Price Match

I’m not sure if other individuals who work in eCommerce dread this type of phone call as much as I do, but the toughest questions to answer are regarding Price Matching.

Most shops and retail stores will offer to price match, but with many many caveats.

  1. It must be the same product, size and color. Why? Because lets say I’m trying to buy a black medium jacket that just came out for 2018. It’s made by The North Face and costs $300. I find the same jacket online for $125 in XXL, except it’s a color from 2 seasons ago that ended up not being very popular. It’s obvious in this scenario that one product is on clearance and one is brand new. However, some people view them as being identical. Even though we wouldn’t consider a 2016 Ford as being identical to a 2018 Ford.
  2. The price match must be from another reputable shop online. Why? Because anyone could own a website like, “JinsDiscounts.com” and create a product that’s identical and shows a lower price.
  3. The price must be advertised online. Because what if I walked into a store in Seattle, noticed they’re going out of business and everything is 70% off (in-store only). The problem is they’re out of my sizes. So I call up a store in Colorado and ask, “Hey, I’m at a store that is selling everything at 70% off, will you price match?” You can guess they’ll probably say no.
  4. The comparable product must be in-stock. Going back to #2, what if I owned a website, and I just created bogus listings that showed low prices but didn’t actually have anything in-stock? Or what if a major website decided to show low prices after everything has sold out? Some websites keep their listings active even after a product is sold out. Sometimes those products never even sold at those prices, but customers think they did.

So usually, by the time someone calls us, asking us to price match, it’s because we’re the last shop in the nation to have a specific item, color and size in stock, or because they saw a “similar” but not exact product for less somewhere else.

I hate to be the guy that says “Sorry, but we can’t,” but in these scenarios, we really can’t price match. For one, people rarely ask us to price match identical products and two, we can’t trust every website out there that claims to be selling a product at a low price.

Union vs Burton Bindings

For the first time in 3 seasons, I’m back to just owning Burton snowboard bindings on all my boards (and a pair of Spark R&D for my K2 Panorama splitboard, which uses Burton straps).

I had a pair of Capita Superpro bindings for a couple seasons, and a pair of Union Force bindings before that. But no more.

My current Burton bindings quiver includes;

  • The Malavitas on my Super Happytime Death Machine snowboard
  • The Cartels on my Capita Kazu Kokubo snowboard
  • The Infidels on my Monument District snowboard
  • The Spark R&D Blaze on my K2 Panorama splitboard

I’ve always wanted to rock Union Bindings, seeing how the US headquarters is based in Seattle. But there were always little pet peeves of mine that stood out. For example, the toe strap. Is it really a toe strap? I could never tell if the lower strap was supposed to go over the toes, or over the forefoot. It would also shift while riding regardless of which boots I wore. At the beginning of runs, I would start with it on my toes, and it would slide up to the forefoot. Or vice versa. While the Burton one is clearly curved and shaped to go over the toes, the Union one is mostly flat. Union’s website calls it a toe strap so lets assume that’s what it is. But for my size 7.5-8.0 feet, it often fit better on the forefoot.

The bindings scratched my boots! Both in the back where the boots make contact with the heelcup and mostly around where the toe/forefoot strap is supposed to go.

The main difference between the two brands is whether you want plastic bases (Burton) or metal bases (Capita). I don’t have a preference as far as this goes, and both brands offer lifetime warranties on the base. The quality of buckles between the two brands is mostly identical as well. Although Burton has innovated the strap so they could add more marketing buzzwords, like heel hammock, asym hammockstrap, supergrip capstrap and so on.

One area where Capita wins is their design. Products like the Butt Snorkeler, Rainier Beer collabs, Pabst Blue Ribbon and other partnerships keep me looking at their products. But for now I’ll stick with my tried and true bindings.

What is earnest money?

Earnest money is the amount you’re willing to put up front to show that you’re serious about making an offer. So if I make a $300,000 offer on a condo, and another person makes an offer of $300,000, the seller might look at earnest money to see who is more serious. If one person put $500 down for earnest money, and another put $20,000, it would appear to the seller that one person is more prepared and more serious than the other.

When is earnest money due? If I make an offer on a property and it gets accepted on a Monday, I have to deposit the funds at the escrow office by the end of business day Wednesday (2 business days).

This also means you have to have the funds readily available. Maybe the person who makes an offer with $500 in earnest money only has that much in their checking account. So the seller may have the impression that they’re not prepared, even if that person has plenty of funds tucked away in an online bank account that will take a week to transfer. You really don’t know the circumstances, all you know is what’s written on the offer.

Earnest money is also the amount the seller can keep if you default. So, for example, if I make an offer for $300,000 and put $20,000 down in earnest money. And then I decide the day before closing that I don’t want the property anymore after all other contingencies have expired, the seller can’t sue me for $300,000. They can only keep my earnest money of $20,000.

How Do I Put a Strong Offer Together?

Yesterday I was doing some research to prove to my partner Mitch Greenblatt, “I bet every deal that has closed in South Seattle has waived inspection.”

Much to my surprise, that was not the case.

In the last 60 days, there were 32 closed transactions under $400,000 in 98188 (basically the zip code around Seatac, Tukwila, Burien).

15 listings went to Pending Inspection status. 17 listings went straight to Pending (meaning the buyers either waived inspection or did a preinspection).

So in this hot zip code where these listings on average barely lasted 2 weeks, I was surprised at how many still had inspection contingencies.

Then how come some of our clients (who are uncomfortable waiving the inspection contingency) keep losing out on deals? And how can we help them write stronger offers?

  • The number one factor when it comes to putting a strong offer together is always going to be price. When a seller sells their home, you have to wonder, “If two offers had the same purchase price, would a seller sell to a family who wants to live in the home forever, or to a developer who will tear that home down?” In most cases, the seller will want to sell to a family, right?
    • But what if the developer is bringing all cash and can close in 7 days? What if the developer raises their offer price so the family can no longer match the offer? What would the seller do? They would probably take the higher offer. And no one can blame them for that.
    • If a home has lingered on the market for 20+ days (which is a lot of time in the Seattle market right now, circa 2018), then you may be able to offer less than asking price on a home, but in most cases, sellers seem to expect multiple offers and a bidding war.
  • The second factor; contingencies. Once the market started heating up again about 5 years ago, I noticed more and more buyers were waiving inspections. Then we started seeing people waiving financing contingencies. These days, we’re seeing people waive low appraisals and releasing earnest money to the seller early and offering free rentbacks to the seller. The details may seem minor but when offers are identical, these details are going to stand out to the seller.
    • If waiving the inspection is not an option, I would strongly suggest doing a preinspection. Most inspection contingencies take 5 to 10 calendar days and sellers aren’t willing to wait for those results. If you could squeeze an inspection in prior to making an offer, then the seller will feel more confident about your offer and will realize that you’re serious.
  • The next factor; set a game plan. It’s a little like playing poker. It’s tempting to ask the seller on the day of listing, “Would you take X amount right now before any other offers come in?” But at that point, the seller is either thinking, “Woah, that’s way more than I thought would be offered,” or “Hey, so we know at least one person is willing to pay that amount, lets see if anyone else can beat it.”
    • So the game begins. You can wait til the last minute to submit an offer and hope you have the best offer. Or you can try to submit first and pressure the seller to accept.

My advice to all the frustrated buyers out there; get preapproved for a loan, get your finances in order (have proof of funds ready in case someone asks), get in touch with some home inspectors, talk to a real estate agent or two, and go to some open houses to get a gauge of the traffic and to hear what others are talking about.

From our experience, there’s no pattern for success. Some buyers get lucky and visit one home, make one offer and get their offer accepted. Others we have been working with for months.

Best of luck to everyone.

Advice to New Agents

I’ve seen a lot of friends on Facebook get their real estate license, update their status, and (I’m guessing) kick their feet up and wait for the deals to roll in.

I’ve also seen a lot of friends let their licenses expire, and let all that hard work and monetary expense go to waste.

So I wanted to share some thoughts that hopefully helps new agents, things that I’ve learned from personal experience, from talking to friends and from being in this industry for 15 years.

  • Set goals. I jumped into real estate in 2003 without any real expectations. I think I saw some big time agent like Teri Foster or Wendy Lister and thought, I could do 100 deals a year, no problem. Little did I realize I would do 3 deals in my first year (more on that later). What I should have done is align myself more with other new agents similar to myself.
    • It’s different from most jobs, where you know what you’ll be doing on a regular basis, and how much you’ll be making on a regular basis. But the beauty of it is that the potential for growth is much higher.
    • And even if being a traditional agent doesn’t work out, there are so many opportunities in the industry. You can go into commercial real estate, or property management, or manage a real estate office, and so on.
  • Once you become a real estate agent, you are essentially your own company, your own brand. You get to pick out your own business cards, website, email address, what to drive, how to dress, what expenses are important, and so on. Make a to-do list and tackle everything one at a time. Someone else isn’t going to make those decisions.
  • Set aside funds to pay your taxes. When you have a typical job where your company pays you, they take the taxes off each paycheck. When you’re a real estate agent, you are in charge of withholding your own taxes and paying them at the end of the year. Don’t let this amount surprise you!
  • Set a marketing plan and budget. It’s important to reinvest in your business. I can’t stress this enough. You can spend time (and/or money) creating postcards to send to friends and family, buy ads online, create partner relationships with other people in the industry and so on. You won’t believe how many people don’t use you as an agent because they just forget. It’s important to be constantly reminding people that you’re in real estate (and finding that balance between persistence and annoyance is tough).
  • Create a pipeline of leads. My partner Mitch Greenblatt and I use CRM software (there are even free editions available out there). It helps organize your task list, your leads/contacts, and your deals. We can get a quick summary at a glance and be reminded of specific deadlines. We have also partnered with dozens of sources to help potential clients get their real estate questions answered (thus generating leads). This keeps us fresh in the minds of potential real estate clients.
    • The reason I was only able to crank out 3 deals in my first year is because each deal took roughly 3 to 4 months, and I wasn’t doing a good job of managing my pipeline. I would work on one client at a time before moving on to the next.
  • Get techie. Use technology to work in your favor. A blog, website, CRM software, Google Voice number, we use tools like these on almost a daily basis. We can’t afford to sit around and wait for the business to come to us.

Now all of this doesn’t matter if you don’t follow the best real estate practices.

This includes being kind, courteous, giving anyone who takes the time to reach out to you your full attention, being honest and transparent, and working hard to represent your clients well and to do things that are in their best interest.

The focus is and should always be on customer service.

The Case for Shopping In-Store

The company I work for, Sturtevant’s Sports, is celebrating their 31st annual Progressive Sale right now. This week, a lot of the ski and snowboard products are 40% off. In-store.

That’s right, the prices are only discounted in our retail stores.

Why, you might ask? Because retail and online stores abide by what’s called MAP policies, or Minimum Advertised Price policies that are set by the vendors.

That means, if you search for a specific item on Google, lets say the latest and greatest 2018 Rossignol Soul 7 HD, you may be disappointed to know that in mid-March, prices are still showing full retail, $749.95.

Again, these are online prices. If you go into a physical store, that might be different. The reason Rossignol (and all other manufacturers) want to keep discounted prices from showing online is easy;

  • It prevents their product from looking cheap and unappealing. If you don’t know much about skis, and you saw one for $350 and another for $700, which would you think is the better product?
  • They want to extend the selling season. Winter sports is a tough industry because the busiest months are November and December (basically the lead up to Christmas). Then in January, people enjoy the snow with their new gear. Some people go out and buy gear and/or upgrade, but it’s nothing like November and December. Then in February, customers are basically waiting for the sales to start. If online stores started discounting products in January, then it would force all brick and mortar stores to do the same.
    • In this industry, you basically have a 4 month selling window before you have to start discounting prices. It’s hard to think of ANY other industry with a similar life cycle. In most industries I can think of, a product is created with a multiple year life cycle in mind (TVs, cell phones), or rarely ever change (beauty products, toiletries, cleaning supplies). I guess the only other thing that comes close to such a short cycle is clothing and fashion.
  • They want to level the playing field. Lets say the Northwest is having a crap winter with barely any snowfall. People aren’t skiing or snowboarding. As a result, all the local stores have tons of inventory left. I’m sure in this case, all the NW shops would love to clearance out their products to the folks on the East Coast or Colorado. But it wouldn’t be fair to the shops in those regions.
    • Also, if Rossignol were to allow this to happen, those shops on the East Coast might avoid carrying products from Rossignol in the future.
  • A race to the bottom. If  MAP policies weren’t enforced, then stores would continually try to discount their products to “one up” each other. Lets say REI decides to show a price of $700 for the Soul 7 skis, then maybe Backcountry.com drops it to $650. It would never end. The whole system would collapse with some stores trying to sell at full retail and others just trying to break even.
  • And the final reason; I think companies like Rossignol actually want you to go into a store, get fitted for the right product, get the right bindings mounted properly, and so on. If you buy online and don’t know what you’re getting yourself into, it could lead to disappointment, unrealistic expectations, poor reviews, injuries, and so on (Not saying this won’t happen if you shop in a brick and mortar store, but it doesn’t hurt to talk to other people for a second opinion). Companies have developed long-term relationships with a lot of their retail stores and it benefits them when the stores help sell their product.

Obviously, there are many cases when shopping online is easier and cheaper. It’s often easier to find rare items (in my case I like to look up old Nike SB products online since they are no longer in the snowboard industry), or odd size items (like shoes for my small wide feet). But when all other things are equal, I like to try and support local small businesses.

I realize it seems counterproductive, almost cannibalistic, for an eCommerce Manager to suggest going into a store, but a lot of the issues we have in the online department; like people ordering products that don’t fit and wanting to return them, or people misusing products and not being properly educated, or people just ordering the wrong item altogether; these types of issues can be fixed with a quick visit to your local stores.

Our Klahanie Listing

MLS 1251657. 3744 247th Ave in Issaquah, WA 98029.

This is the latest listing from me and my partner Mitch Greenblatt. A nice sized home in Klahanie’s Audubon Ridge neighborhood. While most of the other homes are well under 2000 square feet with only 3 bedrooms, this home features 2140 square feet and a 4th bedroom.

It went Pending 6 days after it was listed with multiple offers (a mix of both written and verbal). That seems to be the norm these days as the inventory shortage in the area continues.

There isn’t much to say about this listing yet, at least until the closing date. But I will say that our clients are ecstatic, as they will be moving into their new home in the Issaquah Highlands by this spring.

Stay tuned for more details…

 

Listed on the Northwest MLS. Mitch and I are licensed with Skyline Properties in Bellevue.

Real Estate

Here we go!

You may be wondering what qualifies me to write about real estate and that’s a fair question.

I’ve been a licensed real estate agent in Washington State since 2004 and have been involved in hundreds of purchase and sale transactions. The great thing about real estate is that every scenario is different. You’ll never have 2 identical transactions. It’s a great career for those who like to look at numbers, are able to negotiate, who enjoy networking and meeting new people, and who are self sufficient.

However, I didn’t get into real estate because I wanted a career. I always thought it would be nice to have a real estate license for when I wanted to buy or sell my own properties. But over the years, as you learn the market, meet new people, and do more transactions, you get into a flow (almost a snowball effect) and end up with a legitimate business that requires bookkeeping, an accountant, a marketing budget, CRM software, a business partner, and so on.

So I wanted to start writing about some of my experiences. Maybe it will help others, but it’s mainly to track my own thoughts.

eCommerce

The world of eCommerce has changed quite a bit since I started my first website in 1999. Back then I had to create a website from scratch (no templates could be found), figure out how to upload media / photos / video onto a server (no services like Youtube or Instagram existed), teach myself software such as Dreamweaver and Photoshop, learn how to collect payments (PayPal was in its early stages and wasn’t widely adopted yet), and most importantly I had to focus on marketing and figure out creative ways to promote a product or service (Facebook wasn’t around, Google wasn’t on my radar yet, and there was a lot of inconsistencies when it came to advertising online).

These days, you can create a site in minutes using a service like Wix, SquareSpace or (in my case) WordPress. If you want to promote a new product or service, you can record a high quality video using your phone and upload it to Youtube in minutes. You then have options like being able to promote that video using an ad campaign or have it on your Facebook feed in front of all your followers.

The reason I created this site is so that I could share some of my experiences and have an outlet where I can document some of my thoughts, mainly for future reference. If it possibly helps others, then great.

The Journey Begins

Thanks for joining me!

Good company in a journey makes the way seem shorter. — Izaak Walton

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