Thread: PRICE INCREASE

Originally Posted by timattalon

As mentioned if you were offered a not quite new rifle (But maybe unfired) identical to a new one right beside it on the shelf when you first went in, would you pay the same $800 for the returned one or the new one?

How much "discount" would you need before you purchased the returned one. To be honest $500 is a deal they wont make much money on if any at all. The new one is $800 so I doubt they will be able to sell it for anything more than 25% off retail and more likely 35% or more before someone will pay for it. Add to this, the fact that a wholesaled one to replace the one they sold you will probably cost very close to what they paid you for it means they went beyond what I would call good service.

Secondly to the use of the word "Profit". If I buy a rifle / car / product for $1000 and sell it for $1500 I do not make $500 profit. That is mark up or margin. That mark up is income for the shop to pay for costs and expenses like rent, insurance, power, wages, GST. PROFIT is what little is left AFTER those have been paid.

For $1000 of goods, the first $150 disappears to the GST, that leaves $350 to pay for everything else.

A weeks expenses

Wages for one person @ $15.00 for 40 hours = $600
Rent in an average to cheap building $1000-$1500 per week
Power $125 per week (approx $500 per month give or take)

Even just these three bills mean sales have to exceed $9000 to $10,000 before anything else gets paid. And there are still many other bills to pay including the owner wages (or a return on investment)

Retail is much harder than what is being described.

add his ACC levies im guessing $1500-3000k +
insurance , depending on his stock levels could be anything from 5k on up
computer lease , software fee's, eftpos lease. $250 on up to whatever
and the poor guys probably got anything from $500k to a couple of mil of stock on the place that someone had to pay for
im surprised the poor guy makes a living at all.