Why are dealers so scared to sell product out of

Zd542, recently had the same experience when trying to buy speakers. One out of state dealer told me he was restricted to his area under the manufacturer's dealer agreement. Failure to comply could cost him a valuable dealer relationship.

So, I worked with a local dealer near my house. Yes, he discounted the price by about 19% off MSRP. I thought there might have been more margin with the product with which he could deal. He said not so. His margin was not what I might have guessed, say 40% to 50%. He said it was much less.

And bty, I priced the speakers elsewhere. The deals were no better.

You mentioned that you used to be on the retail side of the business. Is it true that profit margins have been squeezed, at least with respect to higher end speakers??

As an aside, being in the business world, I realize that one must be realistic. The dealer has to make a reasonable profit on the deal. Otherwise, there will be no dealer. OTOH, in my case, the speakers are stored in the manufacturer's warehouse and shipped on special order. That means the dealer does not bear the risk of inventory carrying costs and market fluctuations. So, he clips a fast $n on a riskless transaction. This is also called a "flash title" transaction.

Thanks

Thanks Zd. If your right about mark-up, which I would have guessed you are, I'm surprised that every dealer I spoke to about pricing my new speakers acted like he was cutting his throat with the absolute minimum price he could offer. One dealer told me that the margin on my new speakers is thin and there just wasn't that much he could do. If it was only one guy telling me this, I'd take it with a grain of salt. But for three dealers to come up with practically the same price discount causes me to raise an eyebrow. As I said, the dealer I usually work with doesn't even carry the speakers in inventory. He orders them from a factory warehouse and then flash transfers title as soon as they are delivered. Seems to me, that with so little risk, he would have more to work with in terms of dealing. OTOH, my speakers are a tad pricey for the general market. Maybe the dealer figures that my speakers are not a volume, typical supply and demand type item. Which may mean that the time to make his margin is when he makes a sale since the volume is thin. Just guessing.