the cheaper you pay. So the huge stores pay less for the product but sell it for the same MAP. While this protects some profit margin for the small store, it also ensure the larger the store the higher the profit margin per item though I guess it cuts into their volume some. Which means they can offer lots of extras, free shipping, gifts, more frequent specials, carry more stock, better return policies, pay higher wages to get more knowledgeable employees etc. etc. it seems like enforcing the MAP while using variable dealer purchase pricing by volume while it may help the small dealer also hurts them.

Personally I like to buy local, but I'm also picky I learned long ago it's better to have a few really nice items than lots of mediocre ones, so most stores never stock what I want anyway. In addition if they do the prices are way over MAP and in most cases the customer service, employee expertise etc. is disappointing. Doesn't matter if it's guns, mountain bikes, motorcycles, knives, snowboards, cameras, etc. etc. It's very very rare I find a local store that offers a total package of service, knowlege, and product worth paying their asking price. That being said when I do find one I'm happy to pay a premium to support them.

As for MAP on knives, I'd say if anything it's made it so I don't have to hunt around for "deals" or sales because the prices are pretty much the same everywhere now. I'd say the biggest loser from my $ has been Benchmade, but more because of the price increases and lack of QC at their current price level. That's not really a MAP issue it's simply that I feel BM has set their pricing too high for what they offer in most cases.

 

[Armadew]

KAI makes and sells lot of kitchen knives. Even when you don't realize. For example, I believe all Tupperware knives are made by them.

Even so, those numbers seem way high.

 

[Lapedog]

Yes I was going to add that KAI is a huge multinational corporation which makes all different types of knives under various sub companies. Aside from ZT, Kershaw, Shun, a ton of other kitchen knives under various other names who knows what other companies are subcontracting them to produce product.

Kai could very well be putting out those numbers although it does seem like an exaggeration. Maybe the person you spoke to was speaking hyperbolically.

 

[Cory Hess]

The context of my inquiry was a conversation where we were discussing the number of knives manufactured by traditional knife companies vs. modern ones. The numbers for the traditional companies were pretty easy to figure out. The modern knife companies don't like to make those numbers available. The closest I could come to a company like KAI that put out official numbers was Victorinox. "In 2006 the company had a workforce of 900 employees and produced about 34,000 Swiss Army knives, 38,000 multi-tools, and 30,000 household, kitchen, and knives per workday." KAI has a workforce of 250 employees. If 900 employees can produce 90,000+ knives and multi-tools it didn't seem that far out of whack for KAI to claim that they can make 10,000 with 250 employees. I understand that there are major differences between a SAK and a ZT, but it seemed reasonable for me to believe that KAI makes many more Leeks than it does ZTs. I would think that manufacturing a SAK would be more demanding than manufacturing a Leek.

You all are saying that there's no way KAI is making that many knives. You have more experience than I do with that company, so I tend to believe you. However, I'd hope that you can see how those numbers don't look too far out of whack compared to other companies I was researching at the time.

 

[whp]

A common business rule of thumb (to which there are always exceptions) is that 20% of the consumers buy 80% of the product.

Hmm. OK.
Wonder what the average number of Benchmades owned the 20% of enthusiasts is. At what point does this increase in numbers owned slow. Probably not before there are other enthusiasts to take the first group s place in the buying frenzy. Or so Benchmade hopes!

 

[austonh]

Great discussion.

Not sure if this has been brought up yet, but aside from protecting smaller vendors from the smaller margins and higher output of larger vendors, one area of great concern to companies is protecting the brand image with MAP. We as people, place a high correlation between price and quality/prestige. When large vendors race to the bottom with pricing, people begin to equate Knife Company X with a certain price point. That price point sets the level of perceived prestige and also begins to lock a manufacturer into a price range that might be lower than they strategically planned for. Or perhaps that price range might be lower than their next build calls for. With manufacturing planned a year in advance, they cannot pivot very quickly in a changing market.

A perfect example was the Hi-Jinx by CRKT. They attempted to build a premium knife, but buyers weren't feeling it because CRKT is an established entry level knife manufacturer. (bit of a stretch for the MAP argument, but it serves to show how we perceive and lock manufacturers into price points based on their history).

There is a ton of research surrounding consumer spending and brand perception that would illustrates this point much more concisely and accurately than I have been able.

By and large I don't have a problem with MAP, unless prices continue to climb under MAP, and retailers can't do anything about it until the product is discontinued. In reality, the only voting that companies listen to are those done with our wallet.

 

[Steely_Gunz]

Great discussion.

Not sure if this has been brought up yet, but aside from protecting smaller vendors from the smaller margins and higher output of larger vendors, one area of great concern to companies is protecting the brand image with MAP. We as people, place a high correlation between price and quality/prestige. When large vendors race to the bottom with pricing, people begin to equate Knife Company X with a certain price point. That price point sets the level of perceived prestige and also begins to lock a manufacturer into a price range that might be lower than they strategically planned for. Or perhaps that price range might be lower than their next build calls for. With manufacturing planned a year in advance, they cannot pivot very quickly in a changing market.

A perfect example was the Hi-Jinx by CRKT. They attempted to build a premium knife, but buyers weren't feeling it because CRKT is an established entry level knife manufacturer. (bit of a stretch for the MAP argument, but it serves to show how we perceive and lock manufacturers into price points based on their history).

There is a ton of research surrounding consumer spending and brand perception that would illustrates this point much more concisely and accurately than I have been able.

By and large I don't have a problem with MAP, unless prices continue to climb under MAP, and retailers can't do anything about it until the product is discontinued. In reality, the only voting that companies listen to are those done with our wallet.

Totally agree.
There is such a thing as being too cheap. While there are brands out there that can hang their hats on offering a fantastic product at a fair price (Spyderco comes to mind in this regard), there is a danger of becoming known as the bottom barrel guy. In my line of work, I don't try to be the cheapest. Now, generally, we're not the most expensive either, but the way I price my labor an my wares is based on what I need to make to turn a profit large enough to pay for all of my expenses and still have a modest income of my own.

In all honesty, I don't really WANT a customer looking for a low price. A price shopper is not loyal. They are loyal to the lowest dollar, and will jump ship (be it service or brands) as soon as a better perceived deal comes along. If you cater to a clientele that only purchases from you based on price, you will always be scratching a living, and conversely, your product/service will probably degrade because their is only so much fat you can trim before you start cutting corners.

A MAP for Spyderco makes good business sense. You set a reasonable minimum advertised price point, and this allows YOU to set your value to the buying public. If some knucklehead wants to sell Enduras for a $15 dollar loss, so be it, but Spyderco basically says that based on market value and Endura is WORTH at least $65 and should be advertised as such.

A MAP means that you are going to build a fan base of of your brand and not have to worry about people jumping around due to price. Need a very entry level folder but still want a Spyderco? Try out a Byrd. Want a mid-level, try the classic Endura or Delica. If you want a more premium knife, check out all the different higher end options made all over the world by talented fabricators of various countries.

Basically, Spyderco (and others) can help write their own narrative and worth. Worth...not cost. The knife can be sold for MSRP or 10 dollar loss, but Spydeco (and others) are painting a picture as to what it is worth, what a consumer should expect for his or her money.


I realize that MAP can seem to run against TRUE free markets, but those wanting truly free markets need to remember Day One Business 101: TINSTAAFL. There is no such thing as a free lunch. If EVERYTHING is 100% dependent on price and market value should be 100% be based on such, what does quality matter?