Has anyone tried Factory Direct Trains??
What was you experience with them if you have purchased from Factory Direct Trains??
Good service??
Thanks
Example below of advertisement in MR
PCM Big Boys for $325 No Sound
Y6B’s for $399.00 with Sound
I purchased the Y6b on January 2 for $399 from their website. Prior to placing the order I spoke with Factory Direct Trains and they confirmed that all locomotives come with full warranty. UPS shipping to Michigan was $9 but I believe this is a special 30 day rate.
UPS tracking indicates that it will be delivered today. What is interesting is that the loco was shipped directly from BLI/PCM in Florida so it truly is factory direct. I’ll update this when I receive the loco.
Mike
Thanks for the reply. Sounds like they are representing PCM to sell their overstock, which should be good for us. This also sounds like the first PCM blowout that I am aware of.
I´live in Argentina and had ordered a PCN Galloping Goose, at a surprinsingly 1/3d of the price list. I knew they by the MRR web page, so, I suppose a serious firm. Will see when the merchandise arrive. Bye.
Enjoy the low prices while you can. Once again, IMHO, a manufacturer has shot themselves in the foot with some retailers. This is what happened last week:
Prominent distributor sends my competitor an e-mail about Broadway clearance prices. One of the items listed (to us, at wholesale) was 1.00 HIGHER than what BLI/PCM is selling direct to you guys…per the centerfold style MR ad.
I know of a few retailers who are now no longer going to carry anything from Broadway or PCM. It’s not worth the risk.
Buy direct, save money, good luck.
Crazy way to do business for sure. Why would any shop, real or virtual, carry their products when there is a good chance they will get significantly underpriced by a deal with someone like FDT? [banghead] 
I am not a business person, and can’t claim any experience or insight into pricing policies.
I have found that my local LHS in Nanaimo (not really local, but…) does quite well when he needs to. For example, I can get something brought in on his next order, and he always seems to match what it would have cost me to get it shipped, after those costs and customs, from the USA to my home on Vancouver Island. In fact, he offered me a 10% customer discount, so I came out ahead.
If it would not be an imposition, or an intrusion, for you, OTM, would you help the readership here to understand precisely, and in as much detail and specificity as you can comfortably share, exactly what impact this type of practise has on you.
Thanks very much for any illumination you can shed on it for us.
-Crandell
hang on…got busy here this afternoon, may not have time to answer until tonight
Hi Selector…and others…
first I apologize for derailing the original question posed by this thread. Lack of judgement on my part.
Now, I’m barely a businessperson myself, so I’m not sure I can explain exactly what you want to hear…especially within the confines of no advertising on my part, no discussion of wholesale pricing per my distributor and or by BLI/PCM policies…etc, limits what I can say…
But the bottom line is, let’s say I thought the Broadway Limited On30 galloping goose was going to sell real well here. Let’s pretend I ordered…6 of them. A lot of you already know what our “standard” wholesale discount is to retailers…I can tell you that BLI sells at a SHORTER discount than that. This gets tricky - delete this if you want Bergie - but I already discount a certain percentage to compete with the 'net and mail order…by the time someone pays with a credit card, the amount of profit we make on these products is nearly nothing…but that’s sort of a different part of the discussion.
OK so I have 6 coming in, and 2 sell and 4 are on the shelf. The Feb '07 MR arrives and - with no advance warning from anyone - there you see that these very same products are now discounted 66% off of the MSRP, straight from the factory to you.
Now, what do I do with those units I have on the shelf? What would you do?
It’s a free enterprise system in a free country, BLI can do whatever they want. But no one should expect real stores to carry BLI and PCM products as stock items anymore.
A similar situation happened with Proto 2000 back in the late '90s in my opinion. You wanna dump excess inventory at giveaway prices - fine - but don’t depend on us (LHSs) to promote your line. Don’t come to me/us if or when you have problems.
Don’t know how else to answer your question Selector, it’s just business sense…why take the chance of stocking something at a price based on MS
I hope it was a “good” and profitable busy…[:)]
Yes, I follow you…it is as simple as arithmetic. If you get invoiced for something like 40-50% of what you would place them on the shelf, and then have the distributor or manufacturer dump them at about that price, how can you hope to break even with your carrying costs factored in, even if you did manage to sell them off one-by-one? You get cut off at the knees.
Maybe, and I am way out there in la-la land on this one, there should be an agreement that shipped/invoiced items have a 15% holdback or something so that if this takes place, you get the benefit of the holdback sent to you at month-end. At the very least, this would replace some of your costs and maybe net you a whopping $100 at the end of the month.
How you and your colleagues across the globe could ever engineer that, or impress it upon XYZ Company is beyond me.
Thank-you for taking the time to respond. I get a strong sense it ain’t a great way to make a buck at the best of times without this type of action.
-Crandell
The way I see it its like Presidents Choice selling a complete train set (and I still have not been able to find one [:(] ) for $100 CDN while just the loco can be had for $129.99 USD, on sale, at the LHS or internet store. IHC was able to supply that market much cheaper than the “regular” train market, maybe because of volume or other factors but still undercutting the LHS’s.
[quote user=“One Track Mind”]
Hi Selector…and others…
first I apologize for derailing the original question posed by this thread. Lack of judgement on my part.
Now, I’m barely a businessperson myself, so I’m not sure I can explain exactly what you want to hear…especially within the confines of no advertising on my part, no discussion of wholesale pricing per my distributor and or by BLI/PCM policies…etc, limits what I can say…
But the bottom line is, let’s say I thought the Broadway Limited On30 galloping goose was going to sell real well here. Let’s pretend I ordered…6 of them. A lot of you already know what our “standard” wholesale discount is to retailers…I can tell you that BLI sells at a SHORTER discount than that. This gets tricky - delete this if you want Bergie - but I already discount a certain percentage to compete with the 'net and mail order…by the time someone pays with a credit card, the amount of profit we make on these products is nearly nothing…but that’s sort of a different part of the discussion.
OK so I have 6 coming in, and 2 sell and 4 are on the shelf. The Feb '07 MR arrives and - with no advance warning from anyone - there you see that these very same products are now discounted 66% off of the MSRP, straight from the factory to you.
Now, what do I do with those units I have on the shelf? What would you do?
It’s a free enterprise system in a free country, BLI can do whatever they want. But no one should expect real stores to carry BLI and PCM products as stock items anymore.
A similar situation happened with Proto 2000 back in the late '90s in my opinion. You wanna dump excess inventory at giveaway prices - fine - but don’t depend on us (LHSs) to promote your line. Don’t come to me/us if or when you have problems.
Don’t know how else to answer your question Selector, it’s just business sense…why take the chance of stocking so
Aha!! One Track Mind has helped answer one of my questions. I purchased a set of diesels (PCM) at wholesale (30% off MSRP), and then saw that a large nationally known train store is selling the same set of diesels for only a few bucks more than what I paid through a distributor. At that point I was wondering how they would be making any profit on this. I am assuming that this is explained by what was stated above about PCM selling directly to the hobby shop at a lower cost than what they might give to a distributor, or did I interpret that incorrectly? Are certain places getting them at 40% off or possibly more? The profit has to be made somewhere.
Correction
In this case, the dealers who stocked up on the same products that are now being blown out below wholesale are stuck with their stock.
Smitty -
Not sure if I explained something wrong or if I misunderstood your post…I’ve been sick for two weeks and it’s been a long day and eventually someone is going to tell me that I should never bring this stuff up in the first place…
I’m not sure what question I answered for you.
The bottom line, from my viewpoint only, is that an item is offered for sale at a MSRP at it’s introduction into the marketplace, and my store buys it at the wholesale price of that MSRP. All is fine and dandy.
Then the manufacturer decides to dump the old inventory - maybe I still have some of it on the shelf, maybe I don’t - and sometimes when this happens, we are offered even better wholesale deals from the factory through the distributor to help them move what needs cleared out.
My point was, in this case, even the clearance sale wholesale price was 1.00 higher than the ad states they will sell to you. Technically yes, stores can get a pretty good deal on some BLI products right now, but it’s still HIGHER (even slightly) than what “Factory Direct” is selling directly to consumers.
And of course all this only applies to the stuff that doesn’t sell well in the first place. The desirable items are already sold out, that isn’t something that I have qualms with I guess, it’s just that I don’t have a crystal ball to determine what is going to sell well and what is gonna get blown out in a few months.
I don’t know how BLI sells directly to a hobbyshop, I’m not a big enough place to be ordering direct. Can’t speak for what other places consider to be a profit.
Hope that clears up what I posted, if not, I’ll be around.
One Track Mind:
I suppose I may have mis-interpreted you. I somehow derived that certain hobby shops were getting additional discounts directly from the manufacturer that hobby shops purchasing through the distributors werent’ getting. Say hobby shop A (larger shop) is purchasing large quantities directly from PCM at 40% or more off MSRP, and hobby shop B is purchasing products from a distributor for the standard 30% off MSRP for PCM. Either I need to read a little slower or lay off the crack!
I have TRIED to keep my mouth shut, but here goes.
As a customer I feel cheated that these enormous retail prices for PCM or BLI products are getting SO low direct. I see this as a problem because now no one will expect to carry BLI or PCM products in ANY store at current prices.
I consider BLI and PCM very GOOD manufactors with decent equiptment, first class service etc etc. But… I fear they just created a massive glut of products that now wont sell and will hit thier outlet or sit for weeks unsold at invoice prices.
I support One Track Mind’s comments and I know that there are several stores that will no longer carry BLI or PCM simply because of pricing. There is literally no more profit to be had at the Factory Direct Prices.
What I dont understand is this: BLI created PCM. BLI and PCM are one and same as far as I am concerned. Suppose they took thier website “Outlet Direct” one step further and created a Distribution network aimed directly at the customer bypassing the Hobbyshop and Distributors??
Is that possible in the Corperate world?
I already have several BLI products on back order from the last twelve months and already wrote one of them off as never to be run again out of the factory. I fear that future BLI or PCM engines may in fact be in jepoardy because no one will make them availible at the prices currently being advertised… example, the PCM HO scale Heavy I-1 Decapod 2-10-0 That thing has been on the PCM’s website at about 400 dollars with a short tender with a second run forcast with a possible coast to coast tender. I will not be ordering this engine via the LHS even with the very NICE discount that I enjoyed in the past. Why? because Factory Direct will have pricing that might make it worth my while to BUY TWO of these engines for 400 dollars.
What happens 5 years from now when QSI and other sound equippted engines completely collaspe the market nationwide and they become a sort of a non-profitable item because they cannot be so
Missed the UPS drop off on Tuesday as a signature was required - received the package on Wednesday. The Y6b came in a new PCM box and was in new condition. I did a quick test run and everthing checked out fine but the test was limited as I only have DC. Hope to have a Digitrax Zephyr set up soon. Overall I was happy with the purchase and would buy from them again.
Mike
All I can tell you is I ordered a hard to find BLI F7 A/B set from them for $240 + shipping and they arrived in less than a week. I really don’t care who gets undercut by this. I am out to get the best value for my money and this price was way below what has been listed elsewhere. Now I did just place an order from Walthers latest sale brochure through my LHS. The total is over $600. There were some outstanding bargains in it. I think my LHS dealer is as happy as I am.