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Price point? What's your criteria?

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Price point? What's your criteria?
Posted by thor on Saturday, October 7, 2006 8:51 AM

I just mentioned elsewhere that I thought Lionels Troublesome Trucks were over priced and I thought, to be fair, I'd better check the catalog and sure enough, $35 (alright $34.99!). On the same page, same Thomas goods, is a double hopper at the same price. So there's a wagon with four axles as against two, almost twice as much steel and plastic used in its manufacture and the same price!    Things like that I find annoying, it would be different if there was some intrinsic reason for the price difference, I could see paying more for a Private Owner wagon like the S.C.Ruffey but not a plain jane 4 wheeler.

When I go pricing train stuff those sort of things are my criteria, if something is really desirable and grossly over priced, it can reach the price point where its enough to make me build it myself but because of the time it takes to do that, it usually has to be a pretty persuasive 'must have'.  Usually I'll just make a mental note to wait and see in the case of something like the top end locomotives, patience will pay off, nothing is so desirable I can't wait for the price to come down.

On the other hand, though, if the price is right I'll buy more than I would have. Lets say a desirable wagon is $50 well I'll buy the one but that's all. Whereas if he price point was lower, say $15, I'd probably buy a half dozen. This is certainly true for standard 4 wheel wagons and short carriages, I'd much rather have some nice long consists if it didnt take but four normal length cars to fill half my track!

On the same subject, I wish that there were more choices in plain unmarked wagons. I am almost certainly going to redecorate most of what I have, probably more than once. A lot of time I see something I like but I don't want that road name, or livery. I'd rather have the choice of buying a plain jane wagon or loco, so I can add my own choice of colors and names. Having given up on any hope of getting cheap English O gauge, I've settled for working over American locos to at least make them look like they might have been if the LNER, GWR or LMS owned them.

 

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Posted by daan on Saturday, October 7, 2006 12:23 PM
Even in England itself there is no such thing as cheap 0 gauge.. Compared to any american brand, european 0 gauge is dramatic expensive (and is proto45 scale most of the time.. not able to run on 3 rail track. except ACE trains of course)
Daan. I'm Dutch, but only by country...
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Posted by dwiemer on Saturday, October 7, 2006 12:27 PM

Thor,     Great points and I do hope the MFG are listening (reading).  I do have a problem spending more than $30. for an individual piece of rolling stock, never mind a operating piece.  I also don't like having to spend more than a few hundred dollars on a engine, regardless of the gimmics.  I just got the K-Line F3 set in Lackawanna.  It does have the TMCC and multiple powered units in the ABA set, but was priced over $700.  Until a special sale for under $400.00, I was not going to spend the money for these.  Now that I have the engines on the way, I am looking for the K-Line Lackawanna passenger cars, so like you say, I would spend more, but I would also get more.

     I probably would not go for a lot of the undecorated models, but would like the option.  My father owns a business and I would really like to decorate a few cars in the scheme of his business signs.  I also would like to make some home made decals of pictures of our kids and put them on a car or two.

Dennis

TCA#09-63805

 

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Posted by Richard A on Saturday, October 7, 2006 1:31 PM

Thor,

As they say, I feel your pain.  Back in 1999, I returned to the hobby, moving up from HO in the '70's to high rail.  After some tedious, but worthwhile research, I saw where prices were going and who was leading the increases.  I also saw how great the ready-to-run cars and locos were compared to what I had been used to in the '70's. 

By the end of 2000, I had pretty much identified a price point above which I would not go --- one for cars and one for locos.  I bought fast and furiously (hopefully intelligently) from both the new and after market, so I am fairly well set.  That doesn't mean I am completely satisfied, but I now try to restrict all my purchases to the after market.

My connection to your thread (finally) has to do with the irritating pricing of new flat cars compared to other cars, in any importers line.  Most, if not all of the major importers price them identically.  I refuse to pay the same price for a bare flat car as I would for a box car, hopper tanker, etc.  To me, it's like paying the same price for a children's size "small" T-shirt as I would for one of my XXL T's.  A LHS owner once told me it's the labor and time to produce and not the material used.  Sorry, I guess I'm just old fashioned.

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Posted by brianel027 on Sunday, October 8, 2006 6:11 PM

Thor, this is good food for thought, though the topic of overall prices have come up before. There are some who feel the hobby is expensive, others who feel it is not, with valid points and criteria on both sides.

Personally I feel many of Lionel's prices are far too high, given what you get for the money. And given the improved lower production costs for Lionel. To my last knowldege, it cost Lionel or K-Line about $2.00 to have a regualr box car made and shipped to the mainland US from China. In 1996 the list price for a US produced Lionel basic starter car was $16.95. Today, that price for a Chinese made starter car is $29.95. I'm sorry, but I personally do not see the justification for such a dramatic price increase, other than I am certain the prices on these items help to offset much of the new tooling costs for the newer more premium scale piece, which by Lionel's MTH's and K-Line's own admissions, are mimimal profit producing items.

One also needs to consider Lionel's distribution and wholesale structure. As I pointed out elsewhere, Calabrese in his OGR interview strongly supports Lionel's perceived brand name value and prefers their prodcuts sold at full list price. Ironically Lionel's top ten dealers are all major mail order discount sellers who advertise many discount prices that almost beat or match the wholesale prices that a smaller local Lionel dealer would get. I wonder when Lionel's oversall yearly sales figures would actually be if it were not for TrainLand, TrainWorld, Grand Central, Grzyboski, Island Trains, Charles Ro, Train Express and the otthers. If Lionel had to survive on the sales of full list price local smaller shops, I think Lionel would have long ago gone under.

The other thing that blurrs the picture on pricing (alongw ith the above mentioned discounting) are the wholsale inventory blowouts that tend to go to the same above large mailorder retailers. There are times when the $65 list price car can be had for $25 as a blowout, which does nothing to support the local dealer, which I'm certain plays a big part in why local shops are closing at an increasing rate. More than once I've seen someone buy a Lionel (or others) train set at full list from a local shop, only to have some train guy say "gee, you got ripped off. You could have gotten the same set from Train Express for xxx." Now that local dealer looks like a rip off artist to that customer, although that is hardly the case due to his disadvantageous wholesale price.

And obviously there would not be blowouts if the stuff was selling at acceptable levels in the first place. Which begs the question, why not price the stuff at a list price level that will attract sales? I defy anyone to show a new Lionel catalog to a newcomer and then an MPC-era catalog to a newcomer and see which catalog garners the most excitement. Granted the MPC catalogs didn't show list prices, but the offerings seem more kid friendly. There are certainly values in the new catalog: some of the starter sets and the great idea Add-On packages for those sets. But the other 135 pages show what an expensive hobby this is, at least from a list price level.

Obviously it is not a manufactuer cost level, because RMT is (and K-Line was) sellling similar products to Lionel's for far less, though they are all made at the same exact Chinese facility. So it is really a matter of the mindset at Lionel. Neil Young's support of FarmAid is for the cause of keeping the small American family farm - an idea that Neil finds important. Well, how about keeping the small neighborhood train shop, who is the front line to introducing the hobby to newcomers? It means an even playing field on wholesale pricing. MTH has a pricing structure that does not put small dealers at a disadvantage over the larger ones, though there are blowouts from places like TrainWorld that you won't likely find at a small dealer.

From a personal point, I've never paid more than $35 for a train car, and that had darn well better be an operating car. For a non-operating I insist on less or I don't buy. Only once did I pay more than $80 for an engine. Typically I would pay $25-$45 for a loco, though I've gotten some for under $10.00. I was never in a hurry to buy and could wait for the price I could afford. Now maybe I would pay more for a item in a road name I wanted (if it was an acceptable quality level) but that hasn't been mu7ch of a worry with Lionel since they so seldom produce anything in a well known current road name on an entry level item.

I made a vow years ago I would not buy another new Lionel loco until Lionel reissues the Conrail U36B from several years ago, at the same price only with the dual motors it should have had in the first place. Every subsequent Lionel U36B has also been cataloged with a single motor, and yet has come with dual motors. The one engine I wanted came with a single motor, and even a Lionel Value Added dealer told me it was a poor pulling loco for the money and advised me to pass on it. The only reason it was selling is because Lionel hadn't offered Conrail on an introductory loco in over 20 years.

brianel, Agent 027

"Praise the Lord. I may not have everything I desire, but the Lord has come through for what I need."

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Posted by daan on Monday, October 9, 2006 2:05 AM

If seen from the producer's side; why not try to get the jackpot first before you sell it for waht should be the normal price?

They simply try and know there will always be some people having to have that item no matter what. It's the main reason why those over $1000 dollar engines are sold anyway. Every penny they get extra for their item is very easy money. When the biggest interest is gone the price will come down eventually, attracting people who don't want to spend a half months salary on it. Even then they have their money back + some profit.

It looks like a blowout, but it's simply the normal price without the bonus they calculate for themselves. That way peolpe feel they have a bargain, but they actually pay a normal price. It could be different, but this is what I think about it, and personnaly I'm not spending over 150 to 200euro's for an engine, and that has to be one with full sound.. (equals about 200-280 dollars)

Daan. I'm Dutch, but only by country...
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Posted by phillyreading on Monday, October 9, 2006 8:07 AM

Like a few others have mentioned why spend over a thousand dollars on an engine when a few years from now the same engine can be had for almost half the money.

Even though Third Rail Brass makes some very nice stuff, I can not afford thier product because most start over $1100.00(U.S.).

To me most companies are forgetting the little guy that helped make thier company grow in the first place, like Lionel.  Unless you spend over $350.00 on a Lionel engine chances are the engine can pull only three or four frieght cars and comes with a basic horn or whistle.

Lee F.

Interested in southest Pennsylvania railroads; Reading & Northern, Reading Company, Reading Lines, Philadelphia & Reading.
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Posted by cnw1995 on Monday, October 9, 2006 9:01 AM
I guess I end up buying used items  mostly because I can't really afford to spend a couple of hundred dollars at a pop for something new - like an engine. That said, I find it's possible - through advertisers in CTT and online to find things that aren't too much money.  I think my next purchase would be an RMT Buddy in Sperry Railservices livery.

Doug Murphy 'We few, we happy few, we band of brothers...' Henry V.

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Posted by JamesPH1966 on Monday, October 9, 2006 11:35 AM

The absolute most I've ever spent for a single item was $370.00 (of tax refund money) for a Lionel B&O GP-30 - at that it was a special order for a favorite prototype loco and roadname.  My usual cut-off is a bit over $200.00 - and that better be high-grade pre-war or immediate post-war Lionel - most of my locos (Marx of course) have run considerably less than $100.00 and - to be perfectly honest - I've always suffered from my early 80's intro to the hobby price structure (MPC diesel, used, no box, $45.00 tops; Marx tinplate set, #21 AA Santa Fe diesels with high-truck 3/16 scale freight cars $25.00 and so on) so most prices boggle my mind.

Also - my CAR only cost $750.00 - and I been driving it for 2 years with only one major repair (and it's not like Chevy "upgraded to another operating system and no longer supports" 2.0l engines)...Smile,Wink, & Grin [swg] 

 

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