Thread: Amsoil?

I will be installing a rebuilt tranny in my car in the coming weeks.

So, I looked around for the best ATF I could find. After some research and in talking with TEP, I decided on Amsoil Dex6.

My question: I don't understand their business model. Specifically, they seem to be setup through distributors. They're not in any storefront I can find or at any internet parts store (amazon, RockAuto, Advance Auto, Checker, etc). So - I call around the local disctributors and I can get "retail" pricing.

I then go on the Amsoil website, and I can get retail pricing there too. I process the order and there is something about being a preferred customer. I click the link. Basically, for $10 (the registration fee to become a preferred member), I can buy wholesale. Since I need 14 quarts, I click the link, run the math, and I'm saving $35 or so on this order, so it's a no brainer (a net $25 savings).

My question: being a "preferred customer" allows me to buy at wholesale right off of their website. This, near as I can tell, is the same price the distributors PAY. So, my question is, what is the point of the Amsoil distribution model?

It seems to me that you would be foolish to be an Amsoil distributor when your customers can buy it wholesale directly from Amsoil.

What am I missing?

My question basically is about the disctributors, not the mfg (Amsoil). Why would anyone be an Amsoil distributor when you can be undercut by the manufacturer?

For me, I guess I don't care. I'm just wondering if there's something I'm missing (eg do distributors buy at less than wholesale)?

They get commission and can sell for more than "preferred customer" price to preferred customers as well as regular customers.

You also get the product sooner versus buying direct.

That's what I was wondering - I assumed a distributor can buy at LESS than wholesale (what I can buy at as a preferred customer).

That being said, the 'starter kit' they send you to entice you to be a distributor DOES NOT SAY ANYTHING about the price structure being LOWER than wholesale - it basically says you STILL pay wholesale BUT get a commission. So, naturally, my question was: how could you GET a commission if your customers can go to the mfg direct and buy for the same price as you?

Have the product on hand and tell your customers: heres the product right now for the same price, no waiting.

But it's not the same price unless you, as a distributor, are willing to make 0 (selling at wholesale which is your cost). Moreover, you're ignoring the soft cost of you, as a distributor, tying up your cash waiting for a sale or freightong it in or warehousing it. So, you would be losing money as a distributor UNLESS you sell above wholesale.

What you intimate is that customers are willing to PAY for convenience. That is the ONLY way their distribution model makes sense.

Personally, I can wait 2 days (what it took for UPS ground for me) in order to save $30 or whatever.

If you want to but one quart, and you need it NOW, then going thru a distributor may make sense. Otherwise, I don't see the point (again unless disctributors buy at significantly less than wholesale which I'm pretty sure they don't or they're offered consignment which I'm also pretty sure they aren't).

My company just hired a guy from Amsoil (the manufacturer) who did uptower wind generator sales/service. I'm thinking of asking him about their distributiom model. To me, it makes no sense at all.