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Thoughts on authorized dealers raising GEC prices above the minimum sale price.
- Thread starter Fixall
- Start date
Problem solved..
NewBlades16
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Wow! Thanks for the info. I guess I was “had” then. I spoke with Dale personally on the phone about it and I took his word.
I'm not calling the guy a liar, but it was called-out and we've seen it a few times from dealers recently.
It's just very hard to believe that one dealer would pass on his stock to another dealer these days.
NewBlades16
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I’ve seen price markups but I missed this tactic. Why not just raise the price without throwing bull? Ha ha. Anyways, thanks for the heads up. I guess I was gullible on that one. I think I am in agreement with jmh33. Maybe my days of GEC purchases are coming to an end. If I want a traditional, I will settle for a modern traditional in Lion Steel.
I think the days of casually shopping for GEC knives are over for good.
I don't want to have to mark a calendar and put other things aside just to catch a drop.
I don't find that enjoyable and I certainly don't want to pay extra for the opportunity.
I may or may not buy another GEC knife, but for the past while and the foreseeable future, I will focus on other brands.
I don't want to have to mark a calendar and put other things aside just to catch a drop.
I don't find that enjoyable and I certainly don't want to pay extra for the opportunity.
I may or may not buy another GEC knife, but for the past while and the foreseeable future, I will focus on other brands.
There's already a really simple solution to this. If you don't like the price then don't buy the knife. The dealers that are raising prices are likely doing so in response to market conditions (because they believe the elevated price to be indicative of market demand.) If they're right, they will outperform peers who didn't take this step. If they're wrong then they'll underperform their peers.
The same is true for "scalpers". If someone wants to allocate their money to speculate on knives then so be it. As long as they're not asking me to subsidize a possible loss, I really don't care.
It really is this simple. The dealer doesn't owe you a reduced price nor do you owe them your business.
The same is true for "scalpers". If someone wants to allocate their money to speculate on knives then so be it. As long as they're not asking me to subsidize a possible loss, I really don't care.
It really is this simple. The dealer doesn't owe you a reduced price nor do you owe them your business.
NewBlades16
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I think what several people are saying is the second part to your solution equation. "You don't owe them your business." And you are correct. It is that simple.
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It has been a tough year for knife makers, sellers and buyers..... I know many knife sellers and I don't want to think of them as scoundrels...... Most live very humbly and and I doubt they have a $70k Mercedes in their driveway.....
50 years ago I worked in retail auto parts..... The goal was to make 40% on a sale or you couldn't stay in business..... Repair shops paid a little less and the walk in trade a little more.... But the end of day tally had to average 40%......
Obviously a knife dealer that has a full time job that pays the bills can operate his knife business differently than the guy that depends on the knife sales to put food on the table.....
I hope that the differences in dealer pricing reflect need rather than greed.... If it is all greed then then eventually their customer base will evaporate....
50 years ago I worked in retail auto parts..... The goal was to make 40% on a sale or you couldn't stay in business..... Repair shops paid a little less and the walk in trade a little more.... But the end of day tally had to average 40%......
Obviously a knife dealer that has a full time job that pays the bills can operate his knife business differently than the guy that depends on the knife sales to put food on the table.....
I hope that the differences in dealer pricing reflect need rather than greed.... If it is all greed then then eventually their customer base will evaporate....
Why in the world does it matter whether the dealer is doing it because its their fulltime job or not? If market conditions are such that they can raise prices then god bless.
Its easy to sit around and complain about prices but you're not the one doing the work or paying the bills for that business. Greed or need are completely irrelevant in context to the business owner taking on the risk of a bad decision.
Fear Of Missing Out is the gasoline in GEC's business model and that is reciprocated with their authorized dealers. Equal competition will diminish FOMO with GEC collectors, and the vulture flippers will need to find new prey. Unfortunately GEC has no equal competitors.... yet. There are some contenders climbing through the ranks, from all over the world.
knifeswapper
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In the past several months I have seen several things that do not shine a positive light on GEC distributors. I was not the first GEC dealer; but I am the oldest now as the two that came before me have been out of business for a decade. We have seen intermittent greed over the last few years, but it has exploded recently. The problem, as I see it, is that dealers have become too accustomed to the margins they make in many of the modern brands with MAP price controls. GEC's recommended margins were not nearly that high. Lately there have been many scenarios ranging from masked eBay accounts to flat out lies.
If a dealer wants to charge more for their allocation of GEC knives; just do it and explain to the customer base that they are just adjusting to the market. Don't hide behind ploys. But what surprises me is that the margin on GEC's that has been fine for over a dozen years is no longer good enough. I am a volume seller; always have been. GEC does not allow the margins that the modern makers do; and that may very well be what got them to where they are today. Admittedly GEC algorithm is a bit skinny on lower priced knives. For example, the bullnose at $55 is very close to break-even for dealers that include free shipping and have rewards programs, etc. So, a rattler at $70 is not a windfall. I can understand how dealers that are almost exclusively GEC can look at it and decide to chase the market. But I can't understand how dealers that carry many other brands would risk alienating their base to make another $500-600 on a GEC run.
So, opinions that dealers are stupid if they don't chase the market is a bit harsh. If you want to be an ambassador of a product with such a tight community, then transition the product at a fair margin for the job you do. Don't stay up late at night trying to find a new way to squeeze a dollar out of a newly released product. And to the other thought of "customers don't owe any dealer their business"; I say when was this ever the case? The customer may prefer one dealer over the other; but for the main part customers will buy where convenient and/or timely. Many times you have to get the knife when the getting is good unless you have a smaller dealer that will put your name above others. If I can't guarantee a knife to a customer I tell them to get it elsewhere if they can instead of holding them until allocation is a certainty. So customers don't owe specific dealers anything and dealers don't owe specific customers anything. But somewhere nestled in between these facts is the truth that there are dealers that simply want to make money and dealers that simply love this niche community. It may seem to tilt one way or the other; but these are the times when you figure out where the dealers live.
Flippers were the first sign that something like this was coming. And many times dealers are like folks that play the stock market (I'm guilty); in that a stock bought at $5 and sold for $7 feels pretty good. Until it goes on to $10 over the next couple days and then you essentially feel as if you lost $3 instead of gaining $2. During my first few months with GEC they were not as easy a sell and I tried several ways to work the DSR pricing. Matter of fact my account was suspended twice for trying to find a way to lower margins. One time I offered free shipping on GEC's and Ken took that as a sneaky way to lower the price; but then they took on another dealer that literally had free shipping in their name.
A few months ago I would have said that all dealers are good as gold. But today my advice is "don't throw the baby out with the bathwater". Don't walk away; just decide what level of effort you wish to put forth and have fun accordingly. But, most importantly, take your business to a place that you are comfortable is not trying to find ways to pry your money out of your wallet. And I can honestly say that this is not a sales pitch because I am in the same situation as other dealers - for the time being GEC's are a guaranteed instant sale. But dealers should take nothing for granted, especially savvy customers / friends.
If a dealer wants to charge more for their allocation of GEC knives; just do it and explain to the customer base that they are just adjusting to the market. Don't hide behind ploys. But what surprises me is that the margin on GEC's that has been fine for over a dozen years is no longer good enough. I am a volume seller; always have been. GEC does not allow the margins that the modern makers do; and that may very well be what got them to where they are today. Admittedly GEC algorithm is a bit skinny on lower priced knives. For example, the bullnose at $55 is very close to break-even for dealers that include free shipping and have rewards programs, etc. So, a rattler at $70 is not a windfall. I can understand how dealers that are almost exclusively GEC can look at it and decide to chase the market. But I can't understand how dealers that carry many other brands would risk alienating their base to make another $500-600 on a GEC run.
So, opinions that dealers are stupid if they don't chase the market is a bit harsh. If you want to be an ambassador of a product with such a tight community, then transition the product at a fair margin for the job you do. Don't stay up late at night trying to find a new way to squeeze a dollar out of a newly released product. And to the other thought of "customers don't owe any dealer their business"; I say when was this ever the case? The customer may prefer one dealer over the other; but for the main part customers will buy where convenient and/or timely. Many times you have to get the knife when the getting is good unless you have a smaller dealer that will put your name above others. If I can't guarantee a knife to a customer I tell them to get it elsewhere if they can instead of holding them until allocation is a certainty. So customers don't owe specific dealers anything and dealers don't owe specific customers anything. But somewhere nestled in between these facts is the truth that there are dealers that simply want to make money and dealers that simply love this niche community. It may seem to tilt one way or the other; but these are the times when you figure out where the dealers live.
Flippers were the first sign that something like this was coming. And many times dealers are like folks that play the stock market (I'm guilty); in that a stock bought at $5 and sold for $7 feels pretty good. Until it goes on to $10 over the next couple days and then you essentially feel as if you lost $3 instead of gaining $2. During my first few months with GEC they were not as easy a sell and I tried several ways to work the DSR pricing. Matter of fact my account was suspended twice for trying to find a way to lower margins. One time I offered free shipping on GEC's and Ken took that as a sneaky way to lower the price; but then they took on another dealer that literally had free shipping in their name.
A few months ago I would have said that all dealers are good as gold. But today my advice is "don't throw the baby out with the bathwater". Don't walk away; just decide what level of effort you wish to put forth and have fun accordingly. But, most importantly, take your business to a place that you are comfortable is not trying to find ways to pry your money out of your wallet. And I can honestly say that this is not a sales pitch because I am in the same situation as other dealers - for the time being GEC's are a guaranteed instant sale. But dealers should take nothing for granted, especially savvy customers / friends.
Yep. This is the market responding to opportunities presented by the current structure. E.g. competition arises when a demand is not met by incumbents.
I agree with your point about leaving the market. Consolidation generally leads to higher prices. If I have ten dealers all trying to make a go of it selling GECs and suddenly 5 leave because raising prices isn't worth the potential reputation / brand damage then the remaining 5 are now in a better position to raise prices to the consumer or lower costs from GEC. Either way, the market is correcting for displacements in supply / demand.
After yesterdays KSF drop I'm right there with you
JohnDF
and I'll probably be throwing in the towel. I'll still try to buy a selective GEC knife but I'll probably miss out more often. I spend a lot on different knives that I collect and use so I'll still have my hobby. I use a few GEC dealers because of the stock they carry so calling to reserve a knife like others do is out. We live in the land of opportunity so I can't blame any dealer for marked up or high prices but I think with a new release it's not right. Good luck to all.
JohnDF
and I'll probably be throwing in the towel. I'll still try to buy a selective GEC knife but I'll probably miss out more often. I spend a lot on different knives that I collect and use so I'll still have my hobby. I use a few GEC dealers because of the stock they carry so calling to reserve a knife like others do is out. We live in the land of opportunity so I can't blame any dealer for marked up or high prices but I think with a new release it's not right. Good luck to all.
GP is standing by their previous statement saying GEC sent out an email last week requesting all dealers to charge suggested retail. Thinking about calling GEC to confirm this, as it seems like an odd thing to do from a company trying to provide a knife at a good value.
The GEC #19 knife is not a value at $100 to me. Others obviously believe the same as GP is still showing their allotment in stock.
I'll continue to support dealers charging the minimal suggested price, and avoid the others.
The GEC #19 knife is not a value at $100 to me. Others obviously believe the same as GP is still showing their allotment in stock.
I'll continue to support dealers charging the minimal suggested price, and avoid the others.
Respectfully, I don't understand. Why does it matter that its a new release? If there is a secondary "scalper" market that means the knife is under-priced, right? If so, what's the difference whether its a new release vs. something that's more established?
You're calling GEC to confirm what precisely? I mean, the price is the price. If they want to charge you the price of a small aircraft for the knife that's their prerogative. You're under no obligation to buy it but the pricing is the dealers call.
Essentially, without knowing it, you're doing precisely what's expected in a free market. You're choosing to give your business (a $ vote effectively) to a dealer that either has better pricing or a better rep (both I think from reading your statement.)