Why can't the hobby shops survive?

Tbone Jun 25, 2007

  1. friscobob

    friscobob Staff Member

    When I was a medical technology student in Ft. Smith, AR back in 1979, I discovered the Golden Spike Hobby Shop- it was in the 2nd floor of a house that also contained Cottage Florist. The owner, Dave McDonald, did most of his business in flowers, but he also had a well-stocked shopupstairs, and as soon as I was able to scrape together some cash I would go over to his shop, looking for things I wanted to by. He was most instrumental in getting me seriously involved in the hobby, and it was in 2002 or so that he retired and sold both businesses. He told me that shops like his were wilting due to large mega-shows, Internet sales, and mail-order shops, plus the local hobbyist base was shrinking. Tere is a shop of sorts in the area (in Van Buren, across the river), but the closest one now serving northwestern Arkansas is 18th Street Station in Fayetteville, 50 or so miles north.

    Until he retired, every time I was in Ft. Smith I would stop by Golden Spike (much to the dismay of my ex-wife, but what did she know?) and check up on Dave, plus buy a few items from him. I have no idea if he's still alive, but if he is, I hope he's doing well in retirement, and is finally able to get his On3 layout running.
  2. SecretWeapon

    SecretWeapon TrainBoard Member

    No reason to apoligize Charlie. You answered the question in a business-like manner,with real world expertise as your guide.

    The "eBay mentality" has put a hurtin' on all LHS's. I know mysellf,I seldom buy engines from my LHS or e-tailer. Unless it's something I really want & I'll reserve it. Otherwise,I get most engines at half off or more.
  3. AB&CRRone

    AB&CRRone TrainBoard Supporter

    Why can't the hobby shops survive? They haven't tried to emulate M.B. woo woo woo.

    Check 'em out. In business since 1913, displaced twice by urban renewal, just reopened in a new location, and they are still a draw. They must be doing something right.

  4. Pete Nolan

    Pete Nolan TrainBoard Supporter

    But M.B woo woo woo isn't just a hobby shop. It's also one of the major distributors. I think the distribution business far outweighs the retail business.
  5. AB&CRRone

    AB&CRRone TrainBoard Supporter


    Maybe that is what they are doing right. In any event I really like the inventory system they are using that tells exactly what they have and how many. Makes shopping for that piece of track for those of us with no close LHS much more reliable. Have mostly bought HO scale from them but the way it was handled makes them deserve more of my business.

  6. BoxcabE50

    BoxcabE50 HOn30 & N Scales Staff Member TrainBoard Supporter

    Probably the main reason is necessary floor space. Closely followed by a big investment of $$$. A well stocked craft shop must cover many, many aspects. Painting, paper crafts, knitting, beading, wood carving, wood burning, framing, scrap-booking, flowers, tools, supplies, and more. If you don't own the building, square footage can require a big chunk of cash each month. And quickly pushes the trains aside.

    Boxcab E50
  7. SSW9389

    SSW9389 TrainBoard Member

    Tony there is a lot of truth in your message here. The carbon units that are savy have learned to share their electrons on the net. Those that don't share, are or will be as dead as the Dodo birds. Our train club is in a hobby shop that is going out of business at the end of this month. Guess what, the owner was not savy, he did not share and his little market could not compete with the vastness of the net. I expect we will see quite a bit more of this as the Dodo birds die off. It's simply evolution of the marketplace.

  8. Tony Burzio

    Tony Burzio TrainBoard Supporter

    ...which is why all stores should only carry N Scale trains or smaller, since they take up very little room... :teeth:
  9. Tim Loutzenhiser

    Tim Loutzenhiser TrainBoard Supporter

    The best thing going for me is that I can order an item from my LHS, and if it's not what I thought it should be, I don't have to buy it - the owner of the LHS just puts it up for sale in the store, or he returns it for credit. My LHS can almost always get what I want in just a couple days, and I never pay shipping and handeling - just the sales tax (which I think we'll all be paying on out-of-state and on-line purchases sooner than we think).
    The main thing I like about the local hobby shops I visit around here is that there are usually other modelers there, and we can talk, trade ideas, and get really good advice from the staff of the LHS.
    Then again, I have had good service from Wig Wag, M.B. woo woo woo, and others that advertise on TrainBoard. I had a particularly good experience with Factory Direct Trains - I had a sound equiped E7 fail shortley after arrival - they immediately sent me a replacement, and a pre-paid shipping label to send the broken unit back. Pretty darn good service.
  10. BarstowRick

    BarstowRick TrainBoard Supporter

    I've read until my eyes hurt and my brain went numb. All I can say is WOW!

    Here's a group of guys that should be operating a hobby shop. You have all the answers and good ones at that.

    I worked in a hobby shop while doing a stint in Kettering, Ohio. Within the same community and around the corner from our shop was two gentlemen, brothers, the hobbies finest, who owned a small hobby shop. It worked for us because we had two very good hobby shops and this alone would attract customers from outside the arena of Dayton, OH. The idea most often shared by our mutual customers, "If one hobby shop didn't have what they were looking for there was a good chance the other one did".

    Cutting to the core: The bottom line is profit. If at the end of the day you haven't cleared a profit, you shouldn't be in business. Most suggested retail mark-up is less then 15% and if you give a 10% discount you won't break even. This is changing as LHS and Manufacturers do a reality check.

    Shelf sitting: The biggest concern we had is that we needed to move the inventory on the shelves...collecting dust. To do so would give us the cash flow needed to bring in the new goodies advertised in the model railroad wig wags. To sell it at a lose is counter productive. This put us behind the eight ball playing catch up. Principal being, "What you don't have you can't sell" or "What you can't see...won't sell" and "What shelf sits, is costing you overhead".

    Todays LHS: The smart LHS will have a internet mail order website. It will sponsor sales and discounts, put on work shops, have modeling contests and a modeler of the month type of recognition programs.

    Overhead: After paying the rent, utilities, employee salaries, uncle sam, state and city taxes, workmans comp., shipping and many misc. hidden costs, you must clear a profit. Simply, the most difficult juggling act in any arena.

    The down side: One glitch, one error in judgment, one mistake can and will bring down the house of cards.

    So you want to own and operate a hobby shop. The brain pool has chimed in here. It seems to me, if we pooled our resources we could have a great LHS. Now to pick the location. I vote for Colorado.

    My two cents plus one.
    Last edited by a moderator: Jun 29, 2007
  11. Tony Burzio

    Tony Burzio TrainBoard Supporter

    This is the clearest expression of business economics I've ever read. In fact, I hereby name it "Rule #1".

    The customers know exactly what they want, and are more than happy to let you know. It is the poor businessman who says, "I've been in the business for 30 years, so I know better than you." Violate Rule #1 at your peril!
  12. Tbone

    Tbone Permanently dispatched

    BarstowRick,I will have to admit that you make some great points.I agree with Tony in making that Rule #1.Hilarious......
  13. Rossford Yard

    Rossford Yard TrainBoard Member

    I think its pure numbers, based on MRR declining signifigantly. Model Railroaders circulation has dropped from 225K to 168K in about 15 years.

    IF there is a basic, but aging core group of us, and we all have our layouts and collections, we are probably buying less towards retirement (and after 9-11, corporate downsizing, etc) , even if we are avid modelers.

    In a recent thread, it was reported that loco sales - the bread and butter of the hobby - have dropped from 40,000 units of a model (in HO) to about 5000 units (from an article on Tony's Train Exchange) If those loco sales go to on line shops the rest of the sales isn't enough for an LHS.

    Total MRR sales are about $400M last I heard from a shop owner quoting industry reports. That total has been fairly constant in actual $, not even rising with inflation. I think a lot of that goes to O and G from boomers setting up their Lionel sets again. Some shops specialize in that, so the traditional shop with N and HO is getting less business.

    The consolidations at higher levels (Athearn/Horizon, Walthers/LL) hint at a strategy for surviving. And yet, the dream at the LHS level still lives. MR lists 500 shops or so, and I know there are other good ones who avoid that expense. Then, there are at least that many chain shops (Hobby Town, Hobby Lobby) and other stores that siphon off related item sales (you can buy a glue gun equal to WS at HL for much less)

    Short version - A lot of LHS need to close, based on numbers of overall sales. Its a painful process to watch our faves go out of biz, but its necessary. Like others, I think we will have fewer LHS and more regional on line shops with a store presenced.

    In a city like Nashville, those shops are competing for the business of maybe 3000 model railroaders who average less than $1000 per year in purchases overall (about ten years ago, MR surveys pegged average subscriber purchases at about $600. I haven't seen new data) If they went to the net, they have a shot at perhaps 300,000 modelers, albeit with expenses added to the cost. I think the potential revenues of doing that far outweigh the costs of a web site, 800 number and national advertising.
  14. Tony Burzio

    Tony Burzio TrainBoard Supporter

    Anyone know the subscription rate for the various N Scale mags? I know I don't subscribe to MRR, but I buy the magazine anyway. This forum would be a good enough reason to let the subscription lapse! :teeth:
  15. Rossford Yard

    Rossford Yard TrainBoard Member

    I came across the 2005 Magazine Directory, which is intended to let marketing professionals know and contact the media. It includes circulation numbers, which are audited in some cases (usually the unique numbers, while self reporting tend to be the round numbers):

    Model Railroading

    Hobby Outlook
    (By HobbyTown, Inc. for store distribution, and covering all hobbies) - 208,729
    MR - 181,363
    RMC- 75,000
    Classic Toy Trains - 65,000
    O Gauge Railroading - 39,580
    Garden Railways - 38,000
    Narrow Gauge and Short line Gazette - 16,000
    Railmodel Journal - 15,000
    Mainline Modeler - 12,000
    Model Railroading - 11,000
    N Scale - 10,500
    S-Gaugian - 5,000
    Canadian Railway Modeler - 4,200
    Grand Scale Railroading Quarterly - 2,000
    SN3 - 2,000


    Trains - 130,385
    Classic Trains - 62,000
    Railfan and Railroad - 50,000
    CTC Board - 12,500
    Live Steam - 12,000
    Rail Pace - 11,200
    Extra 2200 South - 10,000
    The International Railway Traveler - 7,000
    Private Varnish – 3,200

    Overall, I was surprised to see the subscriptions for Garden and O Scale Railways. It makes me wonder if MR cannibalized itself somewhat when it came out with a couple of specialty magazines for large scales. The number of Classic Toy Trains Readers alone is more than the subscription drop to MR. Garden Railway readers are also close to the readers dropping out of MR in the last decade.

    Other Hobbies

    In case you are wondering about the relative size of our hobby, here are some other hobby magazines circulations:


    Lettering Arts -5,000


    Bridge (card game) - 145,000


    Chess Life - 60,000


    The Comics Journal - 9,000


    Country Marketplace (crafting) - 300,000
    (The other Crafting Journals average about 24,000)
    Family Circle Home Crafts - 500,000

    Die Cast Vehicles

    DCX - (die cast vehicles) - 100,000
    Die Cast Digest - 40,000

    Dolls and Dollhouses

    Doll Costuming - 12,000
    Dollhouse Miniatures (Kalmbach) - 26,000

    Gas Stations

    Check the Oil (Gas Station Memorabilia) - 3,500

    Gaming and War Games

    Inquest Gamer - 88,659
    Fire and Movement - 3,000
    Strategy and Tactics (Military History)-10,000


    Family Tree (genealogy) - 75,000
    (Other genealogy magazines average about 16,000 each)


    Blade (Knife Collectors) - 22,674
    Knives Illustrated - 41,160
    Carver's Magazine - 40,000
    Chip Chats (Whittling) 28,000

    Sewing and Quilting

    Country Quilts - 300,000
    Sewing News - 173,734
    Stitcher’s World - 100,000
    (Other sewing magazines do much less)
    Love of Quilts - 160,000
    Quilt Maker - 145,000
    Quilting Arts - 85,000



    Model Aviation - 160,000
    Fine Scale Modeler (Kalmbach) - 63,047
    Modelers Resource (Science Fiction and Historical Figure modeling) - 35,000
    Toy Farmer - 28,500
    Flying Models - 25,750
    Toy Soldier - 20,000
    Ships in Scale - 14,000
    Model Aviation Canada - 12,000
    Model Cars - 8,000
    Toy Trucker and Contractor - 7,500
    Steam Traction (Farm Equip) 6,000


    Big Reel (Movie Collecting) - 3,423


    Painting - 71,906
    Paint World - 27,927

    Paper Crafts

    Paper Crafts - 80,015
    Paper Collectors - 4,000


    Sport Rocketry - 6,000

    Radio Control

    R/C Modeler - 205,000
    Radio Control Nitro - 40,000
    Radio Control Boat Modeler - 60,000
    RC Car - 30,000

    Scrap Booking

    Scrap and Stamp Arts (Scrap booking) - 65,000
    Simple Scrapbooks - 170,000

    Stained Glass

    Glass Craftsman (Stained Glass) - 10,000

    Treasure Hunting

    Lost Treasures – 45,000

    Tropical Fish

    Tropical Fish Hobbyist - 35,000

    Overall, Model Railroading is one of the bigger hobbies – Sure sewing and quilting seem to exceed it, but women generally have fewer hobbies, and these also have some practical value as well. Scrap Booking is coming on. It may be no surprise that gaming has fairly big numbers, as it is the thing for kids today.

    Among traditional men’s hobbies, only R/C and model planes equal Model Railroading.

    Some Hobby Trade Magazines:

    Hobby Merchandiser - 8,683
    Model Retailer (Kalmbach) - 6,000
    Needlework Retailer - 11,000
    Picture Framing Retailer - 25,000
    Profitable Embroider - 10,000
    Quilting Professional - 20,000

    No surprise here, as I have heard there are about 6,000 hobby shops. I would expect there to be more general craft shops.

    Some Prototype Trade Magazines:

    Locomotive Engineers Journal (in house for Brotherhood of Locomotive Engineers) - 55,000
    Progressive Railroading (rail executive magazine) -25,046
    Railway Age - 24,453
    Railway Track and Structures - 8,716
    Atlantic NE Rails and Ports (rail execs.) 350

    It seems there are about 25,000 railway executives in the US, and perhaps about 8,700 Track Maintainers?
  16. Rossford Yard

    Rossford Yard TrainBoard Member

    BTW, if there are only 5000 shops and a $400Million market, that averages out to about $67,000 in sales per shop. We know from a recent thread that Allied Trains takes in $3 Mil a year, and imagine that the top 20 shops do similar business, leaving even less for others.

    With product costing 60-80% of gross sales, I doubt that $13K is enough to cover overhead, much less salary and profit in a year. Even if sales have climbed to $600 MIL, its a tough biz.

    As someone suggested, big dealers like Kleins, the old Bobbye Hall, and others are both wholesalers and retailers, which is the only way to discount with a normal markup.
  17. umtrr-author

    umtrr-author TrainBoard Member

    I prefer that Rule #1 remain "It's your railroad."

    The Rule #1 here makes a key assumption: That all customers want the same thing. To intimate otherwise assumes that YOU know what I want, or SHOULD want, and let's not go there because I'm fed up to here with that attitude.

    However, regardless of what specific item they want, whether it be the latest craftsman kit or a basic entry level train set, customers do seem to have one thing in common.

    Whether retail, wholesale or industrial, whether as single consumers or large corporations, customers appear to be aligned across the "better, faster, cheaper, more" axis. I want superb quality, I want 24/7/365 availability for eternity, and I want it for 10% less year over year.

    The Supreme Court has made an interesting ruling that may, or may not, work its way down to our corner of the hobby universe, and that is a striking down of the automatic assumption that retail price agreements are in violation of the Sherman Anti-Trust Law. In theory, that means that on a case by case basis, manufacturers may -- that's may-- be permitted to set Minimum Price Agreements with retailers, violation of which could result in the removal of their right to sell that manufacturers' product. As if limited runs and pre-orders do not do enough to try to hold original retail prices stable (by attempting to restrict supply to approximately the demand at that original price), the introduction of these agreements may in fact help the LHS by removing the Internet based cost advantage.

    What it doesn't remove is what I think is the key answer to the original question, and that is that even in a metropolitan area of three million such as Nashville, there are not enough people with enough discretionary income pointed in the direction of model trains to support the LHSs in that area. I expect that problem to increase at an increasing rate.
  18. Benny

    Benny TrainBoard Member

    I was mulling over the number myself last night, they aren't these but they are very similar. I ran some numbers a few years ago and figured that a Good business doubles your money and a bad business breaks the bank, but it breaks even none the less.

    I know an old family friend in the verde valley, a self employed artist, and the first thing he said about business is half of every dollar MUST be reinvested back into the business. This way, you can upgrade your machinery, or if you have a delivery service, you can upgrade your trucks, or moreso, you can recover some of your debts such as the 30 year mortgage or the rent or other things like that.

    So half of every dollar is GONE off the bat. Now how much money will we need to be in business?

    We won't even start with capital or any of that stuff, that will work itself out by the end of my calculations, you'll see. We'll start with the nonnegotiable Labor. Simply put, if its just you yourself, you're going to get burnt or die of a heart attack. You're trying to help one customer at a time, but you have no less then three guys bugging you for attention. Worse yet, you get to practically watch your merchandise WALK through the front door. So you need help. Do you know the secret of Finding good help and more importantly KEEPING good help further isn't contributing to your walking losses problem? Henry Ford did when he start building his Model Ts, you pay them a living, Working Wage - that makes them WANT to come BACK to work! So we're going to pay our employees like we WANT to keep them! This may be expensive, but the savings we amass in rehiring and retraining is mreo then you mgiht imagine!!

    The means you're looking at 10.00 an hour for your part time help and 15 an hour for your full time help, and you might have to throw on some benefits too. How many should we hire? Let see, we need a full time guy to help you out. He's going to want vacations, and time off, and you can't afford to keep him there ALL the time AND keep him. So you need two full timers in addition to yourself. Preferably, both employees and yourself are working a total of roughly 2/3s of the time all year. That way, between the three of you, there is Always two full time guys in the shop and one guy at home tending to what rally matters, LIFE!

    These guys will need helpers to be truely efficient, so we want some part time help. How much help? Two guys seems to do the trick, becasue with two guys, you always have a part timer sort of in the shop. All right, time to do the accounting, on WAGES alone!!!

    You want to offer some benefits, which is going to cost [here I am lowballing] about 10k per person per year.

    Your own wages, in business, as my uncle says, a manager's salary is equivalent to the sum of all the employee's wages below him. That's WHY your CEOs make so mcuh, they follow a scheme similar to this. I'm cutting it in half because the rate of inflation has REDUCED the common american's steadily since the 1970s when he learned that principle!

    2 part time guys, 20 hours a week, 10 bucks an hour: 20k +10k each
    2 full time guys, 40 hours a week, 15 bucks an hour, 30k + 10k each
    Your wage [manager] = [all PT + all FT wages]/2 +10k = 40k+60k+10K
    Total: 30+30+40+40+55 =195k ~ 200k

    Double that and you have the total amount your healthy business should be bringing in; you have to make 400k in order to support four employees AND make your efforts worth your time.

    Obviously, MANY small businesses are doing no where near this brisk of business, so you may wonder how they are doing as well as they are. First, tax laws are formualted in a starnge manner to at the very least helop out small businesses. The Boss is writing off 70% of all of his personal expenses as business expenses, such as his vehicle and all the gas it uses, as it is registered as a business vehicle, of his lunches at work, which are business lunches, because he's working while he's at lunch, of course. A trip to a trainshop is a business expense, almost entirely, so its all "paid for" by the business. In the end, your small business owner may just very well qualify for a lot of low income assistance, aka Welfare and E.I.C. Next, your businesses are skimping on staff, benefits, and on the amount of money they are reinvesting into their businesses, which means after these adjustments, you have:

    [20]k + [30 + 5]k + [10+10]k [the boss's new wage with benefits, EEKES!] = 75K*2 = 150k, but then of course you notice alot of things are diminished around the business, and its a lot closer to the Breaking point where one small accident of a major medical problem wipes the whole business out.

    The trains businesses that have survived do so because they offer a second service, such as a distributorship, or they are a Lionel Repar facitily for entire Southwest, such as one of my train pushers in town here before he went belly up and retired.

    Oh yeah, I've been running numbers, and everywhere I go, I can't find many businesses that gross more then 250k a year, which is perhaps why I stay working for the man myself!!

    400k a year is what your trian pusher needs to make. In your 3,000,000 there might 1% who are train fans and of that, .1% are buying most of everything in the store. Man do those numbers shrink fast...
  19. BarstowRick

    BarstowRick TrainBoard Supporter

    If you haven't already studied the data provided by Rossford Yard, go back and give it another look-see. Jeff, has provided you with enough data to either see a trend or pattern developing. Check whether or not there is actually a increase in the overall numbers of subscribers for the various model railroad subscriptions. You might also note the increased number of hobbies available and listed by Jeff. Todays hobbyist are focused, hobby specific and diversified. Is it possible there is actually a increase in overall customers of a LHS?

    Allow me to share a thought. I used to subscribe to MR, and as far as I was concerned...it was the only one. Today, I no longer subscribe to MR., however, I do subscribe to two well published N Scale wig wags and one specifically for ATSF fans...three in total. I was wondering how many of you are doing the same? Just a thought!

    Why, am I slowing down on my purchases? Consider... the ever increasing cost of living. It is serio-uselesly biting into my model railroading budget. Do I need to list the obvious reasons....why?

    Back to my previous post with a word of appreciation to Tony Burzio and T. Bone. When in business: Rule #1 is correct in my opinion...hilarious or smerious (sp intended) Yes, a business of any type can and will fold like a stacked house of cards. >:-0

    When enjoying the hobby Rule #1, should be "Have Fun"! And, when you walk into a LHS the shop should reflect this. Smiles, helpful sales persons, appropriate jokes and use of humor. Excitement over various products on the shelves and etc.

    In case you were wondering........Yes, the hobby shop I worked for did fold....@rrrgh#.... "Like a stacked house of cards". Sadly, the finest people to work with and for, my favorite job bar none and a train department to be proud of...closed. With a hard to say good-bye, a hand shake and best wishes expressed all around....we parted. Gosh, I miss the Brady Bunch.

    A LHS: I hope my two cents here will help you understand... running a LHS is no easy task. The ones that may survive into the future will need to be be full service types. The day of the all train hobby shop, in my opinion will be on it's way out. Your local LHS will need to be an outlet for a variety of hobbies IE., beads, wicker baskets, doll houses, model airplanes, cars, RC anything and everything and the list goes on. It will take a different mind set on behalf of the owners and their investors to make it work. Knowing your customer and their "Wish List" never mind their "Needs"...will be the key to keeping the doors open.

    Despite all the negative, I do believe "Hobbies" are well entrenched. What about Model Railroading? I think that's up to us, the You and I. How we promote the hobby and the time we take with up and coming young adults of tomorrow. We will need to reach out to youngsters through the various clubs, museums, restoration projects and hobby shop promoted work shops, just to suggest a few. All for the purpose of teaching, grooming and promoting future model railroaders.

    When I think of those who took a interest in me, the LHS that supported me and the fella (who's name I don't remember) coming to the house to help me with the track laying and wiring. How my great granddad a former engineer/Moffat man, who bought my first American Flyer. My granddad an engineer for the Santa Fe, who gave me my first HO set. Dad, a former REA agent, who took the time to show me various types of switching moves, how to bring in a train, scale operating speeds and the how to's of operating a railroad. Not to forget, a Uncle who built a Lionel model railroad which set in motion my desire to do the same. Harry Hunter a banker in town who took the time to show me the how to's of building a model railroad. My mother who took the time out of her busy life to help me scenic my first model railroad. All a inspiration to this once upon a time.... young model railroader.

    Comparing yesterday to today: When I think back to the lack of ready made equipment. The MR, filled with articles illustrating how guys and gals, literally built their own train equipment. Machinist, who knew their way around a shop. Those honest to God, Craftsmen. Today, we might feel justified to complain, hammering, "We want more". In the words of many old timers, "We never had it so good".

    The hobby may appear in jeopardy but I don't think so.

    Last edited by a moderator: Jun 29, 2007
  20. broadway zephyr

    broadway zephyr TrainBoard Member

    Allow me to offer some insight.

    I don't have a "real" local shop where I live. There is a relatively well known shop about 45 minutes away. I've been to it 2-3 times over the past year. They are trains only, and have everything from N on up. Lots of Lionel. Tons of HO. Ok (in my opinion) selection of N. They are thought of on the boards to have pretty decent service. I have never received any while there. The store is divided between large scale in the front and HO and N in the rear, but the emplyees don't seem to move between scales.

    I needed some assistance, and put myself in a position by the counter where I could be seen and asked, without being obtrusive to the help or the one other customer in there. It is obvious I am waiting for help, there is no way the guy at the counter couldn't have seen me. But he is talking to this other customer about how bad employment is in the town, and who is looking to hire, etc. He and the customer are carrying on this conversation for like 10 minutes. I finally got fed up, took the 9 sets of Microscale decals I found in their clearance box for .50 cents each, walked to the front counter, paid less than a 5 spot with tax for 9 sets, and left.

    This place, like many shops, keeps all of their N stuff behind the counter or inside a case, so you can't really touch and see it unless you ask for help. Thats where the problem lies. I don't want help. I pretty much know what I want anyway. The shop isn't going to "sell" me anything. All the info one wants is readily available from the comfort of my home via the internet, and quite frankly, guys like yourselves here who have MUCH better info on product than most of the help at these shops. So in order to look at something, I must engage with the people at the shop. Once you do that, in my opinion, you are taking their time and there is a cost to that. Someone has to pay for that, and I don't want to pay for that. It represents no value to me. And in order to pay for that, they must charge MSRP, or if something is a slow mover, a slight discount. That doesn't cut it for me.

    Why should I pay $85 for a new Kato F unit when I can buy them all over the internet for AT LEAST $25 less? Pete must make money selling them for $57 and change, right? Shipping/tax net out for the most part, and if I don't like it for some reason down the road, I can ebay it and not take a big hit, if any. I can then buy something else. At $85 per unit, I better really like it. I'll roll the bones more on things via the net at a lower cost, knowing I have decent liquidity to get out of it---if I don't like it after I actually see it.

    Seeing it is all the LHS can offer me, and even then, they don't have mcuh in stock besides the Amtraks and local names, so they have nothing to see anyway. The best hobby shops for me are ALL on the web. Great pictures, descriptions, volume sales, and thus, better pricing, most with fresh inventory. Whats not to like?

    The model of the local shop is dead. The guys doing it now are just hanging on to whatever they have. But there is no catalyst on the horizon to turn it around and get people into the shops. The serious modelers now know the "cost" of just about everything and they will never go back. Sellers must have a web presence and do volume. Period. Some of these guys get it. Pete, Chuck, and others. They can have a local shop, but that will be more from the fact that they need to operate out of somewhere, why not keep the storefront open? I would bet the storefront has been a declining revenue/profit generator for them over time. At some point, that won't even make sense. Look at the guy at Allied in LA. He was selling at full retail to what sounds like like a non-price sensitive customer base. Didn't he say his revenue was somewhere around $3 million a year? And he still figured it wasn't a good business. How can these little mom-and-pop shops make it? The price differentials are just too great to not buy from the net. Just too much.

    I guess I am not one who says they wish it was different. Why? To pay full retail for product? I think the democratization of pricing the internet affords is very liberating for most modelers. And as much as I like going into a big shop to see their stuff and a possible big layout, I will pass on that to buy stuff at 60%---or less---than retail. I won't waste their time and "shop" their items only to go and buy it on the net. I'll just buy it from the net right now.

    Am I the only one who thinks this way?

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