Rockin_John wrote on 12/27/08 at 23:05:17:



And this was said where????  He said that doubling a price is only 50% markup, when it was actually 50% profit margin and 100% markup. Whether it's "retail" market, or wholesale, stocks, housing or whatever you wish, doubling what you paid for an item is 100% markup. In your example you made a 100% markup and 50% profit margin. . You are correct with your guitar example.

Charon wrote "So, as an example, if the dealer paid $90 for your part, and sold it to you for $180, he sold it at a 50% markup. This is standard practice throughout the retail industry. "

Please point out where he said 100% markup is standard practice throughout the retail industry...My computer shows he typed 50%.

Charon wrote "To be pedantic about markup, there is no such thing as "100% markup" unless the original cost was zero."

There is nothing correct about that statement.

There is a difference between markup and profit margin no matter how one justifies their examples as how they were taught.

golfbum wrote on 12/28/08 at 03:09:50:



Savage2K: My quote, and comparison was to "just figuring it the way I'd been taught."

Your assumption that I was quoting and contrasting to Charon's ENTIRE post was a leap you made. Perhaps I should have been more clear in that. But I had no intent in nitpicking Charon's whole post.

I learned a certain way someplace: Charon learned another way someplace. Right there the point of my reference ended as far as I was concerned.

Not getting into here: "show where he said this and that"; because that was never my intent. You jumped to the conclusion that my entire statement was somehow a quote of the entirety of what Charon said. That was not my intent.

FWIW, I agree with you 100% about the 100% markup sale = 50% profit margin on my books.

Just a misunderstanding as far as I'm concerned. Please forgive me if I was not concise enough to be clear.

Perhaps it would be best if I didn't post at all when three days into bronchitis; and stoned on codine and nyquil.    

T Mack 1 - FSO wrote on 12/28/08 at 14:15:48:


All correct again! But OTOH, I've (briefly) worked for rip-off shops who did all kinds of underhanded things to increase their "markup."

The first when I was about 16yo, I went to work at an independent VW repair place. The guy had me pulling parts off of one persons car, cleaning them up, and installing them on someone else's car; then charging them for a "new" part! He even had me do it with complete engines!!! Pull an engine, hose it down with de-greaser; maybe touch it up with some rattle can paint: Instant rebuilt motor!!! He was shameless. If any of us employees were caught talking to a customer without sending them to him, we risked being fired. I didn't last a month there before I told a couple of people they needed to get their cars out of this guys lot before he messed them around as such. Then I went in the office and demanded my paycheck. He cheated me to of course!

Another HVAC company I worked for did the same thing with old furnace and A/C parts. Clean up old pulls from equipment salvaged from change-outs, and charge top-dollar retail for used parts! That outfit also "adjusted" the bill according to the neighborhood the job was in. Big fancy house = jack the bill WAY up somehow. Sell them a compressor they didn't need or something. Once again, conscience wouldn't allow me to work there for more than a couple of weeks...

But the "Overhead" of which you speak is also what has prevented me from pursuing my life-long desire to open a combination music and motorcycle store. I think the two adult toy stores together are a natural fit! But the mortgage/lease, insurance, utilities, more insurance, low margin from fighting on-line discounters etc... has stopped me for years. That, and the fact that I see, and sometimes attend closeout auctions of music stores pretty frequently. With so many mom-n-pop music stores going under, some old enough to have the mortgage paid, I figure: "What chance would I have?"  I do know a couple of small town stores in well-to-do bedroom communities who make a decent living; but it is almost entirely on selling beginner instruments to parents, and then having a whole staff of drum, bass, and guitar instructors working from small studios in the back. If it wasn't for fleecing mom and dad to teach Johnny and Suzy to play, they wouldn't stand a chance of making a go of it. And even at that, the "teachers" are usually their own kids or nephews etc... and then mom does the books while the old man runs the storefront. It takes a whole family and their friends to keep the doors open. And they're lucky if they can afford workers-comp and health insurance after all the aforementioned expenses. And as if all that weren't bad enough, the current struggling economy has "Luxury" items like Music Instruments, and "hobby" cycling down for the count!

Had I jumped into a combo low-end music instrument, and 50mpg+ moped/scooter business when the gas was sky high; the new lower gas prices would be putting me out of business now as we speak! (An idea that I seriously considered!)  

ADDITION to this post:

To get back to the original issue (ie, the op's "valve job") I still say if it was done right, it may not have been that bad of an investment.

But as with T-Mack, I got a heckuva deal on my "chopped" 99 savage by buying someone else's troubles. The Alt/Gen Stator winding was bad, and his shop wanted some $650+ for a brand new one and labor.

He sold me the bike at a bargain so he could go on about his business.