Sunday, October 28, 2007

I recently had a conversation with a friend about surfboard prices. Actually the two of us have had these conversations a few times now. Since I’m looking at new local representation, pricing has been on my mind.

In the early days of the surfboard industry… this would be when boards started being made with foam and fiberglass… the guys that made boards dealt directly with their customers. Eventually a handful of guys, mainly in California, had full fledged businesses. These businesses did everything in house. With the exception of blowing foam the process of building boards was done start to finish at one location and this even included a sales room or store front. That’s what we call factory direct now.

Because surfboards were factory direct the finished boards were never given a traditional retail markup. That factory direct price became what the market would bare for the retail price of the surfboard. Then as the various board builders began distributing surfboards beyond their own stores the retail price remained at the factory direct price. That’s what everyone was accustomed to. Consequently the surf shops that sold boards they did not make could not work a normal retail price for the surfboards they sold and had a difficult if not impossible task of making any kind of margin via surfboard sales.

That price dilemma remains today, except for boards that are made overseas. Because the cost of making surfboards in a country like China is so much less than domestic costs the imported boards can and do have a more inline retail mark up. That’s a good thing for the retailer, finally being able to see a decent margin in their surfboard sales.

The domestic builder now being faced with inexpensive imported surfboards and the retailers turning to these boards because of the margins has to show the value of the hand made, domestically made surfboard. With unsurpassed craftsmanship and staying on the cutting edge of design and performance. Offering what can not be made over seas.

D.R.

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