Jessops close to administration?

Mt Spokane Photography

I post too Much on Here!!
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Mar 25, 2011
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expatinasia said:
I wonder how many of us do this, with so many different items, not just camera equipment. I do not buy my camera stuff online, unless it is something simple like CF cards. Anything costly is purchased in store.
There is no profit in selling cameras, the profit that keeps stores in business comes from selling accessories like memory cards and filters.
 
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paul13walnut5

Guest
@Mt Spokane Photography
There is no profit in selling cameras, the profit that keeps stores in business comes from selling accessories like memory cards and filters.
There is quite a bit of profit in selling used cameras, which Jessops stopped doing a few years back. I know this because when I worked for Jessops, I know what we bought stuff in for and what we sold it for. Anything less than 100% mark up and we wouldn't look at it.
We did give a 12 month warranty so there was some risk.

The staff price on used gear was excellent, the staff price on own brand was excellent, the staff price on cameras and lenses was often more than the over the counter price, so as you rightly say the profit doesn't come from new cameras, which are often loss leaders.

Jessops were charging £60 for an SD card that could be bought from a reliable online source for £20. Assuming that the online trader is making some mark up thats at least a 200% mark up. Not uncommon in clothes and food retail, but maybe impractical in a tech savvy market like cameras.

Whilst it's true that Jessops have rent, rates, staff and tax to pay, their biggest problems were:

a legacy of debt from aggressive expansion (where they tried to wipe out all other photo retailers), debt gained easily before the bubble burst, and hard to service in the aftermath

the fact that Canon and Nikon will let anybody sell their kit based on a minimum order criteria, so Tesco or Walmart can order lots and lots of stock and sell it without expert advice along with your milk, but little specialist knowledgable retailers have to think carefully before committing to a $100k account. Tesco and Walmart have bulk buying power, more efficient delivery networks and infrastructure, and so can discount more.

lack of expert staff. I joined as a pt salesman when a student, specialising in video gear and canon stills gear. By the time I left they were bringing in anybody with retail experience, with an empahsis on pumping warranties.

The only good news that can come from this is that the UK shops that deserve our business, who played fair, who have staff with a clue, may have their position consolidated or even strengthened by jessops demise.
 

GMCPhotographics

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Aug 22, 2010
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AdamJ said:
Cross-border shopping can't be helping bricks-and-mortar stores. It's crazy that I could save £415 on a 5D III shipped from Hong Kong compared with the same thing from even the lowest priced online retailer in the UK.

The impact seems to be bigger for retailers in the UK than in the US because the price differentials appear to be much wider here. Contentions about local warranty and returns explain why buying from HK isn't necessarily a good idea but they don't explain why the differential is so big in the UK. I'm not clear whether the HK sellers are dodging VAT or whether Canon UK simply demands higher retail margins but whatever the reason for this disparity, something needs to be done to level the playing field for UK retailers.
I agree, I sent a letter to the CEO of Canon europe when the 5DIII was released and impossible to source for less than £3000 for body only. My query was why i could import one from the US and pay the VAT and still be 30% better off. His reply was quite an eye opener. He sited that the UK retailers were expected to sell at a discounted rate from the RRP, but nearly all of the UK sellers were selling at max RRP due to low supply. The base sale price to the vendors / shops was pretty much the same in the US and UK excluding the VAT element. The 5DIII really didn't shift many boxes in the first month, compared to the mkII and mkI. The uk sellers were making nearly £500 per unit and passing the cost blame onto Canon. Rip off Brittain! My second 5DIII was bought for £1850 last month from a shop in Jersey. Full UK warranty and manual. In less than one year that camera has dropped £1150, which points to excessive profiteering from the UK sellers.
 
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paul13walnut5

Guest
Looks like the Apple model.

Over the same time as Apple stores came to the fore, Apple went from being a fairly minority maker of IT equipment to being the worlds number 1 consumer electronics company.

As much as I wish Canon success, I hope Canon don't abandon the serious and professional user along the way, as I would argue Apple have done.
 

inky38

I'm New Here
Sep 9, 2012
11
0
It is a sad situation, but with the increase in on-line 'grey ish' importers it is to be expected.

I don't know how companies like Jessops calculate their cost price, but (for reasons I won't go in to) I've got a good idea as to their cost price for a 7d body.

This cost price to Jessops is roughly £250 more expensive than you can purchase it from well known reputable online dealers.
Jessops then put another £100 or so on for their margin.

The way that I see it, is they didn't make enough profit on the goods that they sold. (not sure if this is down to their deal with the manufacturers/importers or simply import duty costs)

I understand that their most profitable part of their business is their printing side, so I expect that will be a service that is retained.
 

GuyF

EOS RP
May 26, 2012
689
0
GMCPhotographics said:
AdamJ said:
Cross-border shopping can't be helping bricks-and-mortar stores. It's crazy that I could save £415 on a 5D III shipped from Hong Kong compared with the same thing from even the lowest priced online retailer in the UK.

The impact seems to be bigger for retailers in the UK than in the US because the price differentials appear to be much wider here. Contentions about local warranty and returns explain why buying from HK isn't necessarily a good idea but they don't explain why the differential is so big in the UK. I'm not clear whether the HK sellers are dodging VAT or whether Canon UK simply demands higher retail margins but whatever the reason for this disparity, something needs to be done to level the playing field for UK retailers.
I agree, I sent a letter to the CEO of Canon europe when the 5DIII was released and impossible to source for less than £3000 for body only. My query was why i could import one from the US and pay the VAT and still be 30% better off. His reply was quite an eye opener. He sited that the UK retailers were expected to sell at a discounted rate from the RRP, but nearly all of the UK sellers were selling at max RRP due to low supply. The base sale price to the vendors / shops was pretty much the same in the US and UK excluding the VAT element. The 5DIII really didn't shift many boxes in the first month, compared to the mkII and mkI. The uk sellers were making nearly £500 per unit and passing the cost blame onto Canon. Rip off Brittain! My second 5DIII was bought for £1850 last month from a shop in Jersey. Full UK warranty and manual. In less than one year that camera has dropped £1150, which points to excessive profiteering from the UK sellers.
Interesting. So what the CEO is essentially saying is don't buy big ticket Canon gear when it comes out unless you can buy it without blinking or need it there and then for what it can do over your current gear as it isn't really worth the initial asking price.

I don't regret buying my 5D3 and a bunch of lenses from Jacobs the day after they went into administration but the fact you can now get the body for £1850 (fuuuuuuuuu....!!!!) does sting a teensy bit.

So the lesson to me is simple - when I come to buy another body (and I do like the thought of a mega-pixel 1D-type-of-thing though I don't need it), I'll wait at least until it is 66% of the RRP.
 

Alex

EOS M6 Mark II
Aug 20, 2012
70
0
31
North Devon
inky38 said:
It is a sad situation, but with the increase in on-line 'grey ish' importers it is to be expected.

I don't know how companies like Jessops calculate their cost price, but (for reasons I won't go in to) I've got a good idea as to their cost price for a 7d body.

This cost price to Jessops is roughly £250 more expensive than you can purchase it from well known reputable online dealers.
Jessops then put another £100 or so on for their margin.

The way that I see it, is they didn't make enough profit on the goods that they sold. (not sure if this is down to their deal with the manufacturers/importers or simply import duty costs)

I understand that their most profitable part of their business is their printing side, so I expect that will be a service that is retained.

HA

Sorry as I am now a Ex Jessops employee I can honestly say that all cameras were a loss leader.. The trade price on a 7D was around £1100 or more.. Jessops made huge losses on cameras sometimes well over £150.. The idea was to try and compete in the market but sell profitable items like memory cards etc with the cameras.. I shall greatly miss Jessops as I was a devoted customer before I worked there..

78 years of trading and servicing the general public has been torn apart in less then 2 days..
 

bchernicoff

EOS RP
Jul 9, 2011
569
1
Alex said:
HA

Sorry as I am now a Ex Jessops employee I can honestly say that all cameras were a loss leader.. The trade price on a 7D was around £1100 or more.. Jessops made huge losses on cameras sometimes well over £150.. The idea was to try and compete in the market but sell profitable items like memory cards etc with the cameras.. I shall greatly miss Jessops as I was a devoted customer before I worked there..

78 years of trading and servicing the general public has been torn apart in less then 2 days..
Sorry to hear you've lost your job. Hopefully, you can find something soon.
 

old_york

I'm New Here
Sep 11, 2012
24
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Alex said:
HA

Sorry as I am now a Ex Jessops employee I can honestly say that all cameras were a loss leader.. The trade price on a 7D was around £1100 or more.. Jessops made huge losses on cameras sometimes well over £150.. The idea was to try and compete in the market but sell profitable items like memory cards etc with the cameras.. I shall greatly miss Jessops as I was a devoted customer before I worked there..

78 years of trading and servicing the general public has been torn apart in less then 2 days..
Sigh...Highlights again how some companies (in our case Canon obviously) use such territorial bracketing to keep strangleholds on the economies that are able/willing/daft enough, to pay more than others. The worldwide marketplace becomes a joke when Canon can say "nope...your warranty is no good because you bought a camera from outside your "territory".

The current 7D body only price on a certain Hong Kong based website (ie: "post trade") whose name may rhyme with rigital-dev, is £729.99. A far cry from the £1100 TRADE UK price that Alex mentions above. For once, it's not all money going to the exchequer, 20% on 729.99 is still only ~£876, so
(even allowing for rigital-dev's mass buying power and maybe loss-leading by up to around 30% on this particular example....and I severely doubt it's that much somehow!)
- somewhere along the line UK sales outlets (and therefore UK consumers) are getting screwed over.

To be fair though....we're still nowhere near as bad a situation as some continental European countries price wise...

Is part of the problem the fact that the larger territories (US/China) have retailers with significantly larger buying power so therefore are more competitive to Canon and the other such multi-nationals? Possibly.
I just know at the end of the day what the camera/equipment is worth in to me. I'm not a pro so it is ENTIRELY about enjoyment, and thus I have to justify what I spend on gear to myself alone.....I would have paid Jessops' prices if I hadn't imported to save hundreds pounds on my last body (about 30%, so again more than just UK tax accounts for - and not rigital-dev as it happens :p). But the temptation to save that money and not feel like I'd been robbed, proved too strong.

To Alex, I have to say - good luck mate, sorry the administrators couldn't do anything over the past couple of days.
To the UK high street - good luck. Currys Group??? BHS??? WHSmith??? any chain that doesn't do something that can't be sourced in a visit to Tesco/Asda-Walmart/Sainsburys/Ikea had better develop some sort of USP very quickly.....or be ready to say goodbye.
Sorry to sound so bleak ! :-\ Didn't mean to have a rant - Honest!
 

Alex

EOS M6 Mark II
Aug 20, 2012
70
0
31
North Devon
old_york said:
To Alex, I have to say - good luck mate, sorry the administrators couldn't do anything over the past couple of days.
To the UK high street - good luck. Currys Group??? BHS??? WHSmith??? any chain that doesn't do something that can't be sourced in a visit to Tesco/Asda-Walmart/Sainsburys/Ikea had better develop some sort of USP very quickly.....or be ready to say goodbye.
Sorry to sound so bleak ! :-\ Didn't mean to have a rant - Honest!
Thank you.. From what iv read and heard Jessops had 4 offers to buy and save the company, but Pwc rejected all of them
 

inky38

I'm New Here
Sep 9, 2012
11
0
Alex said:
inky38 said:
It is a sad situation, but with the increase in on-line 'grey ish' importers it is to be expected.

I don't know how companies like Jessops calculate their cost price, but (for reasons I won't go in to) I've got a good idea as to their cost price for a 7d body.

This cost price to Jessops is roughly £250 more expensive than you can purchase it from well known reputable online dealers.
Jessops then put another £100 or so on for their margin.

The way that I see it, is they didn't make enough profit on the goods that they sold. (not sure if this is down to their deal with the manufacturers/importers or simply import duty costs)

I understand that their most profitable part of their business is their printing side, so I expect that will be a service that is retained.

HA

Sorry as I am now a Ex Jessops employee I can honestly say that all cameras were a loss leader.. The trade price on a 7D was around £1100 or more.. Jessops made huge losses on cameras sometimes well over £150.. The idea was to try and compete in the market but sell profitable items like memory cards etc with the cameras.. I shall greatly miss Jessops as I was a devoted customer before I worked there..

78 years of trading and servicing the general public has been torn apart in less then 2 days..
That was my point. How were Jessops ever going to compete with other online retailers if their trade prices were so much higher than the competition
 

bchernicoff

EOS RP
Jul 9, 2011
569
1
It's not just Canon. When my father owned a camera store in the late 90's he could buy Kodak film at Sam's Club cheaper than he could get it from his Kodak rep. Volume based price discounting has killed small retailers.
 

expatinasia

EOS 5D Mark IV
Aug 18, 2011
1,715
10
Asia Pacific
Alex said:
HA

Sorry as I am now a Ex Jessops employee I can honestly say that all cameras were a loss leader.. The trade price on a 7D was around £1100 or more.. Jessops made huge losses on cameras sometimes well over £150.. The idea was to try and compete in the market but sell profitable items like memory cards etc with the cameras.. I shall greatly miss Jessops as I was a devoted customer before I worked there..

78 years of trading and servicing the general public has been torn apart in less then 2 days..
Sorry to hear about your job, Alex. Hope you get something new asap. You sound pretty switched on, and positive, so I am sure you will have no problem.

As for Jessops, the business model you use there was always bound to fail. As I mentioned in an earlier post I have no objections to buying memory cards (not external HDs though), and other camera accessories online as these tend to be pretty solid, and low ticket items costing under £100. They are not something I want to touch, play with or need advice about generally, so why leave the house. When it comes to buying lenses or cameras though - the much more costly items - I always buy in store. I even do not mind paying slightly higher than the online price for it, as I can control delivery, get to know the sales person etc etc. I quite enjoy the experience, and hope that does not change.

Back to a personal note. Best of luck, again. Cheers.
 
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paul13walnut5

Guest
Hi Alex,

I hope you find something else soon bud, wouldn't wish this on any of the frontline staff.
Hope the rats that jumped ship after steering the company onto the rocks get all they deserve.

All the best
 

GuyF

EOS RP
May 26, 2012
689
0
Yes Alex, I hope you find something soon. I suspect the clowns at the top will be okay though with pension funds and drawings/bonuses from the business. When you come to clear out the shop you could always make sure a 1DX "falls" into your pocket ;)

As a slight aside, the one thing I just didn't like about Jessops was when I went in to price the gear I bought last year (about £5k), the bloke said, "yeah and if you give me a minute I'll get you details on insurance too." I pointed out I was quite well sorted for that but he was quite insistant. I finally had to look him straight in the eye and say pretty firmly I was only interested in the body/lenses. I mentioned this to the ex-Jessops guys who worked in Jacobs next door and they both agreed that that was one of the things that drove them from Jessops, the "insurance push" that came with every camera purchase. Lousy business model.

Take care.
 

AlanF

Stay alert, control the camera, save photos
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Aug 16, 2012
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We used to be exceptionally well served by camera shops in Cambridge UK but we will be down to two shops (the same company) now that Jessops was closed last night. The local Jessops was a good shop with some good staff who knew their job, and the company was quite competitive in Canon gear, considering that the bodies all have Canon warranties. It's very sad for the staff that they are losing out. The insurance is a racket on low end goods because the premiums are so high relative to value. But, they maxed out at £205 for two years cover, which is a great deal on higher end goods, working out at under 2% per annum for all accidental damage and including all repairs for sensor cleaning etc. Fortunately, the insurance comes from a sound insurance company.