Current value of a used J-460 with Stereo?

[ndabunka]

Wisoki and others... What is a fair price of a DEMO (used) J-460 with Stereo, $8K?  I have a buddy who is shopping and I think the dealer is not being competitive (over $9K).  Please PM me your feedback so I can relay it to him.

[Micah]

Do you mean used as in belonged to another customer or was it just a floor model that was running in the store?  That would make a BIG differance on the price. Also what part of the country?

[ndabunka]

Just a show room unit.  Dealer wants to move it to get newer model. It's about 6 months old.  I did find out that the dealer cost separately after my original post so this may have become mute. Dealer would make a little under a grand if sold around $7,400 so my original projections are probably inline.  I know that most low-volume dealers on here would object to that low of profit but that's OK.  I'm not trying to keep the dealer happy, just trying to help my friend get the best deal possible.

[hottubdan]

After factoring in costs such as freight, flooring, delivery, commisssion (if any) contribution toward rent, insurance, workman's comp...if dealer only made a"profit" of around $1000, he would be paying your friend to take the spa.

All ok for dealer and friend if that is what they agree on.  On the other hand, there is someone in the market who will see there is more value and will pay the dealer what he needs to be in business.

No offense, but in order to be in business long term the deals need to be win/win.

[Micah]

How would you feel if your boss came to you and said that they want you to take a 50% cut in pay.  I'm sure you would consider it a slap in the face.  That is exactly what it would feel like if someone made a ridiculous offer like 7400 for a J-460 w/ stereo. "No offense, but." I hope that the dealer has the common sense to say HELL NO!!!

[ndabunka]

Looks like I got the ire of the dealers back up on this one.  Didn't mean to offend but the reality is that hot tub sales are a retail business.  One measure of success is the ability of a retail business to generate inventory turns.  If your local shop only does a few tubs a month, it HAS to generate more revenue per tub than a shop located in a large city (such as Charlotte, NC).  As such, the "market" will help guide the price levels necessary to sustain a healthy volume of business.  Pricing tubs too high (i.e. the premiums many on here appear to be indicating) may actually prevent you from selling the tubs in the first place.  I notice that no one said I was wrong on the numbers, just that THEY would expect a higher profit than that.  That is fine.... in your market.  If you want to do business in a hotly contested market, I think tubs are like any other commodity.  They are worth what the buyer is willing to pay and balanced with what other comparable units sell for in the area.

[ndabunka]

How would you feel if your boss came to you and said that they want you to take a 50% cut in pay.  I'm sure you would consider it a slap in the face.  That is exactly what it would feel like if someone made a ridiculous offer like 7400 for a J-460 w/ stereo. "No offense, but." I hope that the dealer has the common sense to say HELL NO!!!

How would you feel still having that same tub on the floor 6 months form now because your prices weren't aggressive enough?  If I told you I can sell 10 tubs for a $1K profit (each) or you can sell 2 tubs for a $3K profit (each), which would you take?

[Micah]

How would you feel still having that same tub on the floor 6 months form now because your prices weren't aggressive enough?  If I told you I can sell 10 tubs for a $1K profit (each) or you can sell 2 tubs for a $3K profit (each), which would you take?

When I was new as a buisness owner I used to think that way.  Then I realized that if I lowered my prices and tryed to be the "cheap guy" I still sold about the same amount of spas as if raised my prices.  The big differance is that I have more money to take care of employees and provide better customer service.  
There is also the rule of thumb, "if a customer grinds you hard for the best price, that will be your worst customer.

[drewstar]

Can anyone give a guesstimate on the typical retail on the -460 tub with a stereo?

[ndabunka]

When I was new as a business owner I used to think that way.  Then I realized that if I lowered my prices and tried to be the "cheap guy" I still sold about the same amount of spas as if raised my prices.  The big difference is that I have more money to take care of employees and provide better customer service.  
There is also the rule of thumb, "if a customer grinds you hard for the best price, that will be your worst customer.

I use to run a VERY successful retail storefront in a slightly different industry for a number of years.  In the beginning of this industry, the retailers could charge "full retail" and the times were lucrative.  As the industry became more common (i.e. more resellers selling similar products but of different brands), the margins decreased (so you had to sell more to stay in business).  I not only reduced my prices to remain competitive but I also changed my focus to selling a larger volume of services to go along with the "commodity" type model.  In doing so I increased profit SIGNIFICANTLY more than any lost profit from the product.  This method was so successful that the formal non-resident "owner" of the company was able to flip the business for a tidy $5.5 million dollar profit.  As a lowly manager I got my annual salary (I did have a contract protecting my job but nothing to share the profits of a business sale.  At the time, I was young (32) so I consider it a lesson learned on my part) and will not do anything anymore without an equity interest in the business.

This option of services-oriented sales may not be possible with tubs but diversification of products (lawn furniture, grills, etc) appear to be the way some are going.  You see, I am not "new" to retail.  I do not currently sell tubs myself but if I did I would only stock tubs under $8K (as 90% of most tubs sold are in the $6K to $8K range according to most of the industry research I have been able to locate).  Certainly, there are some that want "the best on the block" but most are not willing to fork out that much cash for this particular luxury item.  So, you see, I am not exactly "new" to retail.

[Wisoki]

$10,500, which is why I dont order it. It's an expensive small spa.

Can anyone give a guesstimate on the typical retail on the -460 tub with a stereo?

[Micah]

ndabunka,
I hope you don't think I was refering to you when I mentioned "New".   I was refering to myself and to lessons I learned the hard way years ago.  

Drewster,
In Southern California (one of the most competitive markets) that unit usually sells for around 10K

[D.P. Roberts]

There is also the rule of thumb, "if a customer grinds you hard for the best price, that will be your worst customer.

Somewhat OT,  but a customer made this offer to me in my bookstore today:

"This $24 box set has one CD and one DVD in it. I don't have a DVD player, so that's no use to me. I'll give you $12 for it since I just want the CD."

I turned her down on her "offer".

[ndabunka]

ndabunka,
I hope you don't think I was refering to you when I mentioned "New".   I was refering to myself and to lessons I learned the hard way years ago.  

Drewster,
In Southern California (one of the most competitive markets) that unit usually sells for around 10K

Micah - Sorry that I took it that way.  I do appreciate everyone's input (even if my reply on the internet may not seem that way).  Sounds like a low to mid $8K figure may be the best my buddy can expect.

BTW - I do get a kick out of your sig.  First time I saw it I wondered if Screaming Myrtle might be "performing services"...

[ndabunka]

Somewhat OT,  but a customer made this offer to me in my bookstore today:

"This $24 box set has one CD and one DVD in it. I don't have a DVD player, so that's no use to me. I'll give you $12 for it since I just want the CD."

I turned her down on her "offer".

Yea, I don't see how buyer's are suppose to think an establishment would go for that.  If she just wants the CD, then she should order the CD or pick it up somewhere else.  Almost like asking you to sell them just the shell of a HT and that they will put their own jets in it...  There are mfg's that do it that way, just buy it from them.