Posted by Rick Denney on February 20, 2004 at 13:37:29:
In Reply to: Re: Re: Re: Re: Tuba Consumerism & Emails posted by Joe Baker on February 20, 2004 at 12:53:04:
I think you're wrong about the accessories. I suspect that the margin on accessories is a lot higher, but I'd bet that the instruments still bring in the greater revenue. A $5000 tuba with a 5% (true) profit margin brings in $250. If you sell 500 of those a year, you'll bring in $25,000 in profit (this is true profit--the markup on wholesale will have to be high enough to cover commissions and overhead before you get this profit). If I make a dollar of profit on a two-dollar bottle of valve oil, I have a high profit margin of 50%, but I'd have to sell 25,000 bottles of valve oil to bring in as much profit as those 100 tubas. That's a lot of valve oil!
The local music stores sell mostly accessories, because that's what most local shoppers are wanting to buy, and a store-front is a good place to showcase them. But I'd bet that even WWBW makes the big majority of its profit on instrument sales, and the more specialized shops will be even moreso.
Regarding expectations, most people these days expect instant gratification. I do not think they deserve it, however disappointed they are when they don't get it.
Rick "who thinks that without specialty instrument sales and repair service, shops like Dillons and Baltimore Brass would not exist--or would be just like any other local music store" Denney