Group buys = pissed off people??? Options

[Mueller]

It has been brought to my attention that a few people (Direct customers as well as shops-[still a customer]) have taken notice of the group buy that Aaron has put together in order to purchase items directly from Tarett Engineering.

Originally the group buy was for swaybars, then monoballs and next thing we know, NBK's (Needle Bearing Kit's).
From what I read, Ira (owner of Tarett) agreed to offer a pretty good discount on his parts that he himself designed and has manufactured (swaybars and monoballs), this is fine, the problem that has now been created is that pricing for the NBK's has been reduced by 10% per set.

The retail price of the bearings is set at $400.00, there is room in order for the reseller to make a few dollars from selling to the following:
A)a shop that will resell and possibly do the install
B)to a customer directly

Obviously for "A", Ira would have to offer a discount to the shop in order for the shop to make a few dollars off of the sale to his customer. From how I read the group buy thread, Ira has been misinformed on who his "customer" is. If I am correct, a shop is buying all of these parts under the false pretense that they will markup and resell at "retail" pricing.

Now I could be wrong and all that is happening is that Ira has decided to sell the NBK's at a very deep discount since he is making up the difference by selling his "own products" which should yield a much higher profit margin. This is beyond my control.

I know everyone wants a discount, but it's just not going to happen all the time.

So why the pissed off people?

It's due to customers asking why did they have to purchase the NBK's for $400???

Why? In order to justify my time and expense, this "has" to be the price. In order for Ira or Brad to recommend and sell this product, this "has" to be the price, Ira and Brad (and others) have to make some money selling these or it would be a waste of their time and effort. I can raise my price, but I’d rather not. (I am currently $95 per set lower than the competition)

Now I've got to do some serious thinking, it just might be easier to:
1) Sell my remaining stock of parts and give up
2) Sell my prints and supplier list and let someone else deal with it

"1)" would be too easy
"2)" would piss me off if the product caught on fire and was being sold by Performance or some other catalog (IMG:style_emoticons/default/smile.gif)

[airsix]

Mueller,
Life is too short to let a few whiners spoil your mood. You put a lot of time and effort into designing a product. You spent a lot of time and effort sourcing matterials. You spent a lot of time tooling up and building prototypes. You spent a lot of time and effort establishing a supply chain, partnering with a retailer, promoting your product, and doing PR. It is reasonable to expect that early addopters will absorb more of the development costs than those who come later. It is also very reasonable to accept that you may choose to charge less per-unit for large orders due to ecomomies of scale.

Life is too short for you to waste time feeling bad because you catch some flak from "people who don't get it". Ignore them. They don't get it and you don't have time to educate them. For anyone out there who's peeved because they paid $40 more than the group-buy crowd: Think about how many hundreds of hours Mike has put into this project, the cost of matterials, and the cost of machinery. If he sells 5,000 sets of bearings he'll probably only have made $7/hr for all his time. What do you charge for your time? My biggest peeve is people with no respect for other people's time. They want you to put in the time and effort and get pissy when you set the price. If they don't like the price let them put in the time and effort themselves!

Rant over.

-Ben M.