As an Irish based retailer I'll chip in on this one.
Music instrument retailers in past (pre internet) were used to 50% plus mark ups.
Many of the folks who have done this all their lives have found it difficult to come to terms with the reality of the current industry. Some folks simply refuse to compete and that is why some shops in Ireland are expensive. Their costs of running the business have not gone down 20-30% so why should their income?
On the other hand many of us realise the situation and have tried to compete.
Our (strings.ie) mark-ups range from under 10% up to 25% and sometimes 30%. I can think of only a handful of items we could get 50% on and get away with it.
The problem is, the consumer does not understand the realities of doing business in Ireland and instantly labels us a rip-off.
I occasionally get emails from customers about all this and I always try to explain the situation. In the old business model the manufacturer sets the price they sell to the distributors (wholesaler). The distributors then adds their bit + taxes and sells to the retailer. The retailer then adds his bit + taxes and that is the price the customer pays.
This should mean that all retailers are buying at the same (ish) price and any variation in the selling prices are down the the retailer.
Then came the internet and Thomann/similar. Thomann figured out that if they could sell enougth of something at 10% it was a viable business move. This is essentially known as under selling the product and devaluing its market value. While this is great for Thomann (the Tesco of M.I if you like) its bad news for all the small guys who now have their customers asking them to match Thomann's prices without anywhere near the volume of sales.
Thomann's next move was the swing their new found weight around and cut out the distributor and buy direct from the manufacturer and demand better prices based on the sheer amount they were able to shift.
We now see a clear distinction between some manufactures who have prostituted themselves to Thomann and others that have stood by their long term customer base.
There are products Thomann sell cheaper than we can buy them trade in Ireland. But on the other hand, brands like Ernie Ball who remained loyal to the customer base have set pricing and that's that. This means Thomann buy at the same price as we do and in this situation you will see we (strings.ie) are cheaper than Thomann for Ernie Ball electric strings.
That is the reality with the larger shops like Thomann.
Another area that really winds me up in this country is taxation. Vat is 21%. That instantly puts us as a 3.5% disadvantage to UK retailers. At the very least they should match it to the UK, our biggest trading partner.
Another one I often get is customers asking us to match prices from the US. Everything is cheaper in the US. The fact that petrol is a lot cheaper has large factor on manufacturing costs all the way through the chain. They also don't have Vat so that is 21% instantly knocked off not to mention the import duty. Then on top of all this manufacturers set the pricing geographically so US retailers can buy much cheaper than E.U based retailers.
It is simply not a fair playing field.
Again the government in Ireland does not help. I believe most parcels imported to Ireland from outside the E.U with a declared value of under €50 (maybe higher) go through the system without revenue being collected. While great for the consumer its just not fair for the retailer based in Ireland not to mention the millions lost in revenue.
Our business generates quite a lot of tax for the Irish government and we get nothing in return.
It may be great to buy your stuff from Thomann but none of that money goes to Ireland. None of the stock is sourced from Irish suppliers. This ultimately leads to less jobs and less taxes to provide your country with the much needed resources to make this place better. You may save personally but we all pay in the end.
Having said that, most good music shops in Ireland are only too happy to try and price match Thomann and others where possible. If we can get it and not make a loss we would love your business. But bear in mind that if a retailer cannot match Thomann's price it may not be because they are a rip off. In reality it just may not be viable to lose money.
We have quite a few customers in Europe but in our three years of trading not once have we had an order from Germany. It could be that Germany have Thomann and others so no need to buy outside the country but I would argue that Germany, and in my opinion France, are far more nationalistic than Ireland or the UK. The E.U is supposed to be an open market but having recently visited a friend trying to setup an Irish bar in France I was shocked when he told me how difficult he was finding it to source Guinness in France. He told me "they simply don't want you importing it". Now I may be jumping to conclusions but I noted 9 out of 10 cars in France are French.
Ultimately you have to wonder why Germany and France's economy's are in much better shape than ours. I note this forum still has a lovely big free advert for Thomann in form of a sticky