Feeling ripped off by LDS – please advise.

[Cacia]

The thing that shocks me is the amount of inventory the little guy has to buy and how quickly they get stuck with all that stuff once nobody wants it.

Just stocking all those colors and sizes and brands, well it seems so random and a big crap shoot. I buy online. I might spend with someone that made me feel good about it but we don't have any shops that reward loyalty....maybe because we are a tourist location and there is always a fresh supply of tourist-divers. The local diver market is not really coddled. No guilt here.

 

[RonFrank]

The thing that shocks me is the amount of inventory the little guy has to buy and how quickly they get stuck with all that stuff once nobody wants it.

Just stocking all those colors and sizes and brands, well it seems so random and a big crap shoot. I buy online. I might spend with someone that made me feel good about it but we don't have any shops that reward loyalty....maybe because we are a tourist location and there is always a fresh supply of tourist-divers. The local diver market is not really coddled. No guilt here.

Manufactures are often responsible for what an LDS must purchase. Our local LDS stopped selling brand X of fins. I asked the retail manager why, and he indicated that the dealer agreement had changed, and in order for them to carry Brand X, they would have to purchase a minimum of 50 pairs to get a volume discount. Worst, they could not choose what colors and sizes they got. They were told that they must purchase X number of fins in each size and color. That leaves them with a bunch of pink XS, and XL fins that they can't move while they sell out of black or blue M/L fins. To add insult to injury, they could not backfill their inventory at the discount price with the popular sizes at the discount rate. If they wanted to get another order, they had to purchase another 50 sets including sizes and colors they don't want, and often already had a surplus stock of. That or pay a premium price to get just what they wanted.

I can not say if this story is 100% accurate, but this is what I was told, and I don't doubt it. So this one example of why LP does NOT do business as an authorized dealer. They order what they want in whatever color they want, and don't have to abide by manufacture rules designed to make sure that the LDS, and not the manufacture get's stuck with merchandise in sizes and colors that don't sell well.

I don't feel so bad for many of the LDS owners in my area. The ones I know drive nicer cars then I can afford, spend a couple months a year diving exotic locations, and on the customer's dime. They write off everything, and if they declare 50K in income it maybe a bit of a sham as they likely did 15K or more worth of diving for nothing, and write off their entire lifestyle while gaining equity in a business.

I feel more for the Instructors and employees whom are not making jack, and working two jobs, one just because they enjoy diving and teaching. Those are the people who are really getting the short stick.

 

[goodeatsfan]

Manufactures are often responsible for what an LDS must purchase. Our local LDS stopped selling brand X of fins. I asked the retail manager why, and he indicated that the dealer agreement had changed, and in order for them to carry Brand X, they would have to purchase a minimum of 50 pairs to get a volume discount. Worst, they could not choose what colors and sizes they got. They were told that they must purchase X number of fins in each size and color. That leaves them with a bunch of pink XS, and XL fins that they can't move while they sell out of black or blue M/L fins. To add insult to injury, they could not backfill their inventory at the discount price with the popular sizes at the discount rate. If they wanted to get another order, they had to purchase another 50 sets including sizes and colors they don't want, and often already had a surplus stock of. That or pay a premium price to get just what they wanted.

I can not say if this story is 100% accurate, but this is what I was told, and I don't doubt it. So this one example of why LP does NOT do business as an authorized dealer. They order what they want in whatever color they want, and don't have to abide by manufacture rules designed to make sure that the LDS, and not the manufacture get's stuck with merchandise in sizes and colors that don't sell well.

I don't feel so bad for many of the LDS owners in my area. The ones I know drive nicer cars then I can afford, spend a couple months a year diving exotic locations, and on the customer's dime. They write off everything, and if they declare 50K in income it maybe a bit of a sham as they likely did 15K or more worth of diving for nothing, and write off their entire lifestyle while gaining equity in a business.

I feel more for the Instructors and employees whom are not making jack, and working two jobs, one just because they enjoy diving and teaching. Those are the people who are really getting the short stick.

sounds like the same practices half way around the world..... I often see my LDS carry odd bits of colored gear they can't get rid off AND the guy who runs the LDS always famously claims he only makes about USD300 a month but buys tons of stuff (tech toys - electronic not dive) likes there's no tomorrow.

 

[cerich]

Not all brands operate in that fashion with the dealers.

 

[RonFrank]

Not all brands operate in that fashion with the dealers.

Understood, and I did not mean to suggest that this is a standard manufacture model. I also appreciate that there are good manufactures out there that make great products, back those products, and work well with wholesalers, retailers and the customer which is a benifit to the industry.

Many consumers are educated, and I appreciate and dive products from manufactures like Oceanic, Aeris, and Zeagle to name three that place quality and customer satisfaction high on their list.

 

[Darryl Bowerman]

Stu S. LP buys direct from most manufacturers /distributors. Some just choose to deny that they sell direct and say that LP is not "authorized". The "best price" available to large volume buyers is often "off the price list" and, at least, 15-20% below what the LDS guys are paying. LP uses the normal discount mark up of 50%-a 33% gross margin. Many local dive stores still price at 100-120% mark up, 50-60%+ gross margins. This difference, plus the "inside" pricing creates the 20% + plus discount.

mdb,

I think care needs to be taken when making a blanket statement like you have regarding the manufacturers who choose to sell to LP versus those that do not. Speaking only for the companies I represent and due to my 20 year+ history with Oceanic and American Underwater products I can state without reservation that we do not nor have we ever shipped or authorized a shipment to LP or any non Oceanic/AERIS retailer. Have we slapped the hands of large retailers who have been caught versus discountinuing there dealerships as we should have in the not to distant past? Absolutely. But just because a dealership rolls the dice on continuing to do business with us that is not an aggreement by us to set up LP as a warrantied retailer if they ship them product. The reality of that as it pertains to warranty is that LP has the original warranty and the consumer becomes the third purchaser no different than if they had bought off a friend or in a garage sale. No manufacturer warranty.

If Apollo has chosen to sell LP directly then that is a business decision we can all respect, but I find it a touch irresponsible to make statements like yours. Look on line at the manufacturers websites and do a dealership search and unless you have some serious inside information, then stick with the facts of who does choose to deal with LP as a warrantied dealer of their products.

Do any of us know what the other brands corporate decision or shipment policies are? No. Again I will only say with my knowledge of Oceanic and AERIS corporate policy combined with the fact that we have discontinued dealerships doing business deep into six figures make me feel comfortable that we support our dealership directly be they internet retailers or not.

As I have stated in earlier posts; I have no ill will toward LP. They were early on the internet, they are smart and they have been successful. That being said they are either a warrantied dealership of products or they are not. And if they are not a warrantied retailer of whichever brand they should not be representing themselves as such. Do they have the right to sell whatever brands end up in their store, Absolutely! Hence, the term free enterprise.

Regards,
Darryl Bowerman

 

[RonFrank]

mdb,
The reality of that as it pertains to warranty is that LP has the original warranty and the consumer becomes the third purchaser no different than if they had bought off a friend or in a garage sale. No manufacturer warranty.

They (LP) were early on the internet, they are smart and they have been successful. That being said they are either a warrantied dealership of products or they are not. And if they are not a warrantied retailer of whichever brand they should not be representing themselves as such.
Regards,
Darryl Bowerman

LP has used the model that has worked for them in the camera grey market area for decades. They offer their own warranty, and they are big enough to back it up, so not quite like buying from a garage sale.

With the amount and vast diversity of product LP stocks, I think they MUST be getting a good amount directly from the manufactures, or very large wholesalers. I can not imagine that any given store, or even a few could stock LP on the hush hush.

 

[cerich]

mdb,

I think care needs to be taken when making a blanket statement like you have regarding the manufacturers who choose to sell to LP versus those that do not. Speaking only for the companies I represent and due to my 20 year+ history with Oceanic and American Underwater products I can state without reservation that we do not nor have we ever shipped or authorized a shipment to LP or any non Oceanic/AERIS retailer. Have we slapped the hands of large retailers who have been caught versus discountinuing there dealerships as we should have in the not to distant past? Absolutely. But just because a dealership rolls the dice on continuing to do business with us that is not an aggreement by us to set up LP as a warrantied retailer if they ship them product. The reality of that as it pertains to warranty is that LP has the original warranty and the consumer becomes the third purchaser no different than if they had bought off a friend or in a garage sale. No manufacturer warranty.

If Apollo has chosen to sell LP directly then that is a business decision we can all respect, but I find it a touch irresponsible to make statements like yours. Look on line at the manufacturers websites and do a dealership search and unless you have some serious inside information, then stick with the facts of who does choose to deal with LP as a warrantied dealer of their products.

Do any of us know what the other brands corporate decision or shipment policies are? No. Again I will only say with my knowledge of Oceanic and AERIS corporate policy combined with the fact that we have discontinued dealerships doing business deep into six figures make me feel comfortable that we support our dealership directly be they internet retailers or not.

As I have stated in earlier posts; I have no ill will toward LP. They were early on the internet, they are smart and they have been successful. That being said they are either a warrantied dealership of products or they are not. And if they are not a warrantied retailer of whichever brand they should not be representing themselves as such. Do they have the right to sell whatever brands end up in their store, Absolutely! Hence, the term free enterprise.

Regards,
Darryl Bowerman

Hi Darryl,

Actually Mike knows where we stand on the whole LP issue. His frustration is more directed to the vendors that know how it gets there and encourage/does nothing to stop product that ends up there while having their authorized dealers follow rules that puts them at a competetive disadvantage.

At the end of the day there is very little moral/ethical difference between selling direct or using a middleman to escape being "caught" while enjoying the additional profit that occurs when there is no warranty/free parts programs. (Plus in some cases no rep get paid, mostly when it is handlesd as a secret house account)

Heck, google "internet go back" then look up Aqualungs dealer listing on their web site in 2000/01, they list "Creative Sports" as a dealer, that is LP. Yet we hear that they have never or at the time don't sell to LP, no they sell/sold to Creative Sports which is LP....

Anyway, Mike is one of the good guys.

Best,

Chris

Disclaimer- It is possible that those that should have known where their product was able to get to LP were indeed not aware. That would mean that they were well intentioned but blissfully blind.

 

[mdb]

Hi Darryl:

I agree with you. I did say "most", not all.

We do know that Aeris and Oceanic is one of the most proactive companies that are tracking sales and protecting authorized dealers. There are others as well.

PS: Thanks Chris for the kind words. Like you, I like playing pool on a level table. As we know that is not always the case in our buss.

 

[engbarth]

We are new to diving and in the market for dive gear. Has anyone purchased from divers-supply.com? Are they reliable? Would you buy a reg from them?

I am looking at a package that includes the Mares Kaila BC (ind price about 450), octopus (ind price about 100), Delta 4 reg (ind price about 450), and a nice Oceanic computer (ind price about 750). The price seems great ($1166 for the package) and will be much better than what I can get at my LDS.

Thanks for any input,
Gina