Arctic pricing themselves out of business

[turbo]

I went with a friend to look at Arctic's tundra.  He was interested in buying this spa until he got the price breakdown.  The arctic dealer was charging seperate for items that normally would be charged as a whole package.  The breakdown was 11,500 for shell and cabinet, $ 250 for jets, $ 250 for microban, $ 300 for the heater, $ 500 for the cover, $ 150 for starter chemical, $ 700 for arctic's ozone, and $ 500 for the forever floor, and a few other prices we could not decifer.  This came to a grand total of $ 15,000.  Has anyone else had this experience with arctic?  Would appreciate any feedback on this?
Thanks!

[Tman122]

In my opinion they are way overpriced here in Minnesota also. When I went to the Arctic store in MPLS the sales guy started to do a break down but I stopped him. I didn't need a break down I was just looking for a price for comparision purposes on a tub just like the one he had on the floor. He tryed again to give me a break down and I turned to walk, then he gave me a price that included cover lifter and startup kit. Anything else I wanted was extra.

[fletch49]

Not sure if it's Arctic Spa that is pricing themselves out of business, rather it's the dealer. $15,000 for a Tundra? I don't think that's inline with the MSRP.

I didn't have that experience with my dealer. Their quote was the price of the tub (heater, cover, shell, microban and lifter all in), then the price of accessories. In my case the ozone system.

[turbo]

Thanks for the feedback, I told my friend I thought the price was out of line.  I don't know who would buy a spa with all of the features extra.  You have to pay extra for things that are standard on most tubs.  

[tony]

Tell them you don't want the Microban.  This is sales flaunting and very misleading...maybe fraudulent.  My bet is this comes from the factory like some of the sales tactics from Arctic in the past.  This is what makes people skeptical about Arctic.

[Vinny]

Tell them you don't want the Microban.  This is sales flaunting and very misleading...maybe fraudulent.

I know my dealer or maybe Artesian had a $100 upcharge for Microban. I didn't pick a Microban color but I guess "someone" figured at that point they can make some extra money without worrying about a consumer complaining (at least that's my thought on it).

[bob5820]

...  The breakdown was 11,500 for shell and cabinet, $ 250 for jets, $ 250 for microban, $ 300 for the heater, $ 500 for the cover, $ 150 for starter chemical, $ 700 for arctic's ozone, and $ 500 for the forever floor, and a few other prices we could not decifer.  This came to a grand total of $ 15,000.

Does this mean that you can buy the shell and cabinet without the other options like the jets and the heater. I agree that breaking down the price like this seems like a tactic to confuse the customer. As far as the Microban, my Artesian dealer did not charge extra for the Microban colors. Artesian has either changed its policy from when Vinny purchased his, or the decision on what is standard and what is a chargeable option is up to the dealer.

[JcDenton]

Arctic in 2005 PROFIT 100 List of Canada's Fastest-Growing  
Posted By: Comunications
2005-06-14 13:22:57
For Immediate Release, Alberta-wide, June 14, 2005 – Blue Falls Manufacturing Ltd., makers of Arctic Spas®, has been recognized as one of Canada’s top business performers for the third year in a row.  Listed in the “17th annual PROFIT 100 ranking of Canada’s Fastest-Growing Companies” by PROFIT: Your Guide to Business Success, the company’s 5-year growth rate of 713% landed it at number 90.    

“We’re pleased to once again be listed in this authoritative ranking of high-growth companies,” said James Keirstead, VP Marketing.  “It’s a good sign that consumers continue to recognize the value of a quality product.”

Blue Falls, headquartered in Thorsby, Alberta, delivers their Arctic Spas® line of hot tubs to a steadily increasing dealership network worldwide.  Gross annual sales have soared from $6 million to over $52 million with distributors in Canada, the U.S., the U.K, France, Estonia, and Australia serving 250 dealers around the world.    

“We’re happy to welcome the 2005 PROFIT 100 winners to the most prestigious group of entrepreneurial businesses in Canada,” says Ian Portsmouth, editor.  “Canada’s Fastest-Growing Companies are succeeding by knowing what customers really want, then delivering it.”

Nominations are solicited through PROFIT magazine and other channels and are verified by examination of financial statements and interviews with top executives.

- 30 -

http://www.profitguide.com/profit100/2005/p100.asp?Rank=90

[Hot Tub Guru]

The price you should be able to purchase an Arctic Tundra Signature Series with all the features listed in the first post should be around $9500 to $10,000.

Michael

[turbo]

Thanks again for all of your imput.  I don't know what my buddy is going to do.  He picked the legend series, for a total of $ 15,000.  The price list says $ 11,500.  After adding the so-called options, heater, jets, cover, chemicals, microban, forever floor, etc, it really increased the price.  No wonder the company is profiting, at these prices you can't expect anything else.

[ramdom]

They are more than a little dear. Quality is supposed to be reknowned but it all seems rather unjustified. We got the same song and dance on extras that were in fact neccesary to operating a tub. Check out the Hydropool 625 Anniversary Edition. Amazing value for the money there...

[stl-rex]

At the outset, this looks like yet another way to start a bash Arctic thread.  

The list or retail price of the Arctic tub is high.  Do you pay that?  Depends on the dealer and your ability to negotiate.  My opinion is the Tundra Legend as described can come in at or around $9K.  The list price on that tub is probably going to show around $15K.  The Legend comes with an incredible jet package.  I have no idea why you're dealer is showing "jets" as an extra.  In fact I never had conversations about jets, microban etc with my dealer.  My dealer didn't play those games.  

I think there are dealers of every brand that play pricing games.  If not, they all would post their prices clearly and that's what you would pay.  Most do not display prices.  They will take what they can from an uneducated consumer.

Oh and those that don't care for the Profit 100 report mentioned by JC, that is for revenue growth over I believe the last 5 or so years.  Their revenue has been growing as they increase unit sales and expand sales territory.  I bothered to check it out when I researched the company.  Years 02 and 03, the company turned a profit.  Due to plant acquisition and expansion required to support a growing business, they showed a loss in 04.  Exactly as expected from a rapidly growing business.

[stl-rex]

They are more than a little dear. Quality is supposed to be reknowned but it all seems rather unjustified. We got the same song and dance on extras that were in fact neccesary to operating a tub. Check out the Hydropool 625 Anniversary Edition. Amazing value for the money there...

The 625 is a great spa, but it's not equivalent to the Tundra.  You would need to go to the 800 series Titanium for a fair comparison to Tundra Legend.  The Yukon is probably Arctic's comparable model to the 625 and if I recall, you liked the 625 more and thus purchased it.  The 625 is 84x84.  Tundra Legend is 94x94 - 61 jets.  800 is 96x96 - 60 jets.

[Steve]

Hard to believe I know... but I have an opinion on this!

First off, Arctic isn't going anywhere. They are very stable and have carved themselves a very good niche in the market as a quality spa. (Someone wanna pick stl-rex off of the floor for me... )

Let's be clear that every dealer can price their spas as they deem necessary depending on the market they are in. If the market allows full retail, then that's the right answer for that dealer and supply and demand plays a role. There are too many other factors to list when it comes to pricing spas for any one market and it needs to be done properly or that dealer is out of business. The reality is that anything less than 30% profit for a retail store and they’re out of business. The only dealers I’m aware of making unbelievable margins are those in Europe. Our Hydropool European dealers get Hummers sent over in the containers with their spas for them and their family!

I highly doubt that every dealer does this "A LA CARTE" type of sales. I was under the understanding that the cover and floor was standard on these spas? Is there an upgrade for these as well as an upgradeable heater? I wasn’t aware of that.

I do have a problem with a couple things mentioned.

The list or retail price of the Arctic tub is high.  Do you pay that?  Depends on the dealer and your ability to negotiate.

This type of pricing strategy will put a dealer out of business very quickly. This relates to trying to screw a consumer at first and see how far they can get us down in price. It's for this reason that this industry has a rep like the used car industry. This needs to be stopped!

If not, they all would post their prices clearly and that's what you would pay.  Most do not display prices.  They will take what they can from an uneducated consumer.

What a dismal outlook on your local dealers. If someone came in there as a reputable dealer, all of those companies would be out of business quickly! I think you'll find that a HUGE majority of dealers are in NO WAY out to "get what they can" from consumers. It's a very short sighted approach to business IMO and very short lived. I recommend to my dealers that they price their spas properly and we help add value with factory promotions. I don't want my dealers inflating their price. It's usually done to show "perceived value" in a hike it up and cut it down sort of presentation or it’s done to make room for negotiations. Either concept is poorly thought out.

FYI, the 800 Titanium would still retail fully loaded under $13,000 (Can) in most cases.

Steve

[stabone]

         Good post Steve,   I am sure there are  Arctic dealers  guilty of this type of sales  tactics, and they are not the only ones.    
    I have always thought it is better to present a product that has better features as standard at a competitive price, than  make  everything look like an upgrade...   We all know this stuff happens in every industry.    
   I think that  deal sounds like a bunch of BS,  find another Arctic dealer  or another brand you like!!