Spyderco moving to MAP pricing!

Stays Sharp said:
What were the signs that finally prompted this move? Was Spyderco losing dealers? Were they losing revenue and blame it on online sales?
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We've had many discussions with dealers and distributors. We're trying to see long term and a long ways ahead with the changes in the marketplace and very large dealers.

We've been watching the market for a long time. Advertised pricing has been challenging for the past few years. We felt it was our obligation to take responsibility and try to sort out the issues, but it took a while and a lot of discussion to make a move. Enforcement is an important issue and monitoring requires assistance.

sal
 
My concern is when dealers are stuck with slow moving Spydercos (includes discontinued items) which currently are selling for around 50% off MSRP.
 
Sal Glesser said:
Hi Danthaman,

I think you left out a part of the equation. You purchase 50 widgets to sell and find out that you can't sell any at any percentage of profit because ABC company is advertising the widget for less than you (or they) can purchase it for.

sal
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Sal,
Thank you for participating in this discussion and trying to help us understand why you made this move.
I do understand that part of the equation, and in that respect MAP is a band-aid, not a cure. The cure would be a broader interpretation of existing antitrust laws, and/or new laws preventing some of the 'loss leading' anticompetitive practices that drive small retailers out of business.
But I understand that sometimes the band-aid has to come first.
 
danthaman1980 said:
I think I get it, MAP is one solution that helps keep manufacturers and small retailers from being bullied by the large retailers
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Bullied? That word has become so overused and misused that it has lost its meaning. Large retailers can't bully small ones. They sometimes can sell more products at better prices, and good for them. That isn't bullying. Its competition.

A couple of years ago, Red's Gear offered Spyderco Cats for $7 shipped. I bought their entire inventory, which was only about 7 units. I guess that they were just trying to get rid of them. I would not have bought a Spyderco Cat otherwise. My purchase helped me, because I got a bunch of cheap Cats. It helped Red's because they cleared out their inventory, which was the whole point of the $7 pricing. It moved 7 more Spyderco's, which is good for the company. And it did not harm in the slightest any small vendors (though I have no problem if they can't stay in business) because they didn't lose any sales. Its a win-win-win situation.

Ultimately, tampering with the marketplace almost always backfires in the end. I love Spyderco and I love Mr. Sal. I'm just really discouraged to see it happening here.

20131216_132543_zps41cb3beb.jpg

Spyderco Cat.
 
Sal Glesser said:
We've had many discussions with dealers and distributors. We're trying to see long term and a long ways ahead with the changes in the marketplace and very large dealers.

We've been watching the market for a long time. Advertised pricing has been challenging for the past few years. We felt it was our obligation to take responsibility and try to sort out the issues, but it took a while and a lot of discussion to make a move. Enforcement is an important issue and monitoring requires assistance.

sal
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Enforcement and monitoring also require the budget to support them, a budget that will no doubt be added to overhead costs which will eventually get passed along to consumers by way of higher prices. That's why the consumer ends up getting hit the hardest when MAP pricing goes into effect. We will end up having to pay more for Spyderco products coming AND going.

The irony in enforcing MAP pricing is that the consumer ultimately pays for making sure their prices remain higher than they ought to be.

There is no free lunch!
 
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Sal Glesser said:
Hi Wazu,

We're trying to control advertising, not prices. (Price fixing is illegal, as I understand) Also, one must determine where one will draw their lines. We have more than once had to lose a volume customer trying to force us to be unfair (to them or us).

sal
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Thanks Sal :)
 
bld522 said:
Enforcement and monitoring also require the budget to support them, a budget that will no doubt be added to overhead costs which will eventually get passed along to consumers by way of higher prices. That's why the consumer ends up getting hit the hardest when MAP pricing goes into effect. We will end up having to pay more for Spyderco products coming AND going.

The irony in enforcing MAP pricing is that the consumer ultimately pays for making sure their prices remain higher than they ought to be.

There is no free lunch!
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I have to ask, is this based on industry experience, training, or speculation on your part as a consumer? You are against MAP policies because you feel that the consumer will end up paying more for a product, this is understood.

Conversely, you never hear complaints from individuals who purchased Ti Militaries and sold them for more than the initial sales price...

Again, if the price is too high for you, do not buy. Based on Mr. Glesser's posts your rhetoric will not change Spyderco's position.
 
I'm not suggesting that it will. I just believe in full-disclosure. People need to know what they're getting into when they buy products backed by MAP pricing. At that point, they can make informed decisions. I assume you're OK with that, right?
 
I believe that Spyderco has fully disclosed their position.

You, on the other hand, are speculating on elements of the pricing that you cannot fully understand unless you were in a board meeting while this was being discussed.

MAP policing is often times done by other dealers, their sales rep, etc.

There is not a large cost associated to it that would require an increase in sales price.

Again, I ask, are you basing your comments on industry experience, training, or speculation on your part as a consumer?
 
somber said:
I believe that Spyderco has fully disclosed their position.

You, on the other hand, are speculating on elements of the pricing that you cannot fully understand unless you were in a board meeting while this was being discussed.

MAP policing is often times done by other dealers, their sales rep, etc.

There is not a large cost associated to it that would require an increase in sales price.

Again, I ask, are you basing your comments on industry experience, training, or speculation on your part as a consumer?
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Ahh. So you're a proponent of the free-lunch theory. Spyderco will be able to enforce MAP pricing and it won't cost them a dime. Right! :rolleyes:

If I'm speculating, what do you think you're doing?
 
Why not just wait an see exactly what happens once the MAP goes into place?

Only then will the end customers see what and or how it effects prices and by how much.

I don't think it will make a large impact overall personally.

But then some people get whacked out of shape over a penny so it's all relative. :rolleyes:
 
bld522 said:
Ahh. So you're a proponent of the free-lunch theory. Spyderco will be able to enforce MAP pricing and it won't cost them a dime. Right! :rolleyes:

If I'm speculating, what do you think you're doing?
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Considering I work in the industry, my viewpoint is based it on experience.
 
Is that a good thing?

I assume my viewpoint in pricing, policies, and the consumer are pretty common in the industry. I recognize that MAP is necessary in some instances and that it further allows distributors/dealers to compete better through customer service and policies instead of simply undercutting their competitor or offering loss leaders when they need to make a sale.

Anyone can sell something for little to no profit, but those practices are not sustainable for building a strong brand.
 
somber said:
I assume my viewpoint in pricing, policies, and the consumer are pretty common in the industry. I recognize that MAP is necessary in some instances and that it further allows distributors/dealers to compete better through customer service and policies instead of simply undercutting their competitor or offering loss leaders when they need to make a sale.
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That's right. MAP pricing serves everybody but the consumer . . . just like I said.
 
somber said:
Is that a good thing?

I assume my viewpoint in pricing, policies, and the consumer are pretty common in the industry. I recognize that MAP is necessary in some instances and that it further allows distributors/dealers to compete better through customer service and policies instead of simply undercutting their competitor or offering loss leaders when they need to make a sale.

Anyone can sell something for little to no profit, but those practices are not sustainable for building a strong brand.
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That or staying in business at all. LOL :D

Certain percentages need to be met all along the line to cover all of the expenses as we all know.

Don't know how many times over the years I have told people that everything costs money, nothing is free.

All that stuff customers want, it all costs money, every bit of it.

They are like.... Why don't you do the things like XX does? Well ahh, their prices are 20% higher than ours so they have the payroll to do that stuff. ;)

So if they want all that stuff then they can go across the street and get all of it........ At 20% higher cost. ;)
 
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