Here's what I don't get. For years there has been a lot of money in the aftermarket via flippers. The demand has long exceeded factory supply. Now some of the authorized distributors are jacking prices up. Why doesn't GEC simply make runs longer. They would save on retooling costs and capture the revenue made on the second or third time the knife is sold in the secondary. None of that revenue comes back to them now. I thought they were headed in that direction with the #23, particularly with the lock back. I was surprised and frankly pleased when distributors got second shipments and demand was more completely met. I don't collect knives to make money. I like them. I like to buy two on occasion one to use one to collect. The current GEC climate has made that a thing of the past. You are lucky to get even one and living in the sticks as I do with slow internet speeds ... almost impossible.
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Thoughts on authorized dealers raising GEC prices above the minimum sale price.
- Thread starter Fixall
- Start date
Gee ... pretty sure I did not say put out only four patterns a year. I think they can keep the employees entertained and keep the customer base less frustrated. Or are you happy with the current situation? Maybe the knives are worth $200 a pop to you but I'm not going to pay that.
I don't understand why people expect the dealers to sell at the minimum price and not MSRP. Every knife you got at that discount in the past and future was on sale and you should feel fortunate to have received the discount. I will not defend the ones selling over MSRP and/or at an auction site. The entitlement around here is amazing.
Well they are breaking from a norm they operated in for well over a decade. They established a minimum to protect those who could not operate below it. Anybody's MSRP is a marketing fantasy from auto manufacturers to furniture companies. Your use of the term entitlement is a little over the top. True it is a supply and demand situation and anyone who wants to pay 40% more than they did in years past is entitled to do so. As long as there are distributors who sell near past norms I will try to buy from them. If I can't I guess I'll just fondle some of the 60 or more I have in the tubes that are not in use and maybe my need will pass. They are great knives but they are just not worth the secondary prices on Ebay and that some authorized distributors are getting close to. I made the point earlier I can't quite figure why GEC does not make runs a little longer and capture some of that revenue for themselves at past price levels that long time customers are willing to shell out.
Those who are mad because they don't get their discount are exhibiting a sense of entitlement in my opinion and it is not over the top at all. Yes, it is just the market at work, each individual decides on the value of the knife to them and they purchase accordingly. It's the spoiled entitled ones that complain that they can't have all the cheap knives to themselves any more.
Don't shoot the messenger, you asked why they don't do more larger runs and I responded with what I have heard GEC respond to that question.
You ask if I'm happy to pay $200 for GEC? I have never paid $200 for a new knife from a dealer.
I can believe they came up with that line. I asked one of the distributors about the 30% more he was asking over his peers and he suggested GEC wanted them to to ding the flippers. I think he just wants to pocket more and don't blame him necessarily, but be up front about it. I thought maybe they were tuning a corner with the #23. I was happy to see some of the flippers on Ebay go to "make an offer" in order to make a sale. If they are going to curb the secondary market and pull that revenue in house, they need to meet the primary demand. Then again maybe this is how they really want it and the market will rule.
Last year, within a week after the intro of the 35 B&S ( and a couple frustrating attempts to secure one) I saw at least a hundred show up for resale at $200 and up. I had been seeing the signs all year, but then I knew for sure that the good old days were over. One by one, during the last year my forum buds stopped buying and like them, I knew it was best to just move on. The days of buying GECs at "working man's" price are perhaps over.
You can analyze all MSRP, production volumn, etc. all you want and solve nothing. I follow Mike at CKs feelings on this. He's been at it a long time and, like him I think GEC should dump their dealer network, set the prices and sell through the factory. It just takes a few unscrupulous dealers and a robust flipper market to remove the cachet of "A knife for the working man at a working man's price." I ran a similar collectible crafted item business for over 25 years. After year one, I dumped my dealer network. Most, but not all of the anger and angst went away - can't please all the people all the time...
As for a future collecting GEC...collecting them has morphed into a contest of computer skills. Not fun. I do have a nice collection & as most new runs are basically re-issues, I'm set. In any case, nothing is forever - so it's a good time to stop, say thanks and for now, look elsewhere.
You can analyze all MSRP, production volumn, etc. all you want and solve nothing. I follow Mike at CKs feelings on this. He's been at it a long time and, like him I think GEC should dump their dealer network, set the prices and sell through the factory. It just takes a few unscrupulous dealers and a robust flipper market to remove the cachet of "A knife for the working man at a working man's price." I ran a similar collectible crafted item business for over 25 years. After year one, I dumped my dealer network. Most, but not all of the anger and angst went away - can't please all the people all the time...
As for a future collecting GEC...collecting them has morphed into a contest of computer skills. Not fun. I do have a nice collection & as most new runs are basically re-issues, I'm set. In any case, nothing is forever - so it's a good time to stop, say thanks and for now, look elsewhere.
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I agree 100%. Mike, DLT, and KSF are all I deal with at all and even they are nearly impossible unless you happen to be logged in and also have email open. I have a pretty good collection too but part of the fun is adding to it. Almost impossible now. Oh well. Regarding patterns, I thought they might bring bag the #36 one of these days. I have a some from '08 and '10 and use a couple. Maybe just too big?
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knifeswapper
Knife Peddler
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This has been discussed several times and with actual numbers to corroborate the assertions. But GEC can make an average of 100 knives per production day. #71's go much faster, 3 bladers go much slower, big knives (#36, #45, etc.) go at a snails pace. Currently they are making runs of 1100 - 2000 knives. That is two weeks to one month of production. They have in the past, and even in the not so distant past, made @5000 knives in a run (which took nearly 3 months). So, yes, as
LastRodeo
suggested - when you go to 45-70 days on the same pattern it is burdensome on the market and the morale at the factory.
GEC has changed the pricing schema to allow those dealers that need/want a higher margin, to charge one. I don't really understand the purpose of this move because they left it optional to stay at the minimum level (which they renamed); and do not enforce the top end level. So, why even make the changes other than to give some dealers the excuse of "the factory made me do it".
Things will surely be morphing over time with GEC markets. Hopefully the demand and supply will come to a closer balance. And hopefully afterwards those that put the market in a vice will have no customer base left; which will further assist in the available supply issue as most flippers try to buy from EVERY dealer. But I do expect that eventually GEC will ask dealers to move closer to MSR (Mfg Suggested Retail) than SMR (Suggested Min Retail). And, if we knew that the current market would stay intact going forward, it would be the smart thing to do for most dealers. I'm GEC's largest volume dealer but one of the smallest dealers by overall volume. At this point, I am losing thousands of dollars on every run by staying at SMR. Let's say I would get 20 of the new #89's and I'm charging $85 compared to others charging $175. That is $90 x 20 = $1800. Some runs I may get 40 and they may be selling instantly on eBay for $299 while I am charging $100. So 40 x $199 is a pretty good hickey to take. And, not to be abrasive, but most customers would not think twice about going elsewhere if another dealer started selling them for $10 less. So, although there are many customers that have a sense of loyalty - most do not (I know, because I was/am the same way). But, I started selling knives to support my knife habit and have always said that my goal was to get great knives to our community at the best possible price. That is simply a lie if I go to a 400% profit schema on the backs of my friends - which is exactly what a handful of dealers are doing. You are not a friend in the hobby to them - you are an open wallet. But, this is a true market at play.
So, as in politics, many times we try and solve problems that are a) only short term problems that will resolve themselves; and/or b) our solutions only come in hindsight; and/or c) our solutions are proposed in a fashion that we are guaranteed to not be proven wrong as our suggestions are merely speculations of events that we know will never happen.
My opinions. 1) Increasing production has no advantage. If it is a highly sought after pattern, everyone can get one and then be complaining about none being available within 6 months of them no longer being on dealer shelves (example, Beer Scout). Or, if demand turns out tame, dealers get stuck with a lot of inventory that sits on the shelves for a couple years and puts them in a bind (example, Large Coke). 2) Setting a maximum dealer prices sounds like a good idea - but do I really want GEC getting into my business? Once you or I buy a knife - it is ours to do with how we see fit. I don't like dealers fleecing the customers, but I am not going to contest their ability to do so. 3) During markets such as today it would be advantageous to bypass a dealer network and sell directly from the factory - I have said this before. But it has been taken a bit out of context because I follow it up with the fact that this is only a "current" issue and this policy in general would have bankrupted the factory in probably 10 of the 15 years they have been in business, maybe more. There was a time when I had six figures of GEC inventory and they were asking me to take more from their inventory. Had they not had a dealer network to spread that inventory across, they couldn't have made payroll. And once people figure out all the market bubbles around us and the fact that we are literally just printing paper money with no backing other than the ink and paper - expendable hobby income may not be so free flowing. Or maybe it will if people figure out anything tangible is better than fiat silliness.
So - although I do wish the factory would standardize on one price, I find no fault in the process or policies they have in place currently. If they would raise the "MAP" price to MSR then I could make a nicer profit; albeit excessive for my needs but realistically in line with other makers such as Benchmade, Kershaw, etc. etc.. But, if they would find a spot somewhere between the two current prices that was a more reasonable minimum, but not such a high MSR - it would be very helpful. But, this is not really their problem to solve as I could raise my prices any time I wanted on my own - but honestly that just feels a bit hypocritical.
LastRodeo
suggested - when you go to 45-70 days on the same pattern it is burdensome on the market and the morale at the factory.GEC has changed the pricing schema to allow those dealers that need/want a higher margin, to charge one. I don't really understand the purpose of this move because they left it optional to stay at the minimum level (which they renamed); and do not enforce the top end level. So, why even make the changes other than to give some dealers the excuse of "the factory made me do it".
Things will surely be morphing over time with GEC markets. Hopefully the demand and supply will come to a closer balance. And hopefully afterwards those that put the market in a vice will have no customer base left; which will further assist in the available supply issue as most flippers try to buy from EVERY dealer. But I do expect that eventually GEC will ask dealers to move closer to MSR (Mfg Suggested Retail) than SMR (Suggested Min Retail). And, if we knew that the current market would stay intact going forward, it would be the smart thing to do for most dealers. I'm GEC's largest volume dealer but one of the smallest dealers by overall volume. At this point, I am losing thousands of dollars on every run by staying at SMR. Let's say I would get 20 of the new #89's and I'm charging $85 compared to others charging $175. That is $90 x 20 = $1800. Some runs I may get 40 and they may be selling instantly on eBay for $299 while I am charging $100. So 40 x $199 is a pretty good hickey to take. And, not to be abrasive, but most customers would not think twice about going elsewhere if another dealer started selling them for $10 less. So, although there are many customers that have a sense of loyalty - most do not (I know, because I was/am the same way). But, I started selling knives to support my knife habit and have always said that my goal was to get great knives to our community at the best possible price. That is simply a lie if I go to a 400% profit schema on the backs of my friends - which is exactly what a handful of dealers are doing. You are not a friend in the hobby to them - you are an open wallet. But, this is a true market at play.
So, as in politics, many times we try and solve problems that are a) only short term problems that will resolve themselves; and/or b) our solutions only come in hindsight; and/or c) our solutions are proposed in a fashion that we are guaranteed to not be proven wrong as our suggestions are merely speculations of events that we know will never happen.
My opinions. 1) Increasing production has no advantage. If it is a highly sought after pattern, everyone can get one and then be complaining about none being available within 6 months of them no longer being on dealer shelves (example, Beer Scout). Or, if demand turns out tame, dealers get stuck with a lot of inventory that sits on the shelves for a couple years and puts them in a bind (example, Large Coke). 2) Setting a maximum dealer prices sounds like a good idea - but do I really want GEC getting into my business? Once you or I buy a knife - it is ours to do with how we see fit. I don't like dealers fleecing the customers, but I am not going to contest their ability to do so. 3) During markets such as today it would be advantageous to bypass a dealer network and sell directly from the factory - I have said this before. But it has been taken a bit out of context because I follow it up with the fact that this is only a "current" issue and this policy in general would have bankrupted the factory in probably 10 of the 15 years they have been in business, maybe more. There was a time when I had six figures of GEC inventory and they were asking me to take more from their inventory. Had they not had a dealer network to spread that inventory across, they couldn't have made payroll. And once people figure out all the market bubbles around us and the fact that we are literally just printing paper money with no backing other than the ink and paper - expendable hobby income may not be so free flowing. Or maybe it will if people figure out anything tangible is better than fiat silliness.
So - although I do wish the factory would standardize on one price, I find no fault in the process or policies they have in place currently. If they would raise the "MAP" price to MSR then I could make a nicer profit; albeit excessive for my needs but realistically in line with other makers such as Benchmade, Kershaw, etc. etc.. But, if they would find a spot somewhere between the two current prices that was a more reasonable minimum, but not such a high MSR - it would be very helpful. But, this is not really their problem to solve as I could raise my prices any time I wanted on my own - but honestly that just feels a bit hypocritical.
Thanks Mike, always good information and valued optionsThis has been discussed several times and with actual numbers to corroborate the assertions. But GEC can make an average of 100 knives per production day. #71's go much faster, 3 bladers go much slower, big knives (#36, #45, etc.) go at a snails pace. Currently they are making runs of 1100 - 2000 knives. That is two weeks to one month of production. They have in the past, and even in the not so distant past, made @5000 knives in a run (which took nearly 3 months). So, yes, as
GEC has changed the pricing schema to allow those dealers that need/want a higher margin, to charge one. I don't really understand the purpose of this move because they left it optional to stay at the minimum level (which they renamed); and do not enforce the top end level. So, why even make the changes other than to give some dealers the excuse of "the factory made me do it".
Things will surely be morphing over time with GEC markets. Hopefully the demand and supply will come to a closer balance. And hopefully afterwards those that put the market in a vice will have no customer base left; which will further assist in the available supply issue as most flippers try to buy from EVERY dealer. But I do expect that eventually GEC will ask dealers to move closer to MSR (Mfg Suggested Retail) than SMR (Suggested Min Retail). And, if we knew that the current market would stay intact going forward, it would be the smart thing to do for most dealers. I'm GEC's largest volume dealer but one of the smallest dealers by overall volume. At this point, I am losing thousands of dollars on every run by staying at SMR. Let's say I would get 20 of the new #89's and I'm charging $85 compared to others charging $175. That is $90 x 20 = $1800. Some runs I may get 40 and they may be selling instantly on eBay for $299 while I am charging $100. So 40 x $199 is a pretty good hickey to take. And, not to be abrasive, but most customers would not think twice about going elsewhere if another dealer started selling them for $10 less. So, although there are many customers that have a sense of loyalty - most do not (I know, because I was/am the same way). But, I started selling knives to support my knife habit and have always said that my goal was to get great knives to our community at the best possible price. That is simply a lie if I go to a 400% profit schema on the backs of my friends - which is exactly what a handful of dealers are doing. You are not a friend in the hobby to them - you are an open wallet. But, this is a true market at play.
So, as in politics, many times we try and solve problems that are a) only short term problems that will resolve themselves; and/or b) our solutions only come in hindsight; and/or c) our solutions are proposed in a fashion that we are guaranteed to not be proven wrong as our suggestions are merely speculations of events that we know will never happen.
My opinions. 1) Increasing production has no advantage. If it is a highly sought after pattern, everyone can get one and then be complaining about none being available within 6 months of them no longer being on dealer shelves (example, Beer Scout). Or, if demand turns out tame, dealers get stuck with a lot of inventory that sits on the shelves for a couple years and puts them in a bind (example, Large Coke). 2) Setting a maximum dealer prices sounds like a good idea - but do I really want GEC getting into my business? Once you or I buy a knife - it is ours to do with how we see fit. I don't like dealers fleecing the customers, but I am not going to contest their ability to do so. 3) During markets such as today it would be advantageous to bypass a dealer network and sell directly from the factory - I have said this before. But it has been taken a bit out of context because I follow it up with the fact that this is only a "current" issue and this policy in general would have bankrupted the factory in probably 10 of the 15 years they have been in business, maybe more. There was a time when I had six figures of GEC inventory and they were asking me to take more from their inventory. Had they not had a dealer network to spread that inventory across, they couldn't have made payroll. And once people figure out all the market bubbles around us and the fact that we are literally just printing paper money with no backing other than the ink and paper - expendable hobby income may not be so free flowing. Or maybe it will if people figure out anything tangible is better than fiat silliness.
So - although I do wish the factory would standardize on one price, I find no fault in the process or policies they have in place currently. If they would raise the "MAP" price to MSR then I could make a nicer profit; albeit excessive for my needs but realistically in line with other makers such as Benchmade, Kershaw, etc. etc.. But, if they would find a spot somewhere between the two current prices that was a more reasonable minimum, but not such a high MSR - it would be very helpful. But, this is not really their problem to solve as I could raise my prices any time I wanted on my own - but honestly that just feels a bit hypocritical.
Todd
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knifeswapper
, I appreciate that you weigh in on these things. There’s fair too many armchair quarterbacks and not enough people putting effort into the necessary legwork to truly understand the issue. It’s always easy for the casual knife customer to give advice when we have no skin in the game.
knifeswapper
Knife Peddler
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I appreciate that but realize I probably should just keep my thoughts to myself. And discussing the topics are why we are all here. All should be able to express their opinions as their opinions as long as they will not be offended if others opinions do not line up. Generally reality is somewhere in the middle, if not actually "none of the above".
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well I’m glad you don’t keep this to yourself. You’re a fella who doesn’t like to unnecessarily breed bad feelings, so I understand why you’d feel that way. However, you have a lot of knowledge we will never come by unless you share your experiences. If the truth is somewhere in between, then we need to bookend both sides!
Even Cicero recognized that it was inhuman to take advantage of a fellow human who was in a position of weakness. Nowadays we just fleece our neighbors and say it’s someone else’s problem. Making money isn’t a virtue, but treating others as you would want to be treated yourself is.