how much do shops make on us???

[DCBC]

...but what kinda comission do the shops actually make on scuba gear??

This really depends upon the shop and the item. When I owned an LDS, I sold tanks as a lost leader at cost. Other major pieces of kit, I took my cost and doubled it, so a $450 B.C. cost me $225. Higher mark-ups were made on accessory type items. Filling cylinders was break even. I had my air analyzed independently every 3 months and posted the results.

I made nothing during training, as my courses were 50 hours, so to be competitive I lost what could have been made, but ethically I didn't want to let someone out the door half-trained. If I ran twice the number of courses, I would have greatly benefited in the sales department (thus the genius of the short PADI programs).

I made money on dive charters, especially live-aboard charters on the weekend. The business was marginally profitable, but a lot of work (read time) for the return.

 

[lulubelle]

This really depends upon the shop and the item. When I owned an LDS, I sold tanks as a lost leader at cost. Other major pieces of kit, I took my cost and doubled it, so a $450 B.C. cost me $225. Higher mark-ups were made on accessory type items. Filling cylinders was break even. I had my air analyzed independently every 3 months and posted the results.

I made nothing during training, as my courses were 50 hours, so to be competitive I lost what could have been made, but ethically I didn't want to let someone out the door half-trained. If I ran twice the number of courses, I would have greatly benefited in the sales department (thus the genius of the short PADI programs).

I made money on dive charters, especially live-aboard charters on the weekend. The business was marginally profitable, but a lot of work (read time) for the return.

Thanks for your post. This might be the most balanced thread I have seen on this topic. Usually it degenerates into a fight about shopping at an LDS and shopping online. Each of us has to examine our ethical framework for buying gear and stick to that. I tried to buy all of my equipment locally because i believe in buying locally. I couldn't, so some was bought online. I had more than one LDS owner ream me for doing so.

Sounds like you had a shop with an ethical business that I would have been mighty happy to patronize.

 

[Rocketmahn]

I've been in business for over 20 years and worked for corporations before that. I have several close friends that are business owners too.

No matter how its sliced products sell at "about" twice what the direct cost is.

This is true for most products that you buy - not just SCUBA stuff.

Lights, rent, wages, insurance, advertising, phone, heat, returns, shrinkage (shoplifting & breakage), incoming shipping, equipment (cash register, shelves, signs etc..), taxes, and profit (5-15%) ALL have to be paid out of the difference between the "cost" and the selling "price".

When you add it all up and spread it across all of the items that you sell it seem to average about twice the cost...

The factory charges twice what it cost them to make "it", the middle man (distributor) charges the retailer twice what it cost them to buy "it", keep it in their warehouse etc.., and the retailer charges you twice what they paid the distributor for "it"... and life goes on....!!!

 

[Papa_Bear]

For a lot of shops NOT ENOUGH!

 

[liv2themax]

While I am new to diving, i'm not new to business. As so many have already said, markup on standard retail is 100%. As to whether that constitutes "bending over and taking it" is a matter of opinion.

I personally choose to support my local shop because I like having a local shop. While hard core capitalism would dictate to buy online and save money, online shopping (or Wal-Mart) removes the ability of the local business to compete. They simply can't compete with the economies of scale that the others online or big box store can leverage. However, unlike the online store, my local shop puts jobs and revenue back into my local economy. That has value beyond the $25 I could save. That said, I will buy the gear I want. If online is the only place I can get that then I will buy online. Just my opinion.

 

[RJP]

What is the mark up on jewelery and furniture?

Easy to figure out, when you regularly see things on sale for 50-75% off.



I used to work for a guy who owned a small local chain of bicycle shops. Markup on bikes was 100% for the expensive models, and even more on the low/mid range stuff. Many common items had even higher markups. Think 500% on things we bought in quantity. Like that $8 inner tube - that we bought a thousand of for $1.50 each.

And bike shops don't really discount much - if at all - other than to clear out last year's models, which they want to get off the floor to make room for the new models which they can sell for MSRP.

 

[RJP]

I've been in business for over 20 years and worked for corporations before that. I have several close friends that are business owners too.

No matter how its sliced products sell at "about" twice what the direct cost is.

Yup, pretty good rule of thumb is that the cost of an item doubles every time it changes hands. (Except for alcohol purchased in a restaurant, the price of which gets quadrupled when it passes from the waitress's hand to yours.)

People hate the idea that the LDS marks up that shiny new reg, but never seem to mention that the manufacturer doubled their cost on it, and in many cases a distributor has as well before it was put in your hands.

If it were up to me - for any given price - I'd prefer that the MANUFACTURER was the one that got squeezed.

:cool2:

 

[boulderjohn]

If an instructor is using rental gear during class, you can bet he owns gear the store doesn't sell and cannot use it during teaching.
...
Worst case is the instructor shows up wearing gear that the store doesn't sell. This is a red flag and you might consider shopping around before spending a bundle at that store.

I am sorry, but I sure don't see it that way. In fact, in my experience it is dead wrong.

In the shop where I work, there are more than a dozen instructors. Every one of them uses the shop's rental equipment. With the exception of a few pieces of equipment that I purchased at various times over the years, all my personal gear is from companies the store carries (or carried when I bought it). I don't know the personal equipment of every instructor in the shop, but that is true of every one of them I do know. The only exceptions I know of are people who joined the shop after already having purchased all their equipment somewhere else. (More on that later.)

Yes, I got a discount on the purchase on my gear, but I sure would not use gear that I did not believe in, so I don't see a problem with that. It's good stuff I feel fine about using.

That brings me to the new instructors who purchased gear elsewhere before coming on with the shop. There are a number of manufacturers who make perfectly fine gear. Shop A may sell something, and Shop B sells another brand. Both are just fine for quality. If a diver gets his gear from Shop A and then goes to work for Shop B (which may be in another state to which the diver has just moved), the diver may have equipment that is not the same as the shop for which he is now working. He or she is not going to dump all that gear immediately and go out and buy new stuff. That does not mean he or she thinks there is something wrong with the material being sold at the shop. It does not mean that instructor will not purchase that equipment when the need arises.

So why do we all use the shop's rental equipment for instruction? Three reasons.

1. We want to use exactly what the students are using so that when we demonstrate something they are seeing exactly what they will have to do without having to make an additional mental adjustment.
2. Why take our own personal gear into the pool to get more wear and tear and get eaten at with pool chemicals when the shop is letting us use their stuff for free?
3. Why have to go home with all our sopping wet gear and got through a cleaning and drying process when we can just rinse and hang the gear in the shop?

The shop is doing us a great service by letting us use the rental gear instead of our own stuff, and I can't see why anyone would not take advantage of that service.

 

[RJP]

If an instructor is using rental gear during class, you can bet he owns gear the store doesn't sell and cannot use it during teaching.

No, but you CAN bet that he owns gear that he doesn't feel like lugging back and forth to the shop, having it faded and exposed to excessive wear and tear in the chlorinated water, having to rinse it afterwards, load it into his car soaking wet, drag it all back into the house, have his wife yell at him, hang it up in the laundry room to dry for a few days (more yelling), just in time to load it into his car in the morning before heading to his day job, where his wet gear will sit in the freezing cold or sweltering heat of his trunk all day, so that he can drag it all back into the shop that night for the next class, where he can marinate his gear in chlorine again for a few hours.

When you see me walk into the shop for a class carrying my own mask, fins, and snorkle -- and then donning rental gear for everything else -- that's the only thing you can conclude about me and what gear I own.

What can you conclude about the shop where an instructor or DM chooses to use rental gear in class? Well, the only thing for sure that you can conclude is that the shop is considerate of their DM and instructor staff and values their time and effort...so much so that they are willing to bear the incremental cost incurred by allowing them to use the rental gear that the shop has invested significant money into --- rather than asking the instructors and DMs to bear the incremental cost and hassle of using their own personal gear.

Though I guess that you could further conclude that a shop that is considerate of divers and understands the significant value of the investment that a diver makes in owning their own gear - whether instructor, DM, student or customer - is probably a shop worth doing business with.

 

[cool_hardware52]

drag it all back into the house, have his wife yell at him, hang it up in the laundry room to dry for a few days (more yelling),

Any first hand experience with this phenomena?

Tobin