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Thread: What's wrong with Woodriver?!

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  1. #12
    Join Date
    Dec 2015
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    Dublin, CA
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    Quote Originally Posted by John Kananis View Post
    Sure but I'd like to see the difference in the margins - I would imagine the higher profit items getting the floor space and I can't see Tom paying so high a commission (why should he?).
    It's not that simple. "Halo" products often aren't particularly profitable for the retailer, but they can still be a significant win inasmuch as they draw the right sort of customers to the store. For example the owner of a local WoodCraft buys Clifton planes at trade shows and prominently displays them (WC stores are franchises and they have some latitude to do stuff like that, though they're on their own for distribution). He's clearly not making much if any money on those, but he's decided it's worth it because they bring well-heeled customers through the door. I asked a store manager about it at one point and he was quite blunt that he was using them to make up for the loss of the L-Ns.

    Similar logic has applied to every consumer-oriented product line I've worked on in my career. It is not uncommon to create marginally profitable halo SKUs specifically to enable the retailers to do stuff like that. Professional/industrial stuff is very different of course.
    Last edited by Patrick Chase; 03-16-2016 at 1:05 AM.

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