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Colder’s Math: “Voodoo Economics”

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The holiday shopping season is upon us. Colder’s has at least one “new” promotion–or, rather, a new twist on their old trick–called

“Full Back ~PLUS~ $50 for Every $500 You Spend!”

In a nutshell, it’s the same full-back promotion they’ve always had… with some extra sizzle thrown on top, in case the old full-back/half-back parlor tricks just weren’t pulling you in.

Don’t fall for it.

“Sparky” left a great comment on another Colder’s post we thought we would share with you, if you’re still confused or otherwise considering shopping at Colder’s:

I question previous individuals stating that Colder’s is lowering their margins in a time of need or that this is the ultimate good deal. I will admit that at the end of the day this is a ‘good deal’ but only if you enjoy giving Colder’s increased profit margins way above what they should be receiving.

Our story is that we say a dining room set we loved at $1,200. That qualified us for the “full back” promotion and we would get an additional $1,200 as a store credit. They are also currently having an additional 5% bonus so my credit was $1,300. We wanted to buy a dishwasher with the credit and found a nice Professional Frigidaire we liked that also had great reviews.

So, the normal price on the Frigidaire was $750 but the “full back credit” price was $1,060 so basically I was giving Colder’s $360 of my credit back as pure profit to them and nothing to show for it. This is in addition to paying a $400 premium price for the dining room set above their normal price.

Bottom line is that to get my dining room set and a dishwasher, I would be giving Colder’s $710 of my $1,300 credit as pure profit to line their pockets. This is above and beyond the normal profit they receive on the items at the regular prices.

What’s even better is that Best Buy had the exact same dishwasher on sale for $595 with an instant $20 coupon and they also told me about $100 in rebates Frigidaire was offering so I got the dishwasher for $475. Something our salesman at Colder’s neglected to tell us about…..

It was smoke and mirrors from the moment we walked in the door. I spent 20 minutes with him on Saturday and another 30 minutes with him on Sunday. I have his scribble card right here in front of me and none of it makes sense. Voodoo Economics. For the record I have an undergraduate degree in Economics and a Masters in Finance and I’ve worked in the Financial Services industry for 20 years. If I can’t make heads or tails out of this, I’m sure non-numbers people would be baffled by it (or just overwhelmed by the slick sales pitch and just buy everything out of blind faith that they are getting a good deal).

Could I have bought the table at the normal price and bypassed the “full back” promotion? Yes, and the price was $870. However, that was still a normal everyday price with no discounts for the holiday or any sales pricing. Based on my experience this weekend and the smoke and mirrors games, I refuse to give them anything going forward (and I’ve spent probably $5,000 over the years at Colder’s before these types of sales evolved – they used to be a great place to shop).

All they are doing is marking everything up 25 to 30% above the “normal” prices to create the cushion for the “full or half back” promotions. What they fail to tell you is that you are giving them back the 25 to 30% of your rebate in addition to the profit margins they already have built into the normal pricing. [emphasis is ours –alexfalkenberg.com] Nothing illegal about it and if they get people to buy from them, good for them – it’s a free market society. However, it won’t be from me anymore. There are way too many other options out there from stores that don’t play games.

Read it. Twice. Then read it again. You’ll hopefully now find yourself considering and favoring furniture and appliance destinations that are not Colder’s.

Be safe and smart this holiday season, folks. Thanks again to “Sparky” for sharing his experience with all of us.

Colder's, customer service, furniture, home furnishings, incompetence, Milwaukee, Milwaukee Area, ripoff, scam, shame on you, Wisconsin

More Colder’s Customer Disservice

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Another dissatisfied Colder’s customer.

Milwaukee Rising.net‘s original article–posted just last month–asks the question:

Guess which company is more likely to get repeat business from my family and me?

The article compares/contrasts two recent customer service experiences had by the writer, with both Amazon.com and our Milwaukee-area Colder’s Furniture. Amazon handled things well. Colder’s–surprise!–did not:

Amazon — which resolved the issue within a few hours — or Colder’s, which finally dropped off a table without the leaf and a chair that was broken en route and “repaired” with glue that was still so wet when the furniture was delivered that the piece broke off when I brushed against it? (No, the delivery guys did not disclose the problem.) And then did not return our calls? And when I finally went to the store myself and demanded action, ordered the wrong leaf at least twice? And then told me the replacement chair had been delivered when it hadn’t been and did not return my call when I tried to follow up just a few minutes later after talking to my dad? And then, six months to the day after the furniture was delivered, finally came up with a chair that matched the set, but was not the requested captain’s chair (the kind with arms)?

Just guess.

No need to guess. Wet glue? Six months later, and still got the wrong merchandise? You would logically think there’s simply no way any company could be so incompetent and unwilling or unable to get it right. But we’ve had “The Colder’s Experience”. Others have, too.

Something Less Is Not A Deal

This same family was also unnecessarily berated by Colder’s staff, another apparent hallmark of Colder’s customer-service program:

Colder’s […] customer service rep berated my sister when my dad’s new furniture didn’t arrive for more than an hour after the store called and said the deliverers were on their way

So familiar. It’s happened to us, and it’s apparently happened to far too many of you, too (and is still happening). It’s almost amazing that anyone is surprised anymore.

Bad customer service increasingly seems to be the rule with Colder’s–rather than the infrequent exception from even the best businesses. Sketchy sales promotions, bad customer service… it’s just not worth it.

Colder's, customer service, fraud, furniture, half back, home furnishings, incompetence, Milwaukee, Milwaukee Area, promotion, ripoff, scam, shame on you, Wisconsin

Colder’s Is Doing It Wrong – And Not Just in Grafton

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The following comment was submitted by Tim on 21 March 2009 in response to our post “Colder’s Furniture ‘Fan’ Calls US Extortionists “. We reply immediately afterwards.

Tim’s comment:

I absolutely hate colders pricing methods.

The main issue with the full back or buy back program is that the “retail” price or higher price on their tags is SOOOOO expensive, that it’s inconceivable that anyone would be stupid enough to buy an item at their “retail” price.

The other price they have on the tag is “floor model” price which means that you must take the item off the floor. This to me is not consumer friendly. Also, with the economy the way it is, the floor model price is now the same price for a new item in the box. Colders is starting to realize how uncompetitive they really are.

Their sticker pricing is so ridiculous, that any good consumer who does his or her homework should be able to spot these ridiculous prices and not be fooled.

Please do your homework before you make an expensive purchase and you will not get burned.

I honestly believe that the Colders in Grafton will not be open much longer. The store is never busy, and even the Sales Associates who are 100% commission have commented to me on how ridiculously over priced their “retail” price is.

Thanks for sharing, Tim.

We believe Tim is spot-on about Colder’s pricing. We’ve had people defending their pricing, being OK with paying hundreds more for an item because they were getting “money back” toward “something more”. We admit we don’t quite get it. That “something more” has to then be purchased at Colder’s regular-retail price, which we’ve often seen to be high compared to competitors, so where exactly are the big savings? And even if you do manage to score a deal and save, say, a couple hundred bucks…if you end up having problems or need something after the sale–we’ve read enough reports of Colder’s showing absolutely no interest in fixing items or otherwise taking good care of honest customers–was it really worth it?

Not Colder's Merchandise...Yet?Once they have your money, apparently, that’s it for them. Some deal that is, right? And your cash-back credit? That’s money in their pocket, too, if you end up not cashing it in…

We drive on I-43 and Hwy 60 past the Grafton store quite often, sometimes several times a day, and definitely agree with Tim’s won’t-last-much-longer assessment. The parking lot is almost always embarrassingly empty. We can recall only a few times where there was more than one other party of shoppers in the store at the same time we were. That can’t be sustainable for too (much) long(er)…

We also don’t get how Colder’s sales associates deal with it. We’re not surprised to read Tim has heard sales associates complain, either. Colder’s salespeople are paid on a 100% commission basis, as Tim mentioned; we can’t imagine any sane person taking such a job at a virtual ghost town, or lasting very long there if they did. If they’re busy, at Colder’s normal prices, it certainly has the potential to be lucrative, but the lack of customers means lack of sales, which in the case of a 100%-commission position means a total lack of income…

It’s crazy to stand around all day earning nothing. Maybe that explains the behavior of the saleslady that’s stalked us through the Grafton store so many times, too.

The Colder’s Northshore/Grafton problem will become more exacerbated or maybe even solve itself by way of store closure if/when Steinhafels builds more or less right across the street; Steinhafels allegedly owns property right off that same I-43 exit and it’s assumed they will eventually build a store/showroom there. (Disclaimer: this is not in any way an endorsement of Steinhafels.)

We definitely think there’s demand for a bigger-box-variety retail furniture store in that part of Ozaukee County. But Colder’s isn’t it, by our own estimation, and it’s increasingly clear it’s their own fault–brought about by terrible pricing, ridiculous promotions, unethical sales behaviors, general rudeness, poor customer service all the way up their corporate ladder to Colder’s corporate head of “Customer Service” Sue Lewicki, and likely beyond. Before, during and after the sale. And not limited to just the Grafton/Northshore location, either.

Company-wide, they’re Doing It Wrong.

Really, about the only thing we think they do right is provide a relatively large selection of merchandise (which does not, to our knowledge, include the Inflatable Toast Mattress, pictured above…). Nearly everything Colder’s sells you can find–and buy–elsewhere in the Milwaukee area or even online, easily enough.