Author Topic: A tale of 4 tires: how local business can't or won't compete against online  (Read 536 times)

The Gorn

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It was the middling, not the best of tires. They needed replacement on my vehicle.  :P

I have about 48K on a set of "Yokohama Avid Envigor" on my Nissan Maxima that were installed in November 2010.

I looked up the sales receipt and I paid $836 out the door for that set of tires + installation at the not-aptly named local store "Tire Discounters".

In the last year or so I had become quite dissatisfied with the performance of these tires. Snow driving was a joke, more like a motorized sled. I'd slide on wet roads and spin out when starting from stopped without any effort. Lastly, the tread is quite thin, and I'm seeing some fine cracking in the rubber of these tires.

Time for new tires.

I was initially looking for a deal at the local Sam's Club, which would provide integrated purchase and installation services.  Sam's seemed to beat the best prices from the local tire store chains.

The very "best" deal in terms of online reviews and tire specs I could find available at Sam's were "Kumho Ecsta PA31 Performance Radials" at about $93/tire plus installation services.

Then I started looking online. Of course, I wound up at the smuggest prick of alls' site... Amazon.com. These particular tires are currently $66 through Amazon, on Prime shipment.

OK, now I'm discarding local purchase as an option.  :( I'll certainly deal with a little hassle to save $100+. I can simply load the delivered tires up in my car and go to my local mechanic who charges $24 per axle for balance+install+discarding the oldie.

So what did I wind up buying and having delivered?



NOTE: I ONLY PAID $75/wheel for these tires! The price seems to have gone up $10 in the last week.

I ordered them on a Friday. They arrived the following Monday afternoon. 3 actual days. They're stacked in the garage awaiting my appointment for installation.

And pray tell, just for grins, what is the local price for the same item?

One place ("Tire Discounters"):



How about another local chain? ("Bob Sumerel"):



And JUST FOR SHITS AND GIGGLES... What is a local dealer charging for the tires I am now driving which cost over 200 per axle installed?



So buy the commodity locally and pay from double to MORE THAN TWICE what the same item costs online.

And, see the asked price locally drop like a rock for something that you paid top money for a few years ago.

Each of these local chains has a "price matching" offer. But I am so far from their asking price for this item that I didn't bother. I would expect them to call bullshit and cite a limitation of their offer so it would not apply.

Also after seeing this I simply don't want to give the local chains my business. It leaves a sour taste in my mouth.

So what if Jeff Bezos forces his squat paid contractors to piss in bottles on the production line and prohibits injured employees from receiving help from co-workers?

I GOT CHEAP TIRES HOORAY! F*** SOCIAL CONSCIOUSNESS.

This is why anyone with a brain needs to move online ASAP for their livelihood. It's almost unreal how unrealistic local business has become in trying to squeeze a nickel out of anyone dumb enough to shop them.
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I D Shukhov

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$75 beats Tire Rack:  $115.62 for that Cooper tire, but you get a $100 rebate, so it's about $90/tire.
Did you say what you paid for shipping?

I might do this same process for tires.  Thanks!


Cooper Zeon RS3-G1
Ultra High Performance All-Season
Size: 225/50R17 98W XL
Load Range: XL
Serv. Desc: 98W
UTQG: 500 AA A
Special Offer: Get a $100 Cooper Tires Visa Prepaid Card or Cooper Prepaid Mastercard Virtual Account via mail-in rebate.


The Gorn

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It was shipped under my Amazon Prime. No charge for shipping. Just state sales tax. No rebate offered, however. Buuut... maybe a rebate is offered by the manufacturer for this sale. I'll check that out.

Normally I don't do a lot of penny pinching on low value transactions but this savings amounted to several hundred dollars.

Amazon seems extremely unlikely for buying tires but you can buy furniture and lawnmowers through them, so what the hey.

In a broader sense is this how the economy works? Like two or three major corporations "allowed" to do business with the public?
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unix

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Quote
I GOT CHEAP TIRES HOORAY! F*** SOCIAL CONSCIOUSNESS.


LOL


I am a cheaper bastard than you.  I buy used tires.  In great condition.

Until I found that the thing that expires a tire is its age, not necessarily just miles.

i.e. a 15 year old new-never-mounted tire can be junk.

Brawndo. It's got what plants crave.

The Gorn

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Yes. Tires rot due to ozone and oxygen/oxidation. They don't stay in stasis if they're not driven on. The rubber dries out. That's partially what's going on with my current hugely overpriced set of tires.

I looked into used tires but I couldn't find any consistency in brands, condition or wear/age. I basically don't trust anyone selling them. And I got these top rated tires new for 75/tire. I was seeing Craigslist ads for less well known used tires in the same size for $40-50. At that rate I decided to just buy new.
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The Gorn

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Also,

Amazon Prime is a horn of plenty for a de-industrialized Amurrica.

You'll take your low wages, buy stuff from Amazon, never consider shopping locally, and LIKE IT.

                   - Globalists Everywhere
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unix

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yeah, it's hard to compete with that price.
Brawndo. It's got what plants crave.

unix

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while on the subject, I need to upgrade my obama-era chebby. That thing has been a non-stop source of problems.

It's a 4-wheel ad for Toyota.
Brawndo. It's got what plants crave.

I D Shukhov

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Amazon seems extremely unlikely for buying tires but you can buy furniture and lawnmowers through them, so what the hey.

In a broader sense is this how the economy works? Like two or three major corporations "allowed" to do business with the public?

I can see myself buying almost anything now through Amazon.  I just had delivered cardboard storage boxes, which cost maybe 1/3 more at Staples.  The boxes came in an outer shipping box in perfect condition.

It raises the question of whether to buy Amazon stock.  I'm put off by the P/E ratio of (currently) 223.27.  But if they don't have much competition from bricks and mortar stores or from other online retailers maybe the stock has nowhere to go but up.

The Gorn

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Just a few concerns that I think are entirely self-evident...

1) Is Amazon's pricing advantage sustainable indefinitely? Trump's stated that Amazon gets what amounts to enormous subsidies off of the USPS for shipping and delivery. (Funny cuz most Amazon products I receive come by private Amazon courier or UPS brown trucks.)

2) What will Amazon do when it has eliminated consumer choice in broad product categories? IE, suppose consumers woke up and started buying tires en masse at Amazon - there goes local tire stores which are reduced to installations and service and which are deprived of good resale profits that keep locals employed. Wal-Mart has tended to raise prices in communities once it drove out all competition.  I'm thinking AMZN will put the screws to its public when it has successfully deconstructed or destroyed most retail in the US.

3) Is Amazon's winner-take-all domination healthy for the economy and communities? For one thing it removes any ability to compete in certain categories. Basically AMZN dominance means a nation of Amazon contractors, peons, employees, and a few affiliate marketers and resellers to drive sales to it.

Local service businesses are fine and dandy but it's something I have learned bitterly as a consultant over the years: Amazon is removing the ability for startups to create scalable businesses.

What's left over after an Amazon gloms up all of the scalable business opportunities are non-scalable highly custom low level services, such as car repair and repairs and service in general (home, auto, HVAC, plumbing, etc.)

That's unhealthy IMO.

My thesis is that while Amazon is as evil as they come for a large corporation, smaller local entrepreneurs who basically resell commodity goods have only themselves to blame. My local tire chains don't HAVE to sell tires for almost 3X Amazon's price. Unless the buying power of Amazon actually forces the matter.
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I D Shukhov

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Regarding 1) - Same here, I see mostly Amazon and UPS trucks.  An Amazon truck delivered a food thermometer the other day, so they don't just deliver large items.

I found this:

Quote
According to a WSJ article Amazon  sold more than 5 billion items in 2014. 40 percent of those items were sold by third party  merchants. This number is gradually increasing and the company estimates this number  will reach 55% in next five years.

Amazon's website says:

Quote
You sell it, we ship it. Amazon has one of the most advanced fulfillment networks in the world. With Fulfillment by Amazon (FBA), you store your products in Amazon's fulfillment centers, and we pick, pack, ship, and provide customer service for these products.

So the trend is apparently for Amazon to be in the shipping, online sales, customer service (i.e. returns) and warehouse automation business.  The sellers will still have to do the marketing and if they are not successful Amazon will probably drop them to make things less confusing.  You can see how sellers can fail through Amazon when they price things poorly or get fewer than 4.5 stars for whatever reason.



The Gorn

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I've had an Amazon vehicle deliver a small canister of a food supplement for one of our cats, a small plastic canister about 3" tall and round, in a plastic shipping bag that the guy basically tossed up on our porch in the snow.

We've also had Amazon deliveries where the driver's vehicle pulls up in the driveway and makes it look like we're about to have a home invasion  :o because it's so trashy looking, but the person delivering was thankfully very nice.

In our experience AMZN doesn't mark the vehicles. Not even a pizza delivery style magnetic sign. Amazon needs a lot of distance from those filthy assed delivery contractors.  >:(
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I D Shukhov

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The trucks I've been seeing are large white delivery trucks.  I think they usually have Amazon markings.  It's probably a lot easier for them in a dense suburban area of a big city in terms of number of deliveries per square mile.

They do the same thing -- throw a white plastic package made out of a tough bubble wrap material onto the porch.  One time I saw they lied about the status saying that it had been "handed directly to the customer", which it hadn't.   I Googled on this and other people have had the same experience.   I wonder why the driver would do that?  Usually the delivery status just says "delivered".   

The last delivery displayed a picture of my item sitting on the porch and the page even had a option for me check to indicate that I agreed with the photo!   I've read that Amazon has a big problem with thieves stealing packages -- thus the (IMO) crazy idea of them installing a lock on the door which their delivery people can use to place the item inside the house.  This scheme comes with a camera that is trained on the inside of the front door.

Amazon has also been mulling over the idea, or maybe they're already doing it, of putting the item in your car's trunk.  For high-value items they have locker locations, which I've used a couple of times for returns, but I usually drop off returns at a UPS store nearby.

Amazon's business might be worth following.   I could almost see having a permanent thread somewhere here.  One reason would be to decide whether to buy their stock.  Otherwise, I don't care how they do what they do as long as I get my orders.  I have to say they are remarkably reliable.



unix

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How so?

Quote:

Amazon is removing the ability for startups to create scalable businesses
Brawndo. It's got what plants crave.

I D Shukhov

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How so?

Quote:

Amazon is removing the ability for startups to create scalable businesses
It depends on what the business is doing.  If they are making something, then Amazon and eBay are great online sales and distribution platforms.   If they are a hands-on service Amazon shouldn't disrupt them.  Interestingly, Amazon now has something called Amazon Home Services which will help the following businesses market themselves:

HOUSE CLEANING
HANDYMAN SERVICES
CARPET CLEANING
LAWN MOWING
IPHONE REPAIR
DEEP CLEANING
TV WALL MOUNTING
WINDOW CLEANING
LAWN, GARDEN, OR YARD MAINTENANCE
GUTTER CLEANING
WALL HANGING
MOVING CLEANING

Also a bunch of home improvement services with little pictures to show what the service is, https://www.amazon.com/s/ref=nb_sb_noss_1/141-8736701-3269753?url=search-alias%3Daps&field-keywords=home+improvement+services

That's about the same space that TaskRabbit is in.  TaskRabbit might be in trouble.

This is about small businesses outsourcing distribution and online sales and some marketing to Amazon.