Yeah - its terrible. ZERO incentive to sell any droid product. We preach iPhones - best box GP, zero rate of return, easier accessory and insurance! Vzw is starting to preach 4G take rates,but there is a fine line between following their path and killing profitability. Answer this: how do you sell a 299 droid VS iPhone? iPhone wins all day.
Here is your corporate answer I always get from the dumbasses on top. " You have to sell them the VALUE of the product " I hate Big Wigs they are so out of touch on things.
Its not the boxes that's the problem its the profit, the big commission checks are really dangerous psychology. Many of you rookies think you are making money but you are playing with cash flow. Once you pay your rent, employees, credit line, credit cards, sales tax, employee taxes, etc you probably don't make nearly as much as you think. I am noticing that one charge back in the month affects the profit in a big way, that's when you know you are in trouble! If a customer cancels a line now a days you are on the hook for some serious money.
Another problem is that when a phone first comes out you have to carry it, so if you sell it you make almost nothing on the new phones that launch and if it doesn't move you loose money because they drop the price of the 4g phones after a month.
Its just insane that you can spend an hour with a customer activating a 4G phone, showing the customer features, moving over contacts etc. Then when the transaction is done you see you invested $600+ on the phone, spent an hour of your time, risking a possible charge-back loss, and all to make a $30 profit lol Then when you complain to Verizon about it they tell you that your not making money because your tablet sales are not good LOL This is becoming a high volume, high risk, low margin service business. If the customer does not buy $100 worth of accessories they are barely worth the sale.
Years ago I used to sell carphones as a side business to my TV Store. In those days there was no such thing as a subsidized phone by the service provider. All you did was purchase the phones wholesale and mark them up what ever you felt was reasonable or the market would bear. Then you activated the phone on what ever service and programed the phone for access. As a salesperson you got a commission for each activation of like $100.00 as long as they remained active for 90 days. So you made money both on the phone + installation or accessories & also off the activation.
Its a double edged sword. Consumers want free of low cost high tech phones but and have no clue what the devices actually cost and the Providers want as many loyal long term customers as possible. Long term contracts & ETF's lock in the profits for the provider but at the expense of the retailer and in the long run its no bargain for the consumer.
IThen when you complain to Verizon about it they tell you that your not making money because your tablet sales are not good LOL This is becoming a high volume, high risk, low margin service business. If the customer does not buy $100 worth of accessories they are barely worth the sale.
We are consistently one of the highest ranked stores for tablet sales and they still wont let us get the iPad from them, we are approved and even have the displays ready to go, but we still aren't allowed to purchase iPads because of "inventory constraints"...
So, this is very telling.
1) They don't sell **** for tablets at any other level.
2) "Big 6" stores that DO have the iPad apparently don't sell ANY, because having the item that is 80% of the tablet market they should be able to CRUSH my Galaxy Tab/Xyboard Sales.
3) People in charge of our channel have no idea how we need to operate.
Hi there. I'm the guy on the other side of the counter. If you're a jerk to me, guess how hard I'm going to try to help you?
I may need to rethink prepay however. If you can get them consistently paying the $50/month with you, the long term pre-pay is a better deal for us than a post-pay Droid.
Shows how far we have fallen that pre-pay is looking better.
We just had our kick-off meeting, and all it did is really show me how out of touch they are.
All of this great 4G stuff down the pike is fantastic and all, but no one addressed the elephant in the room.
The internet device adoption rate is so low becuase THE RATE PLANS SUCK. 5GB for $50 is a joke. I am not saying to bring back unlimited, but lets be reasonable here.
Prepaid take rate sucks becase we don't have a smartphone product for the same pricing like every other major player in the market. Prepaid people don't give a crap about the "network"
Yeah, VZW needs some sort of smarthphone offering on prepay if they really want to sell it but I am not sure they do. Think the only reason they released the $50 plan was due to selling nothing on the prepay side because of the other prepay offerings out there.
I have no incentive to sell prepay. Phones are too expensive for anyone to buy and they don't count towards my MAL.
The profit margins are pretty low right now though and the huge inventory cost is a killer. With the iPhones it looks like we're getting a big commission but 100% of my commission always goes back to inventory. The only money I keep is the money we bring in in the store when selling devices. It works out that way penny for penny every single month. The high phone costs are really putting a strain on my credit limit though. I can't make it through the whole month before I have to pay some down before the commission or I'm over limit.
It's also hard for me to sell anything but an iPhone. It makes no sense to sell a 3G droid. For the same price range you can get an iPhone which makes us more money and is a far superior product as far as quality goes. 4G Droids are a little easier to sell for the person that already has a Droid or someone that wants the latest and greatest.
For some reason though the past couple weeks I feel like my Smartphone mix has went down the tube. We were just one of the highest ranked stores in our area for smartphones recently but all the sudden we're getting a ton of basic phone customers.
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" I hate Big Wigs they are so out of touch on things.
Originally Posted by VZWINDIRECTGUY
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