Prices at LFS

[TODAYBOB]

Hi, Just read the post on Aquaclear. Have always tried to do my fish supply purchasing from LFS, owner great guy, very knowledgeable about fish. But his prices have gone up again. AQ 200 $32.99, AQ 300 $44.99
At BigAls $13.99 $19.99
I am planning to buy two AQ 300, enough $ left to pay S/H.
How can LFS stay in business?????????????

P.S. Is this a good price at BA ??? ???

BOB ;)

[Ryan]

The online vendors are very close in price, and they seem to have the best prices on things like AquaClears. LFS are suffering but it's just not practical for me to spend twice as much on something like that. My LFS sells AquaClear 500s for $80... I can't throw around money like that on everything.

Big Al's and That Pet Place are where I order most of my stuff, including the AC's I got.

Ryan

[DHDiscusMan]

I found AC 500s between 75 and 90. I bought 2 with extra sponges and shipping for a bit over 90.

I feel sort of badly for the lfs... especially the non-megachain ones but I don't think I can afford to shop there any more. Everything is basically double.

I checked Amaquel and it's $50 at LFS (one gallon) and $25 at Big Al's...

Sad but true.

[Rick_May]

I have two lines of though on the LFS compaired to the on-line.

LFS have more overhead for the amount of volume they do so they need to mark up more. If they don't make money they will close so I try to support the local guy.

the real problem I have is when I go in and find they marked their product up by 150% to 300% over what I can buy it online. IMO thats not covering your over head thats ripping people off. in these cases I simply sigh and figure they dont really want to stay open and I take my money and leave.

SO my bottom line is, if the LFS isn't ripping people off I'll support them those that rip people off, well I'll just wait for your going out of bisness sale.

[Wolf]

I buy a few things at the local fish store. It is convenient and I get my stuff right away so I don't mind paying $5 extra for a pound of food. It is also cheaper to buy tanks locally since shipping is outrageous so you have to get those somewhere. I do get pissed when they sell a Aquaclear 500 for $90 when I can get it for $25 at Big Al's or they sell the exact same discus(won't mention names)for over $100 that you can get for $30 online. You have to draw the line somewhere.

[DarkDiscus]

I suggest that you go to your LFS owner, tell them the prices that you can get on-line and ask him if he will match it, plus the shipping cost and see what he says. Tell him that you like to support him, but when you can get 2 filters for the price of one, you just can' justify it. See what he says.

My LFS used to give me discounts based on total spending also, which helped some.

But if LFS want to compete, they have to accept that they are not going to be able to mark up products the same way they were in the past.

John

I just picked up a Magnum 350 filter at my LFS (my brother & I own one for those that don't know). I paid our landed cost $98.67 Cdn. If I were a regular customer off the street I'd have paid $199.97 Cdn. But depending on my purchase volume over the last year I could get a 5, 10 or 20% discount off of that price so the minimum I'd pay is $159.97 Cdn. If I bought it from MOPS in Ontario I'd pay $149.99 + freight which would be about $10 so I'd be no better off. If I bought it at PetSolutions I'd pay $113.40 Cdn + freight which would be about $20 for a total of $133.40. So I could save at most $66 but if I regularly shop at this LFS my savings would only be $26 and I'd get the filter that day with no risk of loss in shipping and my warranty would be valid in Canada.

That Magnum 350 was purchased at my LFS in October of 2001. When I took one there was still one in stock. So we've been sitting on them for over a year. We double our cost for most equipment and then offer discounts to our regular customers based on their purchases. The computer tracks that for us and automatically deducts the discount. Our sales are pretty good but there are always products such as the Magnum that we sit on for a long time. Even at 100% markup it's tough to make a buck given the overhead of running this kind of business. We've been open for 2 years and have lost money overall for that period. Hopefully we'll start making a profit soon. We try to keep our prices at the lowest in town although there's always a store that has something on sale that beats our price. But we find that price is not much of a motivator for many customers. They just want to walk in and buy what they want. They go to the store that advertises the most because that's the one that's in the forefront of their mind. The large PetLand, Petcetera, Paws Pleasers stores usually charge more for their products and have poorly trained staff but they do the marketing so they get the bulk of the sales, especially the newcomers to the hobby. We get them after their fish die due to the poor advice they get. And these big stores aren't making money either. The PetLand here in town is huge and it was built to make a statement to the other chains to stay away. It loses money every month and has done so since it opened but it protects the investments that have been made in all of the smaller PetLand franchises. If the presence of a big whacking PetLand in Winnipeg can deter the entry of other chains then the cost of losing money is worth it (so I've been told). The other chains still came but they're having a hard time and there's rumors that they might be scaling back. Meanwhile the smaller owner-manager stores are disappearing. It's a tough business to make a buck in... sales all but disappear in the summer when everyone spends more time outside.

I'm not complaining, just pointing out the other side of the coin... and there's very few coins on the other side.

Dave

[Tim_Ellis]

I agree with John. You should at least give the lfs a chance to compete with your online purchases. They may not want to work with you on items that are already in stock because they already have invested capital in it, on the other hand if you pay when ordering the store is not out any on cash flow and ever little bit helps. If we lose our specialty shops then we are stuck with the likes of Petsmart and Petco. So at least give them a shot first.


Tim

[roger]

IMO the LFS are starting to discover what the LCS (local computer store) has already discovered. Lets face it the people buying computers are more technically savy (on average) than someone who buys fish supplys.
That being said it is only a matter of time before the people who own the LFS realise that people are going elsewhere ie online for their supplys. What this causes is prices to drop and for many places to close.

The only places that tend to survive are the ones that quickly reach the point of somewhat lower prices with good service. Or also in our case good fish.

Back to the original quection, its a ton cheaper to operate out of a "garage" as a business than it is to have a storefront and have employees. More than likely a LFS cant even match the online+shipping idea. Though thats probably more true for big dollar items than it is for mid-dollar items that they turn over quickly. When Im in a hurry, which I try to avoid, Ill buy things from the LFS. Otherwise I only get frozen food and tanks from them. I dont have the room for a bulk order of frozen food, and the thougt of shipping a tank gives me nightmares.

[paulmat]

My LFS owner is a good friend so I allways give him first chance to sell me anything(supplies) but he knows I buy my sups.& foods on line or catalog. Most of the time he can't compete,but when it's close I give him my biz. He's learning thou ;) He buys some fish from me and I can't even afford my own fish!
Paul

my buddies at my lfs have explained it to me that their prices are actually driven up by the online stores. Because the online stores take some of their sales away, they have to raise their prices to make the money they lose from not getting other sales. This is similar to the Gibson guitars sales philosophy that when sales go down, raise the prices and sales magically go back up. the thing is, it works for Gibson but not for LFSs.

[Pat_in_NC]

There is a principal in economics called flexible demand: when price go down the demand for products goes up and vice a versa. I doubt very much that raising prices is going to help the fortunes of any local fish stores. The trick is to have a good customer base who are willing to pay the extra for supplies because there are knowledgeable people to help them. In previous places I have lived I was lucky to enjoy some great LFS--I really miss them now (the closest decent LFS is 30 minutes away).

Pat

[RAWesolowski]

A large part of theblem in pricing between on-line providers and your LFS is distribution. The on-line provider will buy directly from the manufacturer and, in some cases, the manufacturer will ship direct for the on-line business. The benefit is given to tose businesses that can turn a high volume of product.

The LFS, on the other hand, will generally purchase product from a distributor, who purchases in volume from the manufacturer and warehouses product. The distributor can then supply the product to the "low" volume LFS.

The next greatest savings for the on-line company is generally occupancy. Unheated warehouse space is much less expensive than space in a class B or class C mall. Think of paying rent of $12 per square foot plus a percentage of repairs, maintenance, taxes and whatever else the landlord throws at you... and if your sales are high enough, your rent ratchets up due to a "percentage of sales" clause.

The on-line guy may pay the rent and commons but rent is near $3 to $5 on warehouse space without any of those costly things that you have to put in stores like walls, ceiling, floor coverings, paint and decor. The landlord doesn't worry if you have great sales but you have a fixed rent! He's just glad that someone is paying the rent.

I would call employee costs are employee costs a wash for the businesses. It may be slightly lower as a per cent of sales for the on-line company, but sales and maintenance staff for the LFS are traded for customer service and warehouse staff.

Just at my local LFS and a "customer" came in, looked at an Aquaclear. Pulled the box apart and spent a half hour discussing the unit compared to his options. After destroying the packaging and wasting the store's time, he informed them that "on line" was cheaper.

Mmmm, there is a moral running around here somewhere!

[rfidiscus]

I buy from the same wholesalers that the lps buy from and have found that the wholesale price is usually the same as the mail order price! How and the world can they compete? I have tried to coach my favorite lps by getting her to buy in large volumes when the wholesaler runs sales and then charge what the normal wholesale price is on this item... It works: she make her money and doesn't have to sit on ($100) filters for months... turnover!!!!!

[RAWesolowski]

It works if she has an immediate turn on the inventory. That is, the items that she purchases run out the door within a short period of time, say 60 days. If not, she has dollars tied up in inventory that must be recouped through the mark-up on the product.

Your example is particularly good for high turnover items such as branded dog food. Competition and demand create a high turnover item with a very low margin... The dollars look good in the register but essentially bleed right through to the wholesaler.

[DarkDiscus]

Obviously there are a lot of variable in running a business and no one is saying that LFS shouldn't charge slightly higher prices than on-line warehouses. I have no problem paying 10% to 20% more on an item (above and beyond the shipping cost as well) in return for good service, the convenience of immediate purchase, etc. Plus having a good LFS to visit is a pleasure. I am HAPPY to pay extra to keep them in business.

It's the massive markups that are not acceptable. When people are talking about paying more than twice the price on a filter, these shops deserve to lose business. It's all relative. Higher prices are fine, highway robbery is not!

John