New 160g Instant Ocean buckets

Originally Posted by Justin

Just because certain retailers have IO at that price, does not mean the manufacturers like it or condone it, or even know where this store is getting thier salt, because I garuntee you it is not directly from them. Garunteed. PM me if you want details.

Are we talking about a certain very large warehouse, that had a very large quantity of salt, that was going out of business, that sold huge quantities of salt for pennies, creating the cheap salt influx that we see right now in the west coast??? I have personally talked to some of the head honchos in the salt industry, they are not pleased... they feel that these silly low prices degrade their product.

[MitchM]

Originally Posted by christyf5

molson canadian, molson canadian, molson canadian

We can see Christy has started celebrating already.......lol

Mitch

[sumpfinfishe]

Well I would buy I/O even if it was selling for a lot more money.
This is a product that I have trusted for over 6 years, and I'm happy with it's results

160gl pail you say!, well a new pail should still last me about 32 water changes, two and a half years or when the t-shirt is falling off my back

[christyf5]

dang how did this get to 3 pages already?? I thought I put that on page 2!

[LostMind]

business decisions are made daily - some work, some don't.

You have the most profitable retailer in the world, walmart, pushing cheap product for a cheap price. You can't say the high volume, low margin business model doesnt work.

Raising the price of salt is not going to lower the cost of an expensive skimmer made from everyday pvc and acrylic (why does a euroreef cost $600 for $40 worth of plastic and 3 hours labour? Because people will pay for it), raising the price of salt is not going to result in healthy or more diversified livestock being brought in to fish stores and raising the price of salt is not going to change the world.

This is a pretty silly, 3 page argument

If salt is cheap now, I will enjoy the price break, because they come so rarely in this hobby. If, in the future, a salt manufacturer does indeed feel their product is being sold too cheaply and steps in to enforce a minimum selling price for salt that is higher then what I currently pay, then I will pay more - and so will everyone who wants salt. Personally, I doubt it will happen, as the salt was originally purchased by the retailers/wholesalers and the salt manufacturer has already made their profit, they dont care if the product is then sold at a loss - their business isnt directly hurt by the LFS losing a few bucks on a product

Bringing responsibility and ethics as an aquarist into the discussion is uncalled for. It just twists your arguments and makes it look like you are all attacking each other on a personal level.

If you want to talk about ethics, talk about the stores that say you can start a saltwater tank for a couple hundred bucks and keep a dozen fish and a dozen corals plus 3 anemones in a 20 gallon tank - which I have personally seen happen at 3 stores (all slightly different scenarios, but you get the point).

And finally, impulse buying that algae scrubber, fishnet or PH monitor does not make one an irresponsible aquarist.

[Justin]

Lostmind,

I will say that the high volume, low margin model works in some business, but not in an aquarium store. The numbers your talking about from Walmart, I beilive $229 mill last year is FAR beyond what any aquarium store could ever even DREAM about making.

Is raising the salt going to make the Euroreef skimmer (or another product) cheaper? How could you say no?

If a store does not make profit on one item, the mark another up higher. If they don't, they go out of business. If they drop prices on one side, they raise them on another. And of course it would result in more diversified livestock. The store is not going to just be scraping by because of low margins, and order from new suppliers or try new things. They are going to order thier bread and butter, not risking already low capital. This is simple.

Manufacturers do care about the price retailers move thier product for. Perhpas read through the last 3 pages of this topic and you will see evidence of that.

You could keep 12 neon gobys, 12 discoma and 3+ condys in a 20 gallon long. Easy.

Do you have any experiance into the business end of this hobby?

[Samw]

This is all very interesting and totally different from what I would do if I started a store. I would price my items simply based on supply and demand (profit maximization).

If no one wants to buy my salt at my high price causing me to lower the price of salt, I wouldn't automatically raise the price of my other goods. That's because we know from the Law of Demand (downward slope of the demand curve) that artificially raising the price of a good would lower quantity demanded, increase surplus, and reduce profit/revenue.

http://en.wikipedia.org/wiki/Supply_...ilibrium_Point

This is the generally accepted theory for perfectly competitive markets (ex. not monopolies).

[Justin]

That does not take into account goods that have a stable demand regardless of price fluxuations, like livestock. People want thier Nemo!

Stores have to profit. It's simple as that. If they have lower prices then everywhere else, and do not provide any reason for people to come into the store, other then price, they will fail. Look at the fierce competition between King Ed's and J&L. One of them is going to lose. King Ed's has been around a LONGGG time, and has a full pet line (dogs, cats, rabbits, birds ect.) backing them. King Ed's could lose money on thier marine end and still make enough on dog supplies to get by. J&L can't. They have to profit in order to survive. There is no way these stores can lose money, they have to pay thier bills like anyone else. If they don't profit on salt, they have to make it up somewhere. Every square foot of that store has to produce X amount of money to keep them in business. Anyone happen to notice any change in livestock, lighting or any other prices at these stores?

Other stores which do not have as low prices are doing growing and doing well despite have higher prices. They provide another reason for customers to come there other then price. No where in North America I have heard about is here a situation like there is in the lower mainland regarding these stores.

[Aquattro]

This thread has at least reminded me to get some salt...I'm almost out.

[Samw]

Yes, the theory takes livestock demand into account. Yes, of course people want their Nemo. But the Law of Demand states that more people will want Nemo at $15 vs $30. That's hard to argue.

I didn't know either of those 2 stores that you mentioned were losing. Do you know for sure this is the case? I thought both stores are profiting.

In all of my years of studies and research, I have not found any theory that says you can make more revenue by artificially raising prices of goods in a perfectly competitive market.

If it is certain that prices are artificially low, then yes of course the businesses are not maximizing their revenue and will have more demand than supply and will eventually raise their prices.

Firms enter the market to make money and exit when they can't. No doubt. If prices are low because there is too much supply (too many pet shops) then having a store lose and exit the market is inevitable.

In those other regions that you point out, prices and demand are high. But that creates a new business opportunity for a new store to enter the market and get a piece of the pie. Eventually, when more competition is created, prices will also go down. Its all part of Business and Economics.