Example 1: Sigma DP2 has been recently released in small quantity with high demand. Amazon and B&H are sold out at $649.99. 47th St. Photo is selling them on Amazon for an 8% markup ($699.99). Thus if you want one badly enough to pay the premium, you can get one now or simply wait for greater availability at the "normal" street price.
Example 2: Nikon AF-S 35mm f/1.8 has been out for a while now, but no one can keep them in stock for more than a few minutes at the normal price of $199.99. No one can keep them in stock for more than a few hours at a 10-20% markup price. If you're really desperate, Tristate Cameras will sell you a gray market model at 25% markup without a warranty or a US model at a full 50% premium ($299.99 plus shipping).
Example 3: Pavilion Electronics has the black Panasonic LX3 in stock (additional 2-3 day processing time) and is selling on Amazon for only $749.99. Measly 75% markup. Just $50 (plus shipping) more than a black D-LUX 4.
The term frequently applied here is "price gouging", which implies mistreatment of customers. Is this poor behavior from the retailer or just a reasonable business practice when dealing with in-demand items? From a business standpoint, it makes sense to maximize profits unless doing so is going to impact customer loyalty. From a consumer standpoint, would you rather see "Not in Stock" everywhere or have the option to buy at a premium?
Raising Prices in Response to Limited Supply: Price Gouging or Good Business?
Thursday, May 14, 2009
Posted by Amin Labels: DP2, price gouging
Raising Prices in Response to Limited Supply: Price Gouging or Good Business?
2009-05-14T10:59:00-05:00
Amin
DP2|price gouging|
Subscribe to:
Post Comments (Atom)
Recent Posts
-
▼
2009
(119)
-
▼
May
(11)
- Overlooked Serious Compacts
- Compact DSLRs Just Got More Serious
- Slightly OT: Nikon AF-S 35mm f/1.8 Compared to AF ...
- Raising Prices in Response to Limited Supply: Pric...
- June 15th
- A Note About Pre-Ordering from Amazon
- First Part of Ongoing DP2 Review Posted at Lensist
- More Olympus Micro Four Thirds Teasers
- Serious Compacts Hall of Fame
- First Sigma DP2 Batch Shipped from Amazon
- Teaser Tweets Touting Olympus Micro Four Thirds
-
▼
May
(11)