The Aqualung Discussion [ Moved ]

[Debraw]

You are right I am not talking about AL.

 

[mdb]

You are right I am not talking about AL.

Debraw: As many have noted, you are doing well. You are taking care of your customers and dealing with the modern world of e-commerce, e-bay, internet etc. Of course new/old divers are going to check out features, benefits, and prices and the good LDS should be able to react. You are responding in a very positive manner.

 

[Debraw]

<SNIP>When I was moon lighting as a repair tech AL and SP products purchased from known gray marketeers did not have their warrantles honored. Not to say that a few didn't slip through the cracks.
Oh the repair were done but the customer was charged for the parts, labor and shipping, when required for issues that would have been free with an intact warranty.
<SNIP>

If SP and AL do track their serial numbers consistently and are one of the very few suppliers that enforce the warranty issues, then how is it they can not use the serial numbers to track down who is selling them to LP? Wow they spend a lot of time going over the serial numbers but then never use them to erradicate the grey market suppliers. I feel like I just got hit over the head with a wet noodle. I mean seriously I always knew that the suppliers approved of selling to LP but they spend so much time telling me they don't and then when it is so blantantly obvious, well it just makes me feel like a dolt.

In the famous words of someone and no one in particular... well look who just woke up! LOL MEEEEEEEE!

 

[jwdiverdude]

If SP and AL do track their serial numbers consistently and are one of the very few suppliers that enforce the warranty issues, then how is it they can not use the serial numbers to track down who is selling them to LP? Wow they spend a lot of time going over the serial numbers but then never use them to erradicate the grey market suppliers. I feel like I just got hit over the head with a wet noodle. I mean seriously I always knew that the suppliers approved of selling to LP but they spend so much time telling me they don't and then when it is so blantantly obvious, well it just makes me feel like a dolt.

In the famous words of someone and no one in particular... well look who just woke up! LOL MEEEEEEEE!

Can't remember if that was gone over perviously in this thread or the Thread that was canceled.
But the same LDS I used to moonlight at as a repair tech, ordered to regs from LP and then used a serial number tracking section on the AL website, for dealers only that stated that those regs originating from a dive shop in NYC, not LP, something stupid like Bob's aquarama. When AL was called about the serial number they told the shop owner they couldn't track those regs from the serial numbers provided but he was on website looking at the numbers when he called them on it they just tap danced around the issue saying that it wasn't accurate data in their data base. the owner went berzerk and paraded all the regulars who stopped by back to office to show them what he found. Pretty good indication that AL knows who is supplying grey marketers but are willing to turn a blind eye.

 

[Storm]

I'm a bit confused.

AL, which owns Apeks offer a lifetime warrantee on regs sold by their authorized LDSs. At least that what my warranty card says for my Apeks regs. When I was shopping for regs, I did a ten year cost benefit to buying from an authorized LDS and from a non authorized internet site. It amounts to substantial savings to pay the higher price for the life time service.

We all know this. And it&#8217;s not really a disputed point. Apeks supplies the supplier with the necessary parts, who in turn supplies the LDS with the parts which go into my reg at no charge. Therefore the higher LDS price is a bit of a front end load on parts costs...kind of like buying an extended warranty on your car. Someone has to pay for the parts, as seeing how it isn&#8217;t me, the LDS or supplier it must be the manufacturer.

Now from what I&#8217;ve been told, when an Apeks dealer orders the regs, the serial numbers are taken down for each reg sent to the dealer. He/she sells these and they end up in the hands of the consumer who registers these and the dealer from which they purchased them at the higher price. (Keeping in mind the great free parts for life deal)

Now if the manufacturer allowed the dealer to sell the regs cheaper than the price needed to satisfy the cost (or portion thereof) of the warranty, someone is getting screwed and it isn't the customer...they still get their free parts for life because they bought them from an authorized dealer. So who gets stiffed for ten years worth of parts? The dealer, not hardly they sold the regs as an authorized dealer and as the warranty is between the customer and the manufacturer, the dealer's out of the loop cost wise. The manufacturer gets screwed for the parts. Hence you can&#8217;t work both side of the street. Pick a team&#8230;authorized dealer or grey market.

Now the grey market has no warranty and as a result, they are under cutting the price and thus biting into dealer market share. Have I got this right so far?

The solution is simple...Allow dealers to sell the regs with or without warranty. The manufacturer imposes a cost per unit with and without warranty and when the customer goes to register for their warranty they get told either you get parts for life, or so sorry you bought yours al a carte...to bad so sad you pay for annual service and parts.

This gives the decision of which method is wanted to the consumer. You can pay me now, or pay me later...

Would this not work?

BTW off topic a bit....20 bucks a year per reg for parts x 4 regs = $80.00 per year free for 3 years = $240.00 the difference I would have saved if I bought from LP after that direct cost savings in pocket....I won't boycott Apeks....I'll boycott LP. I'll support my LDS and their manufacturers before I'll support the grey market and in this case I'm actually not supporting my LDS as much as I'm supporting my pocketbook over the next ten years. I bought all four regs at the same time so I do know what pinch feels like ($2500.00 CDN). Sometimes looking short hurts in the long view.

To each their own...Peace

 

[Kwbyron]

I would like to better understand the scuba industry as a whole(retirement dreams, when I don't need money, but something to do). As it stands now, the suppliers of dive gear(regs, bcs, ext) sell it at a price, then require the LDS to sell it at a minimum price? are there any other markets that undergo this practice? It seems a weird thing to do... it seems to me, that if the LDS wants to sell the product at cost, they should feel free too. So to get the product the LDS has to sell it at a minimum price? The idea that buy requiring a min price to offset the lifetime parts and labor, doesn't really follow through, since they aren't getting any more funds once the LDS buys it...unless the LDS is just a suppler and don't keep pre-paid inventory(a sales agent so to speak).. then they are setting thier own price.

 

[tomhauburn]

Based on my limited dealing with them they would order x amount made only for Walmart and ask you to warehouse it for a year. As you built up your inventory during a slow time they would say...I cannot pay x amount anymore due to market conditions and offer to buy it for 10-20 percent less or your stuck with branded material. But that only my experience. YMMW Scuba gear would be cheaper in the end and as in many small towns the local shop would go under.
Tom

What would happen if Wal Mart started selling "Scuba Gear" in their sporting goods department? Knowing Wal Mart policies on controlling product and prices who would win ... Wal Mart or the Scuba Manfuctures? Which one of the dive companies would change their practices for a chance to be sold by the worlds largest retailer? You think the LDS have problems with internet sales now ..... what would happen if Cressi , XS , Aeris or Aqualung deceided to sell thru Wal Mart ?

 

[Whitelightnin]

I'm a bit confused.

Now if the manufacturer allowed the dealer to sell the regs cheaper than the price needed to satisfy the cost (or portion thereof) of the warranty, someone is getting screwed and it isn't the customer...they still get their free parts for life because they bought them from an authorized dealer. So who gets stiffed for ten years worth of parts? The dealer, not hardly they sold the regs as an authorized dealer and as the warranty is between the customer and the manufacturer, the dealer's out of the loop cost wise. The manufacturer gets screwed for the parts. Hence you can’t work both side of the street. Pick a team…authorized dealer or grey market.

Yes, you are confused.
First off, when the mfg sells to the dealer (authorized or grey market) they get paid the same amount. They have their "free parts" figured into that price. If the authorized dealer sells for less than MSRP. IT IS THE DEALER who takes the hit. That is the point of this thread. AL pulled a shops dist. because the dealer decided to match the grey market price. AL got the same amount of money for the product from the grey market as from the authorized dealer. Authorized dealers DO NOT pay AL more for the product because they get a waranty. They pay the same as the grey market. The dealer is the one that took the hit on price then got SCR**ED by AL for being competitave.

 

[Storm]

Yes, you are confused.
First off, when the mfg sells to the dealer (authorized or grey market) they get paid the same amount. They have their "free parts" figured into that price. If the authorized dealer sells for less than MSRP. IT IS THE DEALER who takes the hit. That is the point of this thread. AL pulled a shops dist. because the dealer decided to match the grey market price. AL got the same amount of money for the product from the grey market as from the authorized dealer. Authorized dealers DO NOT pay AL more for the product because they get a waranty. They pay the same as the grey market. The dealer is the one that took the hit on price then got SCR**ED by AL for being competitave.

Thank you for clearing that up. When I said I was confued I was not being sarcastic. So it is the grey market dealer who does not provide free parts and service and are working on volume so they can reduce the price accordingly. They avoid taking the hit that the LDS takes to provide the waranty service.

But basically from the buyer's end, we're still talking, price difference, between wanting a reduced price up front versus paying a little more for cost savings over time.

Now from the dealer's point of view. They purchase a number of regs for a wholesale price. The MSRP is x dollars, but the grey market price (sans warranty) is y dollars. The contention here is that the dealer should have the right to sell the regs for the same price as the grey market, while still honoring the warranty or sell at the same price as grey market without the warranty?

Also if the dealer sells at the same price as grey market, but said they will honor the warranty what recourse would the purchaser have if the LDS decided they didn't want keep honoring the warranty...with no registation would not the buyer be out in the cold warranty wise?

Just trying to get a handle on this.

Thanks for the help.

 

[jwdiverdude]

Thank you for clearing that up. When I said I was confued I was not being sarcastic. So it is the grey market dealer who does not provide free parts and service and are working on volume so they can reduce the price accordingly. They avoid taking the hit that the LDS takes to provide the waranty service.

But basically from the buyer's end, we're still talking, price difference, between wanting a reduced price up front versus paying a little more for cost savings over time.

Now from the dealer's point of view. They purchase a number of regs for a wholesale price. The MSRP is x dollars, but the grey market price (sans warranty) is y dollars. The contention here is that the dealer should have the right to sell the regs for the same price as the grey market, while still honoring the warranty or sell at the same price as grey market without the warranty?

Also if the dealer sells at the same price as grey market, but said they will honor the warranty what recourse would the purchaser have if the LDS decided they didn't want keep honoring the warranty...with no registation would not the buyer be out in the cold warranty wise?

Just trying to get a handle on this.

Thanks for the help.

Actually the main contention is that the manufacture should not be dictating what price their authorized dealers can and cannot sell product for. That is called price fixing and it is Illegal in the US as per the FTC.
Gray marketers are not beholden to any price restriction. Meaning they can sell their product for whatever price meets their needs.
Authorized dealer are not allowed to go below a certain percentage of MSRP, I believe PE's original post said 10%, without being penalized by the manufactuer, AL in our current story.
If AL was serious about the probelm they would be going after the Authorized dealers that are feeding the grey market.

This thread actually prompted me to give my buddy, the ex LDS owner, a call last night about this.
During the discussion he told me of two ways that he knew of about how a specific Grey marketer gets their gear.
1.) they buy up gear from dive shops that are going out of business.
2.) They go to dealers and propositions them to buy a more of a product then they typically sell in a year and filter the gear to them at cost. His example was they got to Bob's dive-o-rama and ask bob how many Apeks regs he sells in a year. Bob says 20. they then asks Bob to buy 60 Apeks regs and they will take 35 of those regs but pay Bob for 40. They gets their inventory and Bob gets 5 extra regs that he can sell for pure profit.

I see nothing wrong with number 1. what does a dying business care abut how they liquidate their inventory. but way number 2. If AL wanted to stop Gray marketeering they would slam Bob hard and all the stores like Bob's for collusion with the enemy.
Instead of taking it out on Authorized dealer that are trying to compete.