Stores loose money on Boxing Day sales?
 

if not, sure be nice to see these prices all the time.

agreed!!!

It's not so much the cost of the fish, corals and supplies that is expensive but the crazy cost of transportation that hurts the bottom line. For instance, a few hundred dollars worth of livestock can easily be over $1000 in shipping, transhipping fees, etc.

They lose money on one or 2 products which are "door crashers" and then they rape you on everything else.

Trust me, I sold home theatre equipment for 5 years.

The tv is at cost or just below cost. But the cables, hd box, warranty, etc have a lot of markup

Same thing with fish stuff. Most people that bought 30 dollar boxes of salt probably ended up spending on other things that had markup for sure

Shipping is expensive on livestock because its time sensitive. But dry goods are way cheaper to ship

I think typical dry goods on a day to day basis have at least a 50% to 60% markup... as for corals and fish, it's probably 50% ( before shipping).

Stuff like groceries at the big box markets could be as low as 2% but they have huge volumes.

msjboy

I think it's more like 30% on dry goods and 50% on livestock

Any business running on that margin will not be in business for long, commercial overhead is costly, the sales you see this time of year are typical for business looking to unload excess inventory from Christmas, anyone that has ever worked retail will tell you Jan and Feb are usually pretty lean months. That being said it is nice to score a deal or two for those who have any money left after Cashmas.

Absolutely! I'd figure another 0 on the end of those figures. Some higher end stuff is marked up less, 10 or 20%, but some dry goods are marked up 100% or more. Livestock can be up to 300% or more. figure costs of shipping, covering losses in shipping, supplying the environment to keep it, staff to maintain it, food, the shelf and fridge space to keep the food in, water, etc. It all adds up..
Salt for example is sold at close to cost, mostly because the market has driven it to that. So if the store doubles or triples the cost of the fish to go in that salt, I'm ok with that, as without profit, there wouldn't be a store to shop at.
As for the original question, yes, some stores lose some money on some items.

^ +1 Dry goods are alot easier to sell at cost or below as said, cause they mark up everything else anywhere from 10% or more to cover costs, Like brad said fish can be marked up as much as 300% I sold 1 1/2" Cichlid fry to a LFS once for 2.50 a piece and they sold them for 16.95 at the same size. but they have to do this to pay staff and power bills are enormous in Fish stores

salt and other heavily marked down items are called "loss leaders" - they attract you into the store with the hopes the client will also purchase other items where they will make up the loss.

when i worked at futureshop (when the original xbox and PS2 were new gaming consoles) - we lost $10 per console when selling them at regular price. Our managers reminded us daily to push additional controllers/memory cards/games/extended warranties with each sale to ensure the department's profitability.

Sorry what I meant is live stock cost is half of the price. So 100% markup.

My bad

Lol the "cost" on games was always a dollar less than retail. When in reality the cost is like <20 dollars on a video game

so when you were in retail did you do it to make a living or just for fun?
How much of your salary at the time would you have been willing to give back to the customers??
:twised::twised:

sounds like some people should try being self employed, retail or otherwise. they would learn alot.

I was quite ****ed. This boxing day sale. I seen livestock that was double the normal price to be marked at whatever percent off. I've seen this on regular days also were the price was bumped one day to be marked on sale at yesterday's cost

Just like wing night at the bar...

mmm wings...

I did it as a part time job while going to school. But I was money hungry. I would never take a commission hit to save a customer money. I only gave discounts to intice people to buy more.

Sometimes I'd discount a tv 200 dollars to sell a 400 dollar warranty.

Warranty pairs 17% commission but tvs only paid 2%

Comments like LFSs are raping you are really inflamitory......If you shopped somewhere that inflated their costs just to discount it for boxing day then you shouldn't support that shop...... If you feel that their prices are too high then don't shop there...... There are things like overhead, employee wages, livestock losses that all have to be factored in to the price of everything in the store.... I mean, geez maybe the LFSs shouldn't have boxing day sale if we are gonna get raked over the coals for making money for the rest of the year?.... The sales are for the customers and while yes they still make a profit on some things on Boxing day, other things, they break even or even take a loss on

At any electronics store when they show you the cost and tell you you're getting something at cost. It's not true.

The cost displayed on the cost displayed on the computer is padded to incorporate overhead. No one in the store ever knows the actual cost of anything

Boxing day isn't for making money. It's for building brand awareness and brand loyalty. So that the customers that you satisfied on boxing day will come back many times over the following year

if i had a store of any kind, i'd sell everything at cost on boxing day. take as many customers as possible from the competition.

The only part against this is that there's little competition on boxing day. It's not like the futureshop/visions, etc that have one every block. Pretty much everyone in the lower mainland was at JL's or King ed's, then headed to either OA or OC. So as long as you're not out to lunch on terrible prices, a 10% off would draw people in just as much as a 20%+. This boxing day i spent a couple hundred bucks on random crap, and figured I'd saved about $40, definitely staying home and shopping online next year.

Assumptions
 

So many assumptions made in this thread. Ive been on every side of this industry and it really is amazing at how some of these stores keep their doors open. Margins on many items are ridiculously low.


Some People are throwing numbers out there without seemingly having a clue.

I Would like some loose money. Lol

But stores should be completely for customer loyalty. There's about 6 LFS in Edmonton and I basically deal with one of them now. A year ago I would spend a whole day driving around to all of them trying to find one I liked and trusted

Stores won't loose money, they just don't make enough money. If every buy that much every day they don't mind to sell for that price.

I didnt even notice that :pound:

Yup. They call these products loss leaders. It's more about market share and over all movement of stock. Some products have little to no profit, but chances are, once in the store, you will buy another product as well.

Having worked in retail for too many years I can honestly say you get more P.Od customers from Boxing day than you do happy ones, long lines, limited stock, cranky customers fighting to save a few bucks, like I mentioned before, the sale is just a good opportunity to unload excess Christmas stock and make room for new product. Personally I hate boxing day shopping, I will pay the extra few bucks and avoid the crowds or shop online.

I saw the loose thing but didn't wanna be a douchebag today. But yeah what you said is exactly it.

I'd hate to say that, but I totally disagree.

The prime example is Big Al's Salt special. They use it as a loss leader, but many of the customers that showed up for it did not buy anything else. I was there in the morning and I saw a lot of people that would not shop there normally any other time of the year.

We can lower prices when our suppliers give us special deals (drystock), during holiday times, as they want to reduce their stock. Livestock prices almost never fluctuate during the year.

As for a store that increases prices just before these sales to show the special markdowns, buyer beware.


As for markups, they are needed to keep all stores in business. There are too many expenses to even name, everone gets a piece of the pie before we even see the products. A good guestimate of operating costs a store needs to make is at least $500 a day (Profit) to break even per day.

I remember this time last year, a canreefer said they can bring in pepermint shrimp and sell the from his house for $2 each, I told him I'd buy 500 alone for my store. That sale never happened, I wonder why?

LFS's are completely different than any other retail outlets, other companies can close for a week and do nothing and their inventory remains the same, try that with a LFS and you walk into a room as if someone just stolen from you. Apples and oranges people

Just my opinion..

Ken - BWA

I loved boxing day from a salespersons point of view. I'd sell someone a door crashed tv and give them my card. 60% of the time they come back at a later date to buy add ons.

exactly a year ago on boxing day. i went to big al's and bought a bucket of salt and started my first saltwater tank. i've spent thousands of dollars since then.

if not for the discounted bucket of salt, i may have never even switched to saltwater. im sure theres plenty of people that you dont know. i meet people with saltwater tanks on a weekly basis that dont know that any other saltwater store other than big als even exists in edmonton.

That special doesn't retain customer loyalty though, they would have been bettter off selling it through the back for people that just wanted salt. Would have reduced the bottleneck at the register.

Huh?

it gets people in the store.

i bet there are just as many people with tanks that arent on canreef than there are on canreef.

before i joined canreef i never knew about any other saltwater fish store other than big als

*edit* i agree, putting a doorcrasher at the front is retarded, the point of a door crasher is to make the customer to as far into the store as possible. not in and out without having a chance of seeing other things

meaning that LFS inventory need to be tended to and can die.

Electronics can be left in the warehouse

I can guarentee that there are probally like 70% that arent on canreef, we see the stunned looks when we ask them if they know about CanReef

Geez. Ken and Marko.

Maybe take this PM. Almost getting a little much.

Ken as a retailer, best not to make yourself look too confrontational. Blogs can be easy to misinterpret. And this one is going that way fast.

Oh yes. The obvious. Ha ha.

electronics die too..... they die because a newer one is born. you cant just leave a tv on a shelf for 6 months and expect to sell it at any kind of decent price.

lets say you have an achilles tang. as long as you feed it, and keep its water nice and clean, it cant live for years before you sell it. it wont lose value because a 3D achilles tang came out