Tuesday, February 2, 2010

The Cost of Not Buying A DirectBuy Membership

As an eight year employee of DirectBuy I have decided it is time to actually reveal a little something about the cost of membership. While many have attempted to explain the cost of a DirectBuy membership I believe it is only fair to take a look at what it costs not to have DirectBuy. The example I will use comes from the personal experience of my analyzing the purchases of my parents since I started with the company.

Admittedly, when I started at DirectBuy I had only recently left a retail store after two years in the computer department. This experience made it quite easy to see the value of the membership immediately. In fact, a recent purchase I made with a coupon, during a sale I was patiently awaiting having had privy to it, and with the application of my employee discount could still not compete with the true cost price revealed to me during my interview. So compensation as an employee or no I immediately felt compelled to spread the word about the service.

After being hired and despite the adage of "a man can not be a prophet in his home town" I immediately told my parents about this company I just found out about myself, including explaining the membership dues. Their response of course was that it sounds great but that they had no need for any such service as they had just moved into the home they built only two months before. Rather than me selling them on the benefits they sold me on why they had no need. Yet another sales adage.

Anyway after plenty of years to observe the purchasing habits of my parents while being on the inside it is high time I share the cost of not joining DirectBuy. Keep in mind my parents are in no way above average. My father is an electrician and my mother is a homemaker and they have a total household income well below $100,000. They also refuse to use credit cards. They believe that, aside from a house or car, if you can not pay cash, you do not need it.

To demonstrate the high price of life without DirectBuy I will review the purchases my parents have made over the years and only after I started at DirectBuy. Also, I might point out my father will settle for very little less than excellent quality items and they must all be brand name. He is also a shrewd shopper that shops online first, several stores second, and haggles third.

I will only mention items where I am certain we carry the exact same brands and will show comparisons for items that I checked the prices on and can not mention brand names. These are all rough estimates rounded down from my parents prices and up from what I remember looking up afterwards including shipping and handling. How do I so clearly remember the figures? I repeatedly used them every time they bought something to remind my employees of the benefits.

So here is the list
42" Plasma TV $3200 DB Price $2600 Retail Fee $600
Plasma TV Stand $900 DB Price $500 Retail Fee $400
Entertainment Armoire(Clearance) $800 DB Price $500 Retail Fee $300
Cordless Phone $150 DB Price $100 Retail Fee $50
Snowblower $600 DB Price $450 Retail Fee $150
Riding Lawn Mower $2300 DB Price $1700 Retail Fee $600
Two Adult Bicycles $700 DB Price $550 Retail Fee $150
Computer Desk $1200 DB Price $700 Retail Fee $500
Dining Room Set $1800 DB Price $1100 Retail Fee $600
Mattress $1800 DB Price $850 Retail Fee $950
Outdoor Furniture $1500 DB Price $800 Retail Fee $700
Pool Table $1700 DB Price $1300 Retail Fee $400
Place Settings $250 DB Price $100 Retail Fee $150
Living Room Set $2200 DB Price $1100 Retail Fee $1100
Refrigerator $1700 DB Price $1300 Retail Fee $400

Total amount spent in eight years just on items listed $20,800.
Cost of not having DirectBuy membership $7050.

Items purchased I never compared prices on include a mailbox, storage products, blu-ray player, dvd recorder, surround sound system, pressure washer, leaf blower, tires, coats, work boots, mini fridge, sofa table, linens and comforter, dog bed, rugs, grill, artwork, countless toys for presents, and other various gifts I have seen given, and certainly many other things that I have not noticed or am unaware of.

All these items listed were items available through DirectBuy. Not similar, they are the exact same. Items that nearly every household will purchase over the course of time, amounting to only about $2000 per year, and most of which can not be anticipated. In fact my parents were just telling me about the washer and dryer showing their age and needing replaced.

I never harassed my parents about joining and as with anyone that brings up something they bought retail I will always agree they got an excellent price. Having found that doing otherwise only offends and causes people to justify buying retail. Similar to the many people that passed up the offer for DirectBuy membership and yet still feel compelled to express why they were so smart in doing so.

DirectBuy has introduced tiered memberships and even short term options and I will not break those down or give any specifics regarding these. You can even get a free trial without a credit card or payment by clicking here. Anyway, the greatest disservice done to my parents was my having revealed the dues eight years ago. I will say that at that time the dues were $3600 for an entire ten years including renewals. Meaning that had they viewed that as an investment rather than simply a fee they would have saved $3400 just on the items I have compared the prices on. Nearly a one hundred percent return on investment in ten years!

That is well beyond any investment opportunity I am aware of today and my parents had just built a home prior to even hearing about DirectBuy. Not to mention that ,since 2001, they have not made one single purchase that would have completely paid for the entire membership. Which I have seen happen countless times.

To all the sales people out there consider this a lesson on how dangerous it is to reveal price before showing benefits. To anyone considering DirectBuy view this as a realistic picture of what DirectBuy can do. Sadly, I fear that as a result of my having done so that I have doomed my parents to endure neverending retail fees for as long as they buy things. Which does not appear to be coming to an end anytime soon.

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