restocking fees


More high end manufacturers are selling direct and offering home auditions, and many are charging restocking fees of up to 20%. I absolutely respect the right of any manufacturer to charge whatever he sees fit. It's expensive to have product in the field, and companies want to discourage tire kickers, but I see no reason to risk paying a restocking fee when the market offers me so many other choices. Do restocking fees discourage you from trying a product, or is the risk worth taking.
84audio
Yes ! I would not pay a dime for restocking fee.To me these companies are just shooting themselves in the foot. I realize that this stuff cost good money,but you have to realize most of this stuff is already marked up 300% anyway.To me they should designate a small % of peices for demo and have a waiting list for demo..Most people will not pay 20% to listen to something that more than likely isn't better than anything else. The real issue is that there realy isn't that many peices out there that are head and shoulders above anything else and companies rely on "hype" to get people to get excited about a product and almost feel they have to have that product and get caught up in the foolishness we all create..
When that much absolutely. You can't audition these brands, other's opinions are just that opinions, so its absurd and discouraging. 99% of the time thread answers are "your ears are the only ones that count" when choosing a product you haven't heard. Reviews mean little if it doesn't suit your taste.
restocking fees should discourage one from returning products. as far as discouraging the in-home trial itself, it certainly weeds out tire kickers. a 30 day trial from a small struggling company(manufacturer or retailer) is worth something.
Restocking fees discourage me from trying products I'm not serious about buying, and that's the point as far as I can tell. I have paid restocking fees once, and another time I negotiated away a restocking fee.

20% is excessive, IMO, and that fee would keep me away even if I was serious about the product. I'd rather wait for a used model to show up in the classifieds and take my chance with a resale.
I won't pay restocking fees! I believe this practice is illegal in some states. This may be true even if your forwarned of this policy, no merchant has the right to usurp the law.
I think we pay enough $$$$ already, luxury taxes being one of them, what a joke.

I'll wait and buy a demo or used through here.
I don't have a problem with a restocking fee. Just curious though what does the manufacture do with a returned item? Sale it as a demo, or re-box it and sale it as new? If I buy new, I expect new, not something that may have been passed around who knows how many times.
Jmho if I wanted to audition a mail order piece of equipment I would rather deal with a manufacture that sent a demo unit for audition for a reasonable fee and if I decided to buy, would deduct the fee from the purchase price of a new factory fresh unused unit.
Here is a different view:

I would not mind paying a reasonable fee for trying out a product directly from the manufacturer. 20% might seem much but taking the chance in reselling of used products might come out the same anyway.

Frankly, over the past year I have bought many items directly from the Manufacturer (Fi, Wright, Cain, Pass). Compared to regular retail through dealers these products are already discounted and don't have the high mark-ups. A restocking fee, so that one can try out such products directly from the manufacturer, are reasonable. If the manufacturer would have to resell the demo he would have to offer it at a 20% discount anyway.

Overall, I would welcome a change in the retail system:
- Products direct from manufacturer
- 60 day at home trial of either designated demos or
- 60 day at home trial with new product, but restocking fee of 10-20%

The current dealer system is the most useless thing to me: An 2 hour in-store audition under unknown environment just does not help much; a 2 day at home trial is better but not enough either. A longer at 30-60 day at home trial with reduced prices from the start (as there is no dealer needed then) sound much better to me.

And no, my whole reasoning doesn't have anything to do with my moniker :).
Just someone who welcomes longer trial periods.

Rene
Many higher-end companies are seeing that their non-HT products are not finding a market. The local dealers are catering to Home Theater almost exclusively (excpet the big boutiques in the biggest major markets). Some mfg'ers have too small of a dealer network to begin with. In both cases, they need market coverage and in-home auditons are their only choice. I am not open to any restocking fee, but gladly pay the shipping. These costs are the mfg'ers cost-of-sale and they need to accept that. If the product comes back, make it available as a demo via their website, etc. Companies like Zu, Ridge Stret Audio and others should be applauded for generous "get-to-market" strategies that include 45-60 day in-home trials, and even include the ability to return products that were custom ordered (specific cabinet colors, etc.). Zu and RSA will pre-burn in their hi-effiency speakers before you take delivery, realizing the small SET amps will never properly prepare the speakers for a decent evaluation.

The high-end audio business is in turmoil right now, and some restocking fees are a natural outbirth. I won't go there, though.
Ted
Frankly, over the past year I have bought many items directly from the Manufacturer (Fi, Wright, Cain, Pass).

Pass sells direct to the customer? Do you mean drop ship to a customer through a Dealer? If Pass is selling directly to a customer, and I was a dealer, I would drop his product from my store.

The current dealer system is the most useless thing to me: An 2 hour in-store audition under unknown environment just does not help much; a 2 day at home trial is better but not enough either. A longer at 30-60 day at home trial with reduced prices from the start (as there is no dealer needed then) sound much better to me.


Maybe in your area, not mine. The two remaining dealers in my area will check out a piece of demo equipment for a home audition. Screw that waiting for something that is being shipped. I'll take the local dealer first over mail order.
The whole point of a restocking fee is to discourage the non-serious buyer.
As with virtually anything, the amount is negotiable. If you've done you
homework and you're serious restocking fee aren't a barrier.

Restock, great post.
The two remaining dealers in my area will check out a piece of demo equipment for a home audition. Screw that waiting for something that is being shipped. I'll take the local dealer first over mail order.
Aren't you then limited only to the brands that your local dealer sells? Numerous manufacturers sell direct: Wright, Welborne, Tyler, Zu, Moscode.... So I hear that you would rather not wait for their products to ship, but I'm confused as to what that has to do with paying re-stocking fees to hear a product that you cannot get locally?

Obviously, it costs the manufacturer money to box, ship, track, converse via e-mail, receive the product back into inventory, converse again via e-mail, and then refund the money if there is no sale. I'll never understand the expectation that they should do all of this for free. I don't work for free, so why should they?
A Restocking fee of 10 - 20% is reasonable for a retailer if you've bought a Brand New item, assuming that they in turn will resell it as a returned item. They obviously cannot or should not sell it as New again.
In the case of a local High End dealer, they should not charge anything other than shipping expenses if any are incurred.
We still need the Brick and Mortar Guys/Gals in this Hobby/Business...........at least IMHO. I know it's nice to find it Cheaper on the 'Net sometimes but I would not like to think of the Scenario without "Dealers".
I posted;
The two remaining dealers in my area will check out a piece of demo equipment for a home audition. Screw that waiting for something that is being shipped. I'll take the local dealer first over mail order.
Aren't you then limited only to the brands that your local dealer sells? Numerous manufacturers sell direct: Wright, Welborne, Tyler, Zu, Moscode.... So I hear that you would rather not wait for their products to ship, but I'm confused as to what that has to do with paying re-stocking fees to hear a product that you cannot get locally?
Boa2
No disagreement here. My comments were in response Restock's post. Unless I misunderstood him, he could care less if there were any Dealers. Just buy direct from the manufacture. Bad way to go imo.
As for mail order restocking fees I addressed that in my first post. I see nothing wrong with it.
Where is it illegal? There is no law requiring a retailer
to accept any product back after purchase. If I'm mistaken, please enlighten me.

-Wendell
Thanks for clarifying that, Jea48. Sorry for my confusion.
Businesses are free to set their terms and their prices(within the law), then live with how the market responds. I certainly see the reason for restocking fees, and agree with the practice. If you are not seriously interested in purchasing, you should not order. Dealers cannot fund tire-kickers without losing profit, or raising the prices for the other folks who actually purchase, and I can't agree with the concept that since we pay too much in taxes we should not be obligated to reimburse dealers for their expenses. However, on-line dealers might consider alternate methods of showing their products such as auditions at various audio clubs around the country, and perhaps a traveling demonstration tour similar to what bicycle and snow ski manufacturers do. One thing will never change, we vote with our wallets, then the market sorts itself out.
I don't like to work for free either, and manufacturers shouldn't be expected to work for nothing. But would they have more sales if they didn't charge the fee? If they really believe in their product, and think it's better than the competition, would it make more sense to encourage in home trials with no fees? Sometimes you have to spend money to make money. It's great to claim the morral high ground and say you shouldn't be expected to work for free, but it's even better to make some sales. In any case, I absolutely respect whatever decision manufacturers make about restocking fees, but my decision is not to deal with those manufacturers who charge them. There are too many other good choices.


Some states allow consumers a set time for complete refunds. Never mind that I rarely can find a dealer that truly knows all the intricasies of todays complicated products. One often has to take the item home, go through all the manuals and then hope that the manuals are correct and then hope that the item works as described. Furthermore these products have to compatible with the consumers existing gear. That most of the on line retailers (dealers aren't usually that much better) are clueless about the products their peddling never mind the ones they don't. Many online retailers don't even have an audition set up, set up.
If one were to buy a garment on line that didn't fit, would you expect to pay a restocking fee?
Would you expect to pay a fee to test drive a new automobile?
We are talking about a performance instruments. How are we to know how something performs without trying it? The specs? Internet sales could be viewed as bids.
I simply don't believe any state allows a consumer a set time for a refund. Please provide a list.
From the responses to this post it's apparent that many audiophiles are shoppers as opposed to buyers. In the cold, uncaring dollar oriented world of sales shoppers are seen as a waste of time.
We consumers tend to forget that both manufacturers and retailers know their business better than we do. If restocking fees are a bad idea, they'll learn it soon enough. But the fact that the practice seems to be growing suggests that they are learning the opposite lesson--that the tire-kickers cost too much and bring in too little to be worth bothering with.

If you don't like these fees, and you want to try out lots of equipment, I suggest you buy used, so you can sell what you don't like at little loss. (But I bet you find that trading like that still costs something--maybe 10 or 20 percent?)
I would be willing to pay a 20% restocking fee If I could buy direct from the manufacturers at distributor price. I think Manufacturers should cut out the middlemen (Brick and mortar stores) and deal direct with the public. Even if I paid a restocking fee on 2 items I would still be ahead of the game because I would not be paying full blown retail prices.
Onhwy61, Shoppers are potential buyers. I'm both a shopper and buyer, and I'm afraid I have the bank statement history to prove it.

I was looking for a cable recently and budgeted $150. I narrowed my choices to 3. One manufacturer bragged that his cable was the best, and he would gladly sell it to me but did not take returns. That left me with 2 choices. Another manufacturer agreed to give me a 30 day trial saying he would recredit my card minus shipping if it was returned. The 3rd manufacturer asked lots of specific questions about how and where I was planning to use the cable. He said he had a cable for $100 more that would be absolutely perfect. When I said I wouldn't go there, he asked if he could send me the cable for audition at no charge, and asked me to evaluate it against the competition's cable.

Sure, he's trading me up, but I respect a guy who is confident in his product, and is unafraid to take a risk. He isn't worried about getting screwed or feeling sorry for himself for maybe working for free, and he's not counting pennies thinking about a restocking fee. That's a real sales person!

Granted, speakers and components are different from cables, but the principal stands. Of course it's safer to get the fee, but does it cost you more business in the end? It would be intersting to hear from dealers and manufacturers.
He isn't worried about getting screwed or feeling sorry for himself for maybe working for free, and he's not counting pennies thinking about a restocking fee. That's a real sales person!
No, that's an accommodating chump who ain't gonna be around long. Would they sell more product without a re-stocking fee? Not enough to offset the loss of providing free trials to the customers who expect them to work for free. Those are known as "D customers", those that cost you money every time you do business with them. And they will ruin your business.

Wilson Audio, McIntosh, B&W, and others did not become mainstays in the industry by giving things away. Just as most of us buy with our wallets, they too must repeatedly check theirs...or they are gone. Some manufacturers enter the market with free trials for a period of time, but few will make it if they continue that way. It's not pennies given away. It's far more than that. It costs them big dollars, as well as the fact that would-be customers come to praise them primarily for being willing to give away freebies. In the end, such a reputation is not good for business.
Boa2, I see your point, but this "chump" isn't giving away anything if I buy the cable. Maybe he is sure of what he has, and knows it's much better than the competition. If it's a losing proposition for the manufacturer, I trust he won't make the deal.

There are many roads to success. Plenty of dealers and some manufacturers offer in home trials with no restocking fees. Others charge, and If you are willing to pay them that's great!

I'm not in the audio industry, but I work daily with sales people in a high pressure situation. The most successful sales people are those who are confident and unafraid. They don't count hours and whine about working for free, they understand their market, and they go out and make something happen.

While I enjoy high end audio, I'm out of my league about that market. Let's not pretend that buying and listening means we understand how it's best sold. The high end dealer model is going away, and my guess is that manufacturers who charge restocking fees will eventually suffer. Granted, I'm shooting in the dark--who can really say. Again, I would really appreciate any dealers or manufacturers thoughts.

Thanks
There are many roads to success. Plenty of dealers and some manufacturers offer in home trials with no restocking fees. Others charge, and If you are willing to pay them that's great!
I completely agree.

On the other hand, I'm willing to bet that the majority of folks who protest a re-stocking fee aren't buying anyways unless they first establish that the product can be had at a significant discount. In this case, they are not the type of customer who can contribute to the growth of a business. They are good PR ONLY when they are given something for free.

We are not talking about taking a salesman's time. Most salespeople don't own the business, and they have nothing to do with steering the ship. We are talking about when the salesman OWNS the business. If a salesman isn't good at his job, two months of measly pay will force him to look elsewhere for a better paying job. However, if an owner gives away his time and product without enabling himself to offset his costs, he too will have to look elsewhere, with failed company in tow.
Understood. I would expect nothing less than a company owner acting in his best interest. In some cases, that may be finding a way to get rid of tire kickers. But the model for no obligation returns is out there. Circuit City, Sound City, Amazon, Crutchfield, Audio Advisor, Music Direct, J&R and countless others offer such a policy for on line electronics shoppers. While they don't all sell high end products, there policies make it less likely that high end consumers will be willing to pay a restocking fee.
From your initial post:
More high end manufacturers are selling direct and offering home auditions
Not one of the companies you mention in your last post is a high end manufacturer.
Narrod, off the top of my head I believe that Hawaii offers consumers something like 60 days to return non-customizable items with out a restocking fees unless the merchant clearly advertises a different time frame.
Boa2, My point is that those companies I mentioned in my last post create a climate that will make it difficult for high end manufacturers to demand restocking fees. I doubt that consumers willtake the risk when they have so many other options including products from other high end manufacturers that don't ask for a fee. In any case, the horse is long dead, and I'm going to stop beating it now. Thanks
My point is that those companies I mentioned in my last post create a climate that will make it difficult for high end manufacturers to demand restocking fees.

As is aparent from the responses to this post, many here seem to expect service for free. I personally like Mitch2 idea the best: Having a travelling demo piece of equipment with no pressure to purchase would be ideal and I think viable in North America.

Of course, the market will decide, but if restocking fees will help small amnufacturers survive so be it. Maybe we should call these fees rather equipment trial charges as there is a service provided; retocking does not seem the correct term as the items will not (or at least should not) be sold as new again, as it would be if an item in a store is "restocked".

Rene
Jea48:

The two remaining dealers in my area will check out a
piece of demo equipment for a home audition. Screw that waiting for
something that is being shipped. I'll take the local dealer first over mail
order.

I know we have a different "buying philosophy" here. But to be
even more controversial: Yes, I would buy from the small manufacturer rather
than supporting the local dealer, even with a reasonable "equipment
trial charge". At least in that case, I know that 100% of my investment
goes to a person with skills and creativity, who puts all their effort in making
a good product. The point here is not really to save a few bucks. Being in a
"business" where creativity is most important, I would rather
support the source directly, than people just selling the ideas. In addition, as
mentioned above, checking out equipment for only two days or a weekend is
insufficient IMO.

As for local dealers, I would steer the business model in a completely
different direction: Rather than mainly providing sales service, I would prefer
their position rather as an advisor and service provider. A good example
would be to provide detailed room acoustics improvement and system setup
experiences much beyond what current dealers do, but more in the style of
acoustics companies (e.g. Rives Audio).

Just a slightly different view…

Rene

P.S. Pass’ First Watt effort is almost a direct distribution model where one
dedicated person/dealer distributes everything directly and equipment is
shipped directly from the factory. And it is interesting to see what additional
creativity it allows for the manufacturer (Pass).
If internet vendors expect consumers to demonstrate a leap of faith to purchase items without any benefit of their senses, they should demonstrate a leap in faith that consumers who purchase items do so in good faith. Sheesh, we give total strangers in unknown places our credit card numbers, names and address'. These internet vendors often don't have the cost burden of actually having to learn about and demonstrate the products they peddle. Often times in business I'd have to spend valuable time pitching a bid that never came to fruition for what ever reasons. I'm not happy about it, but I accept the fact that its part of the cost of doing business.
Restock

I know we have a different "buying philosophy" here. But to be
even more controversial: Yes, I would buy from the small manufacturer rather
than supporting the local dealer, even with a reasonable "equipment
trial charge". At least in that case, I know that 100% of my investment
goes to a person with skills and creativity, who puts all their effort in making
a good product. The point here is not really to save a few bucks. Being in a
"business" where creativity is most important, I would rather
support the source directly, than people just selling the ideas. In addition, as
mentioned above, checking out equipment for only two days or a weekend is
insufficient IMO

Jmho I don't think you know how it works. The manufacture needs the dealers. In case you didn't know it, dealers do not sell the manufactures product on consignmemt. They pay upfront for the product plus shipping. If you were to call a Hi-End manufacture like krell, or ARC, bet you would find they like it just the way it is. They are basically a wholesaler and sell directly to the dealer. No one calling them asking them questions, no tire kickers, just buyers. The dealers carry the inventory in many cases setting in their back rooms bought and paid for. Sometimes on borrowed money. And if the dealer doesn't buy enough product from the manufacture a year and another dealer in the area wants to add it to his store, the manufacture will yank the franchise from the dealer and give it to the other. I have seen it happen.

P.S. Pass’ First Watt effort is almost a direct distribution model where one
dedicated person/dealer distributes everything directly and equipment is
shipped directly from the factory. And it is interesting to see what additional
creativity it allows for the manufacturer (Pass).

What do you want to bet that the dealer has already bought and paid the manufacture for his product and the manufacture is holding the items for the dealer to ship to the dealer's customer, drop shipping. It saves the dealer money. Just call "Pass" and see if he will sell to you direct.
Jea48:
Jmho I don't think you know how it works. The
manufacture needs the dealers. In case you didn't know it, dealers do not sell
the manufactures product on consignmemt. They pay upfront for the product
plus shipping. If you were to call a Hi-End manufacture like krell, or ARC, bet
you would find they like it just the way it is.

Traditionally that is the way it is and I have no doubt that you are
right. As a consumer my vote is for a direct distribution system. I know from
certain British Hifi components that dealt exactly as you described with their
dealers. Just strengthening my point that this is a dealer-sold brand not
worth supporting. And you are again right that many big companies do prefer
the status quo.

The current rise in small manufacturers shows that my views do work though.
Take a look at the list of manufacturers that make excellent products and get
away without dealers: Tyler, Omega, Fi, Welborne, Wright, Zu, Moscode, ZYX,
Amazon, Galibier, Teres, Redpoint, Bent Audio, K&K, Dodd Audio, JuicyMusic,
Transcendent Sound, Audionote Kits, Trichord, VH Audio, Ridge Street Audio.

What do you want to bet that the dealer has already
bought and paid the manufacture for his product and the manufacture is
holding the items for the dealer to ship to the dealer's customer, drop
shipping. It saves the dealer money. Just call "Pass" and see if he will sell to
you direct.

Try calling Renohifi and find out whether he paid for all 100 FirstWatt F3, F2
and F1 - I doubt it. In that case it is an exclusive distribution deal of a
singular specialty line.

Another case in point: Magnepan - take a look at their success of their
directly distributed MMG speakers. They would never be able to hit that price
target by going through a dealer network. The point here is that times did
change: With the presence of the Internet, manufacturers do not rely on
dealers anymore to address the small audiophile target audience. IMO the
internet achieves this much more efficiently.

Bottom-line is: This thread addresses restocking fees charged by
manufacturers (which are often small). It did not ask about restocking fees for
online Vendors and dealers. For small manufacturers it does make sense IMO
and is fair. The added diversity and possibility to be more creative is worth
supporting.

Just my 2c for the third time... :)

Rene
anytime a component is purchased as new, there is a risk that it will be unsuitable and sold.

there will be some loss incurred when selling a component purchased new, unless bought at a large discount.

a restocking fee may generate a cost equivalent to the difference between the original purchase price and the price at which the component is resold. in that case there is an advantage in taking the risk of incurring the restocking fee.

assuming there is more than a 50 percent chance of keeping the component, paying the restocking fee avoids the nuisance of reselling.
Mrtennis, one has to pay to play. There`s no free lunch. What does the dealer or mfg. do with an open carton?
hi porziob:

if the dealer provides a demo, there is no problem with reselling. in addition, the deom is at some point, broken in, which gives the listener a more accurate representation of what the component.

dealer's should have a demo of many of the products they carry to lend to (serious) customers.
20% restocking fee is a joke, thats basically telling me they dont want my buisiness.

02-24-09: Sthomas12321
20% restocking fee is a joke, thats basically telling me they dont want my buisiness.

Would you have any problem with the dealer reselling a returned piece of equipment as new factory sealed?

Would you be fine with that if you were the buyer of a returned item?