We obviously speak to a lot of clients, existing and potential, during the course of our working week. There are two common competitors that we regularly analyse against as part of our 'Purchasing Health Checks', and we consistently find some quite horrific pricing and trading policies!
Our friends at Lyreco stand out ......... First of all we regularly find that they quote prices that are way below the cost price of even manufacturing the items! Why is that we wonder?
Well.... it's plain to see that these items are very regularly used items that people will be buying regularly - the kind of items that they will know the prices of! The methodology is that by selling these very regularly used items as 'loss leaders'they will attract business. All we ask is that people sit back and think about it....... Why would you sell items at or below the cost price?
Well we regularly find the reasons why!
Perhaps its because it hides the fact that their RRP's ( i.e. products that attract a standard across the board discount are consistently well above manufacturers recommended prices ! Just recently we have had access to an analysis of 800 Lyreco items to compare the retails to our own...... and we found........ buying one of everything at harrisongreen retails cost £21819. Buying the same quantity at Lyreco retails cost £31091..... a big difference really! So in other words a customer receiving a 30% discount may be paying more than we would charge BEFORE discount!
An example of this recently was where a client was tempted away by a saving of 25p a ream on their copier paper....... however....... a Hewlett Packard toner cartridge they regularly buy was priced at £133, against our price of £71.50. Or put another way..... unless thet bought more than 246 reams of copier paper, the purchase of just one of those HP cartridges would mean they spent more!
This approach to pricing is what we call smoke and mirrors! Its just an illusion!
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