From The Editors Desk (ET/D, July 1981)

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I've received a gratifying amount of thoughtful response to my editorial comments in the May issue of ET/D. And now I wish to comment on three of the letters we received and which appear in the letters column.

The letter writers and I are, I believe, pretty much in basic agreement. I have stated that I believe what the situation should be; they have stated what the situation is.

I do want to respond in turn to some of the comments: Service rates will always be the subject of discussion, short of the formation of a union or other organization with Teamster style clout. However, I do not believe that the low initial cost of much (most?) consumer electronics equipment has anything to do with service rates. To return to the IBM comparison, the technical knowledge and skill, and the investment in service van, parts, service data, the cost of maintaining a shop, etc., are just as great if you are repairing a $68 black and white television receiver as a $1500 electric typewriter (some typewriters are less ex pensive); the value of your time is the same and if you cannot charge for it-go out and get the job fixing typewriters! Don't subsidize the consumer and the television manufacturer. Don't feel sorry for the con sumers; you can't eat gratitude. I learned that the hard way myself.

I wonder just what the real effect of price competition is. I have, over the last 20 years or so, seen shops advertising $2 service calls operating right alongside shops charging $24.95 for service calls. Those with the $2 calls are the ones that did not survive. I remember back in about 1965 that a shop in the Minneapolis-St. Paul area agonized over raising its rates in one jump, from $15 to $25 for a service call. When the decision was made it was expected that there would be a 25-35% fall off in business. The actual fall-off was not noticeable. Very few customers questioned the new rate. I have seen similar examples since then. I believe it is easier to get a proper rate than is generally thought.

I have never heard of a shop going out of business because it charged too much. The shops mentioned here all were known to do good work and back it up and they still are in business, while those that tried to establish themselves by offering low prices have failed. Also consider this: If you double your rates you can have a fifty percent reduction in the number of repairs and still collect as much cash--and have time to go fishing. Which might not be too bad at that. So don't sell your services cheaply.

Along these lines I also see several dealers sell non-discounted products with some success right along side the discounters, mostly on the basis of good reputation for fair dealing and good service. Sales would be much easier without the discounter, but some can be made nevertheless. At times you can find brands that are not discounted in your area so direct price comparisons cannot be made. This helps. However, I agree, the manufacturers want to sell sets. Who sells them and how is secondary.


Sincerely, Walter H. Schwartz, Editor (Duluth)

(source: Electronic Technician/Dealer)

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