unethical business experience *LONG READ*

[mikephoen]

I almost bumped this thread a few weeks ago when I saw this 2 star review:

Loud, mediocre service, food not much better.

On the surface, it doesn't seem like an unreasonable 2 star review... except that it's for a store that sells wood working tools! They obviously don't sell food at all, but somehow this review is permanently stuck to them. They're a smaller place too, with only 33 reviews, so this 2 star review does affect their overall score.

[Flames_Gimp]

I finished paying them off, I don't have to deal with these"people" further, thankfully. I sure hope nobody else goes through that BS!

[heep223]

Came here to hopefully get some opinions and interestingly OP is about a hot tub as well. Mine however is short.

I ordered a tub and agreed on price. Put down a deposit. It took 18 months to get to the dealer. They then said that the price has gone up.

Am I right in thinking there’s absolutely no way I should be agreeing to a higher price? Seems obvious to me but maybe I’m missing something.

[Sliver]

Originally Posted by heep223

Came here to hopefully get some opinions and interestingly OP is about a hot tub as well. Mine however is short.

I ordered a tub and agreed on price. Put down a deposit. It took 18 months to get to the dealer. They then said that the price has gone up.

Am I right in thinking there’s absolutely no way I should be agreeing to a higher price? Seems obvious to me but maybe I’m missing something.

The world today isn't what it was two years ago.

Literally everything has gone up in price. Did the hot tub come from far away? If so, then the shipping price he would have based his quote to you on would have changed. My shipping in that timeframe for products coming from China has now doubled. All raw material prices have gone up. My labour prices are up because I'm paying people while they're away with Covid or Covid symptoms.

I think he should offer you your deposit back if he can't maintain the price you originally agree to.

If you still want it, I'm not surprised in the least the price has gone up. There isn't a way for a business to predict or insulate themselves from those increases...particularly on a sale from 18 months ago. I would hope he has some verbiage in his agreements for tubs he's selling now cautioning about the possibility of a price change for deliveries months down the road, but he likely wouldn't have been concerned about what has now happened when he originally sold you the tub a year and a half ago.

There's no way he is lying that the price has gone up. I understand it sucks for you, but the alternative to keep the price where it is is for the owner of the business to literally pay a portion out of his pocket to subsidize increased costs that were completely out of his control. Would your really want to be that guy that insists his family does without so you can have a hot tub in 2022 at 2020 prices?

We all need to be expecting price increases. Increased prices are not a windfall for most businesses - costs have skyrocketed on everything.

[Lubicon]

Originally Posted by Sliver

The world today isn't what it was two years ago.

Literally everything has gone up in price. Did the hot tub come from far away? If so, then the shipping price he would have based his quote to you on would have changed. My shipping in that timeframe for products coming from China has now doubled. All raw material prices have gone up. My labour prices are up because I'm paying people while they're away with Covid or Covid symptoms.

I think he should offer you your deposit back if he can't maintain the price you originally agree to.

If you still want it, I'm not surprised in the least the price has gone up. There isn't a way for a business to predict or insulate themselves from those increases...particularly on a sale from 18 months ago. I would hope he has some verbiage in his agreements for tubs he's selling now cautioning about the possibility of a price change for deliveries months down the road, but he likely wouldn't have been concerned about what has now happened when he originally sold you the tub a year and a half ago.

There's no way he is lying that the price has gone up. I understand it sucks for you, but the alternative to keep the price where it is is for the owner of the business to literally pay a portion out of his pocket to subsidize increased costs that were completely out of his control. Would your really want to be that guy that insists his family does without so you can have a hot tub in 2022 at 2020 prices?

We all need to be expecting price increases. Increased prices are not a windfall for most businesses - costs have skyrocketed on everything.

This part I agree with, the rest of it depends. If that is the price they agreed to sell the tub for then too bad if the cost went up and the business has to eat the difference. That's life. In my industry our customers don't give a rats ass if our costs went up and are now higher than our prices, they expect us to honor our original agreement.

[Sliver]

Originally Posted by Lubicon

This part I agree with, the rest of it depends. If that is the price they agreed to sell the tub for then too bad if the cost went up and the business has to eat the difference. That's life. In my industry our customers don't give a rats ass if our costs went up and are now higher than our prices, they expect us to honor our original agreement.

Yeah, some customers are #######s for sure. As an individual, I would never want a stranger trying to run a business to have to subsidize my luxury purchase because he was a victim of unprecedented and unpredictable supply chain issues. I would either pay the increased price or get my deposit back.

If we put a gun to suppliers' heads and ask them to honour prices we know have increased, then we can't expect them to be in business for long selling at below their new costs. People need to be flexible and reasonable right now.

[CorsiHockeyLeague]

Well, okay, but it's pretty clearly a breach of contract if you agree to sell someone something for a fixed price and then try to change the price on them.

[Leondros]

Originally Posted by Sliver

Yeah, some customers are #######s for sure. As an individual, I would never want a stranger trying to run a business to have to subsidize my luxury purchase because he was a victim of unprecedented and unpredictable supply chain issues. I would either pay the increased price or get my deposit back.

If we put a gun to suppliers' heads and ask them to honour prices we know have increased, then we can't expect them to be in business for long selling at below their new costs. People need to be flexible and reasonable right now.

Then what's the point of a deposit? If I am putting a deposit down I expect business to place the order right away and secure the price. For example, I am buying a huge amount of steel right now. I gave a 30% deposit 6 months ago which was a large chunk of change. Now the supplier is increasing the price by 40%. Is it my fault they didn't utilize the deposit I provided to pre-purchase materials and keep it in their yard?

When prices go down drastically do customers get the benefit of the savings along the supply chain? No they don't, they use the contract price. Why should be any different. Heep check your contract and read the fine print. If the price and the product are defined and agreed upon, you have some legal footing to stand on. If they have in their T&C's price fluctuation clauses you may be SOL.

[Buff]

Originally Posted by Leondros

Then what's the point of a deposit? If I am putting a deposit down I expect business to place the order right away and secure the price. For example, I am buying a huge amount of steel right now. I gave a 30% deposit 6 months ago which was a large chunk of change. Now the supplier is increasing the price by 40%. Is it my fault they didn't utilize the deposit I provided to pre-purchase materials and keep it in their yard?

When prices go down drastically do customers get the benefit of the savings along the supply chain? No they don't, they use the contract price. Why should be any different. Heep check your contract and read the fine print. If the price and the product are defined and agreed upon, you have some legal footing to stand on. If they have in their T&C's price fluctuation clauses you me be SOL.

Swearing Out Loud?

[nfotiu]

Originally Posted by Leondros

Then what's the point of a deposit? If I am putting a deposit down I expect business to place the order right away and secure the price. For example, I am buying a huge amount of steel right now. I gave a 30% deposit 6 months ago which was a large chunk of change. Now the supplier is increasing the price by 40%. Is it my fault they didn't utilize the deposit I provided to pre-purchase materials and keep it in their yard?

When prices go down drastically do customers get the benefit of the savings along the supply chain? No they don't, they use the contract price. Why should be any different. Heep check your contract and read the fine print. If the price and the product are defined and agreed upon, you have some legal footing to stand on. If they have in their T&C's price fluctuation clauses you me be SOL.

Yeah, I agree. This all depends on the contract language and probably the amount of deposit to an extent. If it's a $100 deposit to be first in line to buy something when it comes in, then fine. But if he's putting a 30-50% non-refundable deposit down, he's doing it to protect himself from prices going up too.

18 months ago, we were still in the middle of all these supply chain issues. If a business owner is taking a customer's money, he should be making sure he can order the product at the cost expected or have a contract that reflects that the price might change.

[BlackArcher101]

Originally Posted by Leondros

Then what's the point of a deposit?

A deposit secures your position in the manufacturing queue, the contract secures your price. It all depends on the contract. Is there an allowance for inflated costs to be passed on over a certain %? Maybe or maybe not, have to read it. I know these days all the contracts I get are "fixed price", but a clause to allow for shipping to be charged at actual cost at time of shipping. I'm betting 18 months ago that kind of thing wasn't included.

In this case, you may have no other option but to accept a price increase, given the vendor can likely just give back the deposit back to walk away from the sale and sell it to someone else at the higher price.

[Sliver]

Originally Posted by nfotiu

Yeah, I agree. This all depends on the contract language and probably the amount of deposit to an extent. If it's a $100 deposit to be first in line to buy something when it comes in, then fine. But if he's putting a 30-50% non-refundable deposit down, he's doing it to protect himself from prices going up too.

I agree with this, but I'm just saying I'd be willing to walk away (disappointed, but understanding) so long as I could get my deposit back. I don't want to put another person in a position where they are subsidizing my luxury purchase due to global factors completely out of their control.

Originally Posted by nfotiu

18 months ago, we were still in the middle of all these supply chain issues. If a business owner is taking a customer's money, he should be making sure he can order the product at the cost expected or have a contract that reflects that the price might change.

lol, I think you guys have a naïve understanding of how much power a typical small business has when negotiating shipping rates and prices on end products. I've had suppliers email me with zero seconds warning price increases across the board that instantaneously affect the prices of literally everything in my production queue that I've already priced out to my customers. Yeah, I do my best to absorb them and 99% of customers wouldn't even know if I'm taking a bath, but if an increase would put me upside down on an order, I would reach out to the customer person to person.

And say my suppliers in China increase their prices mid-way through fulfilling my order...what am I going to do? Sue a Chinese manufacturer for breach of contract? Good fataing luck with that. My only recourse would be to explain the situation to my customer and give him the option to pay more or I'd refund him. I can't afford to be paying portions of hot tubs for one-off customers due to unexpected price increases I can't control or predict.

I will say as far as price increases go, 99.9% of my customers have been totally understanding and sympathetic to our position. I haven't had anybody raking me over the coals for our increased prices. And my margins are lower across the board this year, so we're feeling a bigger pinch than I'm passing on at the moment.

[rotten42]

Originally Posted by Sliver

If we put a gun to suppliers' heads and ask them to honour prices we know have increased, then we can't expect them to be in business for long selling at below their new costs. People need to be flexible and reasonable right now.

I don't agree. If you quote a price and have a deposit based on that price then the company should honor the price. The business I work for sticks to this. We have some items that we sold that are a 30 week lead time. We still honor them.

[Sliver]

Originally Posted by rotten42

I don't agree. If you quote a price and have a deposit based on that price then the company should honor the price. The business I work for sticks to this. We have some items that we sold that are a 30 week lead time. We still honor them.

Yes, for sure that's the way it should be to the extent possible.

[Wormius]

Originally Posted by rotten42

I don't agree. If you quote a price and have a deposit based on that price then the company should honor the price. The business I work for sticks to this. We have some items that we sold that are a 30 week lead time. We still honor them.

Are you eating those costs or is the mark-up high enough to absorb them?

[heep223]

Thx for the discussion. I think I’ll ask what specifically went up. Because to me if it’s transport/shipping, that feels very different than the product itself. When my order went in, they should have contracted with the supplier at cost. That’s their business after all…

[Sliver]

Originally Posted by heep223

Thx for the discussion. I think I’ll ask what specifically went up. Because to me if it’s transport/shipping, that feels very different than the product itself. When my order went in, they should have contracted with the supplier at cost. That’s their business after all…

Yeah, that's a reasonable approach. Should be able to get a read if he's a sincere, honest guy or somebody trying to squeeze you just because people are somewhat prepared for price increases in the current climate.

[Strange Brew]

Originally Posted by CorsiHockeyLeague

Well, okay, but it's pretty clearly a breach of contract if you agree to sell someone something for a fixed price and then try to change the price on them.

This is the end of the discussion.

If you have a customer that pays a deposit and signs a contract, the benefit to your business is that you have the money from their deposit. If they back out, that's what the deposit is for.

You want to play the spot market on future sales, sure do that. Don't take people's deposits and sign a forward sales agreement.

I don't get the "subsidizing my luxury purchase" argument. Why should a customer "subsidize their luxury sales"?

Both parties should honor the contract.

[chedder]

Originally Posted by heep223

Thx for the discussion. I think I’ll ask what specifically went up. Because to me if it’s transport/shipping, that feels very different than the product itself. When my order went in, they should have contracted with the supplier at cost. That’s their business after all…

Any chance you want to tell us how much the increase was? In my mind, if it's something like $1000 on a $14,000 tub, I'd personally suck it up knowing the world has been crazy and I really wanted the hot tub. If it's more than a 10% increase I'd have to think about it. You've probably saved more than that on not having higher electricity bills and chemicals for the last 18 months.

[Sliver]

Originally Posted by Strange Brew

This is the end of the discussion.

If you have a customer that pays a deposit and signs a contract, the benefit to your business is that you have the money from their deposit. If they back out, that's what the deposit is for.

You want to play the spot market on future sales, sure do that. Don't take people's deposits and sign a forward sales agreement.

I don't get the "subsidizing my luxury purchase" argument. Why should a customer "subsidize their luxury sales"?

Both parties should honor the contract.

Of course that's the aim.

But if we're talking about being ethical, I don't see it as ethical to knowingly allow somebody to lose money due to the current supply chain and shipping crisis just because a "deal is a deal." You can operate like that if you like, but I like to treat the people and businesses with whom I interact with more empathy and understanding. Your approach - to me - is a cold and uncaring one. I do care if you made a deal with me and now you're going to get fataed when I can prevent that from happening to you.

But, yeah, obviously you're in the right if you want to play the "you signed a contract" card. I rather play the, "let's see if we can make this fair to both of us" card.