[sokoloff]

In engineering university, I learned the “retail needs to be 5x the BoM* cost” rule of thumb. For a very high value or very high units product, maybe you could shave that to 4x or slightly less, but there are a lot of hands between the designed part and the retail consumer and none of them want to work for free.

* BoM - Bill of Materials (“what stuff goes into this thing?”)

[dylan604]

4x was also the minimum retail price I've been taught as well. The wholesale rate has also been anywhere from 50% - 75% of the retail price depending on the negotiations with the retailer. This is ignoring soulless companies like Walmarts/Amazons/etc where you'll never make those numbers. Something people don't always consider that when they buy something from the retailer directly, they typically make more money from that sale than if you bought the same thing from Walmart. Buying something from somewhere like Etsy vs their direct site also takes a healthy chunk.

[sokoloff]

That’s what I find so infuriating about many first-party sites.

I’ll often find something on Amazon and if it seems like it’s from a small business, I’ll check to see if I can buy it direct. (Arguably, this behavior is unethical on my part against Amazon, but whatever.)

I very rarely (like <10% of the time) find the first-party site to have an offer that even matches Amazon’s.

Look, I tried. I came to you and gave you a shot, but if you want to charge the same item price and also tack on $15 of shipping, I’ve received your message (“please buy it from Amazon; we don’t want to sell it to you direct…”) loud and clear.

I’m usually willing to wait a few extra days, pay the same price, and have worse returns possibility in order for you to double or triple your variable transaction profit, but you’ve got to be competitive.

[Libcat99]

My understanding is that if you list on Amazon, you agree not to sell for less anywhere else, including your own site.

Advertising on Amazon is nearly, but not quite, a requirement in the current marketplace.

This has been part of the recent antitrust action against them.

[applied_heat]

Sounds like the manufacturer just wants to ship palettes of the product to amazon and not deal directly with individual customers and are happy to have amazon make their markup for the service they provide.

[dylan604]

Yeah, sites willing to accept the full retail price and not discount the shipping to match a larger vendor's site, then of course they're firing their footgun with both barrels. There's a reason places will offer free shipping with minimum purchase prices that ensures there's enough profit made to cover the cost of the shipping.

The hassle of inventory/shipping logistics is something people with no experience easily do not consider.

[shiroiuma]

>I’ll often find something on Amazon and if it seems like it’s from a small business, I’ll check to see if I can buy it direct. (Arguably, this behavior is unethical on my part against Amazon, but whatever.)

According to whom? The people who think going to the bathroom during a TV commercial break is "stealing"?

Since when is comparison-shopping unethical?

[sokoloff]

I don’t think comparison shopping is unethical; it’s what makes a market work.

I do think “thank you for letting me know this product exists and meets my need, but if all else is equal to me, I’ll buy it somewhere else where you don’t benefit from the effort to help me address my need” is not the standard that I hold myself to generally.

Further, I think many would object if I found a product through a small business directly and bought it for the identical terms via Amazon rather than direct.

[shiroiuma]

You have to find out about the product somewhere, whether it's from a small business, or from Amazon. After that point, then you comparison-shop. So how's the market supposed to work if you're only ethically able to buy it from the first place you saw it? Or do you think you're only allowed to comparison-shop for things you buy repeatedly (like milk and eggs) or things you learn about through advertising?

[sokoloff]

My personal belief system is "it's fine to buy it from the place that's cheapest/most convenient/otherwise best, but in the case of ties, you should buy it from the place that was most helpful".

[dylan604]

A lot of people would "shop" at brick-n-mortar stores with a mobile comparing prices online. They would look at the physical item right then and there, but purchase from online. At least, that was the early days of online when people were still actually getting off their couches.

[sokoloff]

I think price comparison is totally valid, even across channels. But if the online price is the same as brick/mortar, it seems only fair to buy it from the brick/mortar store if they provided you some knowledge/service that the online places did not.