Athearn and Hobby Store vs Mail order.

AFAIK, when it comes to buying model railway items, it's Price, Price, Price.
The cheapest supplier gets my buck.
I don't care if it's a local Canadian retail store or an American deep discount outfit.
It's my money, I work hard for it, and I'll spend where I get the best value. period.
-- Cheers Roger T.
Home of the Great Eastern Railway www.highspeedplus.com/~rogertra

I agree to a point. But if the difference between my local shop and some other source is only a small percentage(10 or less); I'm going with the local guy. I like haveing a shop to go too for all the other intangibles you can't get from an Internet or mail order purchase.
Roger T. ( snipped-for-privacy@highspeedplus.com) wrote: : AFAIK, when it comes to buying model railway items, it's Price, Price, : Price.
: The cheapest supplier gets my buck.
: I don't care if it's a local Canadian retail store or an American deep : discount outfit.
: It's my money, I work hard for it, and I'll spend where I get the best : value. period.
: -- : Cheers : Roger T.
: Home of the Great Eastern Railway : www.highspeedplus.com/~rogertra

You are both correct. Value for money spent has to be the criteria. What Steve is saying is that in his opinion the hobby shop offers some value that the mail order doesn't and it is worth 10% extra to get this value. I guess the question we all have to ask ourselves is how much is it worth to have the shop and all it offers available. (consider all purchases over say a year) Sometimes "we don't know what we got till its gone", and it hard to get it back.
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If it was a 10% upcharge at a local hobby shop, I'd always buy there. But, instead it usually ranges from 20% to 100%.
I use local shops to buy one or two items, but mail order or internet to buy larger amounts.
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Well, if you're going to use mail order, at least make the order big enough to make the shipping worth it.
I'm always buying onesies-twosies, so mail order doesn't make sense.
Jay CNS&M North Shore Line - "First and fastest"

prices can even vary substantiall between mail order/internet stores (20-100%). many times, a local hobby shop will have the same item at or less than the mail order price.
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I have yet to see a 'store front' shop regularly have items for less than the average mail order operation. A 'hobby shop' has to pay for that overhead. Most of the mail order or train show dealers have their hand on the 'pulse' of the hobby and are ordering/selling the newest releases. They have very short 'on the shelf' time for a product and many do not carry a lot of additional inventory. The trick is to get pre-orders and 'turn' the merchandise very quickly. When I was an owner, we wanted to 'turn' the inventory at least 3-4 times per year. Since we also had general hobby items(plastics, military and 'crafts'), we could weather slow periods in sales, but summer was bad for trains. Most folks had outdoor activities, and many of the new items were not released until the hobby trade shows. We had sales on selected items, and did some discounting on at least one pre-order(Athearn's new SD40-2 at the time). We got a lot of complaints forwarded to us from another chain of hobby shops via a local distributor! We did sell something like 185 of those units in the week after it was released, that turn over of our investment offset the 15% discount we offered. We did have other limited sales like Kadee #5's for 'cost' over a week's span in the fall. This got modelers back in the store after the summer. They also bought up a lot of kits to put this couplers on! But, to regularly sell at a discount was not in the cards with only a 40% markup. Now, the craft side could range rom 50% to 250% markup - there was room to work with there, and having 'classes' would boost those sales even further.
Jim Bernier
ga wrote:
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Jim,
Thanks for letting us know how it is from the hobby shop perspective. It must have been fun running a shop for a while.
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My sister was telling me she found a health food store that sold beeswax at $14 a pound, which she thought was a good deal until she found another place that sold it for $1.50 a pound.
Jay CNS&M North Shore Line - "First and fastest"

JCunington wrote:
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When I was at UC Santa Cruz a buddy of mine (a gimpy Khe Sanh survivor) was from a long time carny family, as was his wife. In addition to collecting political memorabilia, they did a great flea market business, and he operated on one very telling rule: if it doesn't sell at $5, price it at $50 - some fool will haggle you down to $45 and think he got a bargain.
(Bought that Escalation yet Jerry?)

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I'll betcha it's only because they have an online store somewhere in the background! (grin) Regardless, that's not the case in Milwaukee - strictly retail all the way.

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Sometimes, the cost of shipping can be balanced out by not having to pay sales tax...

I am not sure about Athearn and other HO trains; however; I have started a small collection of O-27 and O gauge trains. I like going to my local shops since I can see their layouts, of course built to impres and sell the trains, which then give me ideas about what I would like to do. I am still a beginner only been doing this since Dec 1999. I find I get a lot of help and attention I need to questions I can not get online. There is one store I go that specializes in O guage trains, the other is more of a traditional Hobby Store with trains and other models and crafts. I also realize there is a store in Addison that is well known for HO train sets.

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In WI you're supposed to declare that on your tax forms. I haven't yet heard of anybody who does.
Jay CNS&M North Shore Line - "First and fastest"

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I have never heard of anybody doing that, either. Say, I thought there was a law that made sales tax exempt online, unless the company you're buying from has a brick & mortar operation in the state you're buying from?

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The vendor is exempt from collecting the sales tax unless they have a physical presence in the state, but that doesn't mean the purchaser doesn't still owe it. Most states have laws requiring the purchaser of out-of-state goods to pay taxes, though they are almost never enforced. In California, it is known as a "use tax", and there is a rarely seen special form on which you can report the amount. Some states have started putting a line on their income tax forms for reporting the amount.
Mark Alan Miller

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The problem is that there are about 30,000 different sales taxes in the USA: State, County, City, Special District, etc.
Years ago I bought a pack of gum at JFK, I think I paid NY, NYC and PATH sales tax.
Untill somebody comes up with a solution so that a store in Nebraska can figure out what the sales tax is in Sussex County, NY. There will be no way to fairly collect sales tax on mail order.
Yes, Amazon, and other do collect sales tax, but they have the man and computer power to do it.
-Hudson

Hudson Leighton wrote: (cut down)
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There are several web services out there that currently provide this service. One of them is probably the local phone company in each area, since they have to do this for each end of every phone call made.

SleuthRaptorman wrote:
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Actually, about 40 states are participating in a simplified sales tax project to standardize rates. It's still unclear what the exact effects might be. However, the states cannot enact a sales tax law on their own. No state has power to tax outside its border. In order for a state to require an out-of-state vendor to collect tax, the Federal government will have to pass a law.
Problems I can see if the law is passed:
- All but the smallest merchants will have to engage a service to figure out the tax for them.
- Only about 40 of the 50 are participating in the proposed standard rate.
- Even if rates are standardized, what's taxable may NOT be. Clothing is taxable in NY, but not in CT. Magazines are not taxable in NY, but are in MN.
- Politicians LOVE exceptions. They'll agree to standardize, but will start making exceptions immediately.
Another aspect ot sales tax that's frequently misunderstood: people hear that "there's no tax on internet sales". Well, sort of.
An internet vendor located in CA IS required to charge tax on items shipped to CA, because he has a "nexus", or physical presence, in CA. The state has the power to do so.
However, suppose that vendor has no offices or warehouses outside of CA, but is hosted on a server in Nevada. Nevada may NOT count the server as a nexus, and may not require the vendor to collect NV tax. Also, no state may enact a tax SPECIFICALLY aimed at the internet. (For example, 5% tax on steorefront sales, 7% on internet sales.)
The mail order industry is watching this issue VERY closely, as it will have vast effects on all kinds of businesses. Least affected will be large retailers, many of whom already voluntarily collect tax nationwide. Small and medium sized retailers will be affected the most.
On the benefit side, state treasuries have the most to gain. Merchants without mail order sales will benefit some, but I don't think it will be a tremendous windfall. (Although those selling big-ticket items might benefit most. I suspect that tax savings is a minor consideration for anyone deciding on where to buy a low-dollar item.) Likewise, I don't think the consumer would be hurt greatly, and will adapt fairly quickly. There will be some grumbling early on, but it would soon be a routine matter.
Peter King in NY

We are a "clicks-and-morter" model train supplier. We discount, and we can compete with the mail order discounters on a variety of product lines. Presise, Boley, Bachmann, Kibri, etc. Check our web page at peachcreekshops.com.
We do NOT have two pricing structures. If you walk into the store you get the same large discount as our mail order operation.
I've read a lot of gripeing about Horizon buying Athearn. I can only imagine that some of these gripes come from individuals that were somehow getting their Athearn from sellers that had some kind of sweetheart deal where no distributor was involved. In the old days, Athearn would sell to anyone with a truck and a buck. A few years ago they began to clean that up. Now with Horizon requiring a real honest to gosh dealer that has an account with Horizon, that will all change.
Someone griped that other distributors should be able to get Athearn. If I were a distributor I'd be screaming to high heaven, but how does this differ from the Walther's operation? You can only get Cornerstone from Walthers and who's complaining?
Other distributors have absorbed manufacturers or created their own proprietary line. There is nothing new here.
If you look behind the curtain, you will see two major business decisions being implemented. First, vertical integration. If you make the model and distribute the model, logistical problems are reduced and your profits increase. A secondary effect is that if you rigerously control the distribution, and limit it to only legitimate dealers, you strengthen the retail base. Example: A guy with a van full of Athearn ( this is just used for example) stuff may show up at a train show and offer prices that are really cheap. Good for the buyer at the show, bad for the retailer who bought it from a distributor and has it on his shelf. When this happens too many times, the retailer shys away from the product line in question and this effects the manufacturer and distributor in a very profound way. The bottom line shrinks.
I can only applaud Horizon. This was a business coup rarely seen in the model railroading industry.
John Glaab Peach Creek Shops