G Scale Model Train Forum banner

1 - 20 of 77 Posts

·
Premium Member
Joined
·
1,311 Posts
Discussion Starter #1
OK.. so I know that as of the 1st of Jan, 2009 all them there E-tailers were supposed to conform to the Minimum Advertised Pricing regs.. So I just did a little survey of five on-line retailers... St.Aubin, Wholesale, Trainworld, RLD & Ridge Road. I was looking at the Aristocraft Mikado 2-8-2, electric version.

Threer of our fine suppliers were within $1.50 of each other... ranging between $440.49 and $441.99.
One didn't have any listed....
But we had one outlier..... One retailer had listed a retail price of $330.75.

My impression of the MAP pricing issue was that it was a federally mandated operation.
Isn't everyone required to play? Do we have a Rebel in our midst? I know that they can price it however they like when the sale is made, but aren't they SUPPOSED to advertise at the price set by the manufacturer?????

What's up with that?
 

·
Senior Dish Washer
Joined
·
3,203 Posts
MAP is not federally mandated. It's an attempt by the manufacturers to limit internet sellers, typically. I'm talking about the sellers making 5 or $10.00 on a $400.00 sale. The brick and morter shops cannot compete as they have overhead to pay for while the internet sellers work out of their house. The only way MAP can be enforced is by the manufacturer refusing to sell to the dealer that is not abiding with the MAP.
 

·
Premium Member
Joined
·
1,311 Posts
Discussion Starter #4
Ahhhh.. that's the kicker.. I though I recalled reading somewhere that it was Gov't mandated... If not.. then that's a whole different ball of wax.
 

·
Premium Member
Joined
·
184 Posts
Posted By rlvette on 01/05/2009 5:58 PM
MAP is not federally mandated. It's an attempt by the manufacturers to limit internet sellers, ........... The brick and morter shops cannot compete as they have overhead to pay for while the internet sellers work out of their house.......



So, am I to assume that St. Aubins, Trainworld, Ridgeroad who sell on the internet do not have 'overhead' to pay? Or, are we talking about E-Bay sellers...then I know of several
of them that have 'brick and mortar' storefronts too. Personally, I don't think I've ever purchased via the internet from a company that didn't have a physical store as well.
Who are we talking about here? Not trying to be 'testy' here, just curious.
 

·
Premium Member
Joined
·
2,896 Posts
St. Aubins, Trainworld, Ridge Road station and wholesaletrains.com all have "brick and mortar" shops,
so its safe to say they have overhead...a building, utilities, employees, etc..

Scot
 

·
Premium Member
Joined
·
184 Posts
Posted By Scottychaos on 01/06/2009 6:32 AM
St. Aubins, Trainworld, Ridge Road station and wholesaletrains.com all have "brick and mortar" shops,
so its safe to say they have overhead...a building, utilities, employees, etc..

Scot


Thanks Scot,

I knew that. But can't figure out who that is selling on the 'net' doesn't have an acutal store that I might be buying from. I know there are indiviuals
selling, but most of who I see on-line, at least who I do business with, like the above 3 or 4 are solid businesses.

LOL...but of coruse, those above are usually my suppliers!
 

·
Premium Member
Joined
·
4,297 Posts
So does this explain why on Wholesaletrains.com I saw Aristo Centercab power bricks before Jan 1st were $45, now they're $65?!!!


If these"mandated" online pricing increases are the cause, then I'm dropping out of the engine building business, as it soon won't be worth it anymore if prices are mandated by the manufacturer, they only seam to go up.
 

·
Premium Member
Joined
·
411 Posts
Guys,

MAP priceing only works with stores that get help in advertising, then the manufacturer can set a minium price.. Most of the on-line stores that get help tell you to put the loco in the cart.. They can then give you there lowest price.. Only have to show the MAP price on the main pages of the web-site.. If a store does not get help with the advertisement cost they can put what ever price they want.. This just played out in the record industry..

BulletBob
 

·
Premium Member
Joined
·
749 Posts
I work for a manufacture so I can give you the details on MAP (Minimum Advertised Price).

No manufacture can price fix, or tell anyone what they can sell there items for, but manufactures will tell the retailers/e-tailers that if they dont advertise at the set MAP pricing they will tell there warehouses to stop selling to them or the warehouses will lose there discounts. Not very enforceable. (traditional supplier system. Manufacture -> Wholesale -> Retail)

Soon after some lawyer came up with a MRP policy. MRP (Minimum Retail Price) policy is an agreement between the manufacture and wholesaler/retailer, states if you don't comply with the set resale prices that you lose things like warrantys, and the manufacture will stop selling to you. This only works when you are a decently well known brand name. This also explains why some devices are found everywhere at the same price. As for the law, there is nothing set in stone yet and its illegal to price fix in the USA.

So prices are unenforceable, but the manufactures can guarantee there profit levels by making legal agreements to hold the prices or choose not to sell to you.

Price Fixing (very illegal in most places)
[url]http://en.wikipedia.org/wiki/Price_fixing [/url]

DiabloSport (where I work) MRP policy drafted up by lawyer for untold hours (MRP is the first policy that actually has worked, MAP didn't work for us)
[url]http://www.diablosport.com/legal/mrp/MRP_Policy.pdf [/url]

It is still a HUGE commerce topic and is the basis for a ton of lawsuits till this day.

and no I am not a lawyer, just a software engineer :p
 

·
Premium Member
Joined
·
4,297 Posts
Thanks for the explaination Andrew,

To me its still "price fixing" no matter how you chose to split the hairs describing the policy. If I have no choice but to pay the higher price because the retailer will be punished by the manufacturer and wholesaler for selling below the MRP on the side, then I'm still forced to pay the MRP as set forth by the manufacturer. so that $45 power brick is now $65, and your TSOL mate!

Its like Ebay slimy way to force everyone to use Paypal by monitoring the sales transaction and punishing sellers who bypass that monitoring system accepting MOs on the side, it all boils down to "pay us or we breakz yu legs" mentality. Uggh! between Evilbay's Paypal enforcement, St Aubin being in bed with LSOL, the BTS going all scales, and now these price increases...Sheesh!

Think I'll stick to working with what stock I have from now on, I have plenty, I'll scratchbuild what I dont have. I dont like being forced to do anything and I think its pretty bad to screw with price increasess of things under the current economic condition. I wonder what the backlash will be?

Lets all raise prices during a recession! It's the American way to go broke !!!
 

·
Registered
Joined
·
2,731 Posts
Posted By vsmith on 01/06/2009 8:04 AM
So does this explain why on Wholesaletrains.com I saw Aristo Centercab power bricks before Jan 1st were $45, now they're $65?!!!


If these"mandated" online pricing increases are the cause, then I'm dropping out of the engine building business, as it soon won't be worth it anymore if prices are mandated by the manufacturer, they only seam to go up.










Aristocraft had a 20% price increase the 1st of Jan... across the board
 

·
Premium Member
Joined
·
4,297 Posts
Thanks Nicholas, That explains the price increase, I wonder how many others will follow suit.

Looks then like my engine building days will be much more curtailed, maybe even over completely, $90 for a pair of bricks was doable over time, but at $130+ will require a much longer time to set aside funding, then I'll have to justify the project... thats almost the price of a new Annie just for bricks!

Looks like I'll be cannabalising some of the larger engines made for the yet unbuilt outdoor layout that really dont work too well on the smaller indoor layout. As it is I'll be storing away almost all of my larger items and refocusing on my smaller rolling stock. Macks are still inexpensive, for now at least.
 

·
Premium Member
Joined
·
233 Posts
Honestly, I really dont know what Aristocraft is up to. MAP pricing AND a 20% increase. MAP pricing IS legalized price fixing and will hurt the uninformed buyer and I fear many newbies to this hobby. I personally promise myself to buy only what I need and if I need it. That way I can fight back, we all can by buying less. I've got to admit, just when I thought I was about to drink the Aristo kool aid they pulled what i think is a very bad move on us. I read an article while searching MAP pricing and in many cases, manufacturers tend to back off after a awhile. Lets hope that to be true. This hobby is already expensive for many of us and like I said I will just buy less. We can voice our approval with our wallet and I plan to do exactly that.
 

·
Premium Member
Joined
·
749 Posts
Hopefully, raise prices = less sales, until they lower them again cause they aren't selling anything or make room for another train company to fill in that gap (big out front costs though).

Capitalism....... Pros and Cons
 

·
Premium Member
Joined
·
233 Posts
Well its a tough situation, we dont want to see our manufacturers suffer so bad they go out of business, but maybe "suffer" enough to come to their senses. I mean, 20% across the board is WILD to say the least. Maybe I could see on some of their products but across the board? USAT didn't go up 20% and their stuff is made at the same place Aristo's is. Sheeesh
 

·
Premium Member
Joined
·
1,311 Posts
Discussion Starter #18
One option I see an opportunity for the manufacturers is production of a "less detailed" line of rolling stock. Many (most, All) of the pieces that I see out there range from finely detailed to beyond neurotic detailed. The initial engineering, tooling, production set up and production cost must be astronomical. Hence we get boxcars that retail at $95.00, and can fnd them "discounted" to $45.00....

How about rolling stock that looks perfectly adequate rolling past at a scale 40 MPH, that rolls well and has couplers that fucntion well, but not necessarily every rivet in place or working door hardware or opening roof hatches..... Retail around $45.00.. available "discounted" at $22.50 ?

Of course keep the "good stuff" as well.. but offer a more "work a day" line that has good margins for the manufacturer, good margins for the retailer and reasonable cost for the consumer..

Just a though.
 

·
Premium Member
Joined
·
322 Posts
All I can say about this MAP pricing is, there are going to be alot of trains just sitting in the wharehouses going nowhere. I spend alot of money on trains and that will dry up real soon. I'll just live with what I have for now. I can afford to wait, the sellers can't. I bet sales will drop drasticly. Just like the gready oil companys, they lost alot of slaes in gas and the price came way down, and they may never get all that buisness back. People found other ways.
 

·
Premium Member
Joined
·
348 Posts
Quite frankly I have enough stuff in the back room to keep me busy for a couple of years without buying anything unless I really want it so they can do what they want with prices. Personally I think it sucks. Most manufactures sell to everyone for the same price. It is up to the retailers to price competivally and still operate. If they want to sell over the internet or ebay that is their option. If they can't compete they fail and go out of business. That is the American way. The idea that a MAP pricing is going to help is rediculas because I am always going to shop around and get the best price. USA Trains has policy that you HAVE to have a shop. To become a seller of their products you have to send them pictures of your business liscence,the front of your shop and the inside of your shop. That's good. i will rent a shop for 6 months, send them their pictures, sell on ebay, close the shop and continue selling on ebay. there is always a way around anything you want to get around.
 
1 - 20 of 77 Posts
Top