Costco & Sage

GAT

Dumbfounded
#31
I seem to remember this happening once before in the past. The fly shops tossed a fit (rightfully so). If I remember correctly, Sage sold the rods to a company that were supposed to retail them in a different venue. The third party sold them to Costco instead of the outlet they claimed they would use.

I don't know if that is the case this time but I know Ford dealerships would certainly take offense if Costco started selling F150s below dealer cost.

Fly shops rely on exclusive rights when it comes to selling high priced flyfishing gear. If those products show up at Costco at ridiculously low prices, this does a lot of damage to the fly shops. In this day and age, fly shops have a hard enough time keeping their doors open due to competition from web sites and big box stores. The last thing they need is competition from Costco.

This is a very bad deal for fly shops.
 

dflett68

Active Member
#34
I bet Sage's reps have been getting an earful from their retailers today! This is so totally unacceptable. Maybe a retailer can correct me on this if I'm wrong, but I assume Sage has pricing guidelines with minimum posted prices for their authorized retailers. And from a quick search, it looks to be $475 for this combo. I bet wholesale on this is somewhere in the $250-300 range, so if retailers want to match it, maybe they can at least do better than breaking even.
Wanna know the silver lining? Someone buys this from Costco, decides to return it in five years, Costco takes it back at a full refund, sends it back to Sage and Sage is on the hook for refunding the wholesale price to Costco.
I've been approached by Costco a few times about selling our product in their stores, and each time it comes down to me asking, "So, what if your customer wants to return it in a couple years?", answer is always, well then you have to take it back and pay us". No thanks.
costco's whole model is low margin high volume, and that flows to the companies they buy from. returns are a marginal impact to that model when it is working as designed, as witnessed by the colossal success costco enjoys. the impact to sage of a return in five years will be tiny.

don't forget this is one style, one item, one option, out of sage's entire assortment, and it will be at costco for a very limited time. i don't see how this kind of thing doesn't increase the size of the market for the small shops and ultimately create more customers and business for them. those folks that buy the outfit at costco aren't going back to costco for knowledge, flies, accessories, or their next rod/reel. and if they are spending this much on one, they will be getting another. i'd be really surprised if anyone could show that this was really bad for the local shops. i like costco's business model, and i think by nature it doesn't compete directly with small business.
 

dflett68

Active Member
#35
There was a story. Some freight forwarder - central American distributor, purportedly sold a couple of containers of goods to Costco. As one said above, Costco is always on the hunt for premium goods at a great price. They will even buy smaller (by this I mean not National) lots and sell them regionally.

I think the last round was Simms for sale in about a dozen stores and when the "fertilizer hit the ventilator", Simms went in and bought the remaining inventory back.

I am not sure the vendors (Mfgs) are the villains here. But their train left the station because their models all need sales growth each season. One only needs to sit in on one of their "preseason" sessions to know the pressure they are under.

Costco models their sales on buying right and selling out the "buy" quickly returning the shelf space to another product that will turn in a hurry. They love stuff like this because its new, viral (just like this posting on this forum) and draws feet to the stores.

Sooner or later these guys will get together with one of the big names (seems like it was Calloway in golf, but I am not a follower so I am not sure). Once the barrier is broken, the other guys will have to follow suit or they will fall behind in revenue.

I can't say its bad for the consumer. It is bad for the shops for sure. They live on the margins from trips and from these big ticket items to carry the tippet, Thing-a-ma-bobbers and the like. You got to sell a lot of flies to make up for the margin dollars on a pair of waders or a NRX sold on a Saturday.

I can tell you that Costco would buy four hundred to six hundred pairs of waders just to stock a region. The CEO of a wader company thinks about that every day he drives to work.
there are no villains. it's a market, just compete.
 

Peyton00

Active Member
#36
I feel this can help a fly shop. Costco has swarms of people in and out of the stores daily. If they sell one fly rod and the customer then goes to another store for supplies( gear) it would seem like a win-win for all fly fishing parties. Costco got the ball rolling and now its up to the fly shop retailer to maintain that customers needs. Fly shops should be thanking Costco for bringing new customers in their doors. Costco is making money and so is the fly shop. How many people walk thru the doors of fly shops daily? People know Costco has great products and service, and that could and should carry forward for the fly shops if they are worth their salt.
 
#37
Maybe you should be looking at TFO? or something even cheaper. I mean you want to stick to your principle of being able to put food on the table....right?
Are you saying that if someone offered you a Sage Rod vs a TFO rod for the same price you would take the TFO on principle?? If so good on you but i think you may be in the minority
 

JesseC

Active Member
#38
I can't find anything to hate here. Big surprise, I know.

You have two local companies who are working together to clear some inventory of a rod that'll likely be discontinued soon. I remember the zaxis that showed up a couple years ago was at the very end of its' availability.

I think this'll probably end up helping fly fishing shops. I bet a lot of these rods are getting snapped up by people on an impulse buy. They'll be coming to the shops once they figure out you have to put a fly on the end of those rods ;)
 

Porter

Active Member
#39
I think someone on this board nailed it right when refering to the simms and z-axis issue (alpinetrout maybe?). These items sold at costco, not an authorized dealer, should be voided of all warranties, sold as is. Sage should not honor any repairs/defaults/ etc. from their rods purchased at costco. I'm sure they know (or can find out) the serial numbers of the rods that made their way in to Costco hands.
 

dflett68

Active Member
#40
I think someone on this board nailed it right when refering to the simms and z-axis issue (alpinetrout maybe?). These items sold at costco, not an authorized dealer, should be voided of all warranties, sold as is. Sage should not honor any repairs/defaults/ etc. from their rods purchased at costco. I'm sure they know (or can find out) the serial numbers of the rods that made their way in to Costco hands.
who has established that costco obtained these against sage's will?
 

Porter

Active Member
#41
Previously they had. See link earlier posted. I'm sure its the same type of thing, sage has little to benefit and more to lose from this.
 

Jerry Daschofsky

Moderator
Staff member
#42
Previously they had. See link earlier posted. I'm sure its the same type of thing, sage has little to benefit and more to lose from this.
Yup, everyone I know who has had product go through Costco has regretted it. All never renewed once the contract expired.

Onto Costco, they didn't have it at the South Hill location today.
 
#44
While you are at Costco buying your new Sage rod, ask them to upgrade the line and spool an extra 50' of backing on it. While your at it ask them to show you how to tie that blood knot again. And maybe find out what the local hatch is and pick up a few flies.
Oh sorry this is Costco not a local fly shop. Instead pick up a half gallon of Jack Daniels and go fish.
jesse
 

Jerry Daschofsky

Moderator
Staff member
#45
While you are at Costco buying your new Sage rod, ask them to upgrade the line and spool an extra 50' of backing on it. While your at it ask them to show you how to tie that blood knot again. And maybe find out what the local hatch is and pick up a few flies.
Oh sorry this is Costco not a local fly shop. Instead pick up a half gallon of Jack Daniels and go fish.
jesse
They'd tell you the fish are over in the meat section. ;) Cash matches the hatch in that department. ;)