To the person expressing concerns about “slim profit margins”, I’ve been in on the financial side of manufacturing for more than four decades, and I can tell you without exaggeration that once it gets to the retailer there’ve been a few markups. Manufacturer to distributor, distributor to dealer, and sometimes more. Each adding to their “slice of the pie”. Roughly a 2X or more at each phase or step if averaged out over the entire transaction.
For EXAMPLE ONLY:
- Manufacturing cost= $1,000 x 2 = 2,000 to the distributor
- Distributor cost = $2,000 x 2 = $4,000 to the dealer
- Dealer cost = $4,000 x 2 = $8,000 to the consumer
Again this is just rough averaging it across all parties, but in any case, you’ll never see the real numbers. There’s no obligation to tell you. Even if they did give you a number, it can’t be relied on, because just like scales of economies drives the manufacturer to dealer cost there’s also the deals they cut above and beyond for quantities. I guarantee you that at each level, those buying 100 vs those buying 1 or even 10 are paying a higher or lower price at each stage based on quantities commitment. Never mind other Incentives. They’ll all tell you that their profit margins are slim and that their barely making any money; that’s just sales and marketing talk.
