Decent model shops are indeed few and far between nowadays
Decent model shops are indeed becoming a rarity, eBay, the likes of the big discounters like the Hattons, Rails etc of this world, the internet and the downturn have all taken their toll.
If you read the hornby forum, most people on there think the small-large model shop makes a mint, but that is far from the case.
To keep a bricks and mortar model shop open today you need mega bucks. I have been looking at it as I want to start up myself, but I am staying internet and toyfair based. The overheads for a proper bricks and mortar model shop are crippling!
To compete with the big discounters you make a mere 5% on train sets and 10% on other stuff. The big boys get 25% off the trade list price so you start on an uneven market.
An example is shown here, trade list to the ordinary small-large trader for a Hornby R.1085 Local Frieght Set is £30.80+VAT, which works out at £36.19. The big boys sell that set out at £38.99. To compete with the big boys and get the business I have to sell the same set out at £37.99 which means the average trader makes just £1.80 Gross profit on the set. The big boys buy the set in massive bulk from the likes of Hornby at trade £30.80-25%(their special discount)+VAT=£27.14 net. The big boys make £11.85 gross profit!
People go to the big boys primarily because they are cheap and will undercut anyone else. Ebay has killed the secondhand market for the small model shop, with most people buying used items off EBay.
It's a tough world out there. Swisstrains has the right idea! My advice is the same, use your local model shop or loose it they are becoming a rare beast, it's as simple as that!
Last edited by thetriangman; 9th August 2008 at 12:28.
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