Variation of prices at local model shops

[Fast Eddie]

In my opinion, from a life in retail, you must keep a margin of 100% or double up.

This enables all the other niceties people have come to expect like free delivery, returns procedure etc etc. It also pays the bills eg rent, overheads, tax, VAT, staff, admin blah blah.

After all these costs it also keeps the smile from a grimace when folk want showing how to use their new purchase and get it set up.

This was from a different industry but i am certain any shop owners reading this will agree

[tjf]

The price of something isnt the be all and end all of everything. Personally I would rather pay retail and have it on my door step when I need it than have it a £1 or so cheaper and take a week. This industry like many others moves so fast and when stock ages and doesnt sell because its no longer the latest thing the shop owner has to pay for it. Go shop at Asda then at Waitrose and there's your answer. Asda is cheap but Waitrose gives a much better service and they have invested money training their staff how to pack bags etc.

[dale]

Originally Posted by Fast Eddie

In my opinion, from a life in retail, you must keep a margin of 100% or double up.

This enables all the other niceties people have come to expect like free delivery, returns procedure etc etc. It also pays the bills eg rent, overheads, tax, VAT, staff, admin blah blah.

After all these costs it also keeps the smile from a grimace when folk want showing how to use their new purchase and get it set up.

This was from a different industry but i am certain any shop owners reading this will agree

If model shop owners did this a TLR 22 would be on the shelf at £280 and a TC6 would set you back £600. Markup only turns into profit if you actually sell the stuff... at 100% markup shops wouldn't sell anything.

The markup on RC racing stuff is tiny. It's never been good, and with shops now competing with Hong Kong, eBay and each other via the internet it's now even worse.

I used to know a model shop owner who drove posh cars and went on nice holidays, but that was back in the 90s when there wasn't all this price competition. These days it's hard to see how anyone makes a decent living from it!

[eyeayen]

I used to work in a model shop, a lot of the RRP only had a mark up of between 24 & 33%. I've worked in other industries where the mark ups are between 100 & 500%. We wouldn't be able to afford our hobby if that was the case.

Personally I use my local shop for everything, if they haven't got it they can get it, I can walk in their and have a friendly chat with them. All this competition in price is killing it for most shops. People should try and support their local shops where they can, if they don't you won't have a local shop.

[truggy lover]

Originally Posted by eyeayen

I used to work in a model shop, a lot of the RRP only had a mark up of between 24 & 33%. I've worked in other industries where the mark ups are between 100 & 500%. We wouldn't be able to afford our hobby if that was the case.

Personally I use my local shop for everything, if they haven't got it they can get it, I can walk in their and have a friendly chat with them. All this competition in price is killing it for most shops. People should try and support their local shops where they can, if they don't you won't have a local shop.

i agree but when the local model shop sells i.e. a novak gtb2 @ £120 and i can get it from hongkong for £65 inside a week what are you going to do

its not the shops its the TAX TAX TAX they have to pay look a little closer to westminster .............................

[pro4nut]

Originally Posted by truggy lover

i agree but when the local model shop sells i.e. a novak gtb2 @ £120 and i can get it from hongkong for £65 inside a week what are you going to do

its not the shops its the TAX TAX TAX they have to pay look a little closer to westminster .............................

What the tax that the shops pay and you break the law by not paying?

Its easy to make an 'its the government' comment but its more complex than tax.
Shops in the UK are more expensive to run, ALL of the overheads aer higher than Hong Kong and we also have the problem of buying stock through distributers in the Uk which adds to the cost think of it like this.

In the US a model shop buys a B4 from associated and then sells it to the customer.

In the Uk the shop buys from a distributer who buys from associated before they can sell to the customer. This middle man approach is where a lot of margin is lost.

[Neil Skull]

Oh dear,

The perception of People in the RC world in relation to Sales of goods never seizes to Depress me.

If anyone does not like thier local model shop then F@~* and move to Hong Kong.

[DaveG28]

Originally Posted by Neil Skull

Oh dear,

The perception of People in the RC world in relation to Sales of goods never seizes to Depress me.

If anyone does not like thier local model shop then F@~* and move to Hong Kong.

Or just stay in the uk and place orders in HK instead??

Tbh I shop where I get the best overall experience, factors include:

1. Live stock levels
2. Speed of communications
3. Price
4. Do they stock lots of bits & pieces
5. I built up a loyalty to them.

5 is an interesting one to me, I started buying kits from Stellamodels when exchange rate was more like 180yen/£, no-one in the uk brought kits in from Tamiya, and when they got 501's first...now people stock bits/kits here in the uk, the yen is 130 etc....but I still feel loyalty to Stella, I don't want them losing their jobs either...and I'm not sure why I should dump them!?

What I tend to do now is split a lot of my buying, I like supporting JTmodels with orders as I want them to succeed, I use Demon/PBM as I always have depending on what I am buying, same with JE, but I still tend to use Stella to buy actual kits, even though it doesn't save much these days, is that really bad, wanting Japanese guys to keep their jobs too??

[DaveG28]

Originally Posted by Neil Skull

Oh dear,

The perception of People in the RC world in relation to Sales of goods never seizes to Depress me.

If anyone does not like thier local model shop then F@~* and move to Hong Kong.

Oh, and I think in the uk it would be better to focus on positively attracting customers rather than complaining, a universal maxim in business is long term you can't beat the "bigger guy", you have to differentiate to survive!

Some shops do this well and generate lots of customer loyalty regardless of price (or at least seem to!!), examples for me would be:

1. DMS probably through a variety of methods ultimately, but for example public support of their products on this forum, wide range of brands etc

2. Modelsport, great starter "bundles" in terms of it ring easy to understand what you need on their website, plus offering motor/battery build services, soldering services etc

3. People like JT doing their own hopup parts for the 502

4. Insideline good service, aligning closely to specific brands

5. JE/Nuclear, by racers for racers (probably true of everyone to an extent I guess in this trade!)

In my view, long term, to stay alive against people like Amain/Tower/Stella/Champ/Mushroom/rcmart, it's this differentiation that will prove key!

FYI, as an example of how hard foreign businesses try for our custom, rcmart us a London customer service number despite being a fareast business! No idea if it works mind!!!

[simoncrabb]

Great thread!

RC has one of the smallest profit margins I've known, and if we're honest, no-one's getting rich out of RC, they're doing it cos it's what they love.

[Tezcat]

Originally Posted by Neil Skull

Oh dear,

The perception of People in the RC world in relation to Sales of goods never seizes to Depress me.

If anyone does not like thier local model shop then F@~* and move to Hong Kong.

Try running a pub. Main complaints are always why do tesco/asda/sainsburys sell there beer for x yet I have to pay 3x as much in a pub?

Thats really unfair competition. In the pub I have to pay bills,tax,vat etc yet supermarkets sell at a loss and then pubs get blamed for a binge drinking culture! Wish people would take there heads out of the backsides at times

Retail is a dying breed. Careful what you wish for in prices or soon you'll only be buying on the internet.

[truggy lover]

[QUOTE=pro4nut;495590]What the tax that the shops pay and you break the law by not paying?


i havent broken any laws i paid my import duty so i have broken NO laws !!!!

[pro4nut]

[QUOTE=truggy lover;495728]

Originally Posted by pro4nut

What the tax that the shops pay and you break the law by not paying?


i havent broken any laws i paid my import duty so i have broken NO laws !!!!

So if customs don't charge enough tax you declare the true value of the items and pay the outstanding tax? All credit to you if you do, but I know many that don't
However I did not intend that as a personal remark, so i will retrack that and rephrase.

What the tax that the shops pay and many break the law by not paying.

I have no interest in winding people up, sorry if that was how that came across.

[truggy lover]

fair play accepted

[Neil Skull]

What Dave and others have to understand is that most Model shops and Distributors in the UK have been running at a loss for over a year now.
That can only last so long before things go wrong.

If you are an experinced modeller then you will be quite ok to know what to buy online either from UK or Online. those guys do provide a good service.

But how will the next generation of would be Racers and modellers even get a chance to start without a local shop for help and advice.

How will the nitro boys get fuel if if they have to travel 100 miles to the nearest shop?

Everyone in the hobby has to know That in the UK we pay a lot of import taxes. We pay a lot of overheads to run a business.

We cant compete with some of the overseas countries as they simply dont have same overheads so its unfair competition.

Please dont Call me when you have a problem with something you bought from HK as i will tell you to get lost.

Every shop in the uk has the right to charge what they want which makes it an open and competitive market which in same european countries does not exisit, a fixed retail pricing stops that. So although we have some issues with far east compared to parts of Europe and Africa Australia we are actually not the highest market.

[DaveG28]

Originally Posted by Neil Skull

What Dave and others have to understand is that most Model shops and Distributors in the UK have been running at a loss for over a year now.
That can only last so long before things go wrong.

If you are an experinced modeller then you will be quite ok to know what to buy online either from UK or Online. those guys do provide a good service.

But how will the next generation of would be Racers and modellers even get a chance to start without a local shop for help and advice.

What I worry about here is that the natural conclusion to this is further price rises...I'm not sure anyone will want to take up the hobby if that's the case, the barriers to getting into are already high cost wise...it's between a rock and a hard place!

However, I'm not aware of any industry that's successfully survived by guilt tripping people into "buying British". I just genuinely think you need to give people positive reasons to buy from uk shops, not say you'll refuse to help them unless they do! There are positive reasons to support the shops, many mentioned in the thread..even more so in the States where a lot of shops are attached to tracks!

This isn't aimed at a particular source, but it does surprise me that no-one supports foreign bought goods in rc, distributor wise. I assume it comes from the manufacturers refusing to fund it, but it seems to me that a more sensible approach would be for the manufacturer to financially support the distributor providing good customer service (eg warranty repairs etc) regardless where the item was bought, after all the manufacturer has still made his money from the sale, and it's in his interest to support the product!? Plus that then becomes an income stream for the distributor...

Like I say, don't know the details of why that doesn't happen in rc, but has been a successful way of keeping distributors alive in other industries (and that I DO know from experience). Wouldn't help the shops though sadly..

[passy]

Originally Posted by pro4nut

What the tax that the shops pay and you break the law by not paying?

Its easy to make an 'its the government' comment but its more complex than tax.
Shops in the UK are more expensive to run, ALL of the overheads aer higher than Hong Kong and we also have the problem of buying stock through distributers in the Uk which adds to the cost think of it like this.

In the US a model shop buys a B4 from associated and then sells it to the customer.

In the Uk the shop buys from a distributer who buys from associated before they can sell to the customer. This middle man approach is where a lot of margin is lost.

All overheads are not less in Hong Kong. I'm willing to bet that no shop in Hong Kong owns it's own premises and due to the lack of space in HK rent is astronomically high, even more so for retail. Wages are indeed cheaper, but for the majority of stores it is the shop owner that is sat behind the counter.

RC shops are open everyday of the week until at least 9pm. Most of the shops will be quite full in an evening and you'll find people from all over the world shopping there. A street stuffed full of RC shops, static models and replica guns draws a reasonable crowd. Because of the large foot fall the retail shops actually sell quite a large volume of goods, which I believe allows them to negotiate good prices from distributors.

Even after all of this the model shop owners are still not the ones driving the fancy cars......

[big air]

Originally Posted by passy

All overheads are not less in Hong Kong. I'm willing to bet that no shop in Hong Kong owns it's own premises and due to the lack of space in HK rent is astronomically high, even more so for retail. Wages are indeed cheaper, but for the majority of stores it is the shop owner that is sat behind the counter.

RC shops are open everyday of the week until at least 9pm. Most of the shops will be quite full in an evening and you'll find people from all over the world shopping there. A street stuffed full of RC shops, static models and replica guns draws a reasonable crowd. Because of the large foot fall the retail shops actually sell quite a large volume of goods, which I believe allows them to negotiate good prices from distributors.

Even after all of this the model shop owners are still not the ones driving the fancy cars......

I after agree with you there, Sadly i think it doesn't matter if it's RC car's or the price of a paper clip and Petrol the UK will always be at the extreme end of the price market due to the fact we are all soft touches, We don't say nothing or do nothing about it so nothing will change and things will just keep getting more expensive.

I was reading somewhere that some things that a manufactured here in the UK are cheaper to by in the US and other parts of the world and that's when they have been shipped there. Just another case of rip of Britain.

I do support Model Shops here in the UK but i also buy from HK. Wonder how many people from abroad buy RC kit from the UK

The UK is the soft touch capital of the World and i can't see it changing anytime soon.

[passy]

I sometimes buy my Schumacher spares from the UK, if the HK distributor does not have stock, the UK and HK prices are the same when you take off the VAT. So you can be sure that at least one manufacturer is not exaggerating their UK pricing

However, I have to admit that is the exception to the rule in regards pricing.

HK pricing can be quite odd, some products are lots cheaper than the UK, however other products are roughly the same as the UK without VAT. Also HK and quite a lot of asia are mainly focused towards on road racing, so there tends to be less competitive pricing for off road gear.

Paul.

[eyeayen]

When I got into RC when I was about 8 ( 30 years ago ) there were a lot more local shops than there are now. Walking past and seeing stuff in the window got me and my dad walking in and having a chat with the guys in there, then for Christmas lucky me got my first kit, a Tamiya Fox.

Now the price of kits alone for the shop doesn't let them carry as much stock unless they're a huge outfit. The high street local shop is fading and without your support they will all disappear. Without them people won't find the stuff so easy, if less people join the hobby and they sell less the prices will go up to reflect this even further.

Using your local shop and keeping it going isn't just about buying in the UK it's about keeping the shop on the high street so the next excited 8 year old can walk past and his dad can say I used to do this when I was your age shall we go in a have a look...

Maybe the video game generation has taken hold but at the same time I'd be gutted to see any more local hobby shops close !