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Thread: Explanation of internet pricing

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    Explanation of internet pricing

    This topic has really been brought to our attention as people are inquiring about grand opening sale prices vs internet pricing. I debated posting this for a long time as I don't want it to sound defensive or whiny. I just felt the need to explain why we, and others, choose not to offer in-store pickup for online orders in every situation and why pricing may not always appear to make sense. We are happy to look at each situation case-by-case but in-store pickup cannot always be offered.

    Everybody knows that, more often than not, the internet is the cheapest place to buy equipment. The question hobbyists face is how much more are they willing to spend on said item to support their LFS. The good LFS usually being worthy of such support because of all the things they offer that the online stores don't. These benefits include being a place you can actually observe any livestock before you purchase, get hands on demos of products, offer warranty support and technical assistence, have new technologies on-hand so you can become familiar with them, immediate availability to answer questions by phone, offer product comparisions, sell ro/di water and they offer water analysis. They also offer many out of store services like tank sitting, custom design and installation, servicing, tank moves, and system consultations. Without the hobbyists support these valuable services would disappear. Further, cheap internet pricing has opened the door for the outright abuse of good LFS. I can't begin to tell you how many times I've seen people ask their LFS to spend considerable time designing a complicated reef system, only to turn around and buy the components online. Often without even giving the store the chance to compete with online pricing. Also, we are constantly asked to offer our services in helping explain, maintain, repair, or warranty customers items which were purchased from another online business. Can you imagine how frustrating it is when we are asked to provide what is essentially free customer service for another business?

    Internet pricing is so low because of a few factors. There is obviously the volume sales idea coming into play for the big boys. Also, some of them play both sides of the field. They purchase from manufacturers at distributor pricing and sell to us at wholesale and the public online at a slightly higher "retail" price. So they are selling "retail" at prices smaller companies (LFS and smaller online retailers) can't touch because of the discounts they get for buying as if they were a wholesaler. For the rest of the companies trying to carve out their place online they have too use drop-shipping (even used by the big guys) to compete.

    All of this background information leads up to my original reason for this post. Being a LFS and a small online retailer forces us to make difficult decisions when structuring our store and online prices. We have too make money on the stuff we sell in the store. We have costs to cover...you all know them...rent, insurance, utilities, taxes, advertising, employees etc. One of the biggest being employees or time. When we sell something through our physical retail store it has to be received properly and then usually when sold there is considerable time spent explaining how to set up, maintain and use the item. There is also the cost involved in just keeping the item in inventory. Finally we have too be here to support the manufacturers warranty. That said, I think we do a great job of coming close to matching online prices on things we special order for our customers. The online store gives us more flexibility to compete with the bigger e-tailers. We are able to use drop-shipping which allows us to reduce our associated costs of selling an item. Many of the items purchased online through smaller operations are shipped directly from a wholesaler straight to you. We don't invest any time in shipping the item. We don't have too answer questions, quote prices, or offer any of the other service that go into selling a product. This is why sometimes you will see a price online that can't be touched by the physical retail store. We can afford to cut the margins on drop-shipped items when they are sold online but if we tried to match these prices in the store we would void any slim profit margin because of the labor costs invloved. Finally, the prices set for drop-shipped items usually reflect the fact that we don't have too pay to ship the item to the store first. Instead, the customer is paying the shipping to get it from the wholesaler to their residence. This is why in-store pickup doesn't always work.

    So to sum it up...don't hesitate to contact us about matching our own internet pricing or other companies, but please understand that there are many factors that go into pricing. Sometimes we will not be able to do so. I hope you all will read this as informative rather than defensive.

    Respectfully,
    Cy
    Last edited by barrierreefcf; 09-14-2007 at 12:05 AM.
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    My LFS will normally be higher than on-line but when you add up shipping, service & hands on, I do my best to purchase from them.

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    The service at Barrier reefs is more than worth the extra cost over on-line prices. An hour there with Mark and I felt ready to come home and put together a sump to house my new skimmer If I had chosen to go on line for my skimmer I would have ended up with another POS HOB skimmer. I recieved a wonderful education on skimming along with good advise on choosing a skimmer sized for my system at a reasonable price.
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    That's Dumas!

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    Exceedingly well thought out and written!
    Justly deserving of support
    My best to you, Tim and the crew.
    D

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    Brittle Starfish
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    Thanks for the explanation. I don't live close enough to visit your store but I make it a point to support my LFS as I feel it is very important to be able to see and in some cases touch the products I want to buy.
    Deb

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    I guess im one of the very lucky ones i have a great lfs near me where i get all of my fish/corals/inverts at good prices. But for the equipment there prices are usually higher so im lucky to have a great store called premium aquatics near me.. I would rather get my fish at the lfs over buying them online..

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    Just a bump and I'm going to make it a sticky. We still take this case-by-case and will do our best to get you locals the lowest possible price. In order to simplify things, contact me directly rather than asking the guys at the store. Send me a list of what you want and the prices/website (even if its ours) I am trying to match for in-store pickup. Send inquiries to cy@barrierreefaquariums.com.

    Thanks!
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    Just wondering why stores dont grow their own corals?
    If I had a mini coral farm in my house could i sell some frags to you guys?
    I have an empty room in my house and thinking about setting up a coral farm next fall!

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    Quote Originally Posted by SeaMonster View Post
    Just wondering why stores dont grow their own corals?
    If I had a mini coral farm in my house could i sell some frags to you guys?
    I have an empty room in my house and thinking about setting up a coral farm next fall!

    We do grow our own corals. We also give store credit for certain corals from customers. Under certain cercumstances we will buy for cash. Remember that we have to buy things at wholesale pricing and resell at retail. The items you choose to grow should be harder to find, colorfull, and in high demand. This ensures a market for your frags.

    Thanks
    Last edited by barrierreefcf; 03-31-2008 at 02:03 AM.
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    Emerald Crab
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    Support your LFS! Especially if they are as professional, offer great customer service and products for you, such as Barrier Reef. There services are worth the extra 10-15% (IF) on dry good!

  11. #11
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    i have noticed this problem scince working in an lfs the complaints about how expensive the equipment in shop is but u notice that when people buy reactors or other pieces of equipment they come to the lfs to find out how to set it up
    plus i have delivered quiet a few tanks and the people buying them already have all the equipment that they have bought online and then expect u to set up all the stuff for them when u get there
    i see where barrier is coming from and u might even order corals from the lfs i work in anyway main thing is support ur lfs
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    The reason I'm in the hobby (besides the corals : ) ) is so I can to my LFS, talk shop, and purchase what I am actually looking at. The crew at BR are always a ton of help, and very friendly. Thanks for putting together such a great shop Cy and crew!

  13. #13
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    As of October 2011 we have added the free shipping option for in-store pickup to our website. We will also be adding a touch screen kiosk at the shop to make special orders and internet price matching easier. We will continue to build out all product sections of our website. Its been slow going, we know, but we'll keep at it!
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    BR rocks! They are worth an hour drive to me. They always have the best coral in Wa

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