# A consumer's opinion...



## fishygirl (Oct 31, 2011)

As a fish consumer, I must say I disagree with the opinion stated by Grant in his recent thread. This is by no means a criticism but I thought I'd voice my two cents on what he said here.



> Lowballing product is one thing but when a store decides to lowball livestock, it does not generally end well. I have always been surprised at the BC market and it's instability of pricing. The larger the store in general, the more effort goes into the care of the animals simply because there is more at stake for one reason. That is not to say smaller stores don't put in the effort but overhead is a factor.


I believe that the size of a store does not have anything to do with the amount of care put into fish. It is more dependent on the interests of the owner and the store. It is true that higher overhead costs may encourage larger companies to try minimize losses by taking better care of their fishes but that is not always the case. Take PetCetera for example. They had huge stores with a high amount of overhead and obviously had a lot to lose (and they did lose it). However, they are a large corporation that cared more about high margins and hired employees that lack basic knowledge to take care of their aquariums and could care less about putting an effort to care for the fish. I would often find their inventory diseased or dead, that was a main problem for Petcetera. My point is I think your argument is *biased*. It is hard to argue that overhead costs determine the amount of care put into fish . Sure, some larger stores will put care into their fish but so do smaller stores (correlation does not equal causation). Contrary to your argument, actually, I find many start-up hobbyists particularly on this forum have an emphasis on the amount of care they put into their fish. Ultimately a lower overhead for the seller does not set into stone the amount of care.



> Wholesalers or retailers that devote themselves to being the cheapest, generally don't make profit unless they cut their overhead to bare minimum, in doing so how do they care for their livestock?


That may be true but obviously in the long-term, this is not sustainable practice. In addition to my point above, isn't it important to remember that consumers have CHOICE. If there is a lack of care for the fish because of a lowered overhead, the fish an "amateur" consumer buys may often be diseased/lower quality etc. Sure, the consumer will fall for it once or twice but he will eventually realize that he is getting a crappy deal buying unsustainable lower quality fish. S/he will not return to the same retailer. With no returning customers, those wholesalers/retailers will need to take better care or will eventually go out of business. Then consider the more educated consumers (aka the people on this forum) that choose not to buy from them in the first place because of the lack of care they evidently see.



> With online sales and massive competition, price is the focus. Lately I have seen a few wholesalers putting more emphasis into quality but in these times it is an uphill battle. Unfortunately to many, a fish is still a fish. Does not seem to matter the condition or the health of the fish... Price first, quality second. The European market is the exact opposite of this. Several factors have helped, one being that import laws are very strict, thus weeding out those who think there is an opportunity for a quick buck to be made in their basement. Secondly stores as a whole are actually geared towards making a profit


I'm sorry that competition has been tough for retailers but it's been a sweet ride for us consumers. Again massive competition and the internet gives the consumer a *freedom of choice*. As anyone that studied economics 101 will say, competition benefits the consumer by lowering prices. Rather than having one or two large corporations monopolize the market (and jack up the price of the fish), we now get a choice to buy from a myriad of different sellers. Those that previously monopolized the market obviously won't be happy about this as their profits are significantly cut.

It is important to remember that consumers ultimately drive demand (and this trickles down from the retailer to the wholesaler). Sellers may wish to base the market on price but it cannot be forced on to the consumers and they don't have power to dictate the market. We know that there is a trade off between quality and price. There's a consensus that when we're paying a lower price, we're usually getting something of lower quality. If we find fish that is equal quality between two retailers but one is higher priced than the other, why in the right mind would we buy from the higher priced one? If no consumer wanted cheaper fish, no retailer would import them. Perhaps what you need to do to benefit your argument is to educate the consumer so that they demand higher quality fish rather than putting the blame on your competition. The reality is consumers wants a balance between price and quality.

If prices lower because of increased competition, that is not because we are buying poorer quality-- it is simply because the previously monopolistic corporation were pricing them higher than they are worth. Consumers and fish enthusiasts on this forum are to gain from the dropped prices. Enthusiasts that previously could not afford to buy the beautiful fish now have alternative choices. We get more people interested in aquariums to benefit the whole industry.

Just a perspective from a consumer's POV and not intended to offend...your post just seemed a little biased. I just wanted to share my thoughts with everyone. Cheers!


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## hlee72ca (Jun 29, 2010)

Wow, it seem like everyone is in the essay writing mood. You have some valid points. Economics points out when there is an industry that is earning excess profits, there will be growth in that industry, there will be people rushing in to cash in. However, if the free market system is working properly, ie. there are no barriers to entry into the industry, this excess profits will be eaten up over time as there will be too many companies in the same industry chasing the same piece of the pie(competition). Then there is the phase where the industry, is now earning below market returns for the risk being taken. This will result in a consolidation, companies closing as they cannot earn enough profits to justify the risk being taken. So the weaken get shaken off.
Then the next phase is were there are just enough companies around , earning just enough profit vs risk be taken. Remember when pizza was big, when there we too many pizza place around, competition forced them to offer 2 for 1 then 3 for 1 deals. Remember when coffee shops were opening everywhere, now the franchise fees are ridiculous that buying one is not warranted. Dollar stores, construction companies cashing in on the olympics, etc. Unfortunately, there are only so many aquarists around and they are not growing by leaps and bounds, thus the amount of fish stores and the amount of profits will be marginal( off course there are exceptions, the industry leaders will always make a better profit then the average). There my essay is complete, bet you can't finish reading it without yawning.


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## jobber (May 14, 2010)

Both great essays and a wonderfully thought out rebuttal. Well thought out and glad to read both.


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## Rastapus (Apr 21, 2010)

fishygirl said:


> As a fish consumer, I must say I disagree with the opinion stated by Grant in his recent thread. This is by no means a criticism but I thought I'd voice my two cents on what he said here.
> 
> I believe that the size of a store does not have anything to do with the amount of care put into fish. It is more dependent on the interests of the owner and the store. It is true that higher overhead costs may encourage larger companies to try minimize losses by taking better care of their fishes but that is not always the case. Take PetCetera for example. They had huge stores with a high amount of overhead and obviously had a lot to lose (and they did lose it). However, they are a large corporation that cared more about high margins and hired employees that lack basic knowledge to take care of their aquariums and could care less about putting an effort to care for the fish. I would often find their inventory diseased or dead, that was a main problem for Petcetera. My point is I think your argument is *biased*. It is hard to argue that overhead costs determine the amount of care put into fish . Sure, some larger stores will put care into their fish but so do smaller stores (correlation does not equal causation). Contrary to your argument, actually, I find many start-up hobbyists particularly on this forum have an emphasis on the amount of care they put into their fish. Ultimately a lower overhead for the seller does not set into stone the amount of care.
> 
> ...


My point regarding size of store and how they care for their animals was a general statement, that's why I put "in general". I also mentioned that I was not saying smaller stores did not care for their livestock. I was explaining that when overhead is cut to be able to compete it is bound to affect the health of the fish in said store. My comments are coming from 20 years of observation in BC. Again, my post is about the industry in BC and the effects that lowballing are having on the industry.

Your comments regarding competition I completely agree with, the problem is you don't have a myriad of choices as stated, the number of stores in BC is incredibly low compared to other cities. This is largely because of the lowballing here. My comment regarding competition was actually referring to my wholesale comments overseas.

Honestly I don't expect hobbyists to pay more, thats not what the post was about. I was linking weak market with price slashing affecting quality and inevitably choice. This is an issue with the retailer, not the consumer. Of course competition is a good thing, but not to the point that it damages an industry or abuses price point to where you cant find the product anymore.

I enjoyed the read, love a good debate.


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## SeaHorse_Fanatic (Apr 22, 2010)

Good to see everyone able to debate in an informed and friendly matter. This does not happen in every forum and its something I'm glad to see that BCA members are doing. Respectful disagreement without personal attacks makes for interesting debates and "essays"


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## teija (Sep 30, 2010)

This is a great discussion! 

Having been to fish stores in the UK and here, I would have to say it is much the same. Their "big box" store sold me many unhealthy fish over the year or two I tried to keep fish... I had better luck with the local garden centre - which had a GORGEOUS fish area and all of the nice tanks for sale to oogle and dream about.

Over here, I think we DO have a fairly decent amount of choice IMO (again, comparing to where I lived in the UK)... IPU, Canadian Aquatics, Rogers, J&L, Aquariums West, Pets Beautiful, etc, etc and if you want to venture to the slightly more big-box stores, PJ's Pets (good selection of tanks and accessories; never bought livestock there). I have noticed that what remains of the "smaller" stores generally take better care of their stock, and have employees who actually know their fish facts. It is refreshing to see, and much better than back in the days of getting goldfish from Zellers or K-Mart 

I love to see a good debate - with solid facts from both sides, and no name-slinging! Keep it up folks!


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## Elle (Oct 25, 2010)

As a consumer, I'd personally rather pay a bit more for healthy, higher quality fish. Which for me usually rules out Petsmart etc. Obviously there are lots of factors at play here, including market saturation, consumer education and demand, import/shipping rules etc., not to mention what people can afford and are willing to pay. 

Interesting topic!


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## April (Apr 21, 2010)

Good debate. I think when small stores are struggling..then. Shop owners get discouraged and in turn lose interest..then things go downhill.you can almost see things slide and stock get lower and lower till the end. It's a circle. You discount fish and supplies to generate money...then great..your stock is blown out at a big sale...now empty tanks or shelves then you need to restock. If you don't have stock then people start going elsewhere and eventually the owners demise and apathy.
I saw it with an old guy who owned a hardware store . Actually the building I took over.  
So as grant said your cutting prices and everyone comes running to take advantage...but it could be short lived for that store.
Maybe due to no stock they then need to grab what the,y can at low prices or quality and your acceptance level changes as to what's good enough. Fish are a business but they need to be cared for as respecting a living thing and not only a commodity .
My store is very tiny . Only a few tanks but the fish I have I treat like my personal fish and enjoy them as mine until they sell.

---
I am here: http://maps.google.com/maps?ll=49.204362,-123.132854


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## Koi Kichi (Oct 23, 2010)

Interesting points made from both sides. Love a heated debate. Anyone who has been to my facility will tell you that although it isn't big, I do spend a lot time caring for the well being for my stock as it they were my own pets(well they are in a way, at least temporarily)(I even have a 24 hour streaming camera on all of my stock and I check it sometimes into the wee hours of the night.), as well as the well-being of fish that have gone to my customers. (Yes I do harass them.) Ultimately this is a question of business ethics and must not be used as a gross generalization of any store, big chain or small start up. Such cases must be treated as individual cases as it is up to the owners/workers of the establishment.


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## fishygirl (Oct 31, 2011)

I'm glad that everyone enjoyed the debate and I'm glad that I brought up a topic that was thought provoking. Everyone has contributed some insightful opinions. Here is more to think about (based on the reply I read from Grant) 



Rastapus said:


> Competition is healthy if it is fair competition. One example would be selling a product at or near cost. Many manufacturers have MAP pricing, minimum advertised pricing. This was first introduced in the US and was a very good idea. A great example of this is Apple products. There is very little price difference if you are shopping for Apple products simply because the company recognized that if their product was lowballed enough, it would actually hurt the brand. An aquatic example would be IO salt, this salt is being sold at or near cost around BC. This is an abusive practice because it eliminates other lines of marine salt from coming into the market. Also what will happen is no one will want to carry that product, why would a business owner want to kill a line that people need anyways. Loss leaders have their place but when you use an essential product as a loss leader, well, its dumb IMO. In this example, it will be harder and harder to find IO given enough time, thus killing the line. If MAP pricing was enforced on this item it protects the item from being wiped out of the market. If you owned a LFS, would you carry something and promote it and make nothing or almost nothing? Nothing does not pay the bills. No one gets into business to lose money, at least no one I know.
> To answer your question regarding the Korallia, same thing, someone makes the decision to make substantially less on Korallia, possibly to the point that it falls under the category of the IO and before you know it, becomes difficult to find. Hagen recognized this and now, everyone basically pays the same and service is the most important aspect to selling their product. In my opinion, the way it should be. It's like the saying goes, you have to leave something on the table when negotiating. Some of these products don't have anything left. On a personal note, doing this with livestock is disgusting, particularly when someone like myself is on the front line of protecting the ethics and sustainability in wild harvest. Many South Pacific countries collecting has been shut down, largely due to exporting mass volumes and ignoring the sustainability of such product, in essence overfishing to meet demand due to low prices.


To address the comparison you draw on IO Salt, it is priced that way because it is "priced right" so to speak. The argument that salt would no longer be available is hard pressed. If it is harder to find IO, a smart retailer would take the opportunity to sell the salt for a higher price (more profit for them) as demand by buyers is the same. Because the product is harder to find now, these buyers would be willing to pay the higher price to get their hands on it. More retailers would try to take advantage of this until there is no longer a shortage and prices would eventually have to go down to reach an "equilibrium" such that they are priced appropriately. Hence, we still find IO for sale despite the slimmer profits.

This does not necessarily limit other brands of marine salt being sold. Marine salt is what it is regardless of the brand. Another brand is priced too high and consumers can easily substitute it with the cheaper IO salt. If the other brands had a unique proposition / better attributes and is being sold for more on the other hand, I don't see how the IO salt can limit its sales. More likely than not, it is the same thing being sold-hence consumers go to the cheapest option.

As for the example you give about Apple and Hagen, a lot of times they are being sold as a premium because of the branding. People are willing to pay more because the branding itself is worth something to the consumer. The market still has alternatives of products for consumers to choose from. There are smart phones that are "cheaper" alternatives to the IPhone, for example. There isn't branding associated with fish itself so premium pricing shouldn't be involved here..

I agree that overfishing and lack of knowledge for sustainability is terrible. There is a bigger problem here though, perhaps education and regulation is what the industry needs rather than relying on competition to "jack up" their prices as well to sustain the industry. It is not a monopolistic industry so it is hard for one company to judge and determine what price would help long term sustainability for the industry. Limiting export supplies would have to be up to the government but many of these countries care more about making money then sustaining the fish -- sad truth that we must deal with (as I've learned from one of Oliver Lucanus' presentation). Consumers demand the fish and we can't eliminate this issue by simply charging higher for the fishes. _Sometimes I think it's ironic that fish collectors are all for protecting sustainability but perhaps contribute to shutting down the industry by catching fish. Something to think about for all of us..._



> My point regarding size of store and how they care for their animals was a general statement, that's why I put "in general". I also mentioned that I was not saying smaller stores did not care for their livestock. I was explaining that when overhead is cut to be able to compete it is bound to affect the health of the fish in said store. My comments are coming from 20 years of observation in BC. Again, my post is about the industry in BC and the effects that lowballing are having on the industry.
> 
> Your comments regarding competition I completely agree with, the problem is you don't have a myriad of choices as stated, the number of stores in BC is incredibly low compared to other cities. This is largely because of the lowballing here. My comment regarding competition was actually referring to my wholesale comments overseas.
> 
> Honestly I don't expect hobbyists to pay more, thats not what the post was about. I was linking weak market with price slashing affecting quality and inevitably choice. This is an issue with the retailer, not the consumer. Of course competition is a good thing, but not to the point that it damages an industry or abuses price point to where you cant find the product anymore.


Overgeneralizing about the size of the store and the amount of care can be misleading. Again, reiterating my point above - correlation does not equal causation. Yes, some "lowballers" may lower overhead resulting in less care. It is important to remember, however, that some of these smaller retailers "undercutting" others have lower overheads (ie: they pay less rent, hire less people, etc) and can sell for less in the first place. It's unfair to say that the lower margins necessarily result in lower profits and that they will need to consequently cut overhead. Like April and Koi Kichi mentioned, it's more of a business ethics issue whether they treat their fish the way it should be treated.

"Lowballers" will quickly go out of business if the profits are unsustainable. Perhaps, they may import lower quality fish and sell for a lower price--but these would be aimed at a different segment of customers. Otherwise it may just be the same quality fish but cheaper--probably not an appealing phenomenon for people originally pricing their fish with high margins. It's misleading to say lowballing is a large factor for the "lack of" competition (although "Teija" did mention there are quite a few stores here in Vancouver compared to say 10 years back).

Wow, that was a much longer post than I intended. Like I said, I hope I provide another perspective for everyone! On a side note, Happy Halloween!


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## big_bubba_B (Apr 25, 2010)

so your saying people that buy fish raise them. have them bread for them and sell them at a fraction of what stores do is a bad thing ????


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## budahrox (Apr 21, 2010)

...........................


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## Rastapus (Apr 21, 2010)

fishygirl said:


> I'm glad that everyone enjoyed the debate and I'm glad that I brought up a topic that was thought provoking. Everyone has contributed some insightful opinions. Here is more to think about (based on the reply I read from Grant)
> 
> To address the comparison you draw on IO Salt, it is priced that way because it is "priced right" so to speak. The argument that salt would no longer be available is hard pressed. If it is harder to find IO, a smart retailer would take the opportunity to sell the salt for a higher price (more profit for them) as demand by buyers is the same. Because the product is harder to find now, these buyers would be willing to pay the higher price to get their hands on it. More retailers would try to take advantage of this until there is no longer a shortage and prices would eventually have to go down to reach an "equilibrium" such that they are priced appropriately. Hence, we still find IO for sale despite the slimmer profits.


First off, I did not say salt would no longer be available. I stated that IO will be harder and harder to find and the popularity would drop due to the fact that stores will not carry it at that price point. Proof is in the pudding, very few retailers carry it now already. It is not "priced right" it is abused. Buyers will not be willing to pay a higher price for the product, they will generally demand a lower price when they find it. High quality salts are available but are a hard sale because of the IO problem. Same can be said of the Filstar, its day will come as well, again due to the pricing. Believe it or not, sell a product too cheap for too long and soon you cant find it anymore. Magnum anyone?



fishygirl said:


> This does not necessarily limit other brands of marine salt being sold. Marine salt is what it is regardless of the brand. Another brand is priced too high and consumers can easily substitute it with the cheaper IO salt. If the other brands had a unique proposition / better attributes and is being sold for more on the other hand, I don't see how the IO salt can limit its sales. More likely than not, it is the same thing being sold-hence consumers go to the cheapest option.


If you devalue a product long enough, similar products follow suit or prove impossible to sell. There were a few very high quality salts that hit the market a few years back, they did not sell, likely due to this. The gap between the pricing was too large and the manufacturer in an attempt to protect the product likely had a minimum price on that product. Globally those salts are popular, not so much here.



fishygirl said:


> As for the example you give about Apple and Hagen, a lot of times they are being sold as a premium because of the branding. People are willing to pay more because the branding itself is worth something to the consumer. The market still has alternatives of products for consumers to choose from. There are smart phones that are "cheaper" alternatives to the IPhone, for example. There isn't branding associated with fish itself so premium pricing shouldn't be involved here..


Actually Hagen products are not sold at a premium generally, they are just no longer "given away". As I said Hagen has done a great job to control what was way out of control. As far as branding goes, I would say there is more emphasis on branding with other lines then Hagen. With Apple, yes, their advertising, look, etc. has helped to make them what they are but I believe if Apple was dirt cheap, it would not be as popular. It has been portrayed from the beginning as a unique product, of course that can be said for a lot of aquarium products claiming to be the next best filter, heater, etc.



fishygirl said:


> I agree that overfishing and lack of knowledge for sustainability is terrible. There is a bigger problem here though, perhaps education and regulation is what the industry needs rather than relying on competition to "jack up" their prices as well to sustain the industry. It is not a monopolistic industry so it is hard for one company to judge and determine what price would help long term sustainability for the industry. Limiting export supplies would have to be up to the government but many of these countries care more about making money then sustaining the fish -- sad truth that we must deal with (as I've learned from one of Oliver Lucanus' presentation). Consumers demand the fish and we can't eliminate this issue by simply charging higher for the fishes. _Sometimes I think it's ironic that fish collectors are all for protecting sustainability but perhaps contribute to shutting down the industry by catching fish. Something to think about for all of us..._


"Jacking up prices" was not my suggestion. My comments reflected what happens when livestock is sold at a very lean price and again, how it can affect the sales of that fish in the future. My Yellow Tang and Flame Angel examples explain this. I never suggested that Flame Angels should be "jacked up", rather not given away at a few dollars profit when supply is limited. Emphasis here seems to be put onto selling things very expensive, I never said that, rather selling items at a reasonable price versus selling them at a 5% margin or less. Again, this argument is really for the retailer to consider, not the hobbyist. What hobbyist is going to complain about paying less? My point was how pricing can affect availability and how with livestock it is even more serious due to environmental pressure and stock availability.



fishygirl said:


> Overgeneralizing about the size of the store and the amount of care can be misleading. Again, reiterating my point above - correlation does not equal causation. Yes, some "lowballers" may lower overhead resulting in less care. It is important to remember, however, that some of these smaller retailers "undercutting" others have lower overheads (ie: they pay less rent, hire less people, etc) and can sell for less in the first place. It's unfair to say that the lower margins necessarily result in lower profits and that they will need to consequently cut overhead. Like April and Koi Kichi mentioned, it's more of a business ethics issue whether they treat their fish the way it should be treated.
> 
> "Lowballers" will quickly go out of business if the profits are unsustainable. Perhaps, they may import lower quality fish and sell for a lower price--but these would be aimed at a different segment of customers. Otherwise it may just be the same quality fish but cheaper--probably not an appealing phenomenon for people originally pricing their fish with high margins. It's misleading to say lowballing is a large factor for the "lack of" competition (although "Teija" did mention there are quite a few stores here in Vancouver compared to say 10 years back).





fishygirl said:


> It was a general statement, not directed at everyone AND I stated that this was not to say that all smaller stores don't look after their livestock. Looks like a focus here on a few words and not the entire statement. Some stores use livestock to bring people in and their main focus is pet product. To bring back the comments made regarding Petcetera previously, IMO they fit into that category.
> 
> Wow, that was a much longer post than I intended. Like I said, I hope I provide another perspective for everyone! On a side note, Happy Halloween!


Agreed! Happy Halloween!


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## Rastapus (Apr 21, 2010)

big_bubba_B said:


> so your saying people that buy fish raise them. have them bread for them and sell them at a fraction of what stores do is a bad thing ????


With the example of the Petricola catfish where this thread began, if there is not a steady supply of the fish in question, then selling them in a retail setting at a ridiculously low price when the value of the fish is high hurts the sales of that fish in the future. This is a very small example but that was my point as to why it was hard for a member to sell his. That's all. I encourage local breeding, it is unlikely however that someone bred Petricola to sell them dirt cheap to a store, it is not an easy fish to breed and grows very slowly.


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## 2wheelsx2 (Apr 21, 2010)

Rastapus said:


> Again, my post is about the industry in BC and the effects that lowballing are having on the industry.


I don't believe that's 100% the case. For example, many people thought cheap US cars would destroy the Canadian market. Did it? Look at the OpenRoad autogroup. It's expanded. So Canadian dealers are flourishing. What they've had to do is change their business models to have more ethical selling, instead of moving one car at a 20% profit, they are now moving 5 cars at a 5% profit.

The other reason has nothing to do with the industry itself and is related to your comment about cost of living. It's expensive to live here because people want to live here. They don't come here to work, they come here to LIVE. I don't know of too many people in Ontario going scuba diving, sailing or hiking in January. The reason we don't have as large an indoor hobby base here is the same reason we don't sell many snow blowers here.


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## gklaw (May 31, 2010)

These healthy and lengthy discussions. Honestly could not read every word of them.

I think what Grant may be suggesting is the problem with price dumping which sometimes could be intentionally to cause hardship to your competitors and unintentionally disrupt our natural and business environments. We need some competition at all levels to keep everyone honest and not gouging/exploiting the end users. We also need to be enough profits to make the business or carrying certain line viable - IO salt, Rena or Eheim filters are just examples. I can think of my favorite Coralife salt which was $90 at Big Al's when I started the SW some $13 years ago to consistently below $40 and as low as $29.99 at IPU on boxing week. Now the salt is almost nowhere to be found. While I don't want to pay $90, I still would like the convenience of picking one up anywhere even if it is say $45. There are people out there who want to drive all over town to save $5 but I am a lazy/practical guy who want to save $2 on gas and time and give the $3 to local business. Price dumping eliminated that option is some cases. While I know where to get a certain brand of filter really cheap like you know where, I lost the opportunity / option to pay a little bit more just to venture into a closer and more local store.

At the end of the day, every business needs to find its own style and clientèle. Of the limited stores I go to, albeit only occasionally, KE, IPU, local Pet Habitat, and April's in the land yonder, and yes I confess picking up clearance items at Petsmart, they all cater to different clientèle - may be that's how businesses survive.

I am all for being competitive in pricing and all that. From the business ethic (or general life) point of view, I don't like the idea of making yourself bigger and more successful at the expense of others. Thus big boxes displacing family business, Amazon/Chapters forces local tiny book stores to close their doors.

More often than not, especially for the more aggressive / driven (for the lack of better word), this could be a difficult fine line to walk. How can I be successful without hurting others or hindering others to success? How do I get good deals while leaving plenty of profits for other? 

There is a enough for everyone, we just want to proactively make sure everyone is enjoying their places as much as we are enjoying ours  Of course, this is easier said than done. We still have food to feed everyone in the entire globe - why is there hunger and starvation? Should we blame it on Adam and Eve or should we look closer?


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## Rastapus (Apr 21, 2010)

2wheelsx2 said:


> I don't believe that's 100% the case. For example, many people thought cheap US cars would destroy the Canadian market. Did it? Look at the OpenRoad autogroup. It's expanded. So Canadian dealers are flourishing. What they've had to do is change their business models to have more ethical selling, instead of moving one car at a 20% profit, they are now moving 5 cars at a 5% profit.
> 
> The other reason has nothing to do with the industry itself and is related to your comment about cost of living. It's expensive to live here because people want to live here. They don't come here to work, they come here to LIVE. I don't know of too many people in Ontario going scuba diving, sailing or hiking in January. The reason we don't have as large an indoor hobby base here is the same reason we don't sell many snow blowers here.


Not sure I see 5% as ethical rather then something they HAD to do but I dont know the car market. In reference to the lack of snow keeping people in to enjoy their aquariums, rain sucks. People don't generally get depressed by snow, rain on the other hand.....not much fun to "play" in the rain so I dont think that is a major contributor.


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## 2wheelsx2 (Apr 21, 2010)

Rastapus said:


> People don't generally get depressed by snow, rain on the other hand.....not much fun to "play" in the rain so I dont think that is a major contributor.


I think most people born here or raised here would disagree with you. I didn't even own an umbrella until I was in my 20's. That view is very Ontario-centric. If it sucked so much, why is it the highest cost of living in Canada?

I lived in Saskatchewan and up north around the arctic circle for a while and I can tell you that it isn't very much fun to wear a balaclava to get groceries. I find that much more depressing.


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## Rastapus (Apr 21, 2010)

2wheelsx2 said:


> I think most people born here or raised here would disagree with you. I didn't even own an umbrella until I was in my 20's. That view is very Ontario-centric.
> 
> I lived in Saskatchewan and up north around the arctic circle for a while and I can tell you that it isn't very much fun to wear a balaclava to get groceries. I find that much more depressing.


They both suck. But, gloomy weather and heavy rain in BC and the UK etc. has been medically proven to depress. snow is at least bright. Yes, I am from Ontario and I would take snow over rain any day, under a foot that is. Snowboarding and skiing is great, soaked, splashed etc in rain, not so much.


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## Acipenser (Apr 21, 2010)

I have to jump in here and say I would rather pay a higher price for better service, I work in the service industry and service is what we sell our product is second to service and for that we have a very *LOYAL* customer base. 
Personally I shop almost entirely at my lfs Roberto's pet habitat in Coquitlam. They know me by name, they know my kids names and my wife, they know what pets I have as I have purchased them from there, I get superb customer service, I can return an item months later without a receipt, I get great advise and years of product and pet care knowledge. I don't mind paying 15% to 20% more because I know they are local they shop here they live here and employ people from my niegborhood.

But that's just me I like being greeted by my first name when I walk into their store, I like that they ask me about my day and where my kids are, I feel I am a part pf their " family" so to speak. 
That is what customer service brings you - Loyalty , as a result I purchase ALL my pet supplies here, my cat food, cat litter, all my fish supplies, tanks, hamster food ect.

Unless I cant find what I want and they cant order it for me I buy from them .


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## 2wheelsx2 (Apr 21, 2010)

Rastapus said:


> They both suck. But, gloomy weather and heavy rain in BC and the UK etc. has been medically proven to depress. snow is at least bright. Yes, I am from Ontario and I would take snow over rain any day, under a foot that is. Snowboarding and skiing is great, soaked, splashed etc in rain, not so much.


Fair enough, and that's why I live out here. I hate being cold.


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## gklaw (May 31, 2010)

Cannot agree more Acipenser, Roberto and Russell are great guys - very clean and tidy store as well. Need to keep them around for a very long time. However, I am a little bit of a social butterfly 



Acipenser said:


> I have to jump in here and say I would rather pay a higher price for better service, I work in the service industry and service is what we sell our product is second to service and for that we have a very *LOYAL* customer base.
> Personally I shop almost entirely at my lfs Roberto's pet habitat in Coquitlam. They know me by name, they know my kids names and my wife, they know what pets I have as I have purchased them from there, I get superb customer service, I can return an item months later without a receipt, I get great advise and years of product and pet care knowledge. I don't mind paying 15% to 20% more because I know they are local they shop here they live here and employ people from my niegborhood.
> 
> But that's just me I like being greeted by my first name when I walk into their store, I like that they ask me about my day and where my kids are, I feel I am a part pf their " family" so to speak.
> ...


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## April (Apr 21, 2010)

Roberto is a good guy. And your a great loyal customer.

---
I am here: http://maps.google.com/maps?ll=49.235400,-123.185348


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## fishygirl (Oct 31, 2011)

Interesting ideas raised by everyone, thanks for contributing! Thanks to Grant especially for bringing up counterarguments to keep this discussion going!



> First off, I did not say salt would no longer be available. I stated that IO will be harder and harder to find and the popularity would drop due to the fact that stores will not carry it at that price point. Proof is in the pudding, very few retailers carry it now already. It is not "priced right" it is abused. Buyers will not be willing to pay a higher price for the product, they will generally demand a lower price when they find it. High quality salts are available but are a hard sale because of the IO problem. Same can be said of the Filstar, its day will come as well, again due to the pricing. Believe it or not, sell a product too cheap for too long and soon you cant find it anymore. Magnum anyone?


From my knowledge, J&L, King Eds, and Ocean Aquatics still carry IO. Perhaps you're right that less retailers carry it now because there is lower margins. I think to say that the price is abused is a little harsh though-- those companies are simply pricing competitively to attract customers. Yes, this can be inconvenient for some of us that are willing to pay a higher price for convenience. Perhaps retailers that dropped the product should think of pricing slightly higher to offer that convenience--aka like 7-11 selling milk. Thinking in a business sense this would be practical unless it was outrageously overpriced (and the convenience is no longer worth the extra $). My point is it will never be too cheap to that we can't find it anymore. If it wasn't available some smart business will sell it at a high price and consumers have no choice but to get it from them. Businesses will take advantage of this money making opportunity until it is not a unique proposition for the sole store that originally carried it. No unique proposition = prices drops again. From the prices dropping --sure, some stores are forced to drop the line because it can't be used to cover their less efficient businesses (ex: they have higher costs to cover) Then, me and other consumers have to sacrifice with a longer drive to get it. If there were enough of us demanding it though from our LFS, I don't see why they won't sell -- they'll just neglect the extra $ they could be making? Not a very smart move.. Perhaps, there is just not enough of us making it impractical for them to sell it...



> If you devalue a product long enough, similar products follow suit or prove impossible to sell. There were a few very high quality salts that hit the market a few years back, they did not sell, likely due to this. The gap between the pricing was too large and the manufacturer in an attempt to protect the product likely had a minimum price on that product. Globally those salts are popular, not so much here.


I wouldn't doubt that the high quality salts didn't sell. We need to think of different factors in play though. First, the availability of substitution. I've been using IO for many years and haven't thought of using alternatives. Why? Because IO gets the job done and it's* plain, simple and cheap*. I'm sure many consumers think like me and there is just no value we see in buying the premium product. Perhaps there was no big demand for them in the first place-- hence, the lack of sales. Unless we understand the additional value these premium salts bring the majority of customers can't justify paying the extra. Perhaps educated fish enthusiasts would know but I'm speaking about the bulk of consumers-- there isn't enough demand for it to sustain the product's existence. Available substitution is key but so is demand. Globally, it's a different situation. There's a larger market (compared to Vancouver) and different consumers that drive the demand.



> Actually Hagen products are not sold at a premium generally, they are just no longer "given away". As I said Hagen has done a great job to control what was way out of control. As far as branding goes, I would say there is more emphasis on branding with other lines then Hagen. With Apple, yes, their advertising, look, etc. has helped to make them what they are but I believe if Apple was dirt cheap, it would not be as popular. It has been portrayed from the beginning as a unique product, of course that can be said for a lot of aquarium products claiming to be the next best filter, heater, etc.


I don't believe Hagen was "given away" ever, so to speak. They would not be in business if they were. They have modified their marketing strategy however (smart move from a business POV) Hagen and Apple are brands. They've established their names in their respective industry and we pay extra to have the name. Many associate it with a certain quality or attribute. Although there are alternatives in the market, we specifically choose to pay more for those products because we BELIEVE these products offer us something MORE. This may actually be true, but a lot of times *perception* is key. That is why they can sell for more than the same product offered by someone else that does NOT have the name stamped on it. The premium pricing goes hand in hand with branding and marketing. My question is, then, is there branding associated with fish such that justifies a premium?



> "Jacking up prices" was not my suggestion. My comments reflected what happens when livestock is sold at a very lean price and again, how it can affect the sales of that fish in the future. My Yellow Tang and Flame Angel examples explain this. I never suggested that Flame Angels should be "jacked up", rather not given away at a few dollars profit when supply is limited. Emphasis here seems to be put onto selling things very expensive, I never said that, rather selling items at a reasonable price versus selling them at a 5% margin or less. Again, this argument is really for the retailer to consider, not the hobbyist. What hobbyist is going to complain about paying less? My point was how pricing can affect availability and how with livestock it is even more serious due to environmental pressure and stock availability.


Agreed that lower prices contribute to stock availability due to greater demand. My point is conservation and sustainability is a bigger issue than the margins that a retailer earns. You mention retailers should sell them at a reasonable price to conserve the livestock-- but _what is a reasonable price? What is the right margin for a certain fish to ensure its sustainability? _Unless there is a standard or rules that define this it is *hard to point fingers at others for pricing "too low"*. Is pricing with a certain margin really the problem or is it education and government regulation that is necessary. Again, questions to think about. (Note that this only applies to saltwater / wild caught fish as well).

More ideas to think about (and some reading for everyone to do)


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## jobber (May 14, 2010)

This is becoming quite the case study for a commerce course.


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## fishygirl (Oct 31, 2011)

jobber604 said:


> This is becoming quite the case study for a commerce course.


Rather interesting, I must say myself


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## RD. (Jun 2, 2010)

> Competition is healthy if it is fair competition. One example would be selling a product at or near cost. Many manufacturers have MAP pricing, minimum advertised pricing. This was first introduced in the US and was a very good idea.


Whether it's considered a very good idea by certain retail vendors, in Canada MAP is illegal. In 2007 the US Supreme Court overturned a law regarding minimum resale pricing that had been in place for 100 years, which ironically is the same year that Hagen introduced their MAP program in the USA. As many US based companies have already found out, this does not equate to ALL retail price agreements in the USA being legal either. It's a slippery slope, and legally a very complicated one.

Law Firm Of Pepper Hamilton LLP | U.S. Supreme Court Overturns 100-Year-Old Rule Making Minimum Resale Price Agreements Automatically Illegal

One of the key reasons that Hagen states as to why a retailer should partner with them ......



> "Structured pricing. With our new Internet strategy taking effect this spring to close the gap between your business and online pricing of Hagen products, we are committed to maintaining the price integrity of our brands."


https://www.hagendealerdirect.com/hagen/do/public?template=tmpl-about-hagen&page=why-partner

In Canada, controlling prices by a manufacturer/supplier falls under "Price Maintenance" under Section 76 of the Competition Act, which in brief states;



> "Price maintenance may occur when a supplier prevents a customer from selling a product below a minimum price by means of a threat, promise or agreement. It may also occur when a supplier refuses to supply a customer or otherwise discriminates against them because of their low pricing policy."


Do these types of minimum price agreements take place in Canada by some companies? Yes. Are they legal? Absolutely not.

This is exactly why the term MSRP is used by many Canadian suppliers. Manufacturers "Suggested" Retail Price. Suggested, not enforced with an iron hand.

In Canada neither a manufacturer nor a supplier of a manufacturers goods, can legally dictate retail prices of those goods. There are a few exceptions to this rule, but those exceptions are limited in scope, and very precise. The bottom line is, the Competition Bureau in Canada not only considers, but clearly states;


> "that low prices are usually a good indication of vigorous competition."


While I agree in principal with the US Supreme Courts decision on this subject, it has opened up a Pandora's box for the consumer. I don't personally think that it's in the best interest of consumers to have several industry giants controlling the lions share of the goods being offered to consumers, at a controlled price. Some of these companies have enough financial clout and market share to prevent new, smaller manufacturers/suppliers, from even entering the market in North America, let alone competing with them. How is this possibly good for the consumer?

I'm not even going to get into what constitutes "fair" competition, but suffice to say that what may be construed as "selling at cost" for one company, may in reality be "selling for a reasonable profit" for another. As fishygirl previously stated;


> "It is important to remember, however, that some of these smaller retailers "undercutting" others have lower overheads (ie: they pay less rent, hire less people, etc) and can sell for less in the first place. It's unfair to say that the lower margins necessarily result in lower profits and that they will need to consequently cut overhead."


I would add to that comment that the "unit cost" for various products can also vary depending on a number of factors, and this too can allow some vendors to sell for less than others. If store ABC buys 100 fish (pick a species) in many cases they will get those fish at a much lower cost than store XYZ that purchases 20 pieces at a time. Volume discounts are pretty much standard operating procedure when buying live fish from many wholesalers, or local breeders. Some vendors may pass those savings on to consumers, others may not. For those that do, I wouldn't consider that to be low-balling, or somehow ruining the market. If store ABC puts in the extra time & effort to do their own fish importations, which typically equates to far greater savings vs buying from a local fish wholesale company, and they pass those savings on to their loyal customer base, should they be considered low-ballers, just because they can offer lower prices compared to the store down the street? Not in my world.

BTW - I personally consider snow & extreme cold to be extremely depressing.


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## 2wheelsx2 (Apr 21, 2010)

Very informative post RD, I didn't realize MAP was not allowed in Canada.



RD. said:


> BTW - I personally consider snow & extreme cold to be extremely depressing.


And I think people the world over agree: World's 10 best places to live


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## Rastapus (Apr 21, 2010)

That post is too big now for me to quote so I will summarize my points. 

The only way I can illustrate that the pricing on salt IS abusive is to divulge the cost which I am not going to do. Lets just say that I am not being harsh on the topic, I am simply stating the way that it is. Pricing one salt brand too low does impact the other brands. Please remember, this is my career, it is my business and my statements regarding this topic is correct. I am sure if you were to ask other owners other then the shops you stated they would give you a similar answer. Again great for the consumer, not so good for the product long term or the bottom line. 
Your 7/11 reference is interesting though, of course that business supplies food, a product everyone needs and caters to the on the run purchase or after hours purchase, both which don't really apply to the aquarium trade.

This is actually another point to consider. We are dealing with aquarium supplies here, it is a hobby and a small market compared to others, such as food. People will pay a little more for convenience but people are not so concerned about an extra .50 on a can of pop at midnight compared to a $40-$60 purchase of marine salt. 

My point on this topic has already been proven by the small number of stores still selling IO. It used to be the most popular salt, now it is not as easy to find. This will continue to degrade the product. We recently brought in a salt from overseas that did really well for us but again, we could not price it where it should have been particularly when you consider the logistics and expense we had to go through to get it in. That being said, it sold well mostly because it was new, no one had seen it before and was a good product. Again, we could not price it where it should have been.

Regarding Hagen, my comment about their product being "given away" in the past was on a retail level, not by Hagen.

Regarding the fish pricing etc, I really don't have an issue with this as it applies to IPU. Our fish pricing has always been reasonable, occasionally we are challenged on one price or another but the quality conversation takes place. Some customers believe us, others buy elsewhere.


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## SeaHorse_Fanatic (Apr 22, 2010)

Excellent discussion/debate everyone. Learning a lot and great to hear both sides of the issue while the conversation remains highly civil. Great points in particular brought up by RD, Grant & fishygirl. I think that this would be an excellent topic of research for a university commerce course since it deals with so many different economic and non-economic factors within this specialty market.


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## fishygirl (Oct 31, 2011)

There is no doubt that you understand this business very well, Grant, and I respect your opinion. I believe a lot of issues here are subjective and I hope I'm able to provide an alternative POV to everyone.

I'm sure cutting the prices is not good for the bottom line. When is it ever good for a business unless you can compensate by selling more than before. The businesses with slim margins are obviously now at a competitive advantage on two levels. Customers originally buying from more expensive retailers may choose to go to them and other sellers are getting out because they were not making the margins they were previously. The main effect here is that some retailers can't make as much profits anymore, like you said, not something that really concerns the consumer.

I agree it may be a hassle for us to get to the salt now but evidently we see the trade off. We are willing drive farther to pay $30-40 less. There's not enough people willing to pay that extra $30-40 to make it justifiable (aka profitable) for the LFS to sell it. 

My example for 7-11 is an easy illustration of pricing for convenience. Obviously, they are different industries but the principle is the same. In the same way that someone is not hesitant to pay $0.40 for an extra can of pop, there are people that are not hesitant to pay more for marine salt just so we don't have to drive so far for it (especially when gas is so expensive nowadays). It just not worth it anymore if it's past that threshold where it's no longer "a deal". It's up to the management to do research to find out where the threshold price point is and how much demand there is at that point.

Ultimately, the complain here is then that less profits (and margins) can be made than what it would of been previously. Happens with most industries where competition increases. I think its hard to blame other retailers for this when they can find a way to sustain a business where they can offer cheaper prices to consumers. They are simply operating at a more efficient or competitive level. The products are the same across so perhaps the key is to offer something unique to the customer so they are not hesitant to pay more.

P.S For those of you wondering, I also have a university background in cost accounting hence the seemingly business jargon/focus


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## fishygirl (Oct 31, 2011)

SeaHorse_Fanatic said:


> Excellent discussion/debate everyone. Learning a lot and great to hear both sides of the issue while the conversation remains highly civil. Great points in particular brought up by RD, Grant & fishygirl. I think that this would be an excellent topic of research for a university commerce course since it deals with so many different economic and non-economic factors within this specialty market.


Definitely an interesting topic! Glad everyone enjoyed and learned something!


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## guppygeorge (Sep 6, 2010)

April said:


> The sydontis pensicolas are selling for about 3.00 to stores, individuals etc. There's alot of them .


I have been following this thread with interest....it appears as though Grant has initiated quite an interesting discussion  I find the above statement quite disturbing. Why would the owner of a local pet store post wholesale prices online  I feel that this is a betrayal to the many good owners of aquariums and pet stores in the lower mainland  Many of whom I have come to know well in the many years that I have been keeping and breeding fish 

BTW, I assume you are talking about Synodontis Petricola...which is the correct name. I realize that "There's a lot of them." locally at the moment. However, not all stores pay "3.00" for them :lol: The price paid by lfs's will vary depending on size and quality. I would hope that in future lfs owners would be responsible to their peers and abstain from putting wholesale prices paid on this forum.


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## Rastapus (Apr 21, 2010)

guppygeorge said:


> I have been following this thread with interest....it appears as though Grant has initiated quite an interesting discussion  I find the above statement quite disturbing. Why would the owner of a local pet store post wholesale prices online  I feel that this is a betrayal to the many good owners of aquariums and pet stores in the lower mainland  Many of whom I have come to know well in the many years that I have been keeping and breeding fish
> 
> BTW, I assume you are talking about Synodontis Petricola...which is the correct name. I realize that "There's a lot of them." locally at the moment. However, not all stores pay "3.00" for them :lol: The price paid by lfs's will vary depending on size and quality. I would hope that in future lfs owners would be responsible to their peers and abstain from putting wholesale prices paid on this forum.


To be honest, I thought the same thing. No offense to anyone but yes, I thought that was odd. Of course I recall another post regarding discus from someone else, stating their selling price was cost. very strange.


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## noodles11114 (May 21, 2010)

*I would like two questions answered for this country bumpkin.*

1 What is the meaning of free enterprise?
2 Does it still exist in Canada?
Thanks kindly for your time! Cheers


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## fishygirl (Oct 31, 2011)

noodles11114 said:


> 1 What is the meaning of free enterprise?
> 2 Does it still exist in Canada?
> Thanks kindly for your time! Cheers


1) Free enterprise means that profit-seeking businesses operate in a free market with little restraints by the government. There is no regulation that prevents new companies (ie: competition) from entering the industry or market. Regulation is based on protecting the public as a whole. They don't subsidize any specific company or restrict another from entering. Basically supply and demand form the basis for pricing and quantity of goods in the market.

2) This system (ie:capitalism) is the kind of economic system Canada operates on. The opposite is a socialist economy where the government regulates and distributes goods to its citizens.

I hope this helps without sounding too much like a textbook! Cheers!


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