How long do dealers leave trains on the shelves?

[FJ and G]

Good businesses try to stock their shelves with just the right amount of commodities that will be sold. Too little inventory and they may run out and lose sales. TOo much inventory, and their capital is tied up. It appears that some, perhaps many train hobby shops do not follow good business practices and inventory collects dust on the shelves.

I don't have any solid proof of this but a lot of anecdotal evidence from visiting many hobby shops.

On pages 26 and 27 of the Aug04 toy train mag (the other one), are listed locomotive after locomotive with Protosound, the pre PS-2 system. THese were phased out during the last century in 1999. Yet, they still are there collecting dust. And, the price on them has not dropped significantly.

[ChiefEagles]

Yes I noticed that. When calling or emailing, I always ask if they are PS2. Don't want to take any chances. The last tow I bought were PS2 but were models several years old. $45 off the marked and advertised price at the hobby shop [and that was already below retail].

[brianel027]

Dave, the question is a little misphrased... the dealers don't intentionally purchase items for inventory to then have them sit on their shelves for years. That's a money losing proposition and anyone who has been in retail knows this.

Of course, here it depends on what type of dealers you are referring to. The larger discount train dealers who do the bulk of their business with mailorder (who may also be distributors - some are) get the best wholesale price, and therefore are in the best position to discount prices. With the case of Lionel, then you have the "Grandfather" clause where older established dealers get preferential treatment. Think of it this way... you have a $100 list price train engine... one dealer gets it at 25% off list, the other at 60% off list: who can sell it for a better price? Or to rephrase the question, who is less likely to be periodically dusting off the box on the shelf?

Or course, there aren't many Lionel engines with a $100 list price. Usually it's a lot more, but that's freight train of another color.

With the larger mailorder places who get better wholesale prices and first dibs on the availabilty of inventory blowouts, there's not nearly as much worry about items remaining on the shelves too long.

It's another story entirely with the smaller local shop. Ironically it's the smaller local shops that are essential players in the growth and outreach of the hobby. Yet in this day and age of big-box retailing and the favoritism shown to larger dealers, it's these smaller dealers who usually end up derailed and sitting on a siding.

I'm not defending bad dealers. Don't get me wrong. But the simple economic realities do favor larger mailorder dealers. Small dealers simply do not get the best wholesale price and therefore by necessity have to sell their product at higher prices.

And in my conversations with other dealers I find, even amongst the most die-hard of Lionel customers who must have this and that and this and that - they are the most determined to get a deep discount. They may love Lionel trains, but they do not love Lionel list prices. And don't pay them except out of necessity. And if they do pay list for the item they wanted, then they don't buy as many other items.

Futhermore, in this internet savy / big box retailing environment, no one but no one wants to pay list price. Everyone expects a discount. Small dealers constantly deal with the perception of being seen as greedy crooks because many customers fail to understand the advertised mailorder price in the train mag is very often a lower price than the small dealer's wholesale price.

This may be financial and business reality, but it bodes very poorly for the future growth of this hobby since we all know the new comer and novice are far more likely to visit the small dealer first - not only for purchases but for advice too. Once the customer realizes how much higher his prices are, he doesn't go back... and sometimes this doesn't take a long time to figure out.

And in this "golden age" where there are more varieties and options available for train buyers, it is also far more confusing for the newcomer. We've seen that here on the forum with some of the basic questions from the newbies. With all these possibilities and different control systems and track systems, it's no wonder mailorder places can't answer questions... they're in business to make a load of money and nothing more.

And even if the trains were available at places like Wal-Mart, I think it would be a hoot trying to get even the most basic train question answered from your typical floor clerk at Wal-Mart.

The train companies should subsidize the costs of these forums (there's a good joke)... since so many folks with the most basic questions find the answers here more frequesntly than anywhere else. Mailorder places have good prices. Mailorder places sell a lot of trains. But they don't answer questions about how to set them up or make them work.

[spankybird]

I have to agree with you Dave, some dealers have a hard time to sale an item below list and therefore it is on their shelf way to long. They do not understand the value of cash flow and having newer items on the shelves for customers to look at.

I am not saying that they should just discount them, but instead have a sale such as:

Buy one at regular price, buy this one (the older one) at 40 % off. Have sales on slow business days. If you know that Tuesday are a slow day, then have a sale for that day.

If the dealer is buying direct from the manufacture, then they have to buy box quantities.
That is, if I order a car, the dealer has to order a box of four. Now he has 3 left over and on the shelf they go.


tom

[Big_Boy_4005]

It depends on the dealer, and what the item is. I used to work in a hobby store, and have been in plenty of others over the years. Most dealers will try to look at each item when deciding how many to buy, and try to judge the demand based on their knowledge of their customers and past experience. Most of the time they get it right, but sometimes they get stuck. Then they have two choices, blow out sale, or let it ride.

At one of the local stores where I live, the owner just lets it ride, but then this is mostly on small ticket stuff like cars and accessories. This store doesn't even bother with a lot of high ticket stuff. Another local store keeps a small clearence table to weed out some of the worst sellers.

This raises the question, what do the manufacturers do when the dealers don't buy an entire run of engines. Do they keep offering them in the catalog until they are gone, or do they offer them up to their best customers at a discount to move them?

Either way, when you find old stock, somebody goofed!! So take advantage if you like the item for the price.

By the way, there is another school out there, that works on the "mark it up" principle. As catalog prices move higher on new similar items, they re-mark the old stock to match the new level. Compensation for the time spent on the shelf.[swg]

[spankybird]

Big boy, good to see you, was wondering were you have been.[tup][:D][:D]

tom

[Big_Boy_4005]

Thanks Tom, I've been reading a little, but have been very busy doing all kinds of stuff. The topics have been not quite to my taste lately, so I have been rather quiet.

[FJ and G]

Those proto batteries must be getting old after 5 years as well.

Elliot, working on your layout?

[Big_Boy_4005]

Nope, having a garage sale, and riding real trains, and lots of other stuff like mowing the lawn, yuck.

[ChiefEagles]

Elliot, get a Deere and enjoy the mowing. [:D] Glad to see you.

[Anonymous]

Elliot,

Welcome back. I had noticed that you had been absent for a while. Glad to see that you have been able to ride real trains. The closest I have come to that is trying to chase 3751 down the freeway.

Good to have you back here!

[Buckeye Riveter]

Tom, please explain to me the difference in the PS-2 system and the other system they are talking about. Does this mean if I purchase a MTH General Steam Engine that I need to ask about PS-2? [?][?][?][?][?][?][?][?][?]

Hi Elliot, Have you ridden the new light rail? I heard that it had opened.

[Anonymous]

AS LONG AS IT TAKES TO SELL IT! I bought two years ago a American Flyer A-B-A set, it had been in the case since the early eighties. Brand new in the box.[:D]

[FJ and G]

THe General steam engine may be conventional; not sure. Protosound is the old system and PS-2 is the new. Protosound has had problems in the past with chip failure due to battery discharge. I think that there are ways to run Protosound safely but why bother? Most knowledgeable folks will choose either the inexpensive conventional or PS-2 (also called Protosound-2, which is compatible with DCS and which doesn't have the low battery/chip problem).

[spankybird]

I am doing this from memory and not checking reference books, MTH made at lest 3 Generals in PS1, maybe four. I have two of them.

PS1 engines have sound, horn / whistle, bell and passenger or freight yard sounds. Later ones also have cab talk. They also had remote uncoupling, but had to be done at a stop. The sound system was by QSI and yes if the battery was dead or near dead, it could reverse polarity and fry the board. Most batteries last 3 to 4 years.

PS2 engines have sound as above and is DCS command controls. The uncoupling can be done at anytime, even while moving. PS2 also has speed control, synchronized sound, smoke and control effect, just to name a few.

Unless it was a very good buy, I would only look ad PS2 engines. It is best to ask which it is. It is labeled on the box.

Hope this helps



tom

[Buckeye Riveter]

Thanks Tom. I didn't know that!

[spankybird]

my pleasure to help.

tom

[Anonymous]

THere are several different ideas in the hobby industries about this. I work in the bicycle industry, was a manager of a corporate store for 4 years,and a mom and pop for 3 years. Vastly different ideas on old inventory.
THe corporate store had the equlivent of PS1 in the form of older mountain bikes with no suspension and cantilever breaks. Our owner would never let us discount more than 20.00 on a bike that could cost up to 2000.00. His idea being that he is losing money. The other bike shop i worked at always discounted at the end of the year, even down to cost on a few items. Their idea was to get back the money, so they could invest it in new product. New product would bring in new customers and continue to bring in older customers to see what was "new".
Just trains is two doors down from me and though i havn't talked to kirk about this, i feel he follows the second path. I go in there about three times a week and there is always new stuff on the shelves. Or new engines in the display cases.
Anyway, that is my two cents worth. Take it or leave it [:D] Bill

[mpzpw3]

FJand G, " I think there are ways to run Protosound safely, but why bother?" Well, not all PS1 engines have the chip scrabbling problem. I have one engine that does have the problem, but a new Nicd battery, or a BCR will fix the problem forever.These engines don't demand a command system, yet have many options. The fear of damage is so great, that I have seen ps1 engines for sale as low as $160.00 for a Santa Fe F-3 A-A . I think that they sold for about $500.00 new. In comparison, a new MTH railking postwar style engine of the same type is also about $500.00. The ps1 engines were scale, with see-through screens and a lot of the scale details we want. For a $190.00 a person could have had a F-3 set that was pretty darn scale like, and a bcr, that would have forever fixed the ps1 problem. A bargain? I would say so, compared to recent productions of the same engines, even the new Williams engines!! These engines wer gone within 24 hrs. of their listing. PS1 engines are not in favor with the "Big Boys" in this hobby right now, which allows us little guys to get great deals. I seem to remember an article in CTT last summer about building a layout on a budget. PS1 engines are now budget priced, and conventional operators should at least look into these engines.