Are LHS's doomed?

[betamax]

QUOTE: Are LHS's doomed? I live in Waterloo, Ontario and there isn't a single train store in the area unless I go over 100km to Toronto. 5 years ago there were 4 stores that carried trains. Something killed them. Internet, train shows, laziness and stubbornes of store owners - "I'll have to charge above MSRP for this, just because I want to"

I've got two of them that are easy to get to. One on the way home, but without a big selection (me thinks they are interested in EBay) and a focus on "hobbies" in general.

The other one is Hobby House 'downtown', but I can make it part of the drive home by altering the route slightly. They are more of a specialized store, big train section, lots of books and supplies, even a table of discounted stuff. Family run business. And no comic books.
Lots of stuff to look at, and knowledgeable staff too. By the look of it, they are also moving into internet sales. (The http://hobbyhouse.ca/ site seems to be a place holder right now.)

But here in Ottawa there is a lot of activity in the model railroad scene. Several clubs, ranging from HO to full-size trains. Plus Railfair every fall, and the place is just packed. Doors will be open an hour and there still is a lineup going down the hall and out the door. Dealers come from Mississauga and Hamilton, it's that lucrative. We're talking a 600 mile round trip for a two day show.

Ultimately what determines success in business is service and selection. When the customer can come in, ask questions, get an informed opinion, and leave with what he needs, that makes all the difference. Problem with stores in Canada is the prices will be higher to reflect the exchange rates, which until recently, were pretty poor. So US prices plus shipping and exchange can be attractive.

The online stores are not geared for service. You need to do the research yourself. They'll sell you whatever you want, not necessarily what you need. Part of the reason they can offer lower prices is because they can pad the bill with "shipping and handling".

[tangerine-jack]

Perhaps I'm a little skewed in my opinion, but try, just try, to buy anything in G scale at your LHS. Usualy you will find Bachmann and LGB, both good brands, but at twice or three times the price I can get them for online. Aristo-Craft, Heartland and USA Trains? Nope, not hide nor hair of those excellent brands to be found on the shelf.

My scenery supplies come from 4 Seasons Nursery, my paint comes from Home Depot and my rolling stock comes mail order. Sorry LHS, except for certain small items and the occasional sale, there isn't much support I can give you. I would if I could, but...............................

[on30francisco]

I believe a lot of LHSs are going the way of the 8 track cartridge. There used to be 6 LHSs in San Francisco ten years ago but now there are only two. Unfortunately, the selection and variety of model railroad supplies is slowly but surely dwindling at one of them and the other one specializes in Lionel and other collectables. Both LHSs sell at MSRP. If you're into modeling anything else besides garden variety HO, it is almost mandatory to shop online or through mail order. Even in HO, most shops I've been to only carry what is popular and sells well. Other speciality items must be ordered from Walthers. If Walthers dosen't carry them, they can't order them and either tell you they don't exist or they are discontinued .The main reason I would purchase an item from a LHS and pay MSRP is because I want or need it now. If it has to be special ordered, I can do that myself at a substantial savings. Since I'm in a minotity scale and gauge (Large Scale and On30), I find the online shops meet my needs much more than any of the LHSs in this area and treat me as if I'm the only customer they have. From MY experience, if you are into a scale or gauge that a shop dosen't stock, they treat you as if you came from Mars, however, I realize not all LHSs are like this.

[grayfox1119]

Personally, I enjoy going to the LHS. Luckily for me, I have a small but well stocked shop about 25 minutes away. The 80+ old gentleman that owns the shop knows more about trains and the hobby than I , or most people, will ever know. He has written books, and runs the BIG E train show in January in Springfield, Ma also.
He gives nice discounts, orders anything you want, it is just a darn nice place to shop, so much so that I hate to leave. My wife takes a book with her and sits in the car reading because she knows that it will be a loooong day.

Now, to answer your question, will these shops survive? Here are things that will determine how many LHS's survive:

1. Customer base. A purchasing one, not a look around one.
2. Price of gas. When it gets too costly, some people will migrate more to internet.
3. Cost to run the store vs profit margin. As his cost rise ( taxes, heating/cooling, electrical, labor, maintenance, etc. ) owners will be forces out of business.
4. Laziness of the buying public. As time gets more demanding on people, they will opt to order on the internet rather than drive to a hobby shop. Too tired to get up after a busy day, too much to do, too little time, the heck with it, order online.

Obviously there are more factors that can be added to the list, but this is enough to give you the picture.

[Big_Boy_4005]

QUOTE: Originally posted by coborn35

Ours is shutting down soon, so I just buy through our club and get a discount.

Carr's is quitting after all these years? I guess I believe it. I was in there about 10 years ago, and it felt like a trip back in time to about 1967.

[Anonymous]

I buy my MR, paint,glue, the shall we say staples at the LHS. Mostly stuff that the cost of shipping makes it cheaper to pay the 100% price. I was always one of those who said you have to support your LHS. So what happened to that train of thought? The cost of paying $200.00 for a steam engine they taking it home only to find out its drivers where shot, no problem I bought it at my LHS he always takes care of me, so I took it back to the store. Sorry Dave heres' the address for the maker you will have to send it in to them, I don't do returns. All these years I'm one of his best customers, thats according to him! but now I have to take care of it myself? Well guess how many fingers i held up to him, hint it was less then two.
Now its hello eBay, shows love em, mail order you bet, why not if something goes wrong I still have that address the local hobby shop gave me so I could send it to the factory myself, right.

[Anonymous]

I don't think they're doomed. My LHS has 35% off MSRP for most new Athearn and Atlas stuff.(and maybe other brands, but I've never really looked at other brands) But Athearn RTR freight cars are often $1more that the internet. But I buy from the LHS whenever I can. Think about this- you can't get used or NOS stuff from discounttrainsonline. That's where the LHS comes in. Mine has so much older stuff for sale it's unbelieveable. And I hope mine doesn't go under because I've got a new Atlas CGW S1 preordered [swg][swg] but they aren't due to come out until August or September.

[coborn35]

Ours is shutting down soon, so I just buy through our club and get a discount.

[nbrodar]

When ever possible I buy at my LHS. But then, my LHS offers discounts, great service, and a pretty good selection. When there's only a $15 difference on an Atlas engine between my LHS and mail order, I'll go to the LHS anytime.

Nick

[Anonymous]

Good stores are not going away. Bad stores are.

Discounts, selection, clean, nice staff, mail order, and they do well.

Full priced dump with grumpy old smoking dude yelling at customers over the boxes of old junk not selling and it does not do well.

[Anonymous]

hi guys.
hold on to your lhs, give them a fair crack of the whip,we have no l h s in ireland,my nearest one is train world in new york only 4000 miles away.

good modeling.
patrick

[Bill54]

Here in Fredericksburg, VA there are at least 4 hobby shops within 65 miles. All of them sell their merchandice above what I can get it for online. I only buy from them when I have to have something immediately, otherwise I purchase online.

Online shops have a larger variety at a lower cost to include shipping. In my case I don't have to have it righ away so shipping costs are usually under $10.00. That's what I'd pay in tax if I purchased $200. worth of stuff at the LHS.

With that said, I don't think the hobby shops are going to fold any time soon, at least not in my neck of the woods. They seem to be still going strong even with the online competition taking their share.

Bill

[tomnugler]

While this perspective may be skewed from living near the Chicago/Milwaukee megopolis I don't think the number of hobby shops has declined significantly. I do think the number of shops catering to model railroaders and railroad modelers is half of what it was 20 years ago.
A case in point would be the recent opening of a store whitin 10 miles of home, which could be considered a replacement for a store that was in operation for over 30 years. Racks of R/C and plastic kits, but, if you're looking for anything other than Athearn, Bachman and Microtrains the next closest is 25 miles away.
Granted you can still drop in and pick up basic supplies but every thing else needs to be ordered.
My expectation is that one day I'll be looking for narrow gauge trucks and the kid will lead "the old blind dude" over to the Hot Wheels display.
Tom.

[Tom Curtin]

FYI, here is part of a post I put on another thread, on this very subject. This is, ofccourse, my own opinion ---

The LHS business is indeed disppearing. Nothing unique about this --- all kinds of local shops are disappearing. We may philosophically mourn their passing but the plain fact is that our American buying practices are creating the trend. We are becoming a nation of superstores, and on-line shoppers. Almost everything we buy, except high-end luxury merchandise, is being reduced to a commodity. In model railroading on-line outlets are cropping up at least as fast as LHS are failing.

[jsoderq]

There are a couple things that may swing things back to local shops. First, if the government gets the bugs out of the sales tax mess, you will see prices rise on the net. And believe me they are working on it. Many states now have a space on tax forms to declare what you bought online , the tax for which you are liable . If you think they are not serious, think again. They have gone after purchasers of cigarettes and sent out tax bills for thousands of dollas.
Second, because of realignments like Horizon, you will see fewer "basenent bombers" . These are some of the guys that drove prices down because of no overhead. Also with the loss of Lifelike, you will see far less overproduction, which caused them to dump stuff in the market trying to stay afloat. Remember, AHM\IHC has done this in the past (overproduction and dumping) and still went bankrupt more than once.
As the modeler population fluctuates, the market will shrink. With it being so high-tech driven, prices will thin the ranks because some won't be able\interested in the higher priced stuff. As the voluime drops, internet vendors will face declines, same as LHS already have.As more and more models get produced there is less for manufacturers to do. Thus lower volume and higher prices. As more models get done there is less for people to buy. Notice how there is a;lready duplication (to some extent) in the new items. As the market price goes higher, buyers are less concerned with "the lowest price" because they can afford it. If you watch the boards, the posts for "where ...cheapest" are pretty much beginners, many of whom won't stay around. Another drop in the volume.
Before you dismiss all this, look and you will see some of it. Many online sellers are at or near list on many items. Shipping prices have gone up, so much that even I refuse to buy from some sellers. The percentage of online sellers being "real shops" has risen tremendously online.

[jecorbett]

I think there will always be room for bricks and mortar stores in all aspects of retailing.
Online retailers are just another competitor. Generally you can get better prices online but LHSes have the edge in service. Often, I need something right away. If I have to wait for an item to be shipped, it will slow my progress. Internet ordering is relatively new but the LHSes have always had to compete with mail order stores and it never drove them out of business. The convenience of ordering online might cut into their market share but the good ones will survive.

[Anonymous]

I guess it all depends on what they stock and sell.
My pet peeve with retail stores in general is that they only stock items that sell well. But if they only stock what sells well, then the only choice you have is what is in stock. Which is why it's a big seller.
It's like catch 22. We don't stock it because we don't sell enough of them and we don't sell enough of them because we don't stock it.
[banghead]

[MisterBeasley]

This will be a gradual thing, as people get more and more comfortable with Internet shopping, and less dependent on stores. Some shops will find they can do their own e-business, while others will pick up the decoder installation business and custom painting and detailing. Like anything else, there will be a critical level of customers needed to support a store in any geographical area.

In the good old days, there was no Internet, so people could go to their LHS, or drive a long way to another not-so-L HS. Even the bad ones had a chance to survive that way. Now, we have another choice, so hopefully only the best of the bunch will stay around.

[jfugate]

Adapt or die is how it always seems to work.

I know a brick and mortar hobby shop that went online and did so well online they've closed their brick and mortar operation.

So if you don't insist the future needs to be a copy of how things have been done in the past, there's a way to not only survive but to flourish. [swg]

[IRONROOSTER]

I think their numbers are going down. The retail business has seen a steady loss of small individually owned shops for years. I think most of that can be attributed to lower price competitors. Initially these were big box stores like WalMart. Specialty shops like hobby stores were okay, because WalMart et al didn't compete with them locally (not enough business in one place to make it worthwhile). But the Internet changed that by allowing virtual discount hobby shops that can compete on price. Any LHS unable to compete on price/selection has to rely on people who don't use the Internet for shopping, don't use mail order(most of that's online now) and don't go to train shows. Or people rich enough to not care about the extra cost, but want the convience of getting it now.

Some will adapt and survive, but not many.

Enjoy
Paul

[Darth Santa Fe]

As long as they keep getting customers like me, then probably not.[:D] The hobby shop over here gives a 20% discount on everything and no shipping costs, so I'll order things I want through them. That's how I got my Bowser Challenger, at a lower price than I would have gotten through Standard Hobby [:(!] because I didn't have to pay shipping.[:D] It's also how I'm getting my new Genesis F3A.[:D]

[Big_Boy_4005]

As far as I'm concerned they are. I haven't spent $100, per year, at one in 10 years. I buy most of my stuff at train shows and online, ebay and mail order.

[Anonymous]

I love the "Is X doomed?" topics, but as it turns out our hobby isn't doomed, so how about something of real concern.

Are LHS's doomed? I live in Waterloo, Ontario and there isn't a single train store in the area unless I go over 100km to Toronto. 5 years ago there were 4 stores that carried trains. Something killed them. Internet, train shows, laziness and stubbornes of store owners - "I'll have to charge above MSRP for this, just because I want to"

What are your thoughts?