Richard W Posted December 18, 2012 Share Posted December 18, 2012 I can't recall if this topic has been discussed before and I didn't find any previous posts, but here's my question: what is the point of the manufacturer's suggested retail price--MSRP? (hey, that could be good band name.) For Christmas I made an arrangement with Santa Claus (my wife) and bought myself a new bass. (I'm not allowed to open it and play it until next week.) The MSRP is $1332, but the retail price everywhere I looked (both online and at stores) is $699. As it turned out, I bought it through my local independent music store and the owner took another $50 off the price, so I got it for $649. That's all well and good, but I don't understand why the MSRP is what it is, when the actual price is so much lower--I couldn't find anyone selling it at the MSRP. And every retailer advertised how much you could "save" (48%!) if you bought it from them. Why not just say the MSRP is $10,000 and then claim a savings of over 90 percent? Just seems like BS to me. Anyway, can't wait for Christmas morning... "Everyone wants to change the world, but no one thinks of changing themselves." Leo Tolstoy Link to comment Share on other sites More sharing options...
SteveC Posted December 18, 2012 Share Posted December 18, 2012 I don't know the answer. I hope someone does. There's also MAP (minimum advertised price) but often you can get items under MAP if you ask. Retailers just can't advertise those prices. Again, I don't know why. I'm interested to hear the answer. Link to comment Share on other sites More sharing options...
Bob Gollihur Posted December 18, 2012 Share Posted December 18, 2012 It's a game that has been played for millenia, and one that began before there was such a thing as a price tag. There isn't an answer that really matters as the game will continue. 1000 Upright Bass Links, Luthier Directory, Teacher Directory - http://www.gollihurmusic.com/links.cfm [highlight] - Life is too short for bad tone - [/highlight] Link to comment Share on other sites More sharing options...
J. Dan Posted December 18, 2012 Share Posted December 18, 2012 It's because they sell through distributors instead of direct. The MSRP is what the manufacturer feels the market price should be. They sell to the distributor at some discount off of that. The distributors are free to sell at whatever price they wish, but of course have to balance profit margin with competition from other suppliers. So I guess you could say the short answer is that MSRP sets the price to the distributor based on their agreement (they get 50% off MSRP, or whatever - and different distributors may get different discounts based on volume). The MAP is minimum advertised price and is also set by the manufacturer. This is a minimum price they are allowed to advertise without risk of being fired as an authorized distributor (thus getting their discount yanked). The purpose is to prevent the market from getting eroded by people willing to sell at extremely slim margins. Dan Acoustic/Electric stringed instruments ranging from 4 to 230 strings, hammered, picked, fingered, slapped, and plucked. Analog and Digital Electronic instruments, reeds, and throat/mouth. Link to comment Share on other sites More sharing options...
Bob Gollihur Posted December 18, 2012 Share Posted December 18, 2012 MAP is not universal; it has different meanings based on the policies of the specific company. MSRP also has no universal meaning and is used both by manufacturers that deliver product through both direct means and distributors. There are other numbers like "street price", which again has different definitions based on the mfr. These comments are based on my experience as a bass oriented musical instrument store for the last fifteen years. The only number that is real is whatever shows up on your credit card bill next month, and that will also slide into meaningless if you pay just the minimum monthly payment. Retail is, to express it politely, messed up, and it continues to evolve into new forms of messed up as the new forms of commerce evolve. As far as manufacturer numbers, their meanings will also continue to slide into meaninglessness, which is the reason behind my original, frank reply. To which I will add, it will all be driven, as always, by The Golden Rule. Them that has the gold makes the rules. 1000 Upright Bass Links, Luthier Directory, Teacher Directory - http://www.gollihurmusic.com/links.cfm [highlight] - Life is too short for bad tone - [/highlight] Link to comment Share on other sites More sharing options...
butcherNburn Posted December 18, 2012 Share Posted December 18, 2012 It's a marketing thing to make stupid people feel they are saving money. Other examples are charging $1499.99 or even worse $3.09 and 9/10ths for a gallon of gas. It's $3.10 and if you drove for 20 minutes to get an extra penny per gallon of 15 gallons of gas well.... Most people, even if they are not actually stupid, may be stupid at one time or another. The world depends on this. If you think my playing is bad, you should hear me sing! Link to comment Share on other sites More sharing options...
kenfxj Posted December 19, 2012 Share Posted December 19, 2012 It's a marketing thing to make stupid people feel they are saving money. Other examples are charging $1499.99 or even worse $3.09 and 9/10ths for a gallon of gas. It's $3.10 and if you drove for 20 minutes to get an extra penny per gallon of 15 gallons of gas well.... Most people, even if they are not actually stupid, may be stupid at one time or another. The world depends on this. This. Push the button Frank. Link to comment Share on other sites More sharing options...
Danzilla Posted December 19, 2012 Share Posted December 19, 2012 It's a game that has been played for millenia, and one that began before there was such a thing as a price tag. There isn't an answer that really matters as the game will continue. It's so you have room to haggle. And some people have forgetten how to do that. [video:youtube] "Am I enough of a freak to be worth paying to see?"- Separated Out (Marillion) NEW band Old band Link to comment Share on other sites More sharing options...
rumpelstiltskin. Posted December 19, 2012 Share Posted December 19, 2012 this forum still does not have a "like" feature. because i like people. Link to comment Share on other sites More sharing options...
Eric VB Posted December 19, 2012 Share Posted December 19, 2012 Not much to add but, yes, buyers new to the game can get caught up in the wrong numbers (I save 38% on this one but 49% on that one) instead of, as Bob puts it, the number on the receipt. There is also the mentality of only buying things on sale. This is why places with big ticket items that are only bought rarely, like flooring/carpeting, are always having a "sale". Now, you can't have a "sale" (and still make a good profit) without marking up the price first. That's really where MSRP comes in. Link to comment Share on other sites More sharing options...
Vandy Posted December 20, 2012 Share Posted December 20, 2012 MSRP (times however many "units") allows business models to be structured, and then presented to banks (& investors) to show "potential" for earnings. Then, the accounting department (& tax folks) can do their magic to show "profit". The consumer (or re-seller) can then repeat the process to show their ability to "do business". It's the Capitalist dance . . . Link to comment Share on other sites More sharing options...
butcherNburn Posted December 21, 2012 Share Posted December 21, 2012 You can also consider it to be the Maximum Suggested Retail Price If you think my playing is bad, you should hear me sing! Link to comment Share on other sites More sharing options...
Cthulhu Fhtagn Posted December 22, 2012 Share Posted December 22, 2012 MSRP allows that pinhead on eBay or Craig's List to ask $600 for an axe that isn't worth more than $300 because the MSRP two years ago was $799, and it's his, and that makes it worth something. MSRP allows the moron at the pawn shop (who should know better exactly within two minutes of talking to me) to try and justfy charging me $400 for a 96 Mexi-P with a gouge in the back of the body the size of a human head. MSRP allows the idiot at GuitarMart to try and convince me (who, depite talking to me for 30 minutes STILL doesn't know better) that he's doing me a favor selling me a bass for $799 that is listed at $1299 and he'll ask the manager to knock another $50 off AND give me an unpadded Guitar Research gig bag that won't fit while the same damned bass is selling on Sweetwater for $699 AND is tax free AND has free shipping. I apologize for my mood. I had two crowns put in this morning and came to the horrid realization that if the world did end, then it would end with me in a dentist's chair with a dental tech in my mouth up to her wrists. Ph'nglui mglw'nafh Cthulhu R'lyeh wgah'nagl fhtagn Link to comment Share on other sites More sharing options...
Nicklab Posted December 23, 2012 Share Posted December 23, 2012 I apologize for my mood. I had two crowns put in this morning and came to the horrid realization that if the world did end, then it would end with me in a dentist's chair with a dental tech in my mouth up to her wrists. I hear you, dude! I had a cleaning earlier this week and nearly lost my shit about 1) How much my teeth hurt AFTER the dentist, and 2) The huge clumps of blood I spit into the rinse sink. WTF?!?!?! Obligatory Social Media Link "My concern is, and I have to, uh, check with my accountant, that this might bump me into a higher, uh, tax..." Link to comment Share on other sites More sharing options...
Danzilla Posted December 26, 2012 Share Posted December 26, 2012 You're in my... oh. No. Just no. "Am I enough of a freak to be worth paying to see?"- Separated Out (Marillion) NEW band Old band Link to comment Share on other sites More sharing options...
Cthulhu Fhtagn Posted December 26, 2012 Share Posted December 26, 2012 Ph'nglui mglw'nafh Cthulhu R'lyeh wgah'nagl fhtagn Link to comment Share on other sites More sharing options...
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