MSRP -- what's the point?

[BrunoBlack]

Originally Posted by amyFB

our company uses MSRP as a mechanism to illustrate the potential margin for a distributor partner who buys at the wholesale price.

Amy, I'm curious. Does anyone sell at MSRP? Since no guitar seems to sell at MSRP, the potential margin seems to be cost + X, where X is unrelated to MSRP.

Paul

(PS -- you were right Cm sounds better than C in that arrangement of "Junk")

[seannx]

Originally Posted by amyFB

our company uses MSRP as a mechanism to illustrate the potential margin for a distributor partner who buys at the wholesale price.

That's fine in theory, but as Ted points out in response to Silly Mustache...

Quote:
Originally Posted by Silly Moustache
...For US retailers to offer 40% off list or MSRP (whatever) they must be getting the sort of radical margins that haven't been seen in the UK for decades...

Actually, we do not, in fact most US retailers can't offer such discounts and survive. I spent some time with a half dozen dealers at NAMM, and the frustration level is at a boiling point.

Those potential margins can be hard to attain in today's guitar market. The few guitars we have left in our gallery, may not be replaced once they sell. They are the lowest margin items we have, and as they are sold online directly by the manufacturer below MSRP, it's hard to justify carrying them. It's fun to have them there to play on a slow day. We get some very talented guitarists and professional musicians coming through along with the regular tourists (the last was the Martin Taylor, MBE), and they enjoy the chance to play. From time to time we sell one. I can only imagine how hard Ted and the remaining retail store owners have to work to survive.

So in this case MSRP as an indicator of potential margins is an illusion.

[amyFB]

Originally Posted by Haasome

Amy, I'm curious. Does anyone sell at MSRP? Since no guitar seems to sell at MSRP, the potential margin seems to be cost + X, where X is unrelated to MSRP.

Paul

(PS -- you were right Cm sounds better than C in that arrangement of "Junk")

Yes, some distributors do sell at MSRP - typically to the low volume buyer. Our business is in the industrial marketplace so expectations and experiences don't always mirror in the consumer market.

(PS -- cool! always enjoy swapping ideas)