Argos 'out of stock'

DoaM

https://www.argos.co.uk/product/403%2F9369?clickOrigin=searchbar:sku:4039369

It's an Amazon Echo Show 8 Black ... the only source supplier of these items is Amazon, and they are out of stock until May 22nd. If Amazon are out of stock then it's unlikely that they'd provide stock to their competitors prior to providing stock to themselves.

[Deleted User]

DoaM said: If Amazon are out of stock then it's unlikely that they'd provide stock to their competitors prior to providing stock to themselves.

Just because they sold out themselves does not mean they would renege on an existing order to another retailer. The distribution arm operates separately from the retail in any case.  Remember that Amazon also profits from sales to other retailers who buy in bulk. 

All of which takes us back to post #2...

DoaM

Moneyineptitude said:

DoaM said: If Amazon are out of stock then it's unlikely that they'd provide stock to their competitors prior to providing stock to themselves.

Just because they sold out themselves does not mean they would renege on an existing order to another retailer. The distribution arm operates separately from the retail in any case.  Remember that Amazon also profits from sales to other retailers who buy in bulk. 

All of which takes us back to post #2...

Which means they make far less profit than they do selling them at retail.

JReacher1

DoaM said:

Moneyineptitude said:

DoaM said: If Amazon are out of stock then it's unlikely that they'd provide stock to their competitors prior to providing stock to themselves.

Just because they sold out themselves does not mean they would renege on an existing order to another retailer. The distribution arm operates separately from the retail in any case.  Remember that Amazon also profits from sales to other retailers who buy in bulk. 

All of which takes us back to post #2...

Which means they make far less profit than they do selling them at retail.

He’s right though. The fact that Amazon don’t have any in stock doesn’t have any bearing on whether Argos would have any in stock. 

Argos will have agreed a committed stock quantity from Amazon and this is not linked to the stock amazon sell online. 

It’s also difficult to know whether they do make “far less profit” as although the per item price they receive back from Argos will be less than they sell online. It is also significantly cheaper for amazon to ship 1000 alexa’s to Argos in one shipment than it is to ship 1,000 Alexa’s in 1,000 individual orders. Therefore although I agree they will make less profit I’m not sure it’s “far less profit”. 

[Deleted User]

DoaM said:

Which means they make far less profit than they do selling them at retail.

But a guaranteed sale of umpteen items in one fell swoop, of course 

DoaM

JReacher1 said:

It’s also difficult to know whether they do make “far less profit” as although the per item price they receive back from Argos will be less than they sell online. It is also significantly cheaper for amazon to ship 1000 alexa’s to Argos in one shipment than it is to ship 1,000 Alexa’s in 1,000 individual orders. Therefore although I agree they will make less profit I’m not sure it’s “far less profit”. 

To use that same reasoning ... Amazon will also have a bulk-buy account for shipping, so the amount they pay to ship each order will be small. Although none of us can say for sure, I'd imagine that the net profit for 1000x individual sales is far larger than that of 1x batch of 1000 to Argos - remember that Argos are also out to make a profit, so the price they pay Amazon (per unit) will be much less than what a consumer pays.

To use some made-up numbers:

Retail sell = £120
Cost to Amazon = £50 (being generous - it's probably far less)
Shipping per unit = £2.50
Overheads per unit = £10
Profit = £57.50

Sell to Argos per unit = £80
Cost to Amazon = £50
Shipping (amortised per unit) = £1
Overheads per unit = £10
Profit = £19

As I said, made up numbers. But I doubt Argos are paying much more than £80 per unit to Amazon for a retail price of £120.

JReacher1

DoaM said:

JReacher1 said:

It’s also difficult to know whether they do make “far less profit” as although the per item price they receive back from Argos will be less than they sell online. It is also significantly cheaper for amazon to ship 1000 alexa’s to Argos in one shipment than it is to ship 1,000 Alexa’s in 1,000 individual orders. Therefore although I agree they will make less profit I’m not sure it’s “far less profit”. 

To use that same reasoning ... Amazon will also have a bulk-buy account for shipping, so the amount they pay to ship each order will be small. Although none of us can say for sure, I'd imagine that the net profit for 1000x individual sales is far larger than that of 1x batch of 1000 to Argos - remember that Argos are also out to make a profit, so the price they pay Amazon (per unit) will be much less than what a consumer pays.

To use some made-up numbers:

Retail sell = £120
Cost to Amazon = £50 (being generous - it's probably far less)
Shipping per unit = £2.50
Overheads per unit = £10
Profit = £57.50

Sell to Argos per unit = £80
Cost to Amazon = £50
Shipping (amortised per unit) = £1
Overheads per unit = £10
Profit = £19

As I said, made up numbers. But I doubt Argos are paying much more than £80 per unit to Amazon for a retail price of £120.

The problem is that as you say yourself these figures are made up so you don't know what the profit is for each channel.  I agree it will be better for Amazon to sell directly but I don't believe that it will be "far less profit".  I think the overhead per unit will be a lot less for Argos fulfillment than it will be for Amazon so I don't agree that these figures represent a fair reflection.  

My wife works for a similar sized retailer to Argos and we get cost price plus VAT on everything they sell.  To buy this product I only save just over £8 based on what the price on Argos is.  As a result I would expect the cost price they sell to Argos is quite high.

At the end of the day neither party would agree to this deal unless they both profited out of the arrangements,

Owain_Moneysaver

HampshireH said:

They may only have set aside an allocated amount of stock for the offer at the reduced rate.

Like 1, in Wick. :-)
The 28 day rule has been replaced by general Consumer Protection Regulations that sale pricing must not be 'misleading'. 

CPC, for example, do say explicitly in their offer sheets that they have allocated stock for promotional pricing and that when that allocation has sold the price will return to normal.

It is annoying to look at things on Argos and then find there are none in stock anywhere. The Screwfix site is similar. It would be handy to be able to put a filter on "only show in stock within xx miles" when browsing, before looking at individual items. 

"The price of the item is what someone will pay." Now, with websites being so intelligent, they can show a different price to every customer based on browsing habits. Looking for a widget around £100? "You might also be interested in" this widget at £85. Bargain! You've bought it. What you don't know is that someone else who was looking for widgets around £50 got a "you might also be interested in" the same widget from the same retailer "upselling" at £60. 

Neither customer would probably have bought the widget at its 'true' price of £70, but the retailer has two sales instead of nil, and the profit on one more than cancels the discount on the other.