I have tried to be a good (regular) customer at my LHS for many years, through good and bad economic circumstances, but these days, I have noticed a trend- at least in my area- that their inventory levels have shrunk markedly. I realize, as someone with prior retail experience, that there are significant costs associated with maintaining “healthy” inventory levels, and that walk-in trade is variable, particularly these days, but I cannot help but wonder if the days of the LHS are growing short more quickly nowdays.
As I talk to others in various parts of the country, there are large metro areas that can support an LHS through good times and slow times, based on a larger population of hobbyists, but they are the exceptions, not the rule.
I also see a similar trend among the internet-based retailers- their magazine ad space is maximized only for the pre-Xmas and Xmas seasons; some skip a month or two in the subsequent spring periods- and a few have just plain disappeared (such as IHC), although a few suppliers still have some of their inventory.
There isn’t any businessman I know that’s not trying to “hold the line” on costs these days, and the LHS is no exception. In fact, any hobby shop has to be on the bottom of the barrel as far as priorities for many folks in this economy. Going to the LHS is not one of mine; at least not like I used to visit.
Cyberstores will always have the advantage over a walk in store with its overhead (payroll, inventory, utilites, etc.), and advertising is not cheap anywhere.
Most retail businesses make 80 - 90% of their money during “the season”, which is Thanksgiving to New Years , so a lot of the time, it doesn’t pay for a business to advertise outside of the season unless they have an overstock condition or get a great deal from a supplier.
it is a never ending, downward spiral. your lhs will have less and less inventory and sell less and less of it so it will continue to shrink. meanwhile back in the jungle, a few reputable internet sellers will carry on business as usual while the hucksters will figure out more and more of what they can get away with.
i still enjoy visiting and buying from a well stocked hobby shop but the last two i were in were 250 and 750 miles from my home.
inflation has been hashed over many times on these forums but consider a 30% discount on a $25.00 box car amounts to $7.50. not that i would give that for a box car since i am still stuck in the old, stale two dollar kit mentality.
next, consider how some of the big outfits merchandise their products. first, they try to get everyone to pay up front at full retail just to be sure of getting the item. next, they wholesale them out to anybody who wants to play hobby dealer. then, they dump what is left for about 1/3 of the original price undercutting their dealers and making the original full price buyers feel like they have been had. today,Milwaukee-tomorrow,the world!!
As the hobby gets “better” it has gotta be tougher to be a dealer. Just the proliferation of scenery items and companies alone could fill up an aisle or two. You don’t suddenly have a bigger store just because there is more stuff that could be sold. So you pick and chose and that means the customer by definition won’t find everything he or she wants.
All those detail parts that are out there, and the expensive point of puchase displays needed to show them off so someone will buy them. When a local hobby shop here in the Milwaukee area closed about a decade ago, run by a bunch of young idealists, on their very last day with everything 70% off it was those details that hardly looked like they’d been touched. And those were their pride and joy, the proof that they were catering to the serious hobbyist and not just some newbie who wanted LifeLike grass mats.
Now we have all these wonderful railroad specific detailed engines (at high prices) - you really have to think about what roads sell best in your area. The consequence is that years ago when locomotives meant Athearn blue box, a hypothetical GM&O fan here in Milwaukee might find stuff painted for his favorite road, but it would just be the standard low priced blue box engine with GM&O paint. So now the manufacturers offer a true scale model of that railroad’s engines, but no local shop bothers to carry it because it costs a bunch and might not sell. The GM&O fan in theory is better off, but might not see it quite that way.
It’s a wonder there are as many shops as there are. It’s a classic chicken or egg sort of thing – are sales down due to low inventory or is inventory being kept low until sales pick up?
A lot of hobby shops make this fatal mistake. I say this because I feel that most of the time when you walk into an LHS more of the purchases are impulse items rather then you walk in for one thing pay for it and walk out. We in this hobby have a thing about I better buy it now because it may not be around tomorrow. Which for a great part is generally true but we seem to take it to the extreme. Sure form a business standpoint it may be a more prudent way of running your store, the OPM principal “Other People’s Money”
The hobby shop owner figures why should I carry all this inventory on my shelves when I can let Walthers or Horizon etc. do it. If a customer wants it he’ll wait a day or two. In some cases yes but thats how the LHS I used to frequent before they went belly up did business and how they lost me as a customer. More times then not I would go there for something I needed or wanted for the layout and they would tell me they had to order it and it would be in in two days. Well two days would come and go and when I would stop in after work I got the same story, of two more days. Well the truth was he kept waiting till he had enough on his order for free shipping. Well I had enough when I had 8 large Walthers kits ordered and they never came in and I just stopped in another hobby shop way out of the way from me and low and behold there were all of the its sitting on the shelf and at a cheaper price to boot. Bought em all got more of a discount and canceled my order.
I guess it comes down to knowing what to order and what not to that makes it or brakes it.
It’s basically impossible for a hobby shop to stock every item in the walthers catalog. That’s not to say that there aren’t certain items every hobby shop should stock, but to expect the average sole proprietor shop to have 8 randomly selected (your “impulse” purchase) large walthers kits in stock at any given moment is unrealistic. Sure, you found them in another shop, but the lower price tells me that guy had been sitting on them for a while.
I am so guilty of this. If I think I won’t be able to get it in the future, I’ll buy it then and there, even if I’m not 100% sure I can use it at that time.
Hobby shops could probably do a better business if they marked items on display as “discontinued”
Most of us model one scale, one era, one locale and one road. We are specific about our industries as well. So, we are very specific about what we put on our layouts. Of the hundreds of modelers who frequent my LHS (an estimate) how many do you suppose will buy a Walthers Car Float Apron? How many want a Milwaukee H10-44?
An LHS might sell one or two of these, or maybe none. I don’t expect any LHS to stock the structure kits or specific train items I’m looking for. So, most of my purchases over the past few years have been ordered, not found on the shelves. My LHS makes this very easy and economical, particularly for small items where shipping charges would be prohibitive. This works very well for me. I’ll occasionally buy something off the shelf, because I just see it and instantly want it.
When I look at the shelves in the front of the shop, I see the same inventory not turning over very fast. But, in the back are more shelves full of ordered items, each neatly tagged with the name of the modeler who will be in to pick it up.
ANy retail business “stalls” during the first quarter. People are paying heating bill and paying off xmas.
Add to that a recession, and can spell trouble at the least , and disaster at the most for small LHS or other such stores. Hobby $$ tend to disappear when the mortgage or food bill is due.
I have a good friend who runs a fish shop- tropical freshwater and salt water. AS he puts it “I have nothing in the store that anyone needs, its all a hobby type stuff and people will only buy what they need to maintain their tanks, if they dont dispose of their tanks and fish anyway”.
The same would go for MRRing. Then There is the argument that online HS are taking away from the LHS. ANd even the big OHS don’t carry everything they list in stock on a shelf somewhere. Both will tell you they can order anyhting you want, but somewhere up the chain someone has to have it in stock for it to get to the customer, and in recession that si getting harder and hard.
I have a LHS…in fact 2 of them. One is real close about 10 mins away. about 50 mins away is wholesaletrains.com’s brick and mortar store. Even with the gas expense of driving to WST, I can save $$ over the lhs 10 mins away. SO which do I support? the 10 min lhs also has the same old tired stuff…untill about Aug-Sept when they start getting their xmas shipments. ANother reason to not go there. I try to support the 10min Lhs, but its hard.
Then theres train shows. Never know what I can pickup there at what price.
Also I have about enough stuff and don’t really need anymore.
Anyone who has worked retail ought to know that most retail stores of any kind operate at a loss until Thanks Giving’s black Friday- the day they merge into black ink on the books. Thats is why xmas sales are so necessary.
I live in an area in MIchigan that has been hit very hard by the misfortunes of the auto industry. I have seen factories close, people and lives uprooted and even the division that I worked in for over 34 years is now gone - along with many of its people. One can only imagine the affect this has had on many small businesses and the LHS is no exception. In reality, they do not sell a product that some people ‘need’ in our economy and as a result I am seeing reduced inventory in all sections of the store. They have started to rely on, as have others, Walthers and Horizon to be their warehouse and there are no ‘sales’ and no willingness to negotiate a price. Now I understand this is a business decision dictated somewhat by the situation in our area.
When I got back into model railroading seven years ago, I had 3 LHS’s within 10 miles of my house. I basically lived there evenings and weekends while I learned from those guys, made all of my purchases through them, and built my first two layouts.
Now, seven years later, they are all closed and I make my purchases strictly through the Internet.
But, I really miss the concept of the LHS, and I expect most if not all of them to close within the next 10 years, at least those shops that specialize in model railroading products.
I try to do most everything at the LHS… why? well for one i want them to be there next time i want something… And i can call them and they will order somethng they don’t have in stock… And i just enjoy going there to shoot the breeze with folks who enjoy the hobby//
The nearest LHS to me is about 10-15 minutes away, K-10’s Trains in a steel shell warehouse building. Small, almost tiny hobby shop and a HUGE HO scale layout in the rest of the building.
K-10 has almost all scales, but mostly HO. I model N scale. His selections on N scale are not as varied, but I think Ken does a good job of keeping a decent inventory, especially given the size of the shop.
On a recent visit, I wandered to the back corner where the N scale stuff is, as I usually do. There on the shelf was the new Walthers Cornerstone Santa Fe depot and freight house and at a price that was LOWER than I’ve seen just the depot selling for! I bought it an a flash. I model Santa Fe, but I don’t know if I’ll be able to use the depot/freight house on my new layout. I just couldn’t pass up a deal like that!
When I needed some HO scale track, roadbed and bridges for a small project, I could have ordered them online of bought them on eBay. Instead, I went to K-10’s and bought there. Since I’m not currently building a layout, my purchases are minimal so I like to go to K-10’s any time there’s a need.
