Dealer Cost

[theishkid]

I've been looking for a New Sig P238 over the past week. The vast range of prices have been amazingly outrageous. Most stores/dealers want $500 - $550 dollars for the plane jane contrasting sight version of the gun. There have been one or two that sell it for around $450 - $480 range. And then I found one dealer and one store that sell them for $380.
Now I will put a disclaimer and say that obviously the stores selling them for $380 doesn't have any in stock (or I would already have mine).

So I'm just curious, with these ranges in prices for the same gun, are all dealers getting them for "virtually" the same price? Or is there some huge difference in what each store pays from their wholesaler?

At first I thought maybe the bigger dealers will get a better price on them since they do more volume, but that can't be the only case because Outdoor America has them for $380 (although not in stock), where H&H has them for $515. I would think they deal about the same amount of firearms in the city.

So what's the deal?

 

[B96brig4CC]

H&H is going to be higher because you are basically buying the gun and recieving a $50 gift card and a free trip to the lanes. So you take the $515-50-15=$450 is presumably what you pay at H&H. It is like going to the movies and using the kiosk to buy tickets and it already having built into the price a coke and popcorn(AMC Quail did this for a while but people complained). H&H knows you are going to spend more money for other items and they build that into there price, give you a gift card and lane pass.

 

[mr ed]

I haven't been to Outdoor America in years, but it used to be Fred Baker firearms. A master stocking distributor and OAS was his retail outlet and had the cheapest prices in the state. His low-balling of prices at one time was responsible for putting most of the dealers in the OKC area out of business back in the 80's and 90's
It used to burn my ass when we would go to the Shot Show and try to get good deals for my store. Only to be told to order from him and he was selling to the public for the same price as to dealers.

 

[theishkid]

Well that sucks for you... but it sounds awesome to me! haha

I had no idea that you got a $50 gift card. The salesman didn't mention that at all when I was looking at the gun. I did know you get a free trip to the range and I'm all for that because I'll probably go there to shoot it for the first time anyway... but $10 off for the range still doesn't bring that $515 dollars down to $380.

I guess my question still remains... are all these dealers just pricing based on supply and demand when they charge over $500 dollars. Or are they having to pay that much more for it themselves?

 

[grwd]

setting a price for a product involve so many things, its impossible to generalize how or why prices are what they are.

Retail gun sales is not my cup of tea.
Id rather collect aluminum cans than try to make $20 on selling a gun.

 

[ez bake]

Outdoor America has a bad habit of posting the LEO price on something and then telling you what the real price of that gun is for non-LEO (ask me how I know - that was way back when I first started buying handguns for carry - I walked out of there more angry than I've ever walked out of a gun store before).

I'm not saying that's what they did with the super-cheap price on that P238, but they have done it in the past when I've been in there.

Dealer cost is basically all over the place now days - buying in volume helps lower dealer cost, but you have to move inventory because most well-priced gun shops don't make that much off of your basic handguns or rifles.

Most manufacturers offer different rates for stocking dealers and preferred dealers, etc... there are also distributors who can often times beat Manufacturers prices (or match them), so some of the smarter shops have started getting their guns through the best possible way (fastest, cheapest, most reliable).

It could be that H&H just isn't moving that many Sigs. It could be that they just want to make more profit off of each gun (or are in fact not making much because of the range trip).

Welcome to the site btw...

 

[Glocktogo]

Some places with high volume will be factory direct while others order from distributors. If they're low volume, they have to pass on higher shipping costs per gun than the high volume dealers.

Then you have dealers who would rather make $100 off a gun that cost them $400 vs. another dealer who wants to sell two at $450 and make $50 each.

You can wind up with wide price variations based on these factors. You should always consider the experience and after the sale service unless you're one of those bottm line types who only cares about cost. If you're in that category, you really shouldn't expect much beyond walking out the door with a product.

 

[Glocktogo]

I should also point out that Sig has a bad habit of forcing stocking dealers to buy a set number of guns per quarter. The bad part is they'll tell the dealer that they can buy whatever they want, but part of their quota will include a minimum number of their guns that people aren't buying.

Once the dealer is saddled with two or three quarters worth of the turd guns, they'll blow a bunch out to major distributors well below what they made the stocking dealer pay for them. Then the dealer has to decide whether they want to take a loss to recoup their operating capital, or hope that uninformed buyers will pay more for one than they could from a dealer that bought them one at a time from a distributor.

It's a sorry way to do business IMO.

 

[JD8]

I should also point out that Sig has a bad habit of forcing stocking dealers to buy a set number of guns per quarter. The bad part is they'll tell the dealer that they can buy whatever they want, but part of their quota will include a minimum number of their guns that people aren't buying.

Once the dealer is saddled with two or three quarters worth of the turd guns, they'll blow a bunch out to major distributors well below what they made the stocking dealer pay for them. Then the dealer has to decide whether they want to take a loss to recoup their operating capital, or hope that uninformed buyers will pay more for one than they could from a dealer that bought them one at a time from a distributor.

It's a sorry way to do business IMO.

Someone in the business just explained this to me last week. Extremely disappointed with Sig if that's the case.

 

[ez bake]

Someone in the business just explained this to me last week. Extremely disappointed with Sig if that's the case.

I learned about it not too long ago as well when I heard it as a reply for the Spikes crappiness - Sig isn't the only one doing it now days though (pretty much any manufacturer that you find dumping guns in Aim Surplus, CDNN, etc... is doing it - just at varying levels).

They are one of the harsher manufacturers to deal with on being a stocking dealer - which makes it worse, but they're not the only company around looking to use their "Wal-Mart" like status to strongarm dealers and then dump their inventory to outlets.