billy walker
BMW Rider
I don't know how much it relates to today, but many years ago while in HS/College I worked at an auto parts business. (New parts). The best customers (like car dealerships) received a 30-40% discount on everything, so the markup had to be humongous.
Having never worked with cars I can't address your example beyond a few facts. However, most OEM motorcycle "hard" (not accessories as they are marked up less usually) parts provide for a gross profit (GP) margin of high 20's to 40% gross profit margin. Much of the lower priced parts allow for the 40% GP.
1) If you take a dealer net of $1.00 and use a 1.70 multiplier you arrive at $1.70 retail value. A 1.7 multiplier allows for a 40% GP. Using your self-stated 40% discount you would be retailing the product for $1.02. With overhead a substantial loss.
2) Using your 30% discount you would be retailing the product for $1.19. Throw overhead into the picture and you're way too close to break even to even consider.
Neither of the above examples take merchant account fees into consideration. The 40% discount would put you at a loss and the 30% would probably be a loss as well. A few mistakes in inventory which cannot be returned can turn the whole thing upside down.
Even a 10% discount off a 40% GP results in a 20% (rounded) drop in GP when compared to full retail. Pretty big differences. The margin's have decreased through the years and unless you run a tight ship you can expect problems. The whole motorcycle clothing arena is nothing but a pure joke so we won't get into that.
Auto parts business has a number of price levels depending on where in the chain the parts house is buying their inventory. This simply doesn't exist in the motorcycle business.
NOTE: I did this while on-hold so hopefully my math is correct.