Revealing Furniture Store Markup Scams And How To Negotiate

“Close mouth don’t get fed”

Please, ladies and gents stop paying full price for furniture! Stand your ground when shopping for furniture. Furniture stores mark up their prices 100-400% higher than the retail price. Negotiating is a must, stop being shy or afraid to negotiate there’s ALWAYS wiggle room in their prices. Don’t expect them to give you the discount right away, this will require some going back and forth because the more u pay the more commission they make.

For years furniture stores have been ripping off consumers. I understand every business needs to make a profit but 400% that’s outrageous. Below you will find everything you need to know about how they mark up their products and also how to negotiate.

It’s On Sale They Say

Furniture stores are notorious for marking up their products 3-4x the actual value of the product, then throughout the year toss in the word “sale” to fool the Public into thinking they are getting a deal.

Let’s analyze this why would anyone sell their products at such “discounted prices” 30-80% off? Financially it just doesn’t make sense. If you invented a physical product (it could be anything) and it cost you $100 to make why would u sell it at let’s say 40% off that’s a $40 loss every sale you make.

Now the same example. You made this physical product cost you $100 to make, but this time u decide to sell it 3x (300%)  the actual cost which means sell total=$300. That’s $200 profit every sell u make. Financially scenario 2 sounds better right?

After selling quite a few products at 3x the valve, a holiday or special event comes around and you decide to have a 40% off sale. So 40% off $300 = $180. With $180 being your sale price you still profit $80 every sale you make which is great by the way. 

Since you marked up the price that high in the beginning you were able to sell at 40% off without hurting your profits and that’s exactly what furniture stores do day in and day out. So the next time you see the word  “sale” take it with a grain of salt.

The Famous Gray Line

You’ve probably seen this before when shopping for furniture either online or in stores. They’ll have a price with a gray line going across it and next to that price is a lower more appealing price. The first thing that usually comes to mind is, that’s a great deal I should buy it before they raise the price back up.

Don’t feel bad we’ve all fallen for this trick before. The two prices they’re displaying have a name, the price with the red line going across it is referred to as the “MSRP” which is the manufacturer’s suggested retail price, this price is usually 3-4x higher than the original cost. The lower more appealing cost is referred to as the “MAP” which is the minimum amount reseller agrees not to sell below. Even selling products at the “MAP” price that’s still a good 40% markup on the original cost.

A great way to identify if a store manipulates their price is by checking how much time per year do they have a “Big Sale”. If its more than twice a year then they are ripping off their customers. like I mentioned before it’s not financially smart to lower prices that low unless you know it doesn’t affect your profits which in their case it doesn’t.

In some cases, it’s normal for retailers to have big sales. Especially if new inventory is coming in, they have to clear up some space to make room for the new shipment. Even then that’s not every week or every holiday event as we been conditioned to believe. 

Endless Additional Fees

It’s bad enough they sell us products at ridiculous markup prices. Then they have the audacity to start adding additional fees such as delivery, and assembly fees. These fees can get quite expensive delivery fee alone can cost you up to $100 and add another $100 if you need help putting it together. And let us not forget if you order numerous pieces or sets, that’s more fees they will add on.

Then they’ll convince you to get a protection plan for your furniture and depending on the product you purchased you can pay a few hundred dollars extra just for the protection plan. A protection plan is good and all but I personally don’t bother getting it mainly because I have no kids (except for my wife).

Oh, by the way, the “protection plan” only covers you for a stain, a simple stain! Nothing more nothing less. The sellers will sell you a beautiful dream about the protection plan because they receive commissions for every plan they sell. I’ll be the first to tell you its nothing as they describe I’m talking from experience.

Last year I tried to file a claim to get my sectional “cleaned” I called them and they told me they cant clean my sectional the only thing they were allowed to do is remove one stain, yes you read it right one stain.so if u have multiple stains you’re SOS. with that being said do you think it’s worth getting their protection plan?

Maze Trap

The majority of furniture stores use sneaky tactics when laying out their showroom. They will create a maze with their furniture forcing you to look through all their inventory, including little accents and pillows before landing on what you originally came in the store for. 

It’s actually quite clever of them, they study human behavior and they know we like to act on impulse, and emotions. Once they plant that seed in our head they know they got us. The seed, in this case, would be a nice furniture set you may have seen when Maneuvering through their maze.

They use this sneaky tactic to increase their sales by forcing you to make an impulse purchase. They can easily tempt you if u do not have strong will power.

Some stores even turn it up a notch and make their customers walk through the entire store and inventory before arriving at the cash registers. 

An IKEA spokesman says the stores’ layout is intended for customers to see the range of its products and that their stores have seven shortcuts to skip through sections or straight to the register. But not everyone spots those shortcuts. “If you don’t go to IKEA very often, you might not,” he says.

The layout is so brilliant it should be illegal. They will advertise a “sale” then place all the discounted furniture all the way in the back of the store. You would have to walk through all the full price merchandise before arriving at the “sale” you came in for.

Furniture stores have so much faith in human nature, they know the odds of us buying the full price product and disregarding our main mission of the trip to their store is High. In some cases, they will even get customers that buy the full price product and the “sale” product. 

Not having a strong will or not setting a budget as I talked about in my previous post will run your pockets DRY.

Never Settle

When shopping for furniture, we believe good deals only come during a sale, so we don’t question the sale price and believe that’s the lowest the price can go. Well if u think like that you are limiting yourself to possible savings.

Always try to negotiate no matter what the price is. There’s always wiggle room in their prices and don’t let them tell you otherwise. Even if a 100% off sale is going on, ok I’m exaggerating but you get the point.

As I mentioned before retailers mark up their prices 100% and above the actual value of the product. Selling at their MSRP helps them scale up their profits. So when they claim to have a “Big Sale” don’t feed into their Bs. 

All they’re doing is lowering the price back down to the MAP price to fool us into thinking this is a legit “big sale”. Retailers gross margin is anywhere between 35-50% and gross margin is the difference between the sale and operational expenses.

Negotiating 101

  • When negotiating, always come at it with an angle don’t expect a discount to be handed to you. Negotiating takes work and both parties need to benefit from the deal. You have to give the employee a reason to lower the price for you, tell them you are interested in making a large order and watch how they face lit up. The majority of a sales employee paycheck comes from commissions. So they will be more than happy to negotiate a price that both parties will agree on.
  • Look for any defects and bring it up to the salesperson, typically the floor models are your best bet to find defects. Since customers interact with floor models, the odds of you finding defects is very high. You can save 40% or more if you don’t mind having a little dent or blemish on your furniture. 
  • Go above and beyond the sticker price, even if the product is on sale ask for a discount, because 10/10 its usually marked up and have room to negotiate a lower price. 
  • Most stores have the capability of seeing the lowest possible price on a product when ringing up a customer. So while you are at the cash register ask the cashier politely for the final price and they might be able to give you it especially if their boss not around them.