MAP - Friend or Foe

[TheWaterboy]

I'm not to clued up on the whole subject, but do suppliers or distributors own the rights to import/distribute certain brands, barring other companies from distribution?. and having a say on the MAP?
For example: If a company, "RKS Bobbies" owned the rights to distribute "Lekker pomp pumps" would any other company not be allowed to distribute "Lekker Pomp Pumps"?
Or would the Brand only sell to one distributor?

If shops are closing down, unfortunately online shops would be the way to go for hardware as they don't have as many overheads to pay.

online shops dont work.......they become a tool to cause price wars, and minimal purchases made.......

 

[RiaanP]

Call me old fashioned. But I am from the previous century. I do not like online shopping. Just because of warranty issues.
And I do not want my tank without lights or return pump for days while trying to sort things out with the online shop.

Plus the online shop most likely will not even carry spares or immediately replacements.

 

[Jones]

Call me old fashioned. But I am from the previous century. I do not like online shopping. Just because of warranty issues.
And I do not want my tank without lights or return pump for days while trying to sort things out with the online shop.

Plus the online shop most likely will not even carry spares or immediately replacements.

I have only done minimal online shopping too. Most of my hardware bought new is from walk in purchases. Just saying that if an lfs is heading downhill they should consider online to save overheads. Can still sell at the same in store price, price wars and all.
What grates me is that if one can import an item for a bit cheaper than locally bought, from an overseas company, that buys from a distributor too, the mark up here by the distributor is crazy. Surely a product shipped, for example, to the US from China would cost less to ship here than from China to the US and then here?... Monopoly

 

[Moolis Moolman]

Regarding online shops VS brick and mortar stores

You have to decide between guarantee & service (shop) AND savings (online)
Sadly most want to get it all (butter bread on both sides and add syrup to it all as well) and get angry it they cant get it (get their hands all sticky)

Firstly
Ordering electronics from over seas directly might land you in hot water. (technically you need your own electronic compliance certificate)
BUT
Did you know that your EXPENSIVE wholesaler are forced to:
1. Pay for a SA certificate that cost up to R80 000 each. They can not use the Australian, European or american electric compliance certificate (not sure of correct name) normal cost about 45000
2. have to have a certain amount of spares available for each product they sell
3. Have to carry full guarantees as per consumer protection act..
NON of these are enforceable onto international online shops, but there are a drive (financial drive from Government) to force you to get your own certificates AND I know of 2 short term insurance company's that WILL NOT PAY OUT if your used a non SABS approved product!!
So is his prices/markup really so high, or are these costs PLUS warehousing and distribution the reason.

Secondly
If you don't support your local store, there are consequences for YOU:
1 - they close down - now you will have to drive much further for the stuff you need and livestock become a problem
2 - they start to lower the stock levels - You always have to wait ages for stock to be ordered
3 - they don't invest in new ranges and products
YOU end up emptying your aquarium?

Thirdly
Our trade is slowly loosing knowledgeable AND passionate people. Why? - they can not make a living if they have to feed on scraps their customers might throw them AFTER they bought most of their hardware somewhere else. Remember a person want to be rewarded for their expertise and if they are not rewarded they find something else. Take yourself as example - are you appreciated at work and compensated accordingly. If they answer is NO = then you are urgently looking for alternatives.

Lastly (and this is something you have to take very serious!!!)
LIVESTOCK
Without the sales on hardware the average shop can not afford to order loads of livestock.
Therefore your choices of items are getting smaller and smaller AND now the availability of livestock become a problem as well. Is this the hobby you want??

Downward spiral all caused by hobbyists saving a buck. - The same guys that will complain loudly and aggressively about the lack of "service" they get.

Luckily we @ Pet Stop SA are blessed with loads of loyal clients that support us, so much so that even in this recession we are expanding.

So as I stated earlier
VOTE WISELY WITH YOUR MONEY

Just My 2 c

PS. My vision for the future of EXCLUSIVE aquarium shops - Only a few are going to survive - but PLEASE PROVE ME WRONG!!!!

Unfortunately as things stand now I am not optimistic due to NORMAL human behaviour (selfish)

 

[RiaanP]

for example, to the US from China would cost less to ship here than from China to the US and then here

Single item = yes. Boatload of stuff = no.
Shipping via ship is a lot cheaper than air fright.
So depends if you can fill up the container or not.
Plus there are a lot of ship traffic between USA and China. Like in really a lot. Flying over Honk Kong and its amazing the number of ships you see.

USA is such a bigger market in terms of everything. Not only marine hobby. Percentage wise we in South Africa are a drop in the ocean... excuse the pun. Really, we are so small compared to the USA or European market. Check a bit the online shops sponsors on some of the USA forums. Do a google map search on them and you will find them not in some house lounge or garage. Their online shops are run out of warehouses. Ok ok, most of those warehouses are in some semi factory area. Basically brick and mortar but without the walk in customers.

Coming back to the thread topic, I do understand the basics reason of MAP. Shops are not allowed to advertise lower than a certain value, most will never even give you a written quote or have it in a PM or WhatsApp message just to cover themselves from guys forwarding. But they surely can sell lower, give discount, have specials.
The same as you could find a recommended selling price on some products. Like on potato chips, a few year back they had a price indication on them. Although here it got more to do with some shops over pricing the chips.

 

[hotdog83]

Percentage wise we in South Africa are a drop in the ocean...

I agree on this. I like my rare fish, and talking to friends in Singapore, they lfs's actually subsidize the fish prices to sell them below cost to get more walk ins and sell more equipment. No way that can ever work here given our massive country, relatively weak currency and small hobby (small country, strong currency and massive hobby in Singapore). As an example there you might find a flame angel for $18 retail, but they order 200 flame angels at a time, so even with fish South Africa won't be prioritized.

 

[hotdog83]

I understand recommended selling price, and this makes sense, is this the same basically as MAP?

 

[RiaanP]

so even with fish South Africa won't be prioritized.

Same as those ultra beautiful corals you see on some of the RSS feeds, on some Reef Palooza or whatnot expo.

We miss out...

 

[RiaanP]

I understand recommended selling price, and this makes sense, is this the same basically as MAP?

in a way yes.

Shop owner can sell in both scenarios for lower if they want to.
Although with recommended selling price stamped on the product, the customer will complain loudly if they must pay more.

 

[clownaround]

I too as a customer find it frustrating when looking for certain products and find they are no longer available any more or not bringing in the new ranges. I support my LFS as much as I can and have asked them to order things for me before purchasing online. But have also purchased online locally wth great success.

I too was looking for a Kessil 160w light about a year back to find we only had the 150w here in SA and got my LFS to check wth supplier and they had no stock of the model (spectrum) I wanted. They literally had about 5 units left of various other spectrums and fresh water units. So was impossible for me to purchase a brand new Kessil 150w. I then purchased a second hand one. As much as I was happy with the purchase I felt somehow disconnected from it as I wanted to buy it new and was happy to pay for it.

So I then looked at the AI prime HD but couldn't find it on online stores in SA. Only had the Standard AI Prime. I then asked LFS about if the AI prime HD would be brought here eventually but they couldn't confirm so got direct feedback from supplier in SA and was told they will not be bringing it in. So instead of Purchasing it online overseas i purchased a standard Prime here. Then to see a few months later someone selling a Prime HD second hand that was bought from well known store here, I then I go onto to the website to see it there after I had been told directly that they were not going to be brought in.

I have found the same frustration with the Innovative Marine products that we are not bringing them in but some of the models we have available still here are discontinued and seems like Innovative Marine has been dropped for now so there won't be much warranty on that item and yet they are not discounted or promoted to sell at reduced rates which I do find strange.

Please don't take this as me demanding discounts or anything like that as my LFS really do look after loyal customers, and I know that without them it would be a dire place as I visit mine easy 3 times a week. I have yet to order any equipment from Overseas online but may be forced to as the products I am looking for are not available here and as mentioned at the beginning of this thread, I can't bring myself to purchase the old discontinued stock at the same price as the new items.

I am now looking at a new bigger system and once again have had to look a some second hand items as we only have old discontinued stock and not bringing in the new stock but prices don't justify the purchase here. and also looking at possibly buying overseas.

I am in no way blaming the LFS. As often this is not up to them as when I have queried something they often have to ask their supplier if it's possible for them to sell it that way etc.

A thread like this, as much as it may come across as attacking LFS, really does help us customers to read your responses and get a better understanding of your business and your struggles and why certain things are the way they are and it is much easier to accept certain boundaries intstalled, maybe not by you, with this knowledge.

 

[Dieter OD]

I do not think I the right to give my view about how it works in SA and I do'nt want to bash anyone,just to give you a bit of a insight that it is not only in SA that as a hobbyist you feel ripped off.Its the same here the importers and the LFS mark up there prices up to 500% or more and there is no such thing as MAP,so As I am not willing to pay there prices all my equipment that I need I import myself and By doing that i cut out the mark ups and if i keep it under a certain amount i also dont pay import tax on it.The only thing in witch i support my LFS is in buying fish from them .

 

[Bristlebasher]

I have been reefing for many years,some of you may even know me. I have always had a tank in some shape or form. My mono's have been with me for 15 years now . Large 1500 plus liter fish only ,sps dominated systems,nano reefs , mixed reefs , multi system biotopes , you name it. I have seen reef forums come and go , I have seen many shops come and go and I have also seen many a hobbyist come and go.

I do not believe that enforcing price(MAP as per title) whether it is selling or advertising has any real influence on what we pay for products in a LFS.The common theme in all cases was/is that it is an expensive niche hobby and the numbers in SA are low when compared to Europe and the States. This is the case with most markets , not just our hobby.

I second Waterboy Our margins are really low, the thing which needs to be ended is the supply by wholesalers to garage or home operations. This is killing us as we have large overheads to cover. MAP prices don't make us anywhere near what people tend to think.

I understand why you would feel this way , but rather think about what you can offer your customer that the home or garage shop can't ? Differentiate yourself so that price is not the only measure you compete by.

online shops dont work.......they become a tool to cause price wars, and minimal purchases made.......

Marco , I cannot support this argument . Again , why let price be your only differentiation ? Online shops work very well for me as customer . It allows access to a greater range of products,enables me to make comparisons and for someone with little spare time it means I can get what I need without having to drive to multiple LFS's .

This is where my problem lies . AS YET I have NOT been able to drive to a single shop and get everything I need.

For Example :
I needed ATI T5 tubes. I specifically wanted a Purple+ , an Aquablue Special and 4x Blue+ . I COULD NOT find this total combination at a single shop . Eventually I got fed up ........ ordered ONLINE from Germany and with freight ended up paying quite a bit less . (Remember ! This was a fragile item requiring extra packing and it still I saved money and was able to get my selection first time round).

I have a similar story with a DC skimmer pump. I could not find a source for the pump I needed in SA. I could compromise and buy a Jacod for R3125 and then do an impeller mod . Instead I purchased OEM from Germany with DHL courier delivery for half the price.

again i have the last 3 units left in the country for the next 2 to 3 months....should i rather escalate the price and make the people who want it pay premium??? or give a discount to those who have been looking to buy it and
need the assistance to get one?
i believe in helping the aquarists as much as i can hence i choose the latter option,
if we were all about bottom line........first option, and make okes pay premium for the last 3 would be the choice.

I apologize for cherry picking some of the quotes , but Marco is kinda proving my point with this statement. The LAST 3 in the country , and this is what happens too often. If anyone else wanted in future ? Where would they get it ? You guessed it ! ONLINE !

What I am trying to get to with all of this is that we are living in a Global marketplace , as such all businesses have to adapt to be able to compete . I think this is even more pronounced in these niche markets. MAP matters not one iota if I cannot even get what I am looking for.

What I would like to know is if MAP applies to livestock purchases ? Some of the prices I have seen beggars belief. And it is sad to see so many corals die in tanks just because an LFS is not prepared to negotiate a lower discounted price. R1600 for a golfball sized maricultured SPS just because it came with 2 litres of water. Makes no sense .


HTH

 

[irie ivan]

Nice to see you back bristlebasher