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Huge mark up on kites

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Created by Gazuki Two weeks ago, 2 Mar 2019
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Gazuki
WA, 863 posts
2 Mar 2019 10:00AM
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To start Im not bothered by this just more curious.

I'm toying with upgrading my old core sections to the new nexus's. Looking on kitepowers website the new 7m nexus is 1850, compared to the section which is $1050. That's a huge difference for out of date stock. Imagine if other retailers were the same,. last years Toyota Hilux no longer 55k, down to 25k. Just show the mark up in the kite game as they're still making a profit at $1050.

Robbo2099
WA, 713 posts
2 Mar 2019 12:10PM
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Gazuki said..
To start Im not bothered by this just more curious.

I'm toying with upgrading my old core sections to the new nexus's. Looking on kitepowers website the new 7m nexus is 1850, compared to the section which is $1050. That's a huge difference for out of date stock. Imagine if other retailers were the same,. last years Toyota Hilux no longer 55k, down to 25k. Just show the mark up in the kite game as they're still making a profit at $1050.


They must be making a killing! Did anyone notice that all the people running kite shops are driving around in brand new Landcruisers and Lamborghinis, and living in the biggest houses in town?

Yeah, me neither... ;-)

Fly on da wall
VIC, 677 posts
2 Mar 2019 3:12PM
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I know a guy who got a few 3 year old kites complete with bar and line's new a lot cheaper than that...
Paid around bar price.
He seems pretty happy and just kites for fun.

Chris_M
1716 posts
2 Mar 2019 12:22PM
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Switch kites all the way!

psychojoe
WA, 430 posts
2 Mar 2019 1:07PM
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Robbo2099 said..

Gazuki said..
To start Im not bothered by this just more curious.

I'm toying with upgrading my old core sections to the new nexus's. Looking on kitepowers website the new 7m nexus is 1850, compared to the section which is $1050. That's a huge difference for out of date stock. Imagine if other retailers were the same,. last years Toyota Hilux no longer 55k, down to 25k. Just show the mark up in the kite game as they're still making a profit at $1050.



They must be making a killing! Did anyone notice that all the people running kite shops are driving around in brand new Landcruisers and Lamborghinis, and living in the biggest houses in town?

Yeah, me neither... ;-)


Bang on Robbo.
,,and a new kite shop opens up every week coz there's just not enough competition,,

Gateman
QLD, 236 posts
2 Mar 2019 3:14PM
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Chris_M said..
Switch kites all the way!


That's what the thread is about Chris: The cost of switching kites!

stoff
WA, 178 posts
2 Mar 2019 2:49PM
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Pretty sure the retail prices would be set by the distributors, not the individual kite shops. This keeps it fair among the dealer network and stops everyone just going to one shop.
Im sure shops don't have to sell them at this price, just advertise them at that price. That's why you can normally always get a bit of a discount dealing face to face.
Pretty similar to your Hilux comparison, all the dealers advertise the same price but what you end up paying can vary wildly!

MDSXR6T
WA, 970 posts
2 Mar 2019 3:25PM
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The kite itself probably only costs $100 to manufacture but they need to pay for their overheads, R&D and flying team riders all over the world, making pretty videos about driving to a kite spot etc so the price goes up. They may well be team riders for Core or Ozone or whoever else, but remember we're the ones paying for them

Old mate at the kite shop then buys the kite for about $700ex (i think) and puts 150 or 200% markup (again, it's just what i think) on it knowing full well that everyone expects a discount (this one i know, thanks Gerry!) and because he's a good bloke he'll take off a few hundred while also thinking about how many he needs to sell to pay an increasingly greedy landlord, his staff wages, his overheads etc.

Pretty much why 300ml of warm flavoured milk costs Australians twice as much as 3l of the normal stuff.

towradgi
NSW, 247 posts
2 Mar 2019 10:01PM
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Kites cost shops $700 ??? If thats the case ,there should be a consortium of kiters ,that have bulk buying power and buy kites at cost for members of it, at almost no extra cost from the factory .Oh yes there is K.A. the kiters friend, with a massive membership. This buying group can be a competitor to the kiteshops. Most guys don't care where they buy it from as long they are happy with the price.

bjw
NSW, 2652 posts
2 Mar 2019 11:40PM
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My understanding is that kite shops make about 40% profit on your kite. So when you walk in and expect a 20% discount that's halving their wage.

Oh except for they need to pay rent, wages and all expenses from that 40%, so I'm guessing they'd be lucky to take home 10%.

But as long as you get your 15% discount...

MDSXR6T
WA, 970 posts
2 Mar 2019 11:14PM
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It's almost inconceivable that the shop owners wouldn't have discounting built into their pricing or purchasing structures so i wouldn't feel too bad.

It's no different to Gumtree. If you want $100 for an item you ask $150ono and everyone feels like they get a win when you accept an offer of $100.

Adam''KiteRepair
NSW, 69 posts
3 Mar 2019 8:05AM
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MDSXR6T said..
It's almost inconceivable that the shop owners wouldn't have discounting built into their pricing or purchasing structures so i wouldn't feel too bad.

It's no different to Gumtree. If you want $100 for an item you ask $150ono and everyone feels like they get a win when you accept an offer of $100.


Kite brands set the RRP. So that's a no.

Gazuki
WA, 863 posts
3 Mar 2019 5:12AM
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All I know is that kite shops aren't doing it for love (unlike some of you think) its a job, it obviously pays a wage otherwise they wouldn't do it.

I couldn't care less about what old mate in the shop makes, I was just pointed over that there much be close to 200% margins on kites as they are selling last years stock at half the price and still making a profit.

dafish
NSW, 1321 posts
3 Mar 2019 8:33AM
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Gazuki said..
All I know is that kite shops aren't doing it for love (unlike some of you think) its a job, it obviously pays a wage otherwise they wouldn't do it.

I couldn't care less about what old mate in the shop makes, I was just pointed over that there much be close to 200% margins on kites as they are selling last years stock at half the price and still making a profit.


Sometimes it's not about profit but cash flow. Getting rid of old stock to recover some cash even at a slight loss is often more advantageous to keep up with new items and interests.

Kamikuza
QLD, 3693 posts
3 Mar 2019 8:01AM
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I've actually got a couple of brands pricing lists, including wholesaler prices.

Things no doubt have changed since they were released, but as dafish said, you might make a big loss on a couple of kites to make a little less profit over all...

AndreC
WA, 452 posts
3 Mar 2019 3:31PM
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Gazuki said..
All I know is that kite shops aren't doing it for love (unlike some of you think) its a job, it obviously pays a wage otherwise they wouldn't do it.

I couldn't care less about what old mate in the shop makes, I was just pointed over that there much be close to 200% margins on kites as they are selling last years stock at half the price and still making a profit.


The ones I know are only staying IN because they love it. What do you do for a living ???

Scrubes
VIC, 103 posts
3 Mar 2019 6:44PM
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thats why you see more smaller brands come into the market, at more reasonable prices

cauncy
WA, 6947 posts
3 Mar 2019 4:12PM
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Unless you own a buisness and operate from buisness premises and employ staff
none of you have a fark in clue what your talking about

Gazuki
WA, 863 posts
3 Mar 2019 5:35PM
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AndreC said..


Gazuki said..
All I know is that kite shops aren't doing it for love (unlike some of you think) its a job, it obviously pays a wage otherwise they wouldn't do it.

I couldn't care less about what old mate in the shop makes, I was just pointed over that there much be close to 200% margins on kites as they are selling last years stock at half the price and still making a profit.




The ones I know are only staying IN because they love it. What do you do for a living ???



Paramedic, clocked 260hrs last month. But that's what you do to pay the bills. It would be nice to do a 10-5 though

2stubborn2quit
WA, 100 posts
3 Mar 2019 6:14PM
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Gazuki said..

AndreC said..



Gazuki said..
All I know is that kite shops aren't doing it for love (unlike some of you think) its a job, it obviously pays a wage otherwise they wouldn't do it.

I couldn't care less about what old mate in the shop makes, I was just pointed over that there much be close to 200% margins on kites as they are selling last years stock at half the price and still making a profit.





The ones I know are only staying IN because they love it. What do you do for a living ???




Paramedic, clocked 260hrs last month. But that's what you do to pay the bills. It would be nice to do a 10-5 though


Ooops AndreC that one back fired. Paramedics do an awesome job, in, at times the most trying conditions. Especially treating our loser drug taking comrades. There is an old saying when cross examining or playing the bush lawyer. Don't ask a question unless you already know the answer.

Gazuki
WA, 863 posts
3 Mar 2019 7:01PM
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All good,.. as originally stated though, I don't have an issue with the shops etc,. Just found it interesting and thought I would share my findings.

crakas
QLD, 404 posts
3 Mar 2019 9:22PM
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No huge mark ups.. I'm not sure what the current margins are but I reckon they would be 50-70%. Most probably closer to the 50%. On those margins if you got a 30% discount you are getting pretty close to cost price.

You our have to sell a few kites each week at full retail just to pay the rent, then you have all the other cost associated with a shop front.

As for superseded gear, better to move it at cost to free up capital, because the longer it sits there the less it is worth.

I'd love to have a kite shop, but I reckon my family would go hungry..

jamesperth
WA, 538 posts
3 Mar 2019 8:47PM
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I had an online kite shop for 3-4 years and had a giggle reading the above comments. I can promise you that shops selling kites at 50% discount to new are not making a profit :)

It's a bloody tough way to make a living. I was fortunate in that I had a full time job and this was a hobby business on the side. I never made a dollar of net profit after 3 years - with minimal overheads. Public liability insurance (as an inporter, not reseller) was by far my biggest expense.

I learned a lot and and these days when I buy new, I never ask for a discount as I want my local kite shop to stick around.

God forbid if we end up with 1big online store with no physical presence we all lose.

Buy local and don't screw your shop. You probably earn more than they do.

Gazuki
WA, 863 posts
4 Mar 2019 9:18AM
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cauncy said..
Unless you own a buisness and operate from buisness premises and employ staff
none of you have a fark in clue what your talking about


So if owning a business is so hard and pays so poorly, why do it?

Ozone Kites Aus
NSW, 728 posts
Site Sponsor
4 Mar 2019 12:45PM
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Gazuki said..

cauncy said..
Unless you own a buisness and operate from buisness premises and employ staff
none of you have a fark in clue what your talking about



So if owning a business is so hard and pays so poorly, why do it?


Probably the same reasons you like being a paramedic, despite you seeing some fairly horrific mangled humans, witnessing many avoidable incidents, copping abuse from shocked and disoriented patients, etc, etc.

In my own case I went from chasing $$ and posessions by taking time out, going bust, and then staying very determined to find something I loved to do, then learned to do it very well, and found that people would pay me to keep doing what I loved to do. Does that sound like you and your paramedical career?
BTW I own Kitepower and I can tell you that Section 1 is being sold below cost, its a few seasons old now and we just have to make older models attractive to bargain hunters, get some capital back and invest those funds in new stock that we can try to make some $$ on.

MDSXR6T
WA, 970 posts
4 Mar 2019 10:02AM
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Many people just want to buy a job or lifestyle and think they'll get rich.

It all sounds great until you're 2 years into a 5 year, $35k p/a lease with very few people walking through the door buying your product or service. That's before you even worry about cash flow, employee wages, an online shop and advertising, money owed to suppliers, instructors ruining your reputation, learners breaking or loosing ****, seasonal activity, power, outgoings etc. Ohh and don't forget about the 200k from the bank you initially borrowed to fund this great idea.

I still don't think a 9 or 10m kite is $1450 wholesale. It wouldn't be profitable unless your selling hundreds of kites, bars and boards a year and again i might be wrong but i don't think a kite shop is.

cauncy
WA, 6947 posts
4 Mar 2019 1:50PM
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Gazuki said..

cauncy said..
Unless you own a buisness and operate from buisness premises and employ staff
none of you have a fark in clue what your talking about



So if owning a business is so hard and pays so poorly, why do it?


Any buisness self employed imho is hard yakka, it never stops, when we close its home to do orders preparation , bookwork rosters, pay gst bas super,
good question why the fark do I do it
Tbh I often think back to what I was doing and where I lived
and applied my trade,
I'm better off here by a long way but not financially
Check my office out




MDSXR6T
WA, 970 posts
4 Mar 2019 4:07PM
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Happy2kite said..
So to stop all this surmising and guessing.

Turn's out i was pretty close to the mark on a 9 or 10m pivot

Gazuki
WA, 863 posts
4 Mar 2019 4:58PM
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Soo what your all telling me is those Core Sections for 1k are very good value, thank you (sheesss, finally)

jonnydiesel
WA, 38 posts
4 Mar 2019 8:12PM
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How does someone get 5 seasons, let alone 2 out of a kite.
Mine are flogged out, just ask my Kite repairs, Kit Fix WA & The Sail Doctor, at the end of one season, lines & bar.
While i only wash my gear every 2 or 3 sessions, it is kept in as good a condition as i possibly can,
Gee the poor, kite shop owner, is being flogged, for making a profit , when he can. this sport is cheap.
Try racing motorX or enduros for a season and you'd be hard pressed to getaway with with change from $20000 and Motor Cycle shops have very poor margins, i know as i was a wholesale rep for 12 years, they are battlers.
Beats me, why people complain about someone else making money,
How would you like it if your employers said,
we have to cut your wages, cause you are not making enough money, for us, the employer, so we need to discount your wages ?
You would be spewing.
if the kite shops do not survive, then we have no kites to play with, good luck to those who are making money, even if its my money.
As James has said, he's been there and offered great service and pricing, it hard to make a buck.
It is the cheapest fun, you can have for your buck. great value i think and am pleased to support all the local WA guys.
Hats off, to Tom at Exmouth Surf Centre, Sonya & Jason At West Oz/WASurf, Darren and crew At Action Sports, Reg, and Daniel at Kite Addiction and John at SOS, guys hope you are doing well, thanks for your support , cause Im having fun . '

ExSurfCentre
WA, 404 posts
4 Mar 2019 10:47PM
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jonnydiesel said..
How does someone get 5 seasons, let alone 2 out of a kite.
Mine are flogged out, just ask my Kite repairs, Kit Fix WA & The Sail Doctor, at the end of one season, lines & bar.
While i only wash my gear every 2 or 3 sessions, it is kept in as good a condition as i possibly can,
Gee the poor, kite shop owner, is being flogged, for making a profit , when he can. this sport is cheap.
Try racing motorX or enduros for a season and you'd be hard pressed to getaway with with change from $20000 and Motor Cycle shops have very poor margins, i know as i was a wholesale rep for 12 years, they are battlers.
Beats me, why people complain about someone else making money,
How would you like it if your employers said,
we have to cut your wages, cause you are not making enough money, for us, the employer, so we need to discount your wages ?
You would be spewing.
if the kite shops do not survive, then we have no kites to play with, good luck to those who are making money, even if its my money.
As James has said, he's been there and offered great service and pricing, it hard to make a buck.
It is the cheapest fun, you can have for your buck. great value i think and am pleased to support all the local WA guys.
Hats off, to Tom at Exmouth Surf Centre, Sonya & Jason At West Oz/WASurf, Darren and crew At Action Sports, Reg, and Daniel at Kite Addiction and John at SOS, guys hope you are doing well, thanks for your support , cause Im having fun . '


Hats off to you sir for your support... I'm personally in the game to fuel an addiction to watersports In the process I make a decent enough wage and have a **** ton of good times along the way



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"Huge mark up on kites" started by Gazuki