Earlier this week, Hobby Master elected to alter its MAP guidelines by extending it to nine months. Previously retailers and distributors could lower the price of a Hobby Master product six months after its release. The change was brought on to prevent certain parties from dumping their excess inventory at or below their wholesale costs once the MAP guidelines were lifted. To remain in compliance, we will adjust our own Hobby Master selling policy on our web site along with our marketplace sites to reflect this change in stance.
Recently we had an issue with a customer concerning our free shipping option. Several months ago, said customer placed an order calling for three Panzerkampf MiG-19s, none of which were in-stock and clearly marked as pre-order merchandise. The order was submitted to us late at night so we could not review it to see if we could accept it as it stood. When the first MiG arrived, we shipped it to him at a considerably reduced price to console him. But when the next MiG arrived, and we attempted to adjust the price he became indignant, basically accusing us of everything in the book because he wasn’t getting his way. Needless to say the customer misinterpreted the offer when we would not fulfill his order as he saw fit. There’s some other things that occurred that I won’t comment on publicly that raised an eyebrow so we blocked him from making any further purchases from us. Clearly no amount of explaining was going to correct the situation
So let’s back track for a moment and do our best to explain how the offer works. Our free shipping promotion clearly states that all of the merchandise on your order must be in-stock and ready for immediate shipment. It does not mean that any order of $250 or more qualifies for the discount nor does it mean we will break up an order calling for multiple items to be shipped out over an extended period of time since our shipping costs will go up exponentially, quite possibly wiping out whatever profit we are making on the order. We’ve gone back and edited the Free Shipping option so that it clearly states “All Items Must be In-Stock” to qualify for the discount. I’m certain we will still get orders submitted to us that fails to abide by the terms of sale but at least we made a yeoman effort attempting to make things as clear as possible.
We appreciate your consideration in this matter and hope we have made the matter as clear, concise and understandable to avoid further confusion. Thank you.
“Anything that just costs money is cheap.” ― John Steinbeck
Pursuant to their announcement of a new 1:16 scale King Tiger tank, Waltersons has since indicated in their Facebook posting that the tentative price for the upcoming King Tiger will be between $899.99-$949.99, although this could change based upon market conditions. We’re assuming that their newest vehicle will not ship with the heavy wooden crate that came with the Unimax version a couple of decades ago. As a result, the likely weight of the vehicle and its attendant accoutrements will probably be in the neighborhood of 35 pounds. Its anyone’s guess how that will translate into shipping cost since the rates for all the major carriers keep changing, but expect to fork out an additional $100 or more for domestic shipping within the Continental 48 states since this vehicle will not qualify for our free shipping discount. Having said all that, it looks like a sale will probably set you back close to $1,100 US if you feel you really must own their latest entrant in the Extreme Metal series. That’s a pretty price to pay for a diecast collectible that may or may not appreciate in value based upon all sorts of intrinsic and extrinsic factors, from sell through to global demand. Food for thought if you really want this upcoming vehicle but don’t mind raiding the piggy bank to do so.
So why do I bring all of this up now, when the vehicle may not be available for a year or more? Essentially, I’m a pro, having learned and practiced successful marketing techniques for well over four decades. In college, my major was industrial psychology, an offshoot of traditional psychology that attempts to quantify why people do what they do when they make purchasing decisions. Back in the day, a book entitled Future Shock came out in different softbound packaging, using different colors to help determine why a consumer might pick up say a red book jacket as opposed to an orange or even a green one. That’s my academic background.
I learned a lot of things back then, which includes the use of restive colors on our web site to help increase its so-called “stickiness” — the length of time a customer spends on a web site which could but does not necessarily increase the likelihood of making a purchase. The use of certain fonts, category landing pages, multiple exposures to a product all help to contribute to added sales and a healthier balance sheet.
Your point being? Its simple, really. An item such as the upcoming King Tiger is, for many, a major purchase that could set them back for several months or more before they are once again able to make a follow-on purchase. Moreover, many collectors are hoping to get in on the ground floor of the next “shooting star” – that one collectible everyone seems to be talking about that may or may not appreciate in value far in excess of its original selling price. Yes, some of the earliest entrants in this series have appreciated in value far above its original asking price. On the other hand, their Sherman tank has “tanked” — figuratively as well as literally — meaning you can probably pick one up nowadays for less than its initial selling price.
In a round about way what I am trying to say is that my tradecraft is in marketing and I will use this prowess to help sell this item once we have learned more about it. It is up to you, the consumer, to take everything we and others say about this item with a grain of salt, then determine why you are looking to purchase this item. If its to sit on a credenza for all the world to ogle then you have already made the decision to covet this item purely as a collectible. However, if you are looking to purchase this item in the hopes that it will radically appreciate in value and help fund your child’s education then I seriously suggest you look at this item purely from a speculative stance much like crypto currency. It could go up in value, it could remain the same or it could decrease in value. There is no barometer that will faithfully predict its value in two, three or ten years. Please make sure you understand that to its fullest if you are contemplating making a purchase. As I said in a previous post, caveat emptor.
For some time now, there are several diecast manufacturers who require retailers selling their product to adopt a MAP policy that is aimed at preserving the value of their merchandise. MAP, or Minimum Advertised Price, isn’t exactly a uniform policy that applies to all manufacturers nor does it mean the same thing to everyone concerned. Indeed, there are some manufacturers that politely ask you to advertise their product for a stipulated period of time to avoid discounting their product in the marketplace. Others are more stringent and may, quite possibly, stop selling you their product if you are routinely out of compliance.
There are, as you might have guessed, all sorts of problems with the usage of MAP in the global marketplace. While a MAP policy might have worked years ago when two retailers were located across the street from one another in Anytown, USA, the issue become a bit murky when a retailer such as ourselves ends up competing with retailers from around the world. In mainland China, for instance, where many diecast collectibles are made, oftentimes we see fly-by-night retailers selling a product well below the stipulated MAP, even if their shipping fees may seem excessive. They may be retail arms of the manufacturer or they could be underselling other retailers because their currency could be undervalued against the US dollar. So, while we may be asked to sell an item for say $99.99, it doesn’t necessarily mean a retailer in China, Bangladesh, or Indoneisa is being asked or even required to follow that same policy.
In my mind, and perhaps I’m being mistaken, a MAP means that the retailer may not “ADVERTISE” said item for less than the stipulated price. It does not mean they must “SELL” the item at that price, particularly if they may be running promotions that permit their customers to purchase an item at a reduce price. I oftentimes use the analogy of a Keurig K-cup coffemaker being sold at Bed, Bath and Beyond as a means of demonstrating my position. Keurig may require Bed, Bath and Beyond to sell their newest coffeemaker at $199.99. But we all know that Bed, Bath and Beyond regularly bombards their customers with fliers and other marketing paraphernalia containing discounts that may offer 15% or 20% off of a single item or perhaps a dollar figure off the entire sale. These coupons can then be brought into the store or used online, which, in effect lowers the price of the item by the redemption amount. To sum up, the manufacturer, retailer and customer are all happy with this format.
This article attempts to discuss the idea of MAP pricing in greater detail.
I bring all of this up because we seem to have run into an issue with Hobby Master. Hobby Master has always indicated that their products are to be sold at MAP and that this policy must remain in effect for six months following the item’s release. No problem. When their sales literature is sent out, we list each item at the MAP indicated and, because these are limited edition collectibles, rarely if every lower its selling price depending upon supply and demand. Oftentimes, we increase the selling price as we start to run low on inventory. We are, after all, in the collectibles business. Back in the day, I used to be a coin collector, I fully recognize I cannot expect to walk into a coin dealer’s shop and demand that they sell me an 1878 Morgan Dollar for one dollar. They’ll laugh me out the door and my lonely dollar bill will end up going back in my pocket along with some hurt feelings.
Last week, things changed a bit. Our Hobby Master distributor has changed their stance somewhat which has led to the reason why I am writing this blog post. We are no longer required to indicate that our customers may not apply a discount to a Hobby Master item, however, the final selling price cannot fall below the MAP price. This means we now have to go back to all of the upcoming Hobby Master products and adjust their selling price so that customers clearly see they may not purchase or pre-order the product for less than MAP. Of course, once the MAP has expired, it also means that customers can now freely apply any sales discounts we may be running to whatever price is posted, meaning they can still obtain said item at less than MAP. Great, right? Yes and no. By the time the MAP has ended, its quite possible we could have sold out of the item, so they may be waiting for naught.
Whenever we run a sale, all of the upcoming Hobby Master releases, which include those available within the six month release window, will have the following disclaimer shown in the description pane (see image). So, while you can apply the sales discount at checkout, the final net price will not fall below it’s preset MAP. When it comes to our marketplace sites (eBay, Amazon, Walmart, Facebook, etc.) the same rule of thumb will apply. If we are running a 10% off sale on eBay, for instance, the price listed will reflect a 10% increase over the MAP. Once the six month MAP enforced period has ended, we will remove the MAP Protected shield and any text indicating that the item still falls within the MAP enforced release period.
While I’m not a big fan of this strategy, and loathe having to deal with MAP. I understand its intentions. But, it also means we must manually go through our listings, month-by-month, to adjust the selling price each time we decide to run a promotion. The revised price must take into account whatever the sales discount is pegged at. So, if we are running a 15% off sale, we must increase the MAP to reflect this discount. On the other hand, if no promotion is being run, it means we must change the price back to the MAP, item-by-item, month-by-month, until we are in compliance. Not only is this confusing but extraordinarily time-consuming since this must be done expeditiously and accurately to avoid any further issues. With hundreds of upcoming items, its a tedious process. I took a break from this re-pricing format to pen this blog post in part to explain what is going on and hopefully give us more time until a more elegant solution can be found.
Please note that this policy change affects all retailers that stock Hobby Master products within North America. No one is permitted to sell upcoming or newly released Hobby Master products below MAP. If someone is failing to follow this policy or is in flagrant violation, we would appreciate learning who it is so we can pass along this infraction to our distributor.
According to our principal distributor, the May Hobby Master shipment is expected to pull in to their facility sometime around the middle of next week. Its quite possible the follow-on June and July shipments could be right behind it, meaning lots of new Hobby Master models to go through by the middle to tail end of the month. As always, we would very much appreciate it if you could hold your inquiries for a couple of weeks until we’ve gone through everything and made our initial shipments. At that point, we’ll field any questions you might have as it relates to Hobby Master.
The next AFVs of WWII shipment is also expected this month, although no firm date has been established yet since the shipment is still mired at its port of call. The distributor is working in earnest to free up the shipment so here again we would be very thankful if you hold off any inquiries until these items are marked as being received and have already been shipped out.
In other news, we are finally onboarded with Walmart so for the next week or so will begin listing items that are approved for sale on the Walmart marketplace site. If they permit us to open a storefront, then we will point our Contact Us page right to our Motor Pool storefront. After Walmart has been seeded with a good assortment of product, we will then turn our attention to Target, and hopefully get them set up before the start of the holiday season. We will put our plans to launch our VR store on hold until 2023, since we still have our move to Florida on hold. Presently, it looks as if the move will occur in the beginning of the year since there doesn’t seem to be much progress with the build.
That’s about it for now. If anything else occurs to me this weekend then I’ll update this blog post and pass along any news that crosses my desk. Ta ta!
Update: So, we’re finally up-and-running on Walmart, after some trial-and-error work and a good bit of finessing with the powers that be. Right now, we’ve launched just a handful of items to test the system and see how their marketplace works relative to other similar marketplace sites. Once we feel confident that we understand everything and can perform up to their lofty standards, we will slowly increase our product portfolio size, which must first be reviewed by Walmart so that everything is in compliance with their code of conduct. Items such as German tanks featuring Maltese crosses or German aircraft with swastikas on their tail may not pass muster unless we can somehow demonstrate that these are simply artifacts of war that bear no political leanings. Anyway, just thought you might like to check out our presence on the world’s largest retailer site. Next stop Target then one other viable candidate, before we start to explore our VR options in 2023.
As August unfolds, we thought we’d ask each of our distributors if things are improving as far as imports go. Apparently, not very well. We already reported how one distributor is expecting no less than three monthly Hobby Master shipments all around the same time, meaning lots to go through once the shipments finally do go out the door. Conversely, another distributor has said that one container they have been awaiting has been sitting in the Port of Long Beach for six weeks, mired in red tape and waiting to be placed aboard a freight train before it can reach their warehouse several hundred miles away. The list of imperiled goods goes on and on and right now things are looking much the same as they did in mid-2021, where containers expected for months on end are still languishing at the ports waiting to either be shipped via truck or freight train to their ultimate destinations. So, while the media has reported that consumers have been shifting their discretionary spending away from tangible items and over to experiential activities such as vacations and travel, the slowdown in the logistical network is once again beginning to affect the supply chain both here and abroad. It remains to be seen if both the ports and transport network will be able to get back on track in time for the coming holiday season. We hope so and will continue to monitor this slowdown each and every month from here on out so that we have a clearer understanding of which items will be available for Christmas shopping.
Amazon, eBay, Facebook, WalMart and the Meta Verse. Oh My!
As many of you know by now, our new home construction has been indeterminately delayed. We’re not sure by how many months — it could be a few, in which case we will attempt to relocate our business and belongings before the advent of the holiday season, or it could be as late as November, in which case we will hang around New York until the first of the year so we do not lose out on the holiday business.
Earlier today, we were approved to sell on Walmart’s Marketplace site. This will be our fourth marketplace site (you can already find us on Amazon, eBay and Facebook) that operates alongside our main web site, and I’m sure will bring with it its own set of challenges and rewards. I’ll likely look at how easy or difficult the onboarding process is around the middle of July and start by listing an abbreviated lineup on their site to see how well certain items sell and whether or not the work brings with it the necessary revenue stream that warrants its daily upkeep.
Lastly, we are looking at launching our next marketplace site, The Motor Pool VR, some time in 2023. Unlike our other more traditional retail annexes, our VR site may require the use of Meta’s Oculus Quest 2 headset to navigate the site since everything will be nestled within a virtual reality world. Here again we will likely launch a limited number of products within what we term a boutique setting, which will allow customers to interact with the products, view different forms of dynamic merchandising techniques, and hopefully lead to bigger and better things as we gain traction within the oft-discussed VR world.
That’s about it for now since we have a very large Forces of Valor shipment spread out over three separate deliveries, which will require us to work diligently for the next few days to ensure everything gets out on time and into the hands of our customers. To recap, the latest delivery includes a number of back ordered items, among them a pair of 1:700 scale warships (USS Missouri and USS Enterprise), their inaugural 1:32 scale Tiger I tank, their second issue Sturmtiger assault mortar and the metal tracks everyone has been asking about since they were released earlier this year. Also arriving is their second issue 1:32 scale Tiger I tank, their second M4 Sherman tank and a set of weathered metal tracks that can be attached to either of their M4 Sherman tanks.
That’s about it for now. In the mean time, have a wonderful Fourth of July, spend time with friends and family, and enjoy the summer months. We’re off to see Minions: Rise of Gru!
No these aren’t our cabinets. Ours are likely on a dock, lying amidst a labyrinth of containers, sitting idle in Shanghai, waiting to be placed aboard a cargo ship with 10,000 other fully laden containers. Sigh…
Previously we posted that we planned on moving to Florida sometime this summer after our new home was completed, passed inspection and was fit for occupancy. Well, things have changed and our timeline has had to be reevaluated. The recent lockdown in Shanghai has slowed the delivery of all sorts of manufactured goods, from diecast tanks and planes to, of all things, kitchen cabinets. Without cabinets, we are unable to move into our new residence and presently our building coordinator does not have an accurate idea as to when the cabinets will be completed, on the water, in Florida and hung in our brand new kitchen. This could take place in October or it could be as late as November. If it is November, it appears as if we will have no choice but to delay our move until early 2023, since it will have a dramatic impact on our holiday business. So, for now, assume everything hasn’t changed and we will continue to accept new product as it is made available. Obviously should anything change we will post an update here to let everyone know about our revised plans.
If you thought last year was a bear to get through, then you may want to fast forward to 2023. Even as the logjam that has affected our ports for the past year seems to be waning, signs are already pointing to another troubling year for the upcoming holiday season. That’s because China is experiencing a new wave of COVID-related cases, which is particularly bad in the port city of Shanghai. Currently, 25,000,000 people, or roughly three times the city of New York, are in complete lock down, unable to mill about on the streets, go to work or even obtain groceries at their local markets. The government claims it is doing its best to control the virus but thus far things do not seem to be improving with cases on the rise and its inhabitants literally on the verge of revolt. Keep in mind that Shanghai is one of China’s principal export centers, so when their vast manufacturing sector and trans-oceanic ships end up sitting idle, this has a dramatic effect on the rest of the world, all desperate to get goods and other finished products for the holidays. Stories are already being written about how this is all coming at an inopportune time, as the rest of the world struggles in the wake of their own pandemic relapses. While goods seem to be flowing again for the first half of this year, we expect that the tap will be turned off for the latter half of 2022, with many items likely slipping into early 2023 or later. Sorry to be the bearer of bad news but unless COVID isn’t struck down soon, its going to be another tough year for retail, as inflation continues to push up the consumer price index and the pandemic, now in its third year, will slow the rate at which products make it into the global market place.
We’ve had great success with our free shipping business model on Amazon and have therefore decided to adopt a similar model for eBay, at least in the short term. Beginning on February 21st, 2021, all of our eBay listings now offer free domestic shipping. Thus far we’ve only adjusted the prices on a handful of lower-priced items to at least partially cover the cost of shipping around the nation. Frankly, there’s probably enough margin in some of the higher-priced items to cover the cost of ground shipping so its the lower priced items that we need to watch carefully and, in some instances, may need to adjust their prices since the dollar margin isn’t all that great.
We will soon be offering FedEx for both domestic as well as international shipments likely beginning in early March, so please don’t be a bit surprised if your next shipment is brought to you by the folks “that positively have to get it to you” by any and all means necessary. Again, we’ll be keeping a careful eye on this facet of our operation, particularly for larger packages that need to travel across several shipping zones.
