how much do shops make on us???

[ktomlinson]

The fact is that there is markup on everything. A 50% profit margin is pretty common, you still have to take into account taxes, administrative costs, retail space isn't cheap...at the end of the day just accept the fact that this is the world we live in and it works ok, there's no need to be disappointed about it

 

[vladimir]

If dive shops were making a killing there would be one on every corner. This is not the case.

I think that there is, metaphorically speaking, one on every corner, in the sense that there are far more than the demand can profitably sustain. But I agree that they are not making a killing. It seems they are a lot like independent wine stores and coffee shops in that regard--people open them up because they "always dreamed of owning a" whatever, with little regard for the business's prospects.

 

[udtfire]

well our total mark up across the board is about 35% average and please try to support the lds because if they cant sale gear the price of an air fill and service will go thur the roof its just business

 

[vladimir]

well our total mark up across the board is about 35% average and please try to support the lds because if they cant sale gear the price of an air fill and service will go thur the roof its just business

Why do people keep making this argument? It is the least convincing in the "support your LDS" repertoire. If air fills and service are so valuable, why not charge more for them? Those are services that are difficult or impossible to provide over the internet. So why do shops subsidize those services with high gear prices, that are so easily undercut?

 

[jagfish]

...and oddly enough...the more technical and costly the item, the less the markup, is often the case...

I think one of the reasons the markup on small stuff is so high is that you are likely to be left with a lot of of it at the end of the season...

 

[DALAJS]

I think the important thing to keep in mind, is that these shops need enormous mark-ups to survive in a society where everybody wants high quality gear at the lowest possible price. The shop I go to doesn't always have the best price, but they do have incredible customer service. If we keep fighting our shops for the lowest possible price, they shop won't profit and before long there won't be a shop anymore. I would gladly pay a little extra to support my LDS than deal with the hassle of online orders.

 

[Eric Sedletzky]

After being on both sides of the counter, I feel I am qualified to answer the question objectively. First most dive equipment is marked up 100% of cost. this is a 50% profit margin. Don't get the two confused. Smaller ticket items may be more. The ability to get a discounted price usually depends on the local competition. A dive shop typically needs at least a 30% profit margin to survive and during the winter season in many areas the sales and business in general falls off a lot. Having said that there are companies who's dealer cost is less than 50% profit margin (cough) ikelite (cough)...you will never see their products sold less that 10% off retail because there is not enough margin for the dealer.
Now as a customer you are probably saying to yourself "what a ripoff, they are making a fortune off me." This is not really true and you have ot remember what kind of retail business you are dealing with. As a general rule, a business with high volume can sell at a lower profit margin and a low volume business must sell at a higher profit margin. The dive business is a very low volume sales market compared to a grocery store volume and very low markup around 1%-3%. (don't hold me to this-these numbers are old but they are still close).
There are other factors to consider. A dive store is not making much if any profit on your scuba class. They are hoping you will buy equipment, hence the need for mask, fins, and snorkel for o/w training. As a side note-instructors make little money teaching scuba but thats another story.
If you think the store is making a killing ask yourself a few questions. How much are they paying a square foot? You would probably be suprised that retail space rent goes for especially in a strip mall or high traffic street.
The classes, trips, and training are all designed to produce potential sales and that is the only real profit the store can rely on.
A smart dive store should treat a regular customer fairly and if you are looking for high ticket items, like a set of gear, you do have room to negotiate with a dive store and it is up to you and the store to come to terms if you want a deal. There is more to it but this should give you an idea and ask your self this, if you don't support the store and it goes out of business, how will it affect your diving?

I know and understand everything you're saying here. The dive shop however is one of the very last retail enterprises to get (almost) a 100% markup on products, (they buy something from let's say Trident for $10 and sell it for $19.95.

Back in the late 70's early 80's I was in Excercise equipment retail sales, mostly proffesional bodybuilding equipment meant for gym's and universities etc. As soon as stores like Oshman's and Big 5 started carrying Olympic Plates and higher end equipment it was game over for us. We no longer got our $100%. It was more like
50%. Our store couldn't compete so we shut it down, we couldn't pay the rent.

With LDS's it's the same thing we went through except they are vulnerable from internet dealers who are selling stuff at 50% margin (buy something for $100 bucks and sell it for $150). That's on a good day. Some stuff they sell they only make 10 to 15% on.

There's not much they can do about it except try and compete. If they can't then they go away just like our excercise equipment store.
Air fills will just be an innocent bystander in all this. Unfortunately that will go away with the LDS.

 

[gotwake]

Why do people keep making this argument? It is the least convincing in the "support your LDS" repertoire. If air fills and service are so valuable, why not charge more for them? Those are services that are difficult or impossible to provide over the internet. So why do shops subsidize those services with high gear prices, that are so easily undercut?

This argument doesn't fly for me either. If there is a demand, someone will provide the service.

Whether the scuba industry likes it or not, LDSs will have to adjust to the new market or fail. It's a hard pill to swallow, knowing that you are going to overpay by $1,000 for a couple sets of gear. I have two LDSs near me. Shop 1 (35 miles) charges almost MSRP. Shop 2 (60 miles) comes really close to online shops. Guess which one gets my business. Either Shop 2 or online. As a business, you have to be competitive.

 

[Rec2Tek]

What is the mark up on jewelery and furniture?

 

[redacted]

Why do people keep making this argument? It is the least convincing in the "support your LDS" repertoire. If air fills and service are so valuable, why not charge more for them? Those are services that are difficult or impossible to provide over the internet. So why do shops subsidize those services with high gear prices, that are so easily undercut?

Because there is no manufacturer with anti-consumer policies trying to protect their margins on air and service. And once an effective independent dive club gets going, it would be curtains for the LDS.