MayorSimpleton
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My guess is that many non-US consumers already ARE boycotting Grado because of their comedy pricing strategy. I know I certainly wouldn't buy them.
Pluck
Pluck
Grado and Price Fixing
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lmilhan
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I feel bad for the people outside of the USA when it comes to acquiring a pair of Grados. I suppose that's about my only beef with Grado policy.
xluben
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Grado is the De Beers of the headphone world!
They have tricked us into thinking that Grado's are rare, and that you must give one to your wife in order to get married.
Especially how if you violate their policy they stop sending them to you!
Anyways, I think fixed pricing is ridiculous, and I hate how Apple implies it as well. BUT I think it's Grado's way of keeping demand down, so that their production can keep up. I'm guessing that they're afraid that if they make it into chainstores and online shops (at 60% of retail) they're not going to have any chance of keeping up with demand unless they go to faster/cheaper production methods, and therefore their quality will go down. Either that or stick with quality and leave many places out of stock, and get a lot of angry customers.
They have tricked us into thinking that Grado's are rare, and that you must give one to your wife in order to get married.
Especially how if you violate their policy they stop sending them to you!
Anyways, I think fixed pricing is ridiculous, and I hate how Apple implies it as well. BUT I think it's Grado's way of keeping demand down, so that their production can keep up. I'm guessing that they're afraid that if they make it into chainstores and online shops (at 60% of retail) they're not going to have any chance of keeping up with demand unless they go to faster/cheaper production methods, and therefore their quality will go down. Either that or stick with quality and leave many places out of stock, and get a lot of angry customers.
alfie
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Quote:
I think it is not related to quality, but to the need to enlarge their dimension, which means bank that loads you money, and so on. It is the very usual phase that scares every doing-well-enterprise.
| Originally Posted by xluben I'm guessing that they're afraid that if they make it into chainstores and online shops (at 60% of retail) they're not going to have any chance of keeping up with demand unless they go to faster/cheaper production methods, and therefore their quality will go down. Either that or stick with quality and leave many places out of stock, and get a lot of angry customers. |
I think it is not related to quality, but to the need to enlarge their dimension, which means bank that loads you money, and so on. It is the very usual phase that scares every doing-well-enterprise.
kramer5150
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Fixed pricing is no big deal. Grado isn't the only company that regulates its distributors in this regard.
They are a small company, an 18 man/woman operation. Lowwering their fixed prices and global expansion would increase sales volumes. They may not have the business infrastructure to support a global market. They also may not have the production capacity to handle the increase in volumes. Correct me if I am wrong... but you have to acquire business licensing to sell products to foreign countries. Thare are legal precedents that must be cleared through first, with each respective country. Not to mention the added complications with each countries customs, and getting your products INTO each country.
From what I understand Grado labs was a much larger company. In the 70-80's vinyl era, Grado couldn't keep up with stylus demands. They ramped up staff and production facilities. Then CD's were introduced in the mid 80s, and the demand dried up. The company was in financial ruin, overstaffed, with excessive producion facility literally overnight. Employee layoffs followed, and Im sure there were other business complications with the resulting dop in comsumer demand.
In light of this I really don't think you can fault John for his stance. He has reached a happy medium. Yes there potentially is a huge market opportunity overseas, but in his eyes its probably not worth the added business expense and the added risk.
I've wanted a nissan Skyline for a decade.... no dice.
I want a phillips HP1000... no dice.
I want the european honda accord wagon, not some glamoured out priced-up acura re-badge... no dice.
I want a toyota Alteza, not a price hiked lexus re-badge... no dice.
I would DIE to have a turbocharged renault Clio... no dice.
So you see... all goes around.
**edit**
This is what killed the SR40. From what I understand CC and the likes kept pushing John for price cuts and kept demanding lower and lower prices to increase sales volumes. The cans were "mass-produced", however the drivers were still hand-made (from the SR60), and driver production could only support so much sales volume. It will be interesting to see how they plan to get around this with the iGrado, which also uses SR60 drivers.
They are a small company, an 18 man/woman operation. Lowwering their fixed prices and global expansion would increase sales volumes. They may not have the business infrastructure to support a global market. They also may not have the production capacity to handle the increase in volumes. Correct me if I am wrong... but you have to acquire business licensing to sell products to foreign countries. Thare are legal precedents that must be cleared through first, with each respective country. Not to mention the added complications with each countries customs, and getting your products INTO each country.
From what I understand Grado labs was a much larger company. In the 70-80's vinyl era, Grado couldn't keep up with stylus demands. They ramped up staff and production facilities. Then CD's were introduced in the mid 80s, and the demand dried up. The company was in financial ruin, overstaffed, with excessive producion facility literally overnight. Employee layoffs followed, and Im sure there were other business complications with the resulting dop in comsumer demand.
In light of this I really don't think you can fault John for his stance. He has reached a happy medium. Yes there potentially is a huge market opportunity overseas, but in his eyes its probably not worth the added business expense and the added risk.
I've wanted a nissan Skyline for a decade.... no dice.
I want a phillips HP1000... no dice.
I want the european honda accord wagon, not some glamoured out priced-up acura re-badge... no dice.
I want a toyota Alteza, not a price hiked lexus re-badge... no dice.
I would DIE to have a turbocharged renault Clio... no dice.
So you see... all goes around.
**edit**
This is what killed the SR40. From what I understand CC and the likes kept pushing John for price cuts and kept demanding lower and lower prices to increase sales volumes. The cans were "mass-produced", however the drivers were still hand-made (from the SR60), and driver production could only support so much sales volume. It will be interesting to see how they plan to get around this with the iGrado, which also uses SR60 drivers.
The Monkey
Monkey See, Monkey DAC
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Quote:
See discussion beginning here. Grado's actions are legal--it is not price fixing. Grado may set the price below which it's distributors may not advertise. And if the distributor violates that policy, Grado may refuse to deal with them--legally. It's that simple. Where it gets tricky is when there is an agreement, implied or expressed, whereby the distributor agrees not to sell below a certain price at all. That is a vertical agreement in restraint of trade and per se illegal under the antitrust laws. So, for example, if Grado sends a threatening letter to a distributor telling it that it will be cut off if it does not get its pricing in line, and the distributor then maintains the pricing set by Grado, then there's a problem because an agreement arguably has been made. This is why manufacturers with MAPs must be ruthless with their "rogue" distributors.
| Originally Posted by DDRRE Most of you noticed the fact that all Grado products are price-fixed - as in - if the retailer sales it at a lower price he becomes an unauthorized dealer and doesn't recieve shipments from the company. This happened once, with "Powermax" - they even wrote an article regarding this situation (They sold Grados for a really low price.. SR80 for 64$ instead of 95$ etc.) Actually, they lost their authorization because of us head-fi'ers, advertising their price - which reached Grado eventually. I find price fixing very lame, tbh. It also eliminates competition. Debate 
|
See discussion beginning here. Grado's actions are legal--it is not price fixing. Grado may set the price below which it's distributors may not advertise. And if the distributor violates that policy, Grado may refuse to deal with them--legally. It's that simple. Where it gets tricky is when there is an agreement, implied or expressed, whereby the distributor agrees not to sell below a certain price at all. That is a vertical agreement in restraint of trade and per se illegal under the antitrust laws. So, for example, if Grado sends a threatening letter to a distributor telling it that it will be cut off if it does not get its pricing in line, and the distributor then maintains the pricing set by Grado, then there's a problem because an agreement arguably has been made. This is why manufacturers with MAPs must be ruthless with their "rogue" distributors.
facelvega
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Hey Kramer, I'll forward you an HP1000 if you want. But not a Clio. And though I have in these pages loudly supported Grado's domestic policy by trying to explain why it might actually be a good thing, I totally agree that the international policy is bad, so much so that I've decided to sell my SR-60 at US MSRP on the for sale pages, rather than sell on ebay where they go for 95 euro, i.e., about $125. Admittedly, mine are used, but hey, maybe I'll bring back one pair every time I fly over on sheer point of principle.
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John and I have had our disagreements over the years---I tend to be an early adopter and embrace the whole internet thing, and he tends to be rather "old school" in his approach and maintains a high-end dealer network as would be the norm pre-internet. While I have been frustraited by the incompatability of these two commerce world views, I also believe he has the right to run his business as he sees fit.
I have to say that while I embrace the new "global economy" as it presents itself on the internet, it also has MANY difficult problems. I have a very hard time providing the information HeadRoom does and still be able to be price competative. I believe "selling" is a valuable activity if done well, and it is VERY hard to get that selling paid for in the current internet climate. I have lobbied manufacturers consistanly to get better control of rampent distribution that allows fly-by-night operations to sell on the basis of price and not on the basis of product value to the customer. It has beed extreemely difficult and we struggle daily to maintain profitability in this environment. Johns decision to stick with the old method ensures that his network of sellers can be paid for their work. In that regard I think he has made a legitimate business descision.
I still believe his long term interest is best served by change to the contemporary norms, but I don't think that those changes come without risk of loosing significant business. He's decided not to take that risk, and I understand that.
So, if you don't feel you are getting value for your money with Grado cans, don't buy them. I certainly feel that the typical Grado value proposition is sketchy, but that's just my value system. However, I do feel that many have been very well served by their Grado purchases, and I have no intention of removing their product line for HeadRoom's offering. For those who enjoy these cans are getting value for money, AND we make a reasonable profit from selling them. Nothing wrong with that.
I have to say that while I embrace the new "global economy" as it presents itself on the internet, it also has MANY difficult problems. I have a very hard time providing the information HeadRoom does and still be able to be price competative. I believe "selling" is a valuable activity if done well, and it is VERY hard to get that selling paid for in the current internet climate. I have lobbied manufacturers consistanly to get better control of rampent distribution that allows fly-by-night operations to sell on the basis of price and not on the basis of product value to the customer. It has beed extreemely difficult and we struggle daily to maintain profitability in this environment. Johns decision to stick with the old method ensures that his network of sellers can be paid for their work. In that regard I think he has made a legitimate business descision.
I still believe his long term interest is best served by change to the contemporary norms, but I don't think that those changes come without risk of loosing significant business. He's decided not to take that risk, and I understand that.
So, if you don't feel you are getting value for your money with Grado cans, don't buy them. I certainly feel that the typical Grado value proposition is sketchy, but that's just my value system. However, I do feel that many have been very well served by their Grado purchases, and I have no intention of removing their product line for HeadRoom's offering. For those who enjoy these cans are getting value for money, AND we make a reasonable profit from selling them. Nothing wrong with that.
F107plus5
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Quote:
Considering the laws of supply and demand; Grados' ARE rare!! If John Grado and family are happy with the way their business is going at the moment with their current staff and feel no need to expand, then yes; they are rare and will continue to get even more rare as demand goes up.
The other point of supply and demand states the as demand goes up, so CAN go the price. The fact that as everything else in the US has escallated in price while the price of Grados' and Alessandros' have remained the same for many years shows remarkable resolve on the part of John and George to maintain their customers best interests. Alessandro continues to send Grados all over the world and allows the individual destination countries the ability to add whatever they wish to the cost of the Music Series Headphones right there at their own borders. But nobody seems to complain much about that!!
Perhaps Grado would be better off to abandon all their foreign distributors(and close out all those local shops overseas?)and allow a few US distributors to vend to the remainder of the world and let the individual destination countries governments set the price.
That would take the heat of Grado; wouldn't it?
....EDIT: I see Tyll posted one minute before I did! I fully agree with his comments. I also wouldn't mind seeing HeadRoom get some overseas shipping! That would add a bit more to keeping these forums in operation and keep a business more interested in advancing the hobby rather than simply making profits, remain in operation!
| Originally Posted by xluben Grado is the De Beers of the headphone world! They have tricked us into thinking that Grado's are rare, and that you must give one to your wife in order to get married. Especially how if you violate their policy they stop sending them to you! Anyways, I think fixed pricing is ridiculous, and I hate how Apple implies it as well. BUT I think it's Grado's way of keeping demand down, so that their production can keep up. I'm guessing that they're afraid that if they make it into chainstores and online shops (at 60% of retail) they're not going to have any chance of keeping up with demand unless they go to faster/cheaper production methods, and therefore their quality will go down. Either that or stick with quality and leave many places out of stock, and get a lot of angry customers. |
Considering the laws of supply and demand; Grados' ARE rare!! If John Grado and family are happy with the way their business is going at the moment with their current staff and feel no need to expand, then yes; they are rare and will continue to get even more rare as demand goes up.
The other point of supply and demand states the as demand goes up, so CAN go the price. The fact that as everything else in the US has escallated in price while the price of Grados' and Alessandros' have remained the same for many years shows remarkable resolve on the part of John and George to maintain their customers best interests. Alessandro continues to send Grados all over the world and allows the individual destination countries the ability to add whatever they wish to the cost of the Music Series Headphones right there at their own borders. But nobody seems to complain much about that!!
Perhaps Grado would be better off to abandon all their foreign distributors(and close out all those local shops overseas?)and allow a few US distributors to vend to the remainder of the world and let the individual destination countries governments set the price.
That would take the heat of Grado; wouldn't it?
....EDIT: I see Tyll posted one minute before I did! I fully agree with his comments. I also wouldn't mind seeing HeadRoom get some overseas shipping! That would add a bit more to keeping these forums in operation and keep a business more interested in advancing the hobby rather than simply making profits, remain in operation!
alfie
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I like Grado headphones and I buy and I will buy them via non italian distributor. It is cheaper for me to buy a low cost fly to NYC, buy a RS-1, having fun for a saturday night and come back here, rather than buying the same headphone at the italian distributor price. For a GS1 I think I could get the whole weekend
I mean that I feel I am getting value with Grados, but only at the US price.
| Originally Posted by Tyll Hertsens So, if you don't feel you are getting value for your money with Grado cans, don't buy them. |
I like Grado headphones and I buy and I will buy them via non italian distributor. It is cheaper for me to buy a low cost fly to NYC, buy a RS-1, having fun for a saturday night and come back here, rather than buying the same headphone at the italian distributor price. For a GS1 I think I could get the whole weekend
I mean that I feel I am getting value with Grados, but only at the US price.
Rob80b
Headphoneus Supremus
I believe a lot of frustration comes from potential buyers outside of the US, here in Canada the increase is way above the difference in exchange and shipping/brokerage fees.
iban
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<edit>
F107plus5
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And getting smaller all the time!!
What I meant is that each individual country can add their own charges; that the charges will probably vary from country to country or region to region.
| Originally Posted by iban btw Allessandro shows to me it IS possible to charge the same price worldwide, including shipping! Customs duty is fixed, it is not 'whatever they wish to charge', so there will be no surprises there. The World is smaller than you think |
And getting smaller all the time!!
What I meant is that each individual country can add their own charges; that the charges will probably vary from country to country or region to region.
iban
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<edit>
nichifanlema
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here we go again...
| Originally Posted by DDRRE Most of you noticed the fact that all Grado products are price-fixed - as in - if the retailer sales it at a lower price he becomes an unauthorized dealer and doesn't recieve shipments from the company. This happened once, with "Powermax" - they even wrote an article regarding this situation (They sold Grados for a really low price.. SR80 for 64$ instead of 95$ etc.) Actually, they lost their authorization because of us head-fi'ers, advertising their price - which reached Grado eventually. I find price fixing very lame, tbh. It also eliminates competition. Debate
|
here we go again...
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