In recent years, the practice of selling our products at heavily discounted prices has increased to the point where we feel this is not conducive to good business. A growing number of hobby shops are struggling to make a profit, feeling the pressure to compete on price with Internet and catalog-based businesses. In an effort to support all of our dealers in a fair and equitable manner, we have decided to institute an MAP (Minimum Advertised Price) plan. Therefore, effective March 1, 2005, a Minimum Advertised Price plan will be in effect. The following describes the rules and conditions of the MAP Plan. If you do not understand something about the plan, please be sure to ask one of our staff for clarification. It is your responsibility to fully comprehend and follow the policy.
That does not mean jack to me dawg. The prices are not going down! They will remain the same for us “Consumers” but the prices may go down for the local hobby guy. Those stupid *** tiny units cost more than a dvd player. Innovation in the Model railroader hobby is not like in the electronic business of games, music, tv, etc. In fact they are opposites!!!
DVD player 5 years ago $499
DVD player today $59
Plasma Tv 3 years ago $20,000
Plasma Tv today $3,000
Home PC 5 years ago $999+
Home PC today $400
Cell phones 10 years ago $1000+
Cell phones today Free-$400 for camcoders+camera
Camcorders 10 years ago $1000+
Camcorders today $200
DCC 4 years ago $500
DCC today $500
Decoder 4 years ago $30
Decder today $30
Soundtraxx 3 years ago $119
Soundtraxx today $119
Atlas track 5 years ago Cheaper
atlas track today MORE
Plaster cloth 2 year agos $6.59
Plaster cloth today $8.19
*** is crazy man. With new innovations and easier manufacturing in this shtuff the prices seem to only rise. This is especially for the electronic stuff in this hobby compared to other electronic stuff.
Some of the prices are not accurate but they are close.
Monopoly is the problem – SoundTraxx is the only game in town for good quality after-market sound systems. MRC sound decoders are cheaper, and their sound is also cheap. QSI doesn’t sell their systems to the end user, although there are rumors circulating that LifeLike is planning to market QSI sound decoders as separate items instead of already installed.
Note, too, that SoundTraxx is not the first company to do this – North Coast Engineering was the first, and SoundTraxx probably won’t be the last.
MAP sounds like Nintendo’s marketing plan of pricing, where no matter where you buy the price is the same. Then again the direct translation of the word Nintendo stands for “North Americans will buy anything”.
If we want prices to drop we’ll have to influence the kids of this generation (the Eectronic Junkies) to get involved as they wield the spending power with their needs.
4 years ago the only DCC you were going to get for $500 was a non-full featured system. You can get it for HALF that today, starter systems under $100 now. Top of the line systems back 4-5 years would set you back $1000. That’s $500 now.
4 years ago, decoder were more like $50 with minimal features, You can get ones with silent running and lighting effects for under $15 now (ever hear of TCS?)
You also have to realize that as you make things SMALLER they cost more. That $50 decoder from 4 years ago was a LOT bigger than the $30 micro-decoder you can buy today. If you compare apples to apples, the price HAS gone down, and the features have gone UP.
The trend towards higher prices elsewhere in the hobby has a lot to do with the trend of people to not want to build kits anymore - this I agree is a BAD THING. I was able to pick up some nice Red Caboose kits cheap because the dealer wanted to close them out - for the price of one of the SAME items int he new RTR Red Caboose line, I could have gotten FIVE of the kits. Only Branchline seems to bother anymore, with a decent kit (not that Athearn BB aren’t decent, you just have to add a lot more extra details). I’d much rather pay $10-$15 for a Branchline kit than pay nearly $30 for a Kadee RTR.
Let’s see… A growing number of hobby shops struggling??? Well that is because they are charging list price for everything. Nobody pays list price! Many of these guys are their own worst enemy in the fact that they have other business problems. The internet allows me to have minimal contact with which I like, lower prices, no sales tax, bigger selection, and service to my door. I do support the best of my local hobby shops but there are a bunch of them that have high prices, hit and miss customer service, poor inventories, and I have to drive 60 miles round trip to get to. Another factor would be many of the LHS around when I deal with them it’s as if I speak Greek to them. The online people have 800 numbers for the most part and as a general rule understand what i am talking about… Information is available on the net all over the place. Bottom line is the business is getting tougher for LHS’s and they need to adapt.
I’m with you RMax1. The LHS is suffering because they have not adapted well. 2 LHS in my area selling everything at list, even Walthers catalog orders. If I want to pay list for Walthers items, I’ll order direct from them, at least I know they have it on hand.
I live in NY and I order Walthers items from a guy in AZ, which discounts Walthers items. I save big bucks doing business this way. The guy in AZ has LHS and he knows how to do business. The problem with the LHS is themselves, not the internet or mail order. What cracks me up is the same LHS guys try to sell their stuff on ebay for list! They just don’t get it.
Not in electronics. The three driving forces behind any electronic product are R&D, parts, and labor. All three go DOWN significantly when you shrink a board. Thru Hole resistors are about two cents apiece, and SMT resistors are about 1/5 a cent apiece. SOIC’s have more functionality in smaller sizes, and cost less. Board pricing is directly tied into how much material goes into the board. And when you utilize all SMT components, your labor costs basically go away, since there’s little or no manual parts placement or board handeling.
One of the reasons that Digitrax and Soundtraxx costs so much is that they make their products in house. They have to pay for all those half-million dollar SMT machines they’ve got lying around their shops. And considering how hard it is to actually get product from those two companies (two years to wait for a decoder?), their plant managers suck. Their pricing could probably be cut in HALF just by outsourcing their board stuffing operations to an OEM PCB house in this country (yes, there are still a few left. I’m sitting in one now).
Soujndtraxx’s biggest problem is that they’re a monopoly. Once QSI decides to sell their sound/decoder boards as seperate items, watch Soundtraxx’s pricing tumble. Personally, I’m sticking with QSI and MRC, just because I’ve never liked Soundtraxx’s pricing.
I just checked Tony’s site and compared what I paid for the DSD-B280LC compared to the current price - It appers the same. This MAP plan appears to be the usual ‘dealer control’ when there is no competition present. The sad fact is that Tony has better ‘remote’ customer support than most LHS’s can provide ‘locally’. Maybe QSI needs to get some more investors and increase their production capability.
I’ve bought some decoders from Loy’s Toys in Arkansas. Fantastic service. I checked with a couple of LHS’s around here as to what decoder would be good for my Proto 2000 E8 A/B set. Loy’s knew exactly, gave me options provided instructions and other information over the phone. The largest LHS in the area told me “well I’m sure we can figure out something” . The stuff was at my door in a couple of days with a big thick catalog and other information. It took me about 5 minutes to install the first one. The 2 TCS decoders work great. Every once in a while Walthers sends me these catalogs in the mail. Most of the time they are no big deal but sometimes you can get great stuff at a really good price. Call them on the phone give them the info and a week later viola it’s at the house. IHC, Walthers, Loy’s, Model Expo, Life Like and some others have been great. Mixed results with Long’s and a few others but still not bad. . You think the EBay people are bad, look at some of the Train Show people. $7 to get in drive 30 one way and pay list. I don’t think so. I’ll order from Walthers.
After experiencing Broadway’s performance with QSI (I now have three of them) I will buy QSI almost exclusively now. There are a whole wall full of soundtraxx and digitrax DCC and sound stuff costing similar to MSRP but not too bad because you have to install em yourself. I am not yet ready to cross that bridge.
One person spoke about people trying to sell at List on ebay … I am on eBay several times a day “Hunting” a specific item that is oop and too see long long lists of items that are very close to MSRP and “Buy it now!” tags next to them that are apparently listed by stores. I think some are virtual and some are brock and mortor. This was too much like recent train shows where I have seen 10 year old new products being offered at near retail of today’s offerings.
I find it amazing that they will demonstrate the product at trains shows and people will want to buy it after hearing it using the “WOW factor” by not making the product availible will lose sales as the customer is forced to hunt for a LHS that has the items and discovering the necessity to match the item to the loco. Some LHS’s may install it for you but you are expected to do it yourself.
The statement that customers will get list price direct from the factory means that people will go to a dealer that does have the item or perhaps discount it a small percentage to generate sales.
Also they like the word “Advertised Price” alot in the declaration… we recognize that MR may carry a price that is advertised by the manufactor, websites may carry the retail price but… many will discount and then advertise a lower price. Or worse some will ask you to contact them for the price during a sale. (What good is a sale if you are not told the price up front??)
Additionally they indicate prices given within the confines of trading booths at train shows, Counter tops at LHS’s with dealers free to set thier own prices and phone price quotes not being applicable to the new MAP policy… because
I think if Tonys and the other hobby shops put as much effort into being competive as they do whinning about sellers who can offer a price discount such as the many hobby sellers on e-bay then they wouldn’t be struggling.The post title itself the evil internet shouldn’t it be battling discount sellers.I think Tonys is a great site the info he offers is exceptional,but is offered free.That in no way makes me feel that I should spend what ever amount more on a perticular item I can buy off other sites It only makes me give them first consideration if they cannot compete within a reasonable amount they can watch my dollar go bye bye…Soundtraxx has been the only option for good quality sound{my opinion} for awhile now,if this changes witch I have heard also the rumor of add on qsi systems for LLP2K they may very well enforce there map plan right out of buisness.There new tunsami decoder if indeed is ever new and released better be outstanding in quality,because if the prices of their older sound system do not or are not allowed to decrease then they will be stacked up high on the shelf. Terry.
The comment made above about SoundTraxx needing competition I think hit the nail on the head.
For us, ahem, older folks, [^] remember how much a pack of Kadee #5 couplers use to be? Once McHenry and the rest came out with their automatic couplers, Kadee dropped their price like a hot potato. That irritated me, which is one reason I have not bought a Kadee #5 in years. I felt like, “It was okay to gouge me for years, but, once you see some competition, you decide its okay to lower prices.” Free market? Certainly. Spend my money somewhere else? Certainly.
I understand recouping the costs for R&D, but, I feel pretty darn confident that in the case of Kadee #5’s, the R&D and start up costs were well recouped over the years.
I’m just getting into DCC and have had no desire to purchase SoundTraxx decoder for pretty much the same reason. LHS or Internet has no bearing on the issue.
And don’t even get me started on MTH!!![:p][:p][:p]
So the MAP is to be no more than 20% below the list price. I would be curious to know about anywhere that was selling the Soundtraxx line at a significantly greater discount? I see a few web sites at 21-22% down, but not much more.
I can’t see this making very much difference to anyone. As noted by others, the recent trend towards sound equipped loco’s surely cuts into the Soundtraxx market and if QSI or any other manufacturer of decoders (They all must be seeing the trend) comes out with good low cost sound decoders, then Soundtraxx will have to respond in some way.
Wow After I posted what I did on this topic I was thinking that I was going to be attacked for saying what I said and i was suprised to see most of us feel that way. That shtuff is funny.
rrinker I was not off base because I stated the prices are not exact to prevent a response to correct me as you did. but aww well huh? As someone stated when it comes to computers that is not true that prices go up. $ years ago the best speed for a computer was a 750MHZ now adays we have what 2.4GIGS+ !!! I guess the prices should have rised then. No these chips get smaller and the prices go down.
One more big example of prices high then go low
Sony Playstation I was $350+ new but now you can get a new one for $100 or less even SP2 is only $149 now.
Soundtraxx step up your game man!!! I hope they file chapter 11 one day so I can contact them and congratulate them for running their crap down. As soon as new makers come out this may happen. Hopefully soon
I too recall Kaydee couplers and the cost. For years I grimly paid the cost of installing Kaydees on favorite rolling stock while the no so good performers kept the horn and hook couplers as a sort of a “marker” that it does not run well on the track.
Now since the mid 90’s other coupler makers got into competing directly with Kaydee. I still buy kaydees by the 20 pack because eventaully the other couplers fail. I do this several times a year. The same thing goes for metal wheels. I want the rolling stock to perform very well and will gladly buy Kaydee and Metal Wheels to get the performance.
I feel that Tony’s is indeed a “good” outfit, they have taken the time to keep the website current with information that may not be readily posted elsewhere.
I was thinking about the talk about internet breaking the LHS’s as part of the title to this thread and I kind of am on the fence. I recently used the internet to find out information about a Factory Sale that otherwise would have never heard about and supplied my LHS with the information and a sale was made. Yes I may have bought at a lower price on mail order or the internet… but I did not have to pay list and the service I was given justified the support I gave to my LHS.
My LHS sells Sound devices and Decoders. They are a pretty complete product line with the ability to find and special order specific componets as required by the customer. Looking at that small section where these are sold versus the diversity of other products that are availible ranging from Games, Rocketry, O gauge, kits, RTR and books etc etc etc… I think this store will survive for a good while based on the sheer amount of diversity.
If QSI releases the products to other engine makers and or to the public for installation in own engines at home, they had better maintain the quality. I for one will not accept a “Lite” or “Low calorie” version of the real beef. (Why do we talk food?) And the other producers will have to compete an
Point one – Actually, dealers can sell below the 20% MAP. What dealers cannot do is ADVERTISE a price below the MAP. Tony’s has a full web page with the SOUNDTRAXX notice on it. If Tony wants to sell below the MAP he can put a “call for price” in the ad. You call and he quotes the lower price.
Point two-- Those who believe that prices will go down when more competition arrives are right on. However, the competitors need to be VERY carefull about patents. Look what happened to BLI and Lionel when they got crosswise with Mike’s Train House.
MAP is not “price fixing”, it is simply one of the means by which manufacturer’s can directly influence the market. Only “authorized dealers” are restricted by MAP, it only applies to ADVERTISING, not the actual sale price, and it is perfectly legal, has been for a longggg time.
The retailer can sell the product for any price he wants.
Since they are careful to make it the advertising only, they get around the price fixing. I’m not a lawyer, but I suspect this is still illegal, problem is the dealers don’t have the resources to fight it. Horizon Hobbies is doing a similar thing in limiting who is a dealer they will wholesale to, which may affect the prices of Athearn and MDC.
This makes MRC’s under the table sound system look pretty good - costs less and one will work with all your locos. [:D][:D]
Notice that Tony says NCE is doing the same thing. Notice whose system is the most expensive at Tony’s. I wonder if NCE has noticed that I am not considering their system as I consider whose DCC system to buy this year.