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The other day, I went into a large store with a big car park that had everything on sale on display indoors in a nice fashion, this setup is pretty common across multiple different retailers so which store it was does not really matter. I then did what I always do, being from MLN, compared computer prices. Low and behold as always I noticed the standard shelf price was about 20-40% more expensive than us. It bothered me for years that these large format retailers with hundreds of stores have been able to do this and get away with it. Speak to the average Joe and the answer always is, “they must be cheaper they have huge buying power”, everyone forgets about their huge running costs though as they must need to make more to cover their huge costs. I mean we the customers are paying for that TV advertisement.
To add to that, the huge buying power idea, not sure if it’s true. I mean technically speaking for example, if we all wanted to buy a car and if we all went to Holden all at once and said, I want to buy a Holden for every Australian, the price should get cheaper and cheaper with each order, and with this logic by the time we hit ten million orders the car should be $1. While I have exaggerated this, I think you get the idea …
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