When winter arrives, so does the demand for de-icing products ("deicers") to melt the ice and snow. Though raw material costs are known before winter arrives, most deicer distributors do not openly advertize pricing. This lack of price transparency at the distributors will often remain in effect until the buyer is ready to make a purchase. This article examines plausible reasons for this lack of price transparency and then discusses what this means to the buyers of deicers.
Why is it that most distributors do not advertize the price of the various deicers?
• Answer#1 - "Supply and demand" is used by the distributor to set the price at the point of sale similar to what takes place for retail sales.
• Answer#2 - The distributor prefers negotiating the price at the point of sale based on the buyer's knowledge of product.
• Answer#3 - The deicers being sold are regionally priced by the distributor across the country.
• Awswer#4 - The distributor uses all of the above techniques to set price for deicers.
There is nothing illegal about any of the above pricing strategies. In fact, this is how marketing of many products is done in a free market. In recent years, buyers of deicers have faced an increasing number of product choices. Deicers come in dry and liquid forms, bulk and packaged, blends and un-blended, salt and non-salt products, colored and uncolored, with additives and without additives, etc. All these product choices can make the purchase decision very difficult.
In addition, when pricing is not transparent, it is difficult for buyers to do "comparison shopping", which allows distributors to take maximum advantage of their marketing efforts. There is a recent tendency among many distributors to over market deicers using product claims that exaggerate the true product capabilities. Examples include:
• Low cost rock salt is being mixed with small amounts of premium salts (calcium chloride or magnesium chloride) and the properties of the premium salts are being stressed on the fancy packaging.
• "Catchy" product names are used along with packaging that displays soothing pictures of mother nature to imply a product is better for the environment.
• Color dye added to a deicer is being marketed as a significant aid in controlling application rate. Though this may be an advantage during daylight hours, color dyed salt can actually be harder to see than the gray/white natural color salt at night. Since deicers are often applied while it is still dark outside, it is best to use less costly methods to control application rates.
Generally, if a deicer comes in a fancy package loaded with product claims in place of an ingredient list and the price is negotiable (not advertised), the buyer should be concerned. The chemical ingredients are what a buyer should use to make the purchase decision. These ingredients determine how the product performs.
The distributors with transparent pricing for deicers are often the distributors that sell deicers based on actual ingredients/performance. This is because these distributors are setting the selling price based on the cost of the raw materials in the product. In addition, these distributors do not have the high marketing costs that are often included in the fancy packaged products. Since the raw material cost of calcium chloride (CaCl2) is about 3 times the cost of rock salt, a buyer can expect to pay more for deicers that contain significant amounts of CaCl2. Similarly, the raw material cost of calcium magnesium acetate (CMA) is about 30 times the cost of rock salt. Therefore, a buyer should not expect to find much more than a light coating of CMA in a product even if the product's name implies it is pure CMA, unless it is priced accordingly.
Finally, a pallet of dry deicer weights more than a ton, so the shipping cost per pallet is significant. Distributors that practice price transparency should also include shipping cost in the advertised price.
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