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MSRP vs. street price


videomagician

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I visited my local Klipsch dealer last week looking at both the RB-61 and RB-81 home theater systems. I'm looking for a home system to test my DVD authoring/5.1 mixing projects. Now that Klipsch has posted prices on their website, it appears the local dealer quoted list price on everything. As a video producer who buys a fair amount of pro/broadcast gear, I'm not use to being quoted (or paying) MSRP on equipment purchases. Is this standard practice with most dealers? Does Klipsch deal direct? I'd even take B-stock as I'm more concerned with sound as appearance. Any suggestions/comments would be appreciated.

David Settlemoir

http://www.settlemoir.tv

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most speakers have a 50% profit margin. I used to be a dealer with Paradigm, Yamaha, PSB etc. Even the higher end Paradigm lines. So a MSRP $10000 Khorn costs the dealer about $5k.

Having said that, most specialty dealers need about 25-30% overal profit margin to survive.

So haggle all you want, but let the guy make a living OK!

BTW (selling price - cost)/selling = profit margin or "points"

($100-$75)/$100 = 25% profit margin or "25 points"

($8500-$5000)/$8500= 41% profit margin. Resonable for a Khorn, but you may do better.

BTW, Plasmas, LCD tvs, DLP/LCD projection used to have 25% profit margin. while tube TVs and DVD players etc had 20% margin. I would not be surprised if the 42inch TVs now area at a 20% margin because of competition. Low end digital cameras where already at the 18% rate. Sure there where some volume rebates at the end of the year, but that is what put the food on the table.

I use to say that even if I sold all my TVs, DVD players, Digital Cameras, and camcorders at full list price I would still not make enough profit to survive. Thus why the expensive wire, interconnect and accessory market has emerged.

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Well I got the RF-83 for 1600 cause I sorta got lucky as the store did not know the RF-83 were more expensive then the at the time current rf-7 (msrp of 2200) The RF83 msrp is 2500. But I have seen them at the store now for 1800 a pair. So the store I know is about 81% real msrp price.

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Now that I think about it, I never pay MSRP for anything, such an inflated price. Seems to me Stereo equipment is always 20 to 25% mark-up right off the top, always some room to move price down..........Been checking NEW Khorn pricing.......just researching.....about $3,500. a piece.......still seems kinda high to me......maybe not??...........$7000. per pair, that's more than a new 383 cu. in. strocker small block Chevy, new..........hmmmm!!!....

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  • 3 weeks later...

Well I watched the local paper for a few weeks and picked up about a three-month old pair of RF-62s. I was "underwhelmed" when I listened to the RB-61s in the store, but the RF-62s seem to have a lot more depth to them. Now I've just got to find an RC-62 and some surrounds and a sub and I'll be set! Thanks for all the comments/suggestions.

David

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You may purchase a lot of pro/broadcast gear, but does your local audio retailer get that business? Probably not. So to him you might appear as just another customer. I'm with Duke, if the guy wont come down off MSRP, offer him 85% of msrp, something like that.

There are usually close outs on last years models at my local retailers- that might be a way to get Reference quality at a better price point. The 61's are brand new, that might be why your local guy is sticking to the posted price.

EDIT- nevermind, I just read the rest of thread- congrats on good dealing!

M

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  • 2 weeks later...

I'm looking to purchase a pair of Rf83s, and probably their new Rt 12 sub thats supposed to go along with those speakers. I dont want to pay MSRP, but Id really like to get a good discount if i could on these speakers. I dont know what i should do or now to haggle with the local dealer here.

Would it help if i offered to pay in cash? Would they be more willing to deal if i waited till around thanksgiving?

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