Why the price difference?

[dan42]

I was looking at Flowmaster 40 Series for my pickup, and found them in a Summit catalog for $83.00 - but on the Flowmaster website, they are $113.00. Same part number and everything. My muffler shop is selling them for $120.00. What gives? Why is Su mmit so much cheaper?

[AR15DEFENSE]

I think your seeing Flowmaster's 'suggested retail' price. parts stores and exhaust shops can charge whatever they want, of course they need to make a profit. Your muffler shop has a larger markup on parts then summit. the last shop I worked at 55% markup on all parts we sold (installed).... stupid I know.. PS it's ALWAYS cheaper to have a shop install YOUR parts, just let them know AFTER they give you an estimate for labor.. if they know before hand, they will charge you more labor to make up the difference

[jimmydean]

Often times a manufacturer sells items for full retail vs. a retailer who may have smaller margin needs.

I get 20% discount at my bike shop because I race for them and they get advertising for that. If you buy the same part, you will likely pay full retail because your $ is all they get out of that transaction.

[SactoJim]

Summit is a HUGE distributer and has that buying power. Typically a larger mfr's direct prices are higher than their big distributors (you don't wanna compete with your distributors). Distributors like Summit, Jegs, etc move a ton of product and get deep discounts.

[67 cst swb]

here are my thoughts...
Summit and Jegs are the whore's of the car world... yes, they sell stuff cheap... they sell 15 to 1 the ratio of any local shop, if not more... So, they can live off of way less profit per item, plus they then go to the manufacturer and tell them what price they wanna pay for the parts... and because they sell such a large quantity of that manufacturers products the manufacturer has no choice...
But, remember this... Summit and Jeg's (Whore's) can't take care of you down the road like local seller can. thats worth something to me... if you bring in a part that has a problem later your screwed, if you buy from that installer, they can work things out, they have more options to work with. Ask you local shop what they can do, tell them you'd love to buy from them and have them install it, but your on a budget and that you noticed (the whore's) have the item so much cheaper. Let them tell you what they are willing to do.
I can tell you this from being in the performance aftermarket world for 10 years, your local shop is buying that part at a higher price from the manufacturer or a warehouse then the whore's are selling it to you for...

[mrein3]

Bryan is correct. They get stuff way cheaper and share that saving with you. If you buy stuff at Wal*Mart, you can buy stuff at Summit. You WILL save money. However if you build a relationship with a local business man, you may be better off in the long run.

[70c10]

There's always ebay: http://cgi.ebay.com/ebaymotors/Flowm...QQcmdZViewItem

[Slammed70]

They get a huge discount for buying things in bulk.

My father(asshole) owns his own HVAC business. When he goes to buy new units he gets more of a discount for everyone he buys.

Lets say he buys one....its full price
Two or more and its -2%
Five or more and its -5%
Ten or more and its -10%

I doubt he gets that much of a discount....thats just an example.

So when Scrummit or Jugs refills their stock they might order 5-10 thousand of something at a time, and get a HUGE discount for buying in bulk. So they can sell them for that much cheaper.

Does that kind of make sense?

[Musclerodz]

Summit and Jegs are price protected by the HUGE aftermarket companies they sell like Holley, Edelbrock, ARP, etc. Those companies have buy-in's that START at $25K and go up. With that kind of buy-in number, Jeg's and Summit buy direct and sell to you without a middleman where your local shop is buying from Keystone, Arrowspeed, or some other wholesaler. So the wholesaler most the time to make their margins sells it to your local shop for about the same price as anyone can buy from Summit and to make money they have to mark it up to jobber or retail. Hope that answers your question.

Mike

[72 cheyenne pdx]

If company A is committed to sell 1000 units of my product and company B is willing to sell 10,000 units of my product. Company B will get a better discount from the manufacturer than say company A.

[67 cst swb]

but, what do you then do when company B comes and says they want to but at 50% of the cost you were selling to them before at, then when you say you can't operate on that, they say Bye-Bye to you... then you have to go back to them on hands and knees because you just lost 60-70% of you business...?

[72 cheyenne pdx]

Not true. That is why you offer cash back incentives. If you are business savvy, you will never lose money. Your profit may not be what you would like, but you shouldn't lose money. For example. I sell a product that cost $100.00 to make. I put a MSRP (manufacture's suggested Retail Price) of $500.00. To Company A, I sell to them at 50% off MSRP or $250.00 a piece and they buy 1000 units. To company B, I sell to them at 50% off MSRP plus a 15% discount because the commit to buying 10,000 units. they are buying them at $212.50. They just saved $375,000.00 if they buy the 10,000 units. Plus if they make their goals and get a cash back incentative of 7%, that could be up to an additional $148,750.00 more in their pocket. Big companies know how to play the game. There are ways to lose distributors, and I know from experience. But if you have quality product, superb Customer Service/Tech Support, a great sales team, and a competitive price, in theory you will never go under.

BTW-I work for a lighting manufacturer just in case you were wondering.

[67 cst swb]

I agree with your statement...
My experience with Summit & Jeg's is... whatever they are buying at, once they get to the point of being a companies largest buyer, they go back and use that buying power to negotiate what they "want to" pay for and Item... I'm not bashing your business, but...
Imagine a company buying your product, they are buying about 50-60% of your output... it cost you $100 to make that item, you sell to them for te $212.50... then they decide they wanna pay$135.00 for that item with a promise of increased sales, do you do it? or say sorry.... then you say sorry, and they pull out all purchases, you have to lay people off, slow down production, etc...
Ask Vic Edelbrock about the Jeg's purchasing process...
I'm not upset or pissed at anyone,... I just don't respect those type companies... That wal-mart purchasing mentality...
Ok, I'm off my soapbox,... Sorry to hijack the thread...