You are very right mate. I've just looked back onto my first post and the bit that went
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I think that equipment sales are definitely the way you would bring in more money for somewhat less work hours. Simplistically speaking, 4 days work to make £300 from an OW student or 5 mins good sales technique to sell a £400 wing or set of regs.
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was basically bollocks, scrap it
As to whether prices and wages should go up or down, I don't have a firm view. I know the place I worked (Cook islands) had a slim profit margin on the OW course and made the main profits from day to day divers and AOW etc. I think my point from the first one is the best I would suggest given my limited knowledge in the field.
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With regards to instructors (and especially entry level courses), I think it can be very hard to compete if your prices are higher, even if your standards are perhaps more firm. It's a shame it's that way but with good standards you should be looking to get more qualified divers doing more courses with you. Give them a bit of experience and 90% of divers will go for quality over price if they can.
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PS: Quote slightly edited.