(no title)
karatestomp | 5 years ago
I want a basic fridge with maybe $200, tops (manufacturing & material cost) of improvements to things that actually matter (castors on drawers make a huge difference for the feel of fridge drawers, for example) + non-ugly exterior. Counter depth (so less material!). No ice maker, no water integrated, none of that stuff. Certainly no damn screens. Just a compressor with a cabinet. A good and useful layout, or "UX" if you prefer (this adds no cost, or very little, past the initial design, which can be re-used indefinitely). I will pay a $600-800 premium over the most basic model for this, retail. Call it $1500.
... but in fact the nice parts I want aren't available except on very "high-end" models that start at like $2.5k from a dent-n-ding outlet (let alone full retail) with tons of extra crap, and you pay significantly more for counter depth in most cases (I guess economies of scale make them solidly 10% more expensive, despite the savings in materials?). It sucks, I just want a basic fridge that looks & feels nice and doesn't stick out into my kitchen like some kind of menacing mechanical monster, but is not a rip-off. Pretty much doesn't exist.
[EDIT] actually it's fair to say that "nice, simple, and reasonably priced for the extras it takes to achieve 'nice'" is a category markets often fail to deliver for me. They seem to be great at delivering cheap and crappy, cheap and kinda OK (think: all non-Ikea flat-pack furniture for the former, Ikea for the latter), expensive and crappy, and expensive and actually good. There's a middle-market that seemingly never gets served and sends me looking for antiques, when possible. I suspect the reason for these outcomes boil down to information asymmetry, like lots of problems with markets.
owenmarshall|5 years ago
Many manufacturers sell to retailers under a unilateral minimum price policy. You can buy from the manufacturer and stock your showroom, but you are not allowed to mark it below a certain price. You'll also see payments from the manufacturer to the retailer in the form of "advertising support" to drive certain models. So you'll end up with a retailer:
* Paying $500 per unit (A) which they cannot mark below $399, but buying a certain amount at a loss to receive a payment from the manufacturer for paper/web/TV advertisements contingent on including A in the advertisement and possibly even presenting it in a certain way on the sales floor (endcap, front display, etc.)
* Paying $450 per unit for unit (B) which they cannot mark below $599
The goal for the retailer is then obviously to buy as few of the first unit as possible to get the manufacturer payment and then push as many customers as possible to buy the second. The manufacturer is happy because unit A was last year's model rebadged and they could clear inventory and move towards retiring it.
The real top end items are sold under unilateral fixed pricing: you pay $X and must retail it for $Y. Manufacturers have people employed to mystery shop and look for violations. If a retailer marks up or marks down, they are blacklisted. Possibly for all lines, not just the marquee brand - depends on your sales.
rootusrootus|5 years ago
Corrado|5 years ago