The Soft Science of Pricing
Posted by Scot Wilson on
Thank you to all of our loyal customers who have purchased from our website, Italianiron.com and from our italianironclassics Ebay store. We work hard to be fair in how we price our vintage and modern Ducati Spare Parts. However, there can always be a difference of opinion. Let me share some thoughts.
Not every provider of vintage motorcycle spare parts is out to take advantage of the customer. I would contend, however, that shipping companies, financial institutions and organizations such as Ebay seem to fall within that category. However, these organizations do effect pricing.
My reality with regard to pricing is to recognize that there are acquisition fees for finding and purchasing inventory. Then there are shipping fees for shipping crates and sea containers from the UK and Europe to my shop in the US. The shipping of my last sea container from Europe was over $5,000. That fee adds to Cost of Goods.
Then there are my Business Overhead expenses for shop and warehouse space, utilities, insurances, and the equipment/labor to process and refine used parts. There are also vendors who may provide breaks due to volume of business such as paint, upholstery and chrome plating shops but those fees are additional costs.
Fortunately, there is no listing fee per item on my website but a yearly contract fee to maintain the Italianiron store on the italianiron.com website which is a normal business expense. Therefore, I provide my best prices on product through my website.
Ebay is a different story. I have calculated that between the cost of having an Ebay store, listing fees, and then fees from PayPal and Ebay combined, the total fees can total almost 20%. I must add those fees on to the cost of the same item on my site when listing on Ebay.
These fees in my opinion are very high. However, those fees are not as horrendous as charging Italianironclassics that same percentage on what you, the customer pays for shipping to your destination. If an item costs $100 US and shipping is also $100, then the same fees are charged by BOTH PayPal and Ebay on the item and shipping costs or on $200 combined in this example!!
As I have "Make an Offer" on my website AND on the Ebay store, I find myself communicating often with customers who make an offer and I can easily respond with what price I can offer after all fees. We definitely strive to reach a Win:Win. We need to operate in such a way that there is a little money left over to return to the household. If you only "break even" as a business, you will not be open very long.
Part of the value that we have historically provided at Italianiron.com is the availability of hard to find vintage Ducati spare parts that we import from Europe. As I have restored numerous Ducati bevel drives, I know the sense of relief that comes with finding that "unobtanium" spare part to complete that project. There is also the sense of satisfaction that comes from finding that illusive spare part but for a fair price. This is what we strive to achieve. I am always open to a good conversation through my e-mail address: firstname.lastname@example.org. All the best.