Wholesale cost from manufacturers to either distributor or retailer. Except boutique items, the main stay operates in the mid 30s to very low 40%s. I'm sure
@M Code can confirm. TVs even lower. Speakers represent the highest margins outside of cables.
Depends.
If someone sells at full MSRP, sure but what is involved in selling this stuff? If it's stocked by the dealer, and the requirements can be pretty damn high WRT annual purchases, it needs a place to sit until sold, it often needs to be advertised, people need to be paid and many other expenses need to be covered. Then, there's the interest if it's floor-planned or financed in some other way. If something sold by a B&M dealer is also sold online, the price is sometimes advertised below the dealer's cost- this happens frequently when the equipment is bought from distributors and even without a store, there's no point in driving to their place to pick it up, drive back, deliver/install it and break even. I don't generally sell TVs for this reason. If the item is faulty, it's more driving and time, to support something that cost money to sell. Then, there are manufacturer sites that advertise at costs below what a dealer pays, although lower prices have usually been offered to the dealers, too- just not the same when buying through distribution. It's easy to say "Well, just sell more"- much easier said, than done.
Some brands demand an initial buy-in amount that isn't bad, but they also want the dealer to buy everything in the line and that's where I have a problem with a few companies. If I don't like something in the line, there's no chance that I'll enthusiastically promote it and it will just sit unless someone asks for it.
I looked at buying an AV store and after seeing that the cost of doing business would be over $140K annually, without paying myself, I turned it down. That included some inventory, but it wouldn't be enough for the first year and most of that was more than a year old, so getting a good price would have been difficult, at best.
Most people don't understand the costs of employing people. In WI, as soon as I hire someone, I have to buy unemployment insurance, pay worker's comp, do the admin and pay the second half of FICA (7.65% of earned wages). Employees also like to take some vacation time and have sick/personal days- as valuable as they are for maintaining morale, it is a cost because it's hard to quantify the benefit that came from time off with no production. Do business owners get the same amount of time off? If it's a small business and'or a start-up, don't bet on it. Paid health insurance? Add it to the list and pretty soon, 40% gross margin doesn't seem like much.
This is a partial list of expenses for a business:
Location- whether it's a real store or out of the house, it costs money to have some kind of a base, even if it's only for doing the admin.
Insurance- not only for the office/store, but for inventory, liability and vehicle(s).
Licensing, registration, admin and training-
Gasoline/diesel fuel- there's a lot of driving involved in some businesses that can't operate without it
Wages. Even if the average is $20/hour, people need to do enough to justify their existence in the company. Payroll of $200K/year costs $15,300 in FICA- That's $51K in sales at 30% or $38,250 @ 40%, just to cover a tax. Applying this to only one brand that I can buy only from distributors because I haven't signed up, I would have to sell $102K in order to cover FICA.
We don't see the actual cost of goods because there's a lot that happens between concept and release for sale. How much does it cost to design, build, test, tweak, test, etc a product? They need to source components, pay for tooling, packaging, transit, storage and factor in the markup to distributors and dealers. Should they sell AT cost? That would be ridiculous to expect but it's the main reason direct sales are so popular, although consumers are often paying the seller more than what a distributor or dealer would.
Then, there's the snake oil crap- I saw the AQ price list and they ARE NOT to be discounted. Nice profit, but would die inside if I ever sold cables at those prices.
