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Author Topic: List Price vs Street Price vs MAP
s.huck

Posts: 14
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Post List Price vs Street Price vs MAP
on: October 7, 2012, 19:31
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I think we all know how it got started. But why, in a day and age where we have access to the internet on our phones, does this practice continue? I get where a company might not be aloud to post something below MAP (minimum advertised pricing). But any company that says "hey this is the "list" price, look how much money we're saving you" just seems dishonest. Also when I'm in a big box store and an employee tells me they aren't in competition with Amazon (or GC/MF) I have to laugh. I try to shop local when I can, I don't mind paying a little bit more to support local small business. But I'm not gonna pay double ($10 for a $5 pack of strings?). How do we get retailers and manufacturers to drop this archaic practice. Just put out a MAP price list, and know that if a retailer needs to blow it out for whatever reason they drop the price. Any thoughts?

Schrodinge-
rsgoldfish

Posts: 105
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Post Re: List Price vs Street Price vs MAP
on: October 7, 2012, 21:13
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The big box music stores are in pretty much a state of non-competition. The MAP is as much for them as it is for the makers.

smgear

Posts: 170
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Post Re: List Price vs Street Price vs MAP
on: October 8, 2012, 03:12
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well, the system is antiquated, but still somewhat useful. It's typically indicative of the keystone pricing - MSRP is approximately double the wholesale cost. Online volume sellers don't have as much overhead so they'll typically shoot for about 30-45% over wholesale, but retail stores typically need to hit at least 60-70% over wholesale to cover their costs. And in my opinion, they deserve it if the product needs to be demo'd (like instruments). So while I think that MSRP and MAP are largely unnecessary and no one takes MSRP seriously, the underlying keystone-based system needs to be preserved in... shall we say tactile product markets - like instruments. The instrument market as a whole functions better when there are still small shops and big box stores where people can demo instruments. So to preserve that in the internet age, there has to be MAP pricing online and musicians who value having a local shop need to be willing to spend a bit more to support them. Advertising MSRP is pretty ridiculous, but it is helpful to give the purchaser some idea of what room there is for negotiation because if you do your homework, you can calculate in advance what room for negotiation there will be.

Digital-
Larry

Posts: 192
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Post Re: List Price vs Street Price vs MAP
on: October 8, 2012, 08:01
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A few weeks ago I was down at one of the non-chain music stores near here. They had a consignment shop for years and years where I unloaded my ill-advised purchases that might otherwise have wound up as some sort of interesting (or not) discussion fodder here. They are closing the separate consignment shop and folding it into the main store. I was walking around the main store and overheard a discussion of several of the (mostly idle) store employees - and one who had been around since "Before Internet" was bemoaning the impact that online sales have had on their business.

This doesn't address your question directly, for sure. Established businesses have a hard time adapting to new paradigms. New paradigms may not satisfy everything that was supplied by the old one - especially the need to play a guitar before buying it. I've bought a few stringed instruments over eBay. One particularly comes to mind - a Steinberger bass. It was extensively photographed from all angles - except the one that would have shown a couple extra holes drilled in the body. And although it came in a nice hardshell case, the bass itself looked like it had spent a fair amount of time underwater - the neck was unplayable and covered with some green grunge. Fortunately the seller took it back.

So for instruments, people may find themselves wondering what happened when they buy instruments they have never touched. But online shopping is pretty safe for effects pedals, cables, strings, picks, etc. I see a bit of a resurgence in local one-man shops doing guitar setups and I think these will flourish because it's less hassle to take your new unplayable guitar to get it tweaked than it is to send it back and see your dreams go up in smoke.

That said, I've seen the "Starving Musician" stores actually expand around here - because it's more like a grab bag going in there - no way to anticipate what you might find and last time I visited the one in Santa Cruz, there were at least 4 guitars under $300 that played well and I was really tempted to get. Instead I got one off eBay that really looked cool, but is in need of a setup! However selling something through this store is only for someone who cannot navigate eBay - you'll hardly get anything.

s.huck

Posts: 14
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Post Re: List Price vs Street Price vs MAP
on: October 8, 2012, 18:23
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Most of the small non-chain shops near me survive on setups and lessons. Like I said, I don't mind paying an extra couple of bucks for strings, but we do have one guys that charges almost double what I get them for online. The MSRP/list price thing is what bugs me, and the sales pitch of look what I'm saving you by charging what everyone else does. I agree that MSRP is approximately double wholesale. Although from talking to a friend who owns a small shop that's not as concrete as it used to be. And big box stores get larger rebates for buying larger quantity.

Schrodinge-
rsgoldfish

Posts: 105
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Post Re: List Price vs Street Price vs MAP
on: October 8, 2012, 20:19
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I agree that it's pretty stupid how they show you how much you're "saving" by purchasing the MAP. People keep paying for it, though, so I imagine the businesses are not gonna give up what's a good gig for them. Those poor saps that don't ever negotiate with the Guitar Center guys.

Double D

Posts: 195
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Post Re: List Price vs Street Price vs MAP
on: October 8, 2012, 23:23
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We're pretty lucky in Canada, because our version of Guitar Center (Long and McQuade) sells everything marked way down from the list price, and there's some room to move if you have a friendly employee (thanks Andre). They also do all their financing in-house and do not punish full-time musicians for not having a straight job, which I understand is a real problem south of the 49th parallel.

smgear

Posts: 170
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Post Re: List Price vs Street Price vs MAP
on: October 9, 2012, 05:00
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Quote from s.huck on October 8, 2012, 18:23
but we do have one guys that charges almost double what I get them for online.

Oddly, my old local guy used to give me strings essentially for cost. The regular tag was high, but for those of us that regularly bought instruments and gear, he'd basically just give us strings and picks.

mwseniff

Posts: 149
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Post Re: List Price vs Street Price vs MAP
on: October 9, 2012, 11:35
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Quote from smgear on October 9, 2012, 05:00

Quote from s.huck on October 8, 2012, 18:23
but we do have one guys that charges almost double what I get them for online.

Oddly, my old local guy used to give me strings essentially for cost. The regular tag was high, but for those of us that regularly bought instruments and gear, he'd basically just give us strings and picks.

We have a local dealer here that will back his stuff to the point of making sure you can do a gig even if he loans you an amp or piece of PA gear for free. I know a lot of folks that he really came thru for that way. His prices are competitive but not always the lowest unless you consider the loaners even outside warranty. The only other folk I ever knew that did that were the old TV repair shops back in the day. People got unbelievably cranky without their TVs to the point of near insanity in some cases, I could tell you stories that would make you say WTF?

MichaelM

Posts: 17
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Post Re: List Price vs Street Price vs MAP
on: November 22, 2012, 18:29
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While we're on the topic, Australian prices! (am I right!)

Here's one example: Steinberg-MR816X

Front End Audio, who are in the US, but ship to Australia: $699.99
Muso's Corner, which is about the cheapest store I can find over here: $1,795.00

The Australian dollar is actually valued higher than the US dollar right now! We should be getting this stuff at the same price! And it's not just studio gear. We get screwed over on pretty much everything.

Then people get disappointed when Australia's largest music store chain goes bankrupt!

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