Bubble Magus Pricing

[Ron99]

Aqua Digital,

I do understand some things about importing and retail and distributor markups as I ran a business importing and selling model race cars from around the world. But some of your reasoning still does not make sense.

Firstly, most of us are buying from Chinese retailers such as fish-street or reefshops. They are not Bubble Magus selling direct but retailers in China. So the wholesale price that Bubble Magus charges for their product is less than the retail price at fish-street etc. We were not buying at factory direct prices, we were buying at chinese retail prices. If Bubble Magus is charging you the chinese retail price for large wholesale purchases you better be renegotiating with them. Now, if they want to expand into the newer markets they should be working with you to offer the best wholesale price possible in order to build their new market. You make up the small loss in per unit profit by significantly increasing sales volumes and make more money overall. That is standard and prudent business.

So let's run a hypothetical scenario. The BM180CS is $305 retail in China. Let's assume a 30% wholesale discount (although the usual discount is 40%) which gives a wholesale price of $213.50. Add your 15% for shipping brings the cost up to $245.52. Let's now add another 6% for brokerage fees and duties etc. as you indicated. We're now at $260.25. Your distributor margin is 20% bringing the canadian wholesale price the dealers pay to $312.30. Add 40% to that for retail markup and we have about $438, not $500 and also a significant increase over the overseas prices. So why is MAP at $499? I think most of us would be willing to pay a $50 premium to buy a skimmer locally rather than overseas. But a premium of $120 or more seems a bit high for most of us.

And how do you explain the prices of the dosing buckets? They are $20 and $25 in China and $60 and $75 here. That is a pretty significant increase. That's not a 50% increase but a 200% increase.

Now your comment about spare parts makes no sense. Do they not offer a manufacturer's warranty? If not then perhaps it's not a product worth carrying but as far as I know any decent manufacturer offers some sort of warranty. So I don't see how you are out of pocket for replacement parts which should be covered under the warranty.

Nobody is trying to stop you or the retailers from making money. My problem comes from the apparent extra money making at some stage here. The excitement over Bubble Magus was the expectation that we could have a quality product at a lower price then the competition. But now it is priced in line with the competition and some of us are disappointed and unhappy with that.

Walmart has nothing to do with it. The pricing of the product as available overseas sets expectations here. Yes, we expect to pay a reasonable premium over that once its available here. Some of us think the current premium is not reasonable. As I said above, if you want to expand sales do it by offering better value then the competition and you will expand sales and everybody makes more money; the manufacturer, the distributor and the retail stores.

But don't keep changing your tune and blaming shipping costs, or duties and taxes, or warranty support or some notion that price affects perceived notions of quality.

And you will have to deal with the new world economy. The internet and Paypal and international sellers are here now and it is easy and, for the most part, safe to deal with sellers all over the world. Buying things from all over the world on the internet is increasing all the time. You need to recognize that and adjust to it too. It's not about throwing dosh to China and hoping for the best. That is nothing more than a scare tactic to justify higher prices here. More and more people are doing this as they don't want to pay excessive premiums for things. I found dealing with the Chinese retailer to be a good experience. They were eager to help, shipped our order quickly and gave support afterwards. So why wouldn't I and others do the same to save large amounts of money? Where's your value proposition to the consumer? Really, why should I buy it locally vs. overseas? You have yet to provide a compelling reason to justify the much higher prices on much of the Bubble Magus line.

[Aqua-Digital]

Just an FYI Ron, BM shut down supply of Fish street to stop them under selling their product line into the North American market.

You will find it very hard now to source BM from within China directly unless it is old stock, BM have shut everything down to protect their product brand from devaluation.

I have provided a very compelling reason wy BM is now more expensive. BM wants it accessable to all, not the few. If they want to set a price they feel the product is worth irrelevant whether you feel it is justified based on a very blinkered view and not looking at long term growth of a company, then this is up to them.

Lets put it another way, we imported nearly $20K of bubble magus in April, we sold all of it, and so did dealers, I think that is enough proof the price is set fairly at a price people think the product is worth, if not, simply put, we would be stuck with a whole lot of kit.

So the product sells well at this price, clients love the product, build quality and support, so I fail to see the problem other than the select few as always looking for a rock bottom bargain with no care what so ever of long term effects this sort of thing has on the survivability of our hobbies dealers

Go get a BM bucket shipped direct from china "if you could even source one" and then let me know what they would charge you in shipping. OOPs I have the answer here $48 direct to your door just for the shipping!

Not exactly $25 bucket anymore eh!

As i said above, the product sells at these very reasonable prices and if you had not sen what they were being sold for direct before, then we would not be having this discussion, and in 6 months from now when the masses have access to the product and many new lines have been introduced, providing the client is happy, which seems they are, whjy should a factory bend to the few that just want "that deal"

Lets all bow down to Walmart and Ebay and look at what they have done to the global economy, wahoo mega cheap prices, suppliers struggling to stay in business to keep up with consumer greed for far reduced MAP prices way below product worth, and where will we all be in 10 years? Sourcing out of China direct to appease the few that dont see past their own view point and dont care who suffers down the supply chain.

Sad world we live in it really is.

Accept a product price or dont buy it, move on. Debating it here is changing nothing and certianly does not change any market strategy when we are stretched already to meet consumer demand.

[OceanicCorals-Ian-]

We are stocking the Bubble Magus line now and we do NOT have to purchase them from any such "exclusive" distributor.

We will be pricing this whole product line in a fair manner in respect to our customers and for ourselves as far as margins and justifiable business is concerned. I personally think that MSRP's do have their place in the market but the markup on these skimmers is simply outrageous.

Do we have the ability to warranty these skimmers? Probably not but how about a replacement program if the warranty is justified?

This is our two cents.

[Aqua-Digital]

Hiya Ian,

I will let Iven, and Victor and Socal know this then you may find you have difficulty getting supply from now on then.

We all had a very long communication about this late last night and into this morning, Jason was very clear at Bubble magus that they will not tolerate this.

BM are very serious about their policy, and also very serious about protecting the Canadian distributors and USA distributors pricing, simple response was, "if they cause trouble they lose supply"

If you have doubts over this please feel free to contact BM directly I will happily pass you the email address to contact.

[kien]

So I've been following this thread because I found the topic quite interesting. After the last couple of posts I did some digging (just out of curiosity) and was quite confused by what I found.. AD lists the BM180CS for $399 retail while OC lists their BM180CS for $489 ?? Is that a typo ??





I'm just a little confused is all (but then that's usually a common state for me)

[OceanicCorals-Ian-]

Originally Posted by Aqua-Digital

Hiya Ian,

I will let Iven, and Victor and Socal know this then you may find you have difficulty getting supply from now on then.

We all had a very long communication about this late last night and into this morning, Jason was very clear at Bubble magus that they will not tolerate this.

BM are very serious about their policy, and also very serious about protecting the Canadian distributors and USA distributors pricing, simple response was, "if they cause trouble they lose supply"

If you have doubts over this please feel free to contact BM directly I will happily pass you the email address to contact.

This sounds great; however, I am not sourcing them from anyone that you have listed nor are we going to divulge where they are coming from, I will do everything in my powers to offer these products at a more reasonable price.

Thanks!

[Aqua-Digital]

Just in case there are doubts here is the email from last night the relevant text that applies

Hi Michael ,
Just now I discussed with Ivan ,and We reached a consensus below.

The first , you are exclusive distributor in Canada ,this is truth , and ATB ,Socal and other dealers will not sell BM products to Canada .

we finalize this price at last (including shop price and wholesale price),everyone all must abide by this agreement .............

we will never send any products to new customers now .

At last ,if you have any questions ,tell me .
Regards
Jason
2010-05-20
________________________________________
Jason

[Aqua-Digital]

Hi ian,

I would talk to your source quickly then, as things are a changin

[lastlight]

Originally Posted by kien

What?

[OceanicCorals-Ian-]

Originally Posted by Aqua-Digital

Hi ian,

I would talk to your source quickly then, as things are a changin

Like I said, you won't win Michael.

You screwed yourself with us when you openly slagged our product on Reef builders,

Funny how someone like you would preach to all the perspective buyers here to buy overpriced products just because you have a captive audience when you clearly stated to everyone on Reef builders that it is easier to cut out the middle man and just get the product "yourself". A little of the Kettle calling the Pot black......??

This was taken from Reef Builders where Michael Hall (Aqua Digital commented on our NpX-Bio Bead announcement...

1. I’m curious about this stuff. Maybe someone who’s been using them for a few months will post here.
   As for the disclaimer on the page, I think that’s just a really bad way of saying “A good protein skimmer is an absolute must” just like manufacturers of other carbon/bacteria filtration products state. All nutrient reduction techniques using organic carbon/bacteria can crash a tank from oxygen depletion if the gunk isn’t removed by a properly functioning skimmer.
   
   Posted by: pickle
   April 27th, 2010 at 10:43 am
2. I don’t use this but I do think a good refugium at least 20% of tank size and a good LR Nitrate Test kit is a must. I have found that looking down the tube of a Lamotte that is less than 0.25 ppm Nitrate as NO3 is best way to have good growth without bleaching. Just a hint of color beyond blank. Not really a science but hazardously hoping organic fuel (either pellet or liquid) will balance itself out is reckless.
   
   Posted by: iggy
   April 27th, 2010 at 1:16 pm
3. From what I have seen and heard form people who have used these biopellets they really aren’t that effective. Personally Would stick to vodka and bacteria dosing. It is a much cheaper alternative and has a proven track record of results.
   I have been dosing bacteria and vodka for almost two years now with great results. I do not run a refugium or conduct regular water changes. Carbon dosing works well but it is not free of faults. As Pickle has stated, a large skimmer is a must.
   
   Posted by: Sonny
   April 27th, 2010 at 1:58 pm
4. Here is a link to a popular Canadian Reefing bulletin board with a ton of questions and answers (from Oceanic Corals themselves): http://www.canreef.com/vbulletin/forumdisplay.php?f=170
   
   Posted by: Westcoast Frags
   April 27th, 2010 at 3:56 pm
5. “From what I have seen and heard form people who have used these biopellets they really aren’t that effective. Personally Would stick to vodka and bacteria dosing. It is a much cheaper alternative and has a proven track record of results.
   I have been dosing bacteria and vodka for almost two years now with great results. I do not run a refugium or conduct regular water changes. Carbon dosing works well but it is not free of faults. As Pickle has stated, a large skimmer is a must.”
   I agree with Sonny 100%. I also have been dosing vodka and bacteria for almost 2 years and following the various threads and really do not think it is worth the money.
   
   Posted by: Paul_PSU
   April 28th, 2010 at 6:46 am
6. Guys
   cut out the middle man on this stuff, seriously it is readily available to anyone wishing to buy in small bulk. You can even get it shipped from China for $35 including product for 1kg
   http://en.wikipedia.org/wiki/Polycaprolactone
   I am not going to make it easy for you to find a manufacturer as i have various here in canada and the USA, just google Polycaprolactone suppliers.
   
   Posted by: michael Hall
   April 28th, 2010 at 8:29 am
   
7. Polycaprolactone is NOT the same product as what is in Bioplastics used for denitrification! Michael (Aqua Digital), make sure you do your homework before suggesting people dump Chinese plastics in their expensive reef tanks. The biopellets used in the industry do not use Polycaprolactone, but instead use a similar (PHA) base polymer plastic with additional additives and mineral fillers.
   Bad advice.
   
   Posted by: David Jones
   April 28th, 2010 at 10:22 am
8. Sorry to be miss informed then I better tell me friends using these with equal success.
   
   Posted by: michael Hall
   April 29th, 2010 at 7:25 am
   
9. Here is the Tetra USA patent that they hold on Polycaprolactone bio pellets for use in aquariums
   http://www.google.ca/patents?hl=en&l...uction&f=false
   
   Posted by: michael Hall
   April 29th, 2010 at 7:40 am
10. Great link Michael, too bad it does not apply to this product. Wonder why you suggest cutting out the middle man when you are the distributor for Fauna Marin additives, people could cut “you” the middle man out and just us the VSV method and also purchase the zeolith media from China in bulk.(same thing).
    
    Posted by: Davis Jones
    April 29th, 2010 at 11:38 am
11. Alright everyone, please simmer down; let’s try to keep the discussion civil, respectful and distinguished.
    
    Posted by: Jake Adams
    April 29th, 2010 at 11:43 am
12. Something tells me the Fauna Marin and Zeo distributors are getting a little anxious considering how well these biopellets are working for people! There will always be a game changer in the industry! We may have one on our hands here……….
    
    Posted by: Sean Wyan
    April 29th, 2010 at 11:44 am
13. Firstly, I will opnely apologise my first post it was not meant to rattle and could have been worded a lot better, i even contacted ryan to edit it.
    That being said, I have ben approached to make our own bio pellets but the market will soon get flooded with these, there is no point, they are readily avaiable to anyone willing to do the research in supply. I have a friend using Polycaprolactone pellets bought openly right now and are working just fine.
    That does not mean that for the average user they should not buy them from an LFS who has gone to great lengths to package these up and market them. But if you do your research and wish to buy in large quantities yourself they are available. I say the exact same thing about ZeoLith rock, its expensive to ship and for the price if you can get it direct do so.
    In regards to the patent, I do not see the difference, but it would be great to be educated in what exactly the diffeence between the tetra Polycaprolactone patent and the bio pellets on the market. The above post stated that they are not Polycaprolactone and Polycaprolactone could not be used in a reef system, so why is tetra doing just that?
    The patent states clearly “pure Polycaprolactone”
    
    Posted by: michael Hall
    April 29th, 2010 at 1:56 pm
14. You mentioned some interesting points, I was actually referred here by a friend of mine. Defaintely good info. http://ddl2.com/download/Brian-McKnight—Evolution-of-a-Man-(2009).html
    
    Posted by: Elmo
    May 15th, 2010 at 4:29 am