Dealer 'Blowouts' when they drop a product line… why?

[Comcast has been down again, or rather, depending on how you look at it, we just got our SEVENTH cable modem in the last 8 weeks. Well, the first one was melted by the lightning strike, so MAYBE Comcast was not at fault for that one, but, … 7?]

OK, on to our topic of discussion.

When dealers lose or drop a line, they often ‘blow the stuff out’ on Audiogon or Ebay at ridiculously low prices.

Is this stupid or what? Don’t dealers care about making money? [Of course not, you may joke, if they did they’d be in a different business :-)]

Dealers [and sometimes distributors] are angry when they lose or drop a line. Understandable. But why sell their stock at such low prices?

The traditional explanation is that they do it to ‘punish’ or ‘hurt’ the line. To get back at the people who used to be their suppliers of the products in the line.

But, half the time they are

1) dropping a line because the distributor or manufacturer is selling out the back door at low prices anyway, so who’s it going to hurt?

And the other half is because they are

2) getting dropped because they are discounting to much for the comfort of the supplier. So why sell them even cheaper yet? Seems like the discounted prices, although higher, were selling just fine, otherwise they would not have gotten caught.

[We are ignoring the other half 3) where the supplier or dealer is just plain psychotic and extremely paranoid and sees daemons and ghosts appearing and telling them things that make no sense at all].

The Blow Out is going to hurt the dealer doing the Blowing Out’s pocket book because they invested time, energy and money into the products and are now selling them cheap cheap cheap.

Anyway, just another stupid thing people in this industry do in their spare time, I guess.

And you others not in the industry , are probably thinking, blowouts? cheap cheap cheap? WHERE?

Well, I’m not going to make it THAT easy, and besides, it changes over the weeks and months. But the ones that are irritating to us [and are the best finds for you people :-)] are good brands that do not get discounted on a day to day basis. So check Audiogon, and find a dealer who has ‘lots of product’ they are selling of a line they no longer carry, at prices way below what the market will bear because they are pissed off.

Go ahead and take advantage of their temporary lack of business sense, better our readers than some random Mary or Joe, but be aware that only the best dealers will offer any support if the product turns out to be broken or not as new as they said it was.

How do you tell if they are a reputable dealer if you don’t already know? Check out their other product lines. Are they heavily discounted on Audiogon and elsewhere or are they top notch lines whose manufactures require some amount of integrity and service of their dealers? [Many dealers lie about what product lines they carry, especially on their websites, so this can be problematic sometimes]. Call them up and tell them you are interested in the most expensive thing they sell, not the thing they are blowing out, and ask them how much will they knock off the price for you… If they start talking about 40, 50, 60 percent or more [some will set you up as a ‘dealer for a day’], you might just figure that they are not going to be carrying THAT line for much longer either, and that another Blow Out will be soon forthcoming, at even higher discounts.

The upshot? You dealers, stop being stupid. Ask around before you pick up a line to see if a distributor or manufacturer is selling direct at 40 – 60% off. Don’t just assume that because what they make or distribute is a great product that they have a clue about building a brand or how to take care of the customers who will one day have to sell these darn products, or , heaven forbid, get them repaired.

And if you lose a product line, please sell it at market [demo] value. Why toss away money? And how the heck else you going to sell anything again? People will just wait around for you to drop whatever they are interested in and get THAT at fire sale prices.