Planet X Delivery Charge
- Thread starter Mr Reeves
- Start date
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jack smith
Veteran
- Location
- Durham
What business are you part of out of interest is it s bikes business? I can imagine planet x will loose out on alot of low profit customers but if charging postage will do better for them or not only time will tell i suppose.
My business or the one I trimmed back on was mainly the mobile side of the windscreen repair and paintless dent part. I stopped going out for dealers who only had 1 or 2 jobs at a time. Now I only mobile for 3 jobs or more.
This freed up a lot of time each week, which for me was spent growing the more profitable bits up, for example the training side.
This freed up a lot of time each week, which for me was spent growing the more profitable bits up, for example the training side.
I guess if they work on a model of a minimum 40% gross margin, then on £20 that would be £8 margin. They should be able to negotiate around £3 carriage fee max with their carriers. So basically it would erode their margin entirely when you add the cost to serve, packaging etc.
Most people probably spend more than £20 or buy higher margin products. I have no idea what margin they work on. The bikes probably have a huge margin.
Regarding returns, they should be minimal if they sell quality products with accurate details, and it's good customer retention.
phil_hg_uk
I am not a member, I am a free man !!!!!!
They have more buying power so the goods are cheaper and they can negotiate cheaper prices with the couriers. They probably pay a fixed amount to collect + to cover all the returns which in turn will get them more customers and make them more money, that's assuming they are making money of course high turnover does not necessarily mean high profit.
Amazon.
phil_hg_uk
I am not a member, I am a free man !!!!!!
Have they actually made a profit yet ?
Not to my knowledge!
Ask me one on sport.
Maybe, but that would mean that somewhere, somehow, Amazon might be making money. I'd read that Amazon hadn't turned any profit anywhere so far, that could be because Bezos is churning the money back into the business. Who knows.
DCLane
Found in the Yorkshire hills ...
- Location
- Dewsbury, West Yorkshire
Andrew_P
In between here and there
As someone else said earlier some of it will be volume discount, the two companies mentioned have bidding battles over full containers of such things as tyres, nearly all LBS's will purchase as an example Fulcrum Wheels from the UK distributor, yet the big mail orders will deal direct with the manufacturer probably buying at the same or possibly better than Madision etc.
Wiggle turned over £168 million for the year to Feb 2014 and added almost 9 million to their shareholders funds, so definitely a bit of profit in cycling! (and running etc)
Apple famously did not hand out dividends for 17years. It is now the most valuable company in the World and its cash hoard is immense. Jeff Bezos was very clear before, during and after the IPO that he is not looking at the short term. Amazon has been investing heavily in technology and people. And he is also capitalising on UK and EU's weak anti trust laws.
The customers are now the beneficiaries of its influence in the marketplace. Hopefully Bezos does not screw customers when he controls all the levers. If Amazon did not step in it would have been the ;likes of Alibaba.
UK's bane is that its best minds are in academia and state research entities and not exactly in commerce. In the US, there is routine movement back and forth between academic and commerce.
