Experts Business Terms

I can only speak from a furniture stand point but my guess would be it’s not much different across most retail establishments. There are three types of furniture businesses out there; the Big Chain, Big Independent and the Small Independent.

The Big Chain guy has multiple stores in multiple states, they succeed on perceived image or perceived low pricing which in many cases is an illusion. Typically if they spend a dollar on a product they sell it anywhere from 1.85-2.20. They use suggested retail pricing to compare to which is three times the cost of the product, some times four times the cost, thus if a dollar is spent suggest retail price is as much as 4.00. The Big Chains effectively use special financing to their advantage offering up to two years without interest. Often the Big Chain uses their buying power to squeeze their suppliers into cutting off the smaller stores and big independents local to them so their customers can’t price shop. The best way they protect themselves from price shopping is they get their suppliers to make certain collections exclusive to only them. Normally if you see something priced in a Big Chain Store it’s a safe bet you can find it cheaper elsewhere.

The Big Independent guy typically has multiply stores in one state or his state and a bordering state. In many cases they operate much like the Big Chain, they have enough buying power to affect the smaller guys in their area, keeping them from carrying certain collections or certain suppliers. While most of the Big Independents have the same pricing structure as well as offer attractive financing, they will at times come down to make the sale so there are certain situations where you can wheel and deal and get a lower price from the Big Independent.

The Small Independent guy normally has one store, at times two maybe three locations but most of the time he operates out of one building. There are some small independents that use the same pricing structure as the first two examples but this retailer is normally your best chance to get the lowest price. He will start his pricing at the 1.85-2.20 and come down from there, sometimes this type of retailer isn’t the most trustworthy. Because of his size he doesn’t need as many procedures and policies to guide his employees so trust your instincts and guard yourself by using a credit card when dealing with them.

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