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Retail Questions
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Hi Bruce, Most "mom and pop" hobby shops have little profit margin to work with. Generally wholesale distributors only give 40 to 50 % discount on hobby items to small retailers. On top of that manufacturers set a retail price for thier products of which the consumer is aware. All of this tends to keep the "mom and pop" prices at or close to full retail. <br /> <br />As to the "chain store" hobby shops...they combine their buying power to obtain deeper discounts on the wholesale level. However, due to the high overhead that these "mall stores" have they do not really offer any substanial dicounts either except on "loss leader" items that they use to get you into the store in hopes that you will buy more than just that "loss leader" item. They may on occasions purchase direct from the manufacturer in very large quanities and at a substanial discount for a special promotion, again designed to get the customer into the store in hopes that he will purchase other items too. <br /> <br />The internet and mailorder shops have a relatively low overhead. Subsequently, if properly funded they can purchase either from the distributor or manufacturer at deep discounts and pass on the savings to the consumer and still make a good profit. Also they will offer items at times at or near cost to entice the customer to order other things with the savings. <br /> <br />Pricing structure in any retail business is a complicated thing and there are many many varibles that I haven't touched on. Hope this helps answer your question....Vic
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