QUOTE(DannyOP @ Nov 17 2008, 07:32 PM)
Actually it is normal for any co. to mark up 6 times from the cost (or more) if there are more than 1 level of distribution and also depending on what kind of products and the brand. Eg. :-
Manufacturer - Distributor - 150%, Distributor - Reseller - RM150%, Reseller - Enduser - 300% (varies acc to product and brand)
The more exclusive the brand the higher the markup .. eg. what do u think the cost is for a Jimmy Choo ladies shoe selling at RM10k a pair?
Of coz if u compare apples to apples the price should be the close ie. If Jimmy Choo at Retail Shop A is RM10k then Jimmy Choo at Retail shop B should also be close to RM10k. Or, Dreamland at retail shop = RM3k, Dreamland at Amway should be +/- RM3k also. Most MLM companies have high lvl of markup so that is the main reason they market products that are exclusive to them, or they may have a very low initial cost otherwise they won't be able to compete with other retailers.
Sometimes a reseller may mark up many times depending on their cost and purchasing power. Eg. Carefour may mark up 100% for a tin of milo because they buy in container loads and still sell cheaper than a kedai runcit who can only buy a carton and mark up 20%.
I kinda agree with some of your points, but try to explain why Amway is selling a lousy air purifier at Rm 4k? I did prove Amway air purifier sucks and they did sell at 4k, didn't I?
If you are in any manufacturing line before, you should know for most of the consumer products, there is no way you can mark up 150% to your distributors, you think your distributors are nuts? Distributors to resellers another 150% mark up, do you again think resellers are nuts? And Enduser being markup 300%, do you think enduser like you and me are nuts?
I kinda don't agree with you exclusive brand cost more, can I sell my KLSOONER brand shoes to you at 10k? It is exclusive isn't it, one and only one in the world, some more hand made. ( I will make sure I hand made it to you if you willing to pay 10k) Do you really think Jimmy Choo's shoes cost 10k because they are "exclusive"? think again!
OEM air purifier from China and put your own brand in it is also exclusive, what so special about exclusive??
Why do you care how much Carefour mark up when you have the "choice" to compare price with the Milo from Kedai runcit Ah Huat? Are you trying to tell me you will buy from Ah Huat even his Milo is 50 cents more expensive than Carefour because Carefour mark up 100% and Ah Huat only mark up 20%?
Why buy from Amway when you can buy from retail shop? You can try on your own about how comfort the bed is and try from one shop to another and have price comparison. Buying a bed from catalogue without laying your butt on it is just plain stupid.
Nov 16 2008, 10:46 PM
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