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Parts prices and savings
Posted by David Prantl (more from David Prantl) on Thu, 2 Dec 1999 13:46:15
I a previous discussion, I wrote:
>>1. SAAB parts and accessories at 25% over-cost.
>
>>IMHO, it pays to buy original on stuff like this, and Camelback's
>>deal can't be beat. The list prices on SAAB parts are 65% or more
>>over-cost, so... you get the picture.
>
reply was:
>25% under list is not the same as 25% over cost.
In general, the above statement is correct because each percentage refers to
a different basis.
However, consider the following easy examples:
9000 2.0 water pump # 93 21 670
Camelback dealer cost: $80
(I got this from Camelback's old-style impact-printed invoice. Their
printer ribbon was so new that this number could be made out from the
'masked-out' area of the form.)
Camelback Nines discount retail price (25% over-cost): $100
Dealer list price (regular retail): $135
(Again, according to Camelback invoice - translates to 68.75% over cost)
If a dealer were to offer '25% off list', the discounted price would be:
$101.25
900 2.0 water pump # 88 17 900
Camelback dealer cost: $49
(Calculated back from their Nines discount price - their new laser-printed
invoices omit the 'cost' field entirely.)
Camelback Nines discount retail price (25% over-cost): $61.25
Dealer list price (regular retail): $82
(According to phone quote from Gossett SAAB - Memphis - 67.35% over cost)
If a dealer were to offer '25% off list', the discounted price would be:
$61.50
It quickly becomes clear that when the cost-to-list markup is 2/3 (66.67%),
there is NO DIFFERENCE between the '25% over-cost' deal and the '25%
off-list' deal.
Proof:
A = 1.25C = 25% over-cost
B = 0.75L = 25% off-list
When A = B,
1.25C = 0.75L,
L/C = 1.25/0.75 = (5/4)/(3/4) = 5/3
This means that list must be 5/3 of cost, or 2/3 over-cost, or a 66.67%
markup, in order for A to equal B.
I looked at about 20 other SAAB parts I purchased recently, ranging in list
price from $1.40 to $195.00. The cost-to-list markup ranged from 59% to
70%, but most of the time, it was just about right on 2/3.
Therefore, when it comes to SAAB dealer parts, the 2 deals are pretty much
the same. Camelback offers the first deal to anyone who calls them
(800-876-5199) and says they are a NINES (SAAB Club) member. I have yet to
find a dealer offering the second deal. Interestingly, the higher-ticket
items (exhaust parts in my case) showed a cost-to-list markup as low as
59%, so getting these from the local dealer at 25% off-list would have saved
me a couple of bucks. This would have washed out though, as local sales tax
would have been somewhat higher than Camelback's $5 drop-shipping (and no
tax). Drop-shipping also had the added benefit of saving me a trip to the
dealer for pickup during weekday business hours (9 to 5), which is when I'm
at the office. Besides, there's the fact that the local dealer would laugh
if I suggested such ludicrous discount deals !
As always, your mileage w.r.t. dealer cost, list, and discount/markup
information may vary. I am not affiliated with Camelback in any way, and
cannot be certain that the price info I have read/inferred from my
transactions with them is applicable to other SAAB dealers, and to parts I
have not purchased. I go by the offer they advertise in the NINES (which I
LOVE to read !) and by the excellent reliability I have experienced in
receiving parts from them.
Best regards,
David Prantl
david_prantlno39sdcx6spamx782hotmail.com
'84 900S, 210kMi, RIP
'86 9000T, 172kMi
'88 9000S, 136kMi
'89 900, 115kMi
'68 97 Sonett V4, 76kMi, #000467
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