Restocking Fees, 30-Day Free Trials

03-05-13: Mapman
"Restocking fee" done on a % of sales price does not make sense to me. It cost the same to re-stock a similar sized amp for example whether it costs $500 or $50000.

You are missing the point. The online dealer may be calling the charge a restocking fee, but, if the guy is honest and doesn't try to resale the equipment as new, he is using the fee to offset the cost to resale the unit as used, open box, demo, or what ever the dealer wants to call it.

Would you pay $25K for an amp that somebody had in their home before you? Or would you demand a new unopened factory fresh sealed unit?

A little background on pricing. The cost a dealer pays most of the time to the manufacture/Distributor for a Hi-end piece of equipment is 60% of the manufactures retail set price.

So using your $25K priced Amp the dealer will pay, up front before delivery from the manufacture, $15K + shipping....

I can hear you now.... 40% PROFIT!

Well first are you going to pay the dealer $25K for the amp? Maybe things have been slow and the dealer discounts the amp to you 10% off.

30% profit WOW!

Well that might be if the dealer is running the business out of his basement of his home and has a full time job doing something else. Even then I would bet the guy has a line of credit with a bank and will borrow the money from the bank + interest to buy the amp.

But I doubt that is the case. Would you buy a $25K amp from a guy that operates out of his basement?

If the dealer has a store front he has overhead costs.
Rent.
Utilities.
Phone, Yellow page buisness ad.
Internet hookup.
Advertising costs.
Insurance costs.
Any employees? Costs, costs, costs...
Showroom inventory?
________________________
Deduct overhead costs from the 30%

Jea,

Makes sense. But isn't there a difference when one buys direct from the maker via Internet? If I return something for whatever reason, and the maker tests it out and confirms it functioning like new before reselling? I could see whatever that costs as being baked into the "restocking fee" I suppose. The actual cost might vary for say speakers versus amp versus DAC, etc.

But isn't there a difference when one buys direct from the maker via Internet? If I return something for whatever reason, and the maker tests it out and confirms it functioning like new before reselling?

Is the equipment then resold as "B" stock? Discounted "B" stock price?

New is new....

Back in the 1970s I bought a new Nak cassette deck from a B&M dealer, paid full price. Factory fresh.

Got the thing home took it out of the box hooked it, played with it for a while and then, LOL, sat down to look through the owners manual.

To my surprise a salesperson's business card, one of the dealers employees, was stuck between two pages......
.

"Is the equipment then resold as "B" stock? Discounted "B" stock price?"

No, because the maker has certified it as functionally "new".

If cosmetic defects or other issues would remain, I would expect so then.

I just think things are a little different when buying direct from teh maker than via a middleman, which is probably why that seems to be the direction things are heading these days.

Although 85% of audiophiles are genuine and potentially serious buyers, in my experience there is a full 15% that are tire kickers, audiophile nervosa merry-go-rounders, or just individuals unwilling to pay reasonable discount prices. Some are even looking to try out well reviewed new gear in their home, even if unaffordable....and know they're not keeping it before the manufacturer or dealer even approves the home audition. A 15% restocking fee IMHO is reasonable and the only way these non-local sellers (direct manufacturer sales or online or non local dealers) can avoid these individuals and stay solvent. If you don't agree, as said by others, find a local dealer willing to loan his demo unit for a weekend, even if you have to reserve that weekend 4 weeks in advance....have patience or go to shows to audition gear that interests you, or buy used. Let's please remember that dealer cost is usually 55-60% retail for electronics and 50-60% retail for loudspeakers, depending on whether a distributor is involved. Yes, there are some unethical dealers and resellers out there but most are just trying to make a living.