Referral Credits Suddenly Missing


#1

FOUR of our referrals just disappeared. We had 7 a few days ago.

I’m really hoping this is a “database error.” I’m trying not to suspect GF.

Please fix. Thanks!


#6

Not judging your feelings in any way. Explanation:

You will get credit/payment for the remaining referrals only when they receive their machine. That has not changed since the beginning. When GF can put those purchases on their books you get paid. It’s not like the company wants to lose money with these delays or problems.


#7

I’m really hoping that’s not what’s happening here.


#8

Some people lost referral credits because those referrals canceled. Its possible that that’s what happened


#10

Oh, didn’t mean to repost then. You may have already mentioned it but the credits would be for fulfilled orders. If the order was never fulfilled then there’s no reason to award a credit.
Its pretty frustrating but its an unfortunate reality.


#11

They probably aren’t losing money due to the delays. A preorder cancels and they refund their money and now they have one more unit to sell for twice as much to a current prospect who they have lined up waiting.

If I make 10k units in 6 months and I sell the first 5k at 2000$ and the second 5k at 4000$ but have another 1000 customers waiting to buy, then every time an early 2000$ customer bails and I can sell that same unit to a new person for 4000$, I’ve done pretty well. That doesn’t account for the money I have saved on potential referrals and proof grade bonus materials, etc. If I was feeling far more motivated, we could actually map out the optimal price point with the quadratic equation and determine how many units they should sell at 2000$ vs 4000$ in order to maximize their return.

Every startup/dev company I’ve ever worked for adjusts, delays, alters their production schedule based on deals in the “pipeline”. If they have a pipeline flush with buyers, I would fully expect that to have influenced their delivery schedule. They can accept preorder cancellations knowing that unit is still technically sold (and probably for more) to someone further down their list. They are obviously a smart group over there and I’m certain they have someone who has weighed out the financial benefit against the need for damage control and determined an optimal schedule. If they can only produce 8k units between now and the end of the year but they have 12k sold and a long list of people eager to buy, it seems like an obvious plan to sell those 8k units for as much as possible.

When things don’t add up (like a three month schedule stretching into two plus years)… follow the money. This may seem like I’m taking a jab at GF but I’m not. If you take away the emotion in these decisions they make sense. Additional interest generates additional sales. The increased sales result in higher expectations. Higher expectations mean they have to produce a better product. A better product requires more time and money. Spending more time and money on each unit reduces their margin. A lower margin means that they would much rather sell the final product at full price if possible. So, if you hang in there and actually get a pre order at the pre order price, you are probably getting a much better deal than was originally planned for. If you get a refund, they are getting a better deal selling it to someone else.


#12

That’s really a wonderful analysis. It’s exactly what I was afraid of, but much better enumerated.

It doesn’t reflect the costs to the buyer. We planned an engineering class for at-risk youth based around the GF in 2016. When it was delayed, we had to do something else. Twice. After the second delay announcement, we learned our lesson and didn’t plan on using it after that. Now we may have lost $400 in referral credits (hoping not), making the machines more expensive. Two years ago, we might have bought a much more expensive laser cutter and tons of kids would have been able to use it already.

Taking the emotions out is sometimes hard, when promises to the consumer are repeatedly broken.


#13

For sure. I think after about a year of delays, I finally was able to emotionally disengage from this purchase and resolve to the fact that more delays actually meant I’d receive a better tool. That said, I am in no rush because I don’t have a use for this other than hobbies. So, I definitely feel for you and your time/investment that cannot be recouped.


#14

Cancellations before the first delay would totally make sense. They cancelled in good faith, no harm no foul.
Cancellations after repeated announcements of non-delivery by the company are not the fault of the purchaser.


#15

Your reasoning here only makes sense if the marginal cost of producing a machine were greater than $2000, or if there were only a limited number of machines that could be built.

In the case of Glowforge, they have engaged with a manufacturing company that can most certainly make more of the machines–and I would be confident that they are not losing money on any of the units. In that case, they are losing money on each one that cancels.

Furthermore, the more people that cancel, the more negative press and word-of-mouth extends about the company, thus making future prospects lower.


#16

There is always a “limited number of machines that can be built”. That will always be defined by resource limitations within a given timeline in regards to money, space, materials, laborers, etc…

Companies, even private ones, operate on fiscal schedules. So, there are only so many units that they can produce per quarter, year, etc, regardless of who is building them. If the purchasing demands exceed the production abilities, it is in their best interest to find the optimal monetization for what they can reasonably produce. So, having someone cancel a 2000$ order that can be resold for 4000$ inside of the same fiscal cycle is advantageous.


#17

Thanks for letting us know about this. We’ll reach out via email since this involves personal information about your account. In short, it appears that several referrals have canceled their orders, leaving three remaining open orders.


#18