Let's Make A Deal
(Caveat Emptor)

By Jeffrey Allen

I am often asked about where to go and how to get a good price for a variety of electronics equipment. Recently I have received many requests for guidance on buying digital cameras (“digicams”) and digital video cameras (“DV cams”). This article will address the process of selecting a vendor and making the purchase. It will not address specific digicam and DV cam features or models. (For a discussion of digicam features and models, see my Road Warrior column in the June issue of GPSolo’s Technology & Practice Guide.) The rapidly changing world of digital photography makes discussions of specific models out of date within months. The guidelines provided below have a more enduring value as they will continue to serve you well long after the current crop of digicams and DV cams have become distant memories.

You can find digicams and DV cams in a variety of places and for widely differing prices. Depending upon your preferred method of shopping, you can pay list price for the camera, pay a premium over list price, or acquire it at a substantial discount. Buying at a discount often means purchasing on the Internet or over the phone (you can often realize greater saving from an out-of-state vendor). Telephone and Internet sales can save you money, but they can also cause you considerable aggravation and sometimes cost more money. The bottom line is, wherever you buy, use an appropriate level of caution and take reasonable steps to protect yourself. Remember, not every vendor has a level of business ethics deserving of your patronage.

Digicams and DV cams do not have large margins (the difference between the manufacturer’s list price and the price paid by the vendors. Available discounts will vary over a considerable range. The manufacturer, the cost of the camera, newness, popularity, and availability of the model will also play into the deal that a vendor will offer you. The vendor may also play other factors, based on its own situation. To give you an idea of the range of discounting you might find on the Internet, as I wrote this article, I looked up a few cameras on the Internet at the Cnet site (see below). I checked pricing on two digicams and two DV cams. For digicams, I found Canon’s very popular Powershot G5 ($800 list) offered at pricing between $598 and $800) and Sony’s DSC F717 ($800 list) at pricing of $625 to $800). On the DV cam front, I found Sony’s DCR-TRV80 ($1500 list) offered at pricing between $1075 and $1500) and Canon’s Elura 50 ($800 list) for prices between $550 and $800).

At the present time, many vendors do not charge sales tax on telephone or Internet purchases shipped to a state where they do not have a physical presence. Accordingly, if you live (and take delivery) in California and purchase from a vendor that does not have a “presence” in California, such as MacWarehouse or PCWarehouse, for example, you will not pay sales tax in connection with the purchase.

If you want to buy a digicam or a DV cam, regardless of whether you plan to buy from a brick-and-mortar store, over the phone, or from an Internet-based vendor, you should start by doing some research. After some preliminary work, you will have the ability to determine what features you want and need. Your investigation should include both online research and a visit to a brick-and-mortar store. You might also want to check for product reviews in the most recent issues of popular photographic magazines, such as Camcorder (for DV cams) and Popular Photography & Imaging (for digicams and DV Cams).

You can get a great deal of information about digicam and DV cam models, features, and prices over the Internet. Use the Internet or magazine reviews to identify several camera models that appear to satisfy your needs. In checking out cameras, go to the manufacturer’s website. You can usually find a specifications sheet for the camera, a list of features, a list of available accessories, and the list price on the manufacturer’s web site. Many manufacturers have a feature on their websites that enables you to locate a vendor near you, where you might go to look at the camera “up close and personal.”

If you don’t know the manufacturer’s URL, you can usually find it by going to www.google.com and then searching for the camera by the name and model number. Google regularly provides the manufacturer’s website in response to such a search.

If you want to find out what reviewers have said about the camera, you can check magazines such as Popular Photography or look up reviews on the Internet. CNET ( www.cnet.com) is a good source for consumer reviews of a number of products, including digicams.

While exploring reviews at CNET.com, you can also check pricing at a number of vendors available through the Internet or otherwise. CNET will also identify vendors that it considers reliable, based on purchaser’s evaluations. You can access pricing directly from the CNET.com site or by going to CNET’s www.shopper.com. Other sites worth checking out for prices include www.pricegrabber.com and www.pricescan.com.

Before buying any camera, go to a store that sells the camera you are thinking about buying and look at the camera. Hold it in your hands. Check out its weight and size and the placement of its controls. Make sure that you are comfortable with the camera and that its controls work conveniently for you during use. Look at the image in the LCD display, and if possible, check the LCD display out in sunlight as well.

Once you have identified a camera model that you want and decided on one or more probable vendors, you can start to negotiate the purchase. I refer to the process as a “negotiation,” because the process of purchasing a digicam or DV cam online or by phone often resembles the process of buying silver jewelry on the streets of Tijuana. The initial asking price and the final purchase price may not be the same. Virtually all phone and Internet vendors will negotiate the price if you ask them to do so. Many brick-and-mortar stores will as well, although they generally will not offer as substantial a discount. Factors that help you in the negotiation include the length of time a particular model has been on the market, the quantity in the vendor’s inventory, the availability of replacement inventory, the popularity of the model, the size of your purchase (the more you buy/spend the greater flexibility the vendor will likely show in the adjustment of the price), and the time of month (buying at the end of the month often gets you a better price than buying in the middle of the month). Willingness to make an immediate purchase often makes a difference in the deal you can get.

You can often place your order with a discount vendor either by phone or online. Each approach has its own advantages and disadvantages. If you plan on negotiating the price, you will probably want to call; it is faster than email. If you call, you may get the benefit of suggestions of other models (which may or may not be better than what you initially chose). If you call, you likely get pressured to buy accessories or/or extended warrantees at often-inflated prices to offset any discount that you negotiate. If you go into a brick-and-mortar store, you will get similar “guidance,” but often in a lower pressure environment.

When you are ready to purchase, please keep the following tips in mind to help you protect yourself.

Tip No. 1 . Look Before You Leap. Do your homework. Investigate thoroughly and decide what you want before contacting a discount vendor. If the vendor tries to talk you into a different camera than you planned to buy, and the different camera sounds really good to you, don’t buy anything. Check out the new model and decide if serves your needs better than your first choice (sometimes you will find that it does). If so, check comparative pricing and buy the digicam. Impulse buying can get you burned badly. Never buy a camera model that you have not seen operate to your satisfaction.

Tip No. 2.
Never pay in cash, checks, or via wire transfers. Use a credit card to buy over the Internet or phone. The rules and regulations respecting credit cards afford you some protection against a vendor that ships nonconforming goods or that fails to ship at all after charging your card. If you want to exercise extra caution, get a separate, relatively low-limit credit card to use in such transactions. If something goes wrong and your credit card number gets picked up by someone that shouldn’t have it, you can cancel the card without interrupting your other credit card usage.

Tip No. 3. Beware of Gray Market Goods. Certain vendors sell goods that were not manufactured or distributed for sale in the United States. These goods, sometimes called “gray market” goods, have found their way to the United States through a circuitous route, and gray market vendors will happily sell them to you, often at an substantial discount. Many of the so-called gray market goods are made by well-known manufacturers, arrive in excellent condition, and work perfectly fine. On the other hand, gray market goods may also arrive without a set of instructions in English. More importantly, they will almost definitely arrive without a U.S. warranty. The absence of a U.S. warranty means that if something fails, you get to find a repair center and pay to repair or replace it.

Tip No. 4. Beware of the “U.S. Warranty” Scam. Some vendors, anticipating that a customer will know enough to ask for a U.S. warranty, sell gray market goods with a third-party warranty contract provided by a United States-based repair service. Since the third-party warranty comes from and provides service through a United States firm, the vendor will, truthfully, tell you that they will sell the camera to you with a “U.S. Warranty.” These third-party warranties often do not match the breadth of coverage of the manufacturer’s warranty. Unless you feel like gambling, when you order, be clear that you want a camera that comes with the manufacturer’s U.S. warranty, not gray market goods.

Tip No. 5. Beware of the Shipping Charges Scam. Some discount vendors will quote you a very favorable price for the camera of your choice. While you are congratulating yourself on the great deal you just made, the vendor will then recover some of the profit discounted out by adding an excessive amount for “shipping and handling,” say $60 or $75 when the true cost should be $20 or $30.

Tip No. 6. Service Contracts Cost Too Much. Often you will have the opportunity to purchase a vendor or third-party extended-service contract for your new digicam to supplement the manufacturer’s warranty. Distinguish these from extended warranties from the manufacturer. They are either a store arrangement or a third-party warranty package. Generally the service contract or extended warranty costs 10–30 percent of the cost of the camera, depending upon its scope and term and depending upon which vendor offers it. The primary purpose of these contracts appears to be creating an opportunity for the vendor to make a few extra dollars. These extended warranty packages often do not represent a good value, and you probably should forgo the “opportunity.”

A final note about the brick-and-mortar stores: Some brick-and-mortar stores (and some Internet and phone vendors) will diligently work to provide you with accurate information about digicams, DV cams, accessories, and prices. Unfortunately, other stores operate in an ethical void that allows them shamelessly to take advantage of the uninformed. Just because many discount camera stores exist in New York, for example, do not assume that going into a camera store in New York will allow you to get a good deal on a digicam or a DV cam. I recently visited New York. While there I went to Times Square. For those of you who are not familiar with Times Square, it is in the heart of the theater district. Within a several block radius of Times Square you will find an incredibly large number of camera and electronics stores. Many of the stores have displays suggesting that they will sell you electronics equipment at very favorable pricing. When you talk to the salespeople in many of the stores, they will endeavor to convince you of the same thing. I went into five of the stores within a few blocks of Times Square and talked to them about buying a particular piece of camera equipment that Panasonic had recently released.

Although Panasonic lists the unit at $399, all of the five stores I went into represented the list price at substantially more than $399 (the range ran as high as $1,200). None of the stores actually tried to sell me the piece at their fictitious list price; each offered it at a lesser amount (but still well over the list price). All of the stores anticipated negotiation over the price. Upon my request for a better price, each immediately offered a further “discount.” The best price I received from these five stores was $543 (after some haggling on my part) for the unit (only $140 over the manufacturer’s list price). When I told the sales manager who made this very special offer to me that I knew Panasonic listed the piece for $399, he did not even bat an eyelid before telling me that his price was still a good deal, as people regularly pay premiums for electronics in New York. Even then he did not offer to sell it to me at the manufacturer’s list price. The bottom line is, don’t buy anything until after you have checked out the manufacturer’s list price and available discounting. Caveat Emptor.

Jeffrey Allen ( jallenlawtek@aol.com) has a general practice in Oakland, California. His firm, Graves & Allen, emphasizes real estate and business transactions and litigation. He is a frequent speaker and author on technology topics and the Editor-in-Chief of the GPSolo Technology & Practice Guide and the Technology eReport .

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