Spyderco moving to MAP pricing!

Hi Neomentat,

MAP does not dictate pricing. It dictates advertising. I don't think you will see much, if any, price differences. Few dealers sell our products at less than 40% off. Some will advertise prices below dealer costs, mostly as a lost leader, which is difficult for many of our dealers to deal with. They've asked that we try to help them out and that's what we're trying to do with MAP.

sal
 
I just bought two different Spydies online today. The best price I found was neither at Wal-mart nor Amazon. I got one at Cutlery Shoppe and one at Knifeworks. I don't favor one dealer over another, as I have found that they all offer about the same service (at least the ones I frequent). I will say that I do favor ones that don't charge shipping. I have bought Striders, CRK, and Emersons many times and they all operate under some kind of fixed dealer pricing. No big deal to me, it seems to be the future of knives. Would I have bought the knives I did today at MAP prices? I honestly dont know, that just depends how much more it would have been and if any other company offered a similar product. Fortunately, or unfortunately, depending on how you look at it, no other company really makes knives like Spydercos. So if you like them, you will likely pay what they cost.
 
One of the best dealers I've seen only charges a couple percent higher than what he gets the knives for. He's not ashamed to do it because it's growing his customer base because people see he's reputable and has good service. Under MAP no one will care about buying from him and he can't meet the quotas unless he sticks to Spyderco inventory alone. He's not big enough to afford a big website, not big enough to afford a bunch of ad space, and definitely not big enough to be a noteworthy sponsor of any big knife shows. Most people probably have never heard of him and the people who remembered him enough to keep checking with him didn't remember much about him except his low prices. That made him viable in the marketplace.
 
How will Spyderco enforce MAP?
I can see how with a small seller they simply could stop selling him knives. But how about the "1 ton Gorilla"? The one I read they are trying to fight with MAP. Would they say "bad gorilla we wouldn't let you sell thousands of our knives anymore"? Would Spyderco really want to take a hit just to stick it to the "bad guy" who is probably enabling most of their sales?

I think the real reason could be market positioning and shifting the brand perception towards the higher end. The increased price will mean less sales but increase the profit margin if successful.
More profit for Spyderco? Of course right now it seems the profit goes to the sellers but the MAP will guarantee the sellers that they wouldn't be undercut by other sellers and because of this Spyderco will be able to ask more money from the sellers since now he will have a guaranteed profit. Not for old models where everybody knows the prices but probably for new ones the knife sellers will probably have to pay more. A big seller with more purchasing power might get a discount from Spyderco and a small one probably not.
Now the small guy doesn't get mass purchasing discounts (just like before) but on top of that he can't design his own prices to maximize his profits in a way he seems fit. Instead of levelling the playing field it seems just more restricted and that only in one direction.
Does the small knife seller benefit or the big one?
Thinking about this I'm doubtful about MAPs effectiveness but I can't come up with anything better.

Be it as it may if Spyderco continues to make knifes which interest me and have a price matching that interest I will buy and don't care much from who as long as I can trust them. To me it doesn't really matter if there is any MAP or other agreements in the background. I just look at what I've to pay and what I'll get for it.
 
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bld522 said:
To be replaced by what? I suspect it's time to wake up and smell the global economy, my friend. All MAP pricing will do is create a vacuum underneath it that Chinese manufacturers will be more than happy to step in and fill. Mark my words. It's already happening.
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Absolutely true, when a basic nice production knife costs no less than a hundred, that leaves a lot of room for other options from unknowns to make the buying list.

I just got a Cara Cara 2, love it, and I bought an Endura because of it.

The Endura is great, but the backspacer still isn't flush, which doesn't bother me on a superb $20 knife like the Cara Cara, but kind of does on a $70 knife like the Endura.

I know when Benchmade's MAP hit I was suddenly willing to buy used and alternative knives that I previously would have ignored.

There's a lot at play and I appreciate a lot about Spyderco, I hope everything works out and customers (addicts) don't end up noticing much of a difference.

Thanks for joining the thread Mr. Glesser!
 
I have the solution . Keep MAP and lower the MSRP . We all know the PITS is not worth 400, the Slys is not worth 500 , lion spy 400+ , the proficient 490 . If spyderco keep there MSRP realistic there will be no problem .

I'll keep buying the Sprint Militaray , PM2 , and Manix . That will be it for me . If the price is not right I will cut them of like I did with benchmade and ZT . The exchange also works well for me when it comes to knives I want to try out then trade them .
 
Sal Glesser said:
I don't think anyone here is knocking Amazon or Wal-Mart. They are successful companies that have many plusses on their card. They're not likely to go anywhere in the near future and they're also dealers of ours. We think our MAP experiment will work. If not then we'll still continue to try to make things better for all concerned.

sal
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I like Amazon because if I can't find something locally they usually have it (Not knives) like stuff that has been discontinued in our local region for whatever reason.

For Walmart, well I try and not go there unless I really need to, everything under one roof thing. I do all the shopping for my Mother (67) and it's easier to get all of it at Walmart than to hit 3 different stores. For most stuff I hit the local grocery stores as there are 4 chains in my area, all within 3 miles from my door so I can take my pick depending on what I want. I really don't like shopping in large stores due to my injury as it effect walking distances a lot so in large stores like Walmart I have to stop a lot and rest.

Six to one, one half dozen to another.... :)
 
Sal Glesser said:
Hi Neomentat,

MAP does not dictate pricing. It dictates advertising. I don't think you will see much, if any, price differences. Few dealers sell our products at less than 40% off. Some will advertise prices below dealer costs, mostly as a lost leader, which is difficult for many of our dealers to deal with. They've asked that we try to help them out and that's what we're trying to do with MAP.

sal
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Just so I'm clear, what you're saying is that once MAP pricing is instituted, all anyone has to do to get the actual price a dealer is willing to sell a Spyderco for is call them and ask them. In other words, MAP pricing is no more than a fiction manufacturers use to give the image that they're leveling the playing field for their dealers when in fact they really aren't. Dealers can still sell Spydercos for anything they want to sell them for and getting around MAP pricing could be as easy as picking up a telephone. Is that right? If it is, I'd say my days of buying knives online from Internet dealers are over. Depending on my negotiating skills and my willingness to pit one dealer against another if I have to, relief could be just a phone call away. And "call for best price" rather than "add to cart" could become the new paradigm.
 
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bld522 said:
To be replaced by what? I suspect it's time to wake up and smell the global economy, my friend. All MAP pricing will do is create a vacuum underneath it that Chinese manufacturers will be more than happy to step in and fill. Mark my words. It's already happening.
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Not really all that sure, but I can tell you this for a fact.

Walmart is bleeding money like crazy in their Super Stores, once they started selling groceries like they are now.

They have a serious major logistics problems from what I have personally seen with my own eyes, it's really so bad I am actually amazed they haven't addressed them yet.

As smart as they seem to be overall in their business model, the grocery side of the Super Stores is a major issue that will bring them down in the long run if they don't make some major changes.

They can't continue to bleed money like that forever, it's the worst system I have ever seen in my life overall.

It would be a massive investment to fix those massive problems so I can understand somewhat why they haven't addressed them as of yet.

It would actually be smarter to shut the grocery side down in their Super Stores, that's how bad it really is.
 
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Yep. In thinking this through a little deeper, MAP pricing affects dealers that are most dependent on low-price advertising to sell products. That's who MAP is really aimed at. And it doesn't take a degree in rocket science to figure out who those dealers are. Will they take MAP lying down when they know all people have to do to beat their prices is pick up their phones? What do you think?
 
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Well, it does mean MINIMUM ADVERTISED PRICING not minimum DICTATED pricing.

For the longest, that's exactly what it was with Benchmade for example, until they decided to enforce their minimum pricing onto online dealers who were doing the add to cart gig.

More and more seem to be in line with a minimum price, CRK, Hinderer, Strider maybe even William Henry's never go below a certain price. Chris Reeve even said that "whoever sells my knives for less would be cut off". Add those companies in with ZT, BM, Emerson and some others and it seems that dictated minimum pricing is a better description than minimum ADVERTISED pricing.

Again, I'm not a fan of this MAP at all on any level, but given that only Amazon, Ebay, and two online dealers sell over 40% anyway, Sal also has a point that many showing concern may not be affected at all anyway. Not to mention the folks who don't own one Spyderco or not much of a customer at all but are fully participating on these threads just for the hot topic.

Let's ask the right questions: How will MAP be enforced? Will add to cart prices/coupons be aloud?
 
Stays Sharp said:
More and more seem to be in line with a minimum price, CRK, Hinderer, Strider maybe even William Henry's never go below a certain price. Chris Reeve even said that "whoever sells my knives for less would be cut off". Add those companies in with ZT, BM, Emerson and some others and it seems that dictated minimum pricing is a better description than minimum ADVERTISED pricing.
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I suspect that's a whole lot closer to reality, all right. Of course there's a tool you can use to find out for sure. It's called the telephone. ;) The way I'd approach it is to set your own MAP (Maximum Actual Price). In other words, decide what you're willing to pay for a knife. Then call around and see if anyone is willing to sell it to you for that price. If not, buy something else. If enough people were to do that, dealers would get the message in a hurry. And it's dealers that dictate to manufacturers . . . not consumers.
 
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bld522 said:
I suspect that's a whole lot closer to reality, all right. Of course there's a tool you can use to find out for sure. It's called the telephone. ;) The way I'd approach it is to set your own MAP (Maximum Actual Price). Decide what you're willing to pay for a knife and then call around to see if anyone will sell it to you for that. If not, buy something else.
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Hey, if Knifeworks or another dealer is willing to take my call to continue getting my 3% (they sell Spydercos at 43% average over MSRP) I'm all for it. Half my orders are through the phone with them anyway. Somehow, I doubt that's gonna happen though.

One thing, Besides brick and mortars we hear about from lucky forum members who say they get below MAP Benchmades from, the Benchmades I have bought since MAP enforcement was through EBay (non official?)l dealers that allowed me to negotiate a price. I got a 940-1 for $215, 531 for $105, and a 707 for $107. Other than that, I only buy Benchmades from the exchange now.

Add: If we all did that phone thing you suggest, then it could work. But we as a whole won't.
 
I really can't get a handle on this. Seems as if consumers are willing to pay more and more for knives that have not improved appreciably over time. Will that trend continue? If it does, MAP pricing isn't going to be a big deal. Consumers will just suck it up and keep reaching for their wallets. And those of us who refuse to do that won't amount to hill of beans. That may be the ultimate reality, of course.
 
bld522 said:
I really can't get a handle on this. Seems as if consumers are willing to pay more and more for knives that have not appreciably improved over time. Will that trend continue? If it does, MAP pricing isn't going to be a big deal. Consumers will just suck it up and keep reaching for their wallets. And those of us who refuse to do that won't amount to hill of beans. That may be the ultimate reality, of course.
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Then again, $300+ knives are not at all by any stretch of the imagination; mainstream. Hinderer, CRK on their own will never blow to be the size of Levi's, or Apple. It's a very select nich market to be spending more than $50 for knives...more than $150 for knives etc etc. I think these top end models for Spyderco with the crazy high MSRP's aren't intended to be for the masses but for a select group of people. The same rare group that buys midtechs and customs. There's not that many of you guys, may be hard to see that in your/our reality as knife guys.

I'll vote with my wallet, and no I'm not gonna be a "yes man" to whatever prices. I'll spend what I'm comfortable with..

As an example, I am not comfortable paying for the Nirvana.... Not because it isn't worth it per se, but I just don't spend $300 plus on knives (anymore). But...

Typical cost example:

R&D: $
Materials: $
Materials shipped to Taiwan: $
Knifemaker cost: $
Shipping to US: $
Royalties to collaborator: Negotiated $
Spyderco profit: $
Dealer profit: $

Did I miss any? I understand the cost. Regardless, the answer is no. It will always be about what I am comfortable with.
 
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We all know that MSRP is a joke. With MAP, manufacturers reverse-engineer that number based on the prices they set for their products and the discount their willing to allow dealers to advertise them. It's a simple math exercise.
 
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Stays Sharp said:
Then again, $300+ knives are not at all by any stretch of the imagination; mainstream. Hinderer, CRK on their own will never blow to be the size of Levi's, or Apple. It's a very select nich market to be spending more than $50 for knives...more than $150 for knives etc etc. I think these top end models for Spyderco with the crazy high MSRP's aren't intended to be for the masses but for a select group of people. The same rare group that buys midtechs and customs. There's not that many of you guys, may be hard to see that in your/our reality as knife guys.
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Exactly right. :thumbup:

MOST people aren't going to spend more than $40 on a knife and I would say a very large percentage won't spend over $25.

It is a very small by comparison niche market.

The lower end market is saturated because that is what sells the most.
 
First of all I'd like to say that over my career, I have learned that knife afi's are generally "Mavericks". They'll maintain their interest even if none around understand, they still do it anyway. The internet has made it possible for these "Mavericks" to communicate with each other (could that be dangerous ;). That's one of the enjoyments of being in this industry, interesting people.

This is an interesting discussion and I am pleased of which to be part. We, the industry, runs into "new" problems as a result of the changing times. I think Gail says it best. "While Spyderco is not a public company, we really are in that you, the End Line Users are the stock holders. You invest in your company. Therefore we strive to please our investors/customers. That's the mission".

We're going to have to have patience and see if this "band-aid" or first step in many has the desired effect. You can watch as we will watch.

It's our industry and knife afi's are the tip of the spear of the industry. It's our responsibility to try to keep it healthy and pleasing us.

sal
 
Sal Glesser said:
First of all I'd like to say that over my career, I have learned that knife afi's are generally "Mavericks". They'll maintain their interest even if none around understand, they still do it anyway. The internet has made it possible for these "Mavericks" to communicate with each other (could that be dangerous ;). That's one of the enjoyments of being in this industry, interesting people.

This is an interesting discussion and I am pleased of which to be part. We, the industry, runs into "new" problems as a result of the changing times. I think Gail says it best. "While Spyderco is not a public company, we really are in that you, the End Line Users are the stock holders. You invest in your company. Therefore we strive to please our investors/customers. That's the mission".

We're going to have to have patience and see if this "band-aid" or first step in many has the desired effect. You can watch as we will watch.

It's our industry and knife afi's are the tip of the spear of the industry. It's our responsibility to try to keep it healthy and pleasing us.

sal
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Hi Sal,

Kinda like the people who are buying Weatherby's instead of Marlins so to speak. :)

Not to say anything bad about Marlin, it's just the ones who buy Weatherby want more out of their rifles etc.

Jim
 
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I've been quiet on the subject, but I just have to get this off my chest. Maybe it's just my lack of understanding as it relates to business. If I were a small business owner, my stance would be "How dare you (Spyderco, in this case) tell me what price I can advertise an item. It's my store and I'll advertise how I see fit." I'd then drop the product line in a heartbeat. Am I missing something with this logic? Why would store owners be held hostage to a product they're selling for the manufacturer?
 
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