In today's economy, when we all want high quality, durable furniture that will last, every penny counts. Many smart consumers are price shopping, and when shopping for things like convertible sofas, or a new sectional couch, the pricing structure can get pretty confusing!
Today I'm going to break through the veil of silence (and hope that the furniture goons don't come after me) and share with you the basics of furniture pricing using a sleeper sofa (or comfort sleeper) as an example.
Convertible Sofa Chair
Here's the scoop, the low down, the arcane way that furniture buyers and sellers price their furniture to most confuse the consumer. Comparing the top of the line Comfort Sleeper and the regular sectional couch of a well known is a perfect example because it will show both ways.
Manufacturers Suggested Price.
So, on the Comfort Sleeper, one of the top brand's most popular convertible sofas (and for good reason, they are amazingly comfortable and convenient), the manufacturer tells the retailer that the minimum that can be charged. This minimum has a reasonable profit built into it, and many retailers mark it up beyond even that. But a retailer can't go below that price, so eventually, when you shop around, you'll find some retailers that just sell it at that price and then you can compare them for extras, like free shipping and customer service.
Retailer Pricing
Now most good brands also makes other furniture, including lovely leather sectional sofas, fabric sectionals and a variety of chairs, loveseats and items that go well with them. With these items the retailer gets to choose his own pricing. The retailer know how much it will cost, then they mark it up and sell it for either a) a fair price given its quality or b) whatever they can get. Since the retailer like their customers and want them to come back they prefer option b)!
The Phantom of the Sale
Have you ever noticed that all furniture everywhere is always on sale? It's hard to find a straight price on anything. I'm sure it makes sense to some fancy marketing guru, but to me it's just a bunch of manipulation and number crunching that they do so those customers understand the value of my products.
Manufacturer pricing: for example the convertible sofa sectional. The retailer is told the baseline price. Then they double that. Then they mark it down. So, take the example of brand "A" Comfort Sleeper Sectional - an award winning sectional sleeper.
Let's just say that it costs the retailer 07, and they were required to sell it for at least ,709 (yes, there is a good profit there - and it does take a lot to sell and service one of these deluxe sofas). What a retailer might do is list it for ,900, and has a "Sale" price of ,999. So the "List Price" is just an illusion. No one is actually selling it for that price. The purpose of that high price is to make you think you are getting a deal.
The retailer pricing is similar, you just get more variation in pricing. I've seen some retailers sell at 0 over cost - I have no idea how they make a profit, although I do notice that when I really look into their offering they are sometimes showing images of an entire sectional sofa set, and then only selling one component of it - confusing!
The Real Sale
Now getting back to the Comfort Sleeper and other furniture with a manufacturer's suggested retail price, often one time a year the manufacturer will let the retailers sell it at a lower price. If you wait until this sale time - you can often get great deals on furniture.