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The short answer is fairly simple...
Retail stores generally go by the manufacturers suggested retail price... which is marked up substancially.
Also, retail stores have alot more expenses so they need higher revenue to maintain profit margins. A retail store might buy the camera for 300 dollars, but they have to pay alot of employees, maintain stores, pay for alot shipping (from the manufacturer to warehouses and then from warehouses to the store, etc - more stops than online warehouses normally), and advertising on TV is also a big expense.
Online retailers eliminate alot of these costs.
They buy direct from the manufacturer and then resell it. Less costs + fewer middlemen = lower market price
There are hundreds of other reasons too... those are just a few that I thought of off the top of my head.
The fact that many retail stores, such as a Circuit City or CompUSA is a much bigger corporation has alot to do with it (name recognition). Online there are a ton of online retailers.. all tryign to undercut each other, thus they all have to settle for selling at lower prices and less profit per item. There is less competition in a local area with stores actual then there is online. Many people like going to a store rather than buying online for a number of reasons and are willing to pay it. Simply put, if retailers weren't able to sell it for 600 dollars they would drop their prices. Online retailers have much higher competition and to stay in business are often forced to sell for lower prices. Breaks down to supply, demand, and competition = market price.
Last edited by VHockey86; 03-07-2004 at 03:00 PM.
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