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Hi all,

don't get me wrong, I really like Summit and other vendors as a great source for all kind of stuff. However, I also like to support the manufacturers and try to order via their website. I always think this way they make a better deal without the vendor in between. Latest example is a subframe connector (910C) from Global West. $168.99 on the Global West website and e.g. $165.99 at JEGS. $3 to support the manufacturer is totally acceptable. But now comes the problem, shipping at Global West is $67.23!!!! vs free shipping at JEGS. No way I will pay $70 more.

Now I wonder how much JEGS pays for the subframe connector and for shipping.
 

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Volume discount, Jegs and Summitt buy much more than individual purchasers. They get a better deal, economics 101.

Have you called Ford directly to buy a car?
 

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$67.23 is likely GW's actual cost to ship. I'd almost guarantee it.

I'll also guarantee that by shipping for free, by the time they actually factor their business expenses into the product, Jegs is losing their arse on that stand-alone transaction.

Out of proper forum discretion, I'll not go into my theories as to "why" or "how". Just saying that GW's shipping quote was actually right on target with what it costs these days. I'll also not go into how much NPD writes-off in shipping losses annually. Trust me, it's ugly. But it's the cost of doing business in 2020. None of my competitors have it any better either.
 

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1968 coupe, 1968 vert, 1966 coupe
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Even for sheet metal it’s so expensive why can’t I order directly from Dynacorn and give them the bussiness and save myself alittle money I have no problem meeting there minimum order amount of $3,000 a few times a year!
 

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Keep in mind that it is poor/unscrupulous/unethical for W/D distributors and/or manufacturers to sell direct to the public at prices that are less than their published MSRP. It undercuts and undermines their W/D customers, which is their life blood.

This is why going direct rarely achieves any cost-savings. They have an ethical obligation to protect and respect their distributors.

After I've invested tens of thousands of dollars, even hundreds of thousands, in stocking my shelves with a manufacturer's product-line, and promoting their merchandise and their brand name in hundreds of thousands of catalogs and on my website.. The moment that I discover that they're screwing me by selling direct to the public at a price that totally pulls the rug out from under my ability to sell the inventory I purchased in good-faith, they get a phone call. A not very nice phone call. And there's been a few over the years that I've hit the "eject" button on.

You never undercut your W/D clients. It's a huge business no-no that dates back to the cave men.. ;)
 

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I grew up in Anniston, Alabama, home of Auto Custom Carpets. Years ago I asked about buying carpet directly from them and if memory serves they would not sell. Now, I think they will, but the price is higher than NPD would sell it for. I kinda want to see the facility and buy some carpet just to say it came from my home town. A ton of you guys have ACC carpet in your Mustangs and other classics. Thanks for supporting an American company that is employing American workers, much like Daniel Carpenter, Rick @69bossnine and NPD, Virginia Classic Mustang, CJ Pony Parts and so many other hobby suppliers.
 
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Hi all,

don't get me wrong, I really like Summit and other vendors as a great source for all kind of stuff. However, I also like to support the manufacturers and try to order via their website. I always think this way they make a better deal without the vendor in between. Latest example is a subframe connector (910C) from Global West. $168.99 on the Global West website and e.g. $165.99 at JEGS. $3 to support the manufacturer is totally acceptable. But now comes the problem, shipping at Global West is $67.23!!!! vs free shipping at JEGS. No way I will pay $70 more.

Now I wonder how much JEGS pays for the subframe connector and for shipping.
Won't tell you what the JEGs acquisition cost is but they get a deal..... mainly all such deals are dictated by the customer, believe it or not.
JEGs- "we need to see 'umpty squat' (margin) to do business with you." I was involved with those types of meetings with Super Shops and
Ford Motorsport when I was at GW.

Subframe Connectors are very bulky and un-economical to ship. These days I'm not surprised by a $67 S&H charge for those.

ex-Global West GM
1991-1995
 

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I have a wholesale / distributor license and here are a few concepts:

1) OEM / Large Scale distributors sell in volume and do not cut there bread and butter sellers for 1 little sale. As others mentioned, they may have a "posted" retail price, and do not sell under that price, to ensure they are not "competing" with their vendors. When Scott Drake moved his operation from Grant's Pass Oregon, to Southern California, he actually spoke to me (I was in Simi Valley) as he was looking at Simi Valley, but did not want to set up close to one of his vendors, and instead went over the hill abou 20 miles to Camarillo.

2) License. Most OEMs will not talk to you without a sales tax license, business EIN, etc.

3) Volume discount and shipping: Say in the above example, the retail is $165. Wholesale MIGHT MIGHT MIGHT be $85 for 10 - 15 and $76 for 20+. They come by freight a container at a time, so the per piece cost is $12 for shipping. Shipping retail is not cheap, and to sell 1 to you MAY mean having to process a small order through shipping department, setting up sale tax account for that state, even having to deal with a different shipping (FedEx) versus Freight Company, so not worth it.

4) Minimum and Repeat Buy Amounts. For example, to be a distributor of Mustang parts, buying from Scott Drake as the wholesaler, MIGHT MIGHT (ALL NUMBERS ARE MADE UP) it might be an initial Buy in of $8000 and $3000 per quarter to keep the relationship active. They may also have minimum quantities (1965 1966 Front valance only are sold in groups of 5) as they are shipped 5 per box, and they are not interested in breaking down the boxes.

Some items have HUGE mark ups, since they are a low cost / high time to deal with item For example, NUMBERS MADE UP, the little plastic roller in the front window for a 1965 1966, retail might be $2 each, and wholesale, Box of 100, is 27 cents each. But it takes time ($$) and packing material ($$) and boxes ($$) to fill a sale of 2 rollers, whereas a set of 4 Style Steel Wheels might have a wholesale of $96 and a retail of $125, as they come in boxed, and ship out in the same box, so very little is involved in selling them.

PLEASE all numbers are SWAG's and are not being quoted from anyone's proprietary information.
 

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1968 coupe, 1968 vert, 1966 coupe
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These are some of the prices direct from the manufacturer in Taiwan crazy isn’t it!!!
 

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Manufacturers are in the manufacturing business and NOT set up for retail sales. It takes no less effort for the manufacturer to process the paperwork and do billing on a $250,000 order from Jegs than it does one's $200 order.
 

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These are some of the prices direct from the manufacturer in Taiwan crazy isn’t it!!!
Umm. I can't read that at all, but it's probably just as well. I remember how much markup there was at my first job at a local convenience store 30 years ago. The owner's grocer prices were low, sure, but he had to keep the lights etc on, employees paid etc etc and he didn't make a ton. I learned enough that summer to know I didn't want to make my living in his shoes or the ones I was in!
 
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Global West is a tiny tiny tiny tiny company in a really tiny building making one type of product. I know I have been there several times. Jegs is a HUGE company that sells many many many items from many many many companies and sells lots of them. They get a volume shipping discount from shippers and can absorb the cost of a few returns. Global West doesnt get that discount and cannot absorb the cost. Also anything being shipped from california or shipped to california is way more expensive than any other state due to enviromental taxes and fees shippers have to pay that are passed onto you.
 

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I completely understand why the manufacturer sells at MSRP when they also sell to retailers. Jegs and Summit probably get great deals on shipping. I have ordered some stuff direct from the manufacturer but it's usually a replacement part for some item. I've also ordered when it was an odd or rare part that no one stocked and was going to special order anyway. Of course, for Mustang Parts, I like to order from NPD as they are right up the road and I usually get it next day, though I do have to pay that pesky sales tax.....

But if i have a question, they are only a phone call and/or email away.

I've ordered from some other vendors as well, Kentucky Mustang, Virginia Mustang, and Maryland Mustang, but that's probably less than 15%.

I order stuff like water pumps, fuel pumps, u-joints, etc. usually from Rock Auto.

I worked in a car stereo shop (we sold satelitte TV, CB's, cordless phones, and some home stereos) back when you had a sticker gun, and the markup was really complicated. If we paid less than $10 for it, you multiplied by 3 and rounded up to the nearest .49 or .99. I think 5 packs of fuses were $1.99 back then. Figure out what we paid. My boss would let me mark an item that came out to like $2.01 at $1.99 (we tried to be competitive believe it or not-there was an auto parts store next door, and we did a lot of exchange business). Obviously, high priced items were not near the mark up. Some of the car stereos we sold we only made $20 on a $159 radio. But we also made money on installation. It was a small private company with only a handful of stores. There was no computer (gasp!), just a real cash register. We did well, but there were just a few employees. Oh, and those fuses, since we stocked nearly everyone imaginable, we sold a ton (probably as much or more than Radio Shack in our town). We even sold them to the auto parts store for the their delivery customers when they were out (The manager would buy them from us). I can't imagine what we did on those parts, and just sometimes we'd sell the person a cordless phone or something else too.

So business relationships can be complicated.

Jason
 

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The answer to the question is why manufacturers have authorized dealers.

Hiring a sales staff, shipping department, management, customer support and a web based catalog would drive the cost of the product through the roof.

Its far easier to concentrate on manufacturing and let someone else worry about everything else.

You cant go to a Frito Lay factory and buy a bag of chips or go to the car factory and buy your new car.
 
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