Pricing!

A couple of ladies came in my store today that have purchased in the past and lasered right onto the # 4114 Bradington-Young Recliner Special in leather that I have in the store at $ 799 ( $769 + shipping for those that are long distance). They were buzzing all about it. Turns out, they had each ordered one at a store in Williamsburg, VA, 2.5 hours south of here at $ 999 plus $ 150 freight. When all was said and done, I was $ 300 less for the same chair, and I had one in stock (but not two of the same color). So one of them could have one today, the other I would have to order.

So they're very busy on the cell phones, going back and forth with the store in Williamsburg who is saying its impossible for any store to sell it at $ 799. I'm laughing now, because the ladies are telling me this and I say 'Well, the chair is right here, its in the same leather, the tag says $ 799, and you can load it up and take it home today so I think its pretty much the real deal."

They walk out in the parking lot and buzz in the cell phones some more to the store. The store manager says "Get me a quote on a store letterhead and fax it to me". So they come in and ask for that.

I say "No, I'm not going to give you a quote on a letterhead. Because if I do, I can guarantee you that as soon as its off the fax down there, it will be copied and sent to the CEO of Bradington Young with a raging attachment letter from that store's owner and then I'm going to get a phone call from B-Y's head guy *suggesting* very strongly that I raise my prices. Then I have to make the chair $ 999 and I don't want to do that. So no quote on a letterhead. The chair is here, you can buy it and take it home if you want."

So they get back on the phone AGAIN....they want to cancel their week-old order with the store, but he's going to charge them $ 100 each to do so. They'd still be $ 200 ahead even after paying the cancel fee, but they can't tolerate 'losing' one hundred dollars and the manager says he'll work with them if they keep the order there.

Hilarious. I bid them goodbye and last I saw they were still on the phone as they climbed into their car. Not sure if they'll be back, but it surely gives them a project to work on the rest of the day with the store down south.

I'm curious. Do the laws in Virginia allow that Williamsburg dealer to refuse a refund one week after the order has been placed? I'm willing to bet that the factory has not yet started to work on the furniture. If those ladies paid by credit card, they can probably force a refund.

As far as I know, there are no laws in Virginia governing refunds of deposits on orders placed, then canceled, Jeff. But it sure is bad for business when stores lock customers into something like that.

I charge a 3% fee of the deposit as a cancellation charge in my store, and that's only if a customer uses a credit card. Reason being, the credit card companies do not refund the merchant the processing fees when a transaction is reversed.

For example:

$ 10,000 order total. 20 % deposit = $ 2,000. Customer uses a Mastercard/Visa/Discover and the credit card fee I pay to the bankcard company to service the charge varies between 2.1% and 3.1% depending on the kind of card the customer uses (business rewards cards are the most expensive to process). That means I pay appx. $ 60 to process that charge. When a customer cancels and asks for a refund of a deposit, I don't get that $ 60 back to process a credit to their account, so I go 'in the red' on the order. Hence the 3% cancellation charge when using credit cards, and I don't do that for cash or check.

Could they do a charge back on the deposit at that store? Possibly. Depends on the contractual paperwork on the Special Order form they signed to order. There is specific language required of the store and it has to be in letters 1/4" tall stating 'deposits are non-refundable if orders are canceled', and the customer has to sign the order form.

Good story there, hopefully those women will stop by your store first next time to do business with you.

I was recently asked if I could show a dealer proof of deals I was being offered when shopping for a new vehicle, I politely but firmly said not gonna happen. I could tell this wasn't a case of them wanting to call and complain about unfair pricing as seeing if I was exaggerating the deals being offered to me. Thankfully they didn't press the issue and decided to just work with me to give the best deal they could.