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Jonathan_Lotton

Tamiya Minimum Advertised Price controls?

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So I just got an email from Internet Hobbies stating that Tamiya is instituting a Minimum Advertised Price program that will require people to not sell their products below a certain price point and prevent any and all discount programs.  Has anyone heard more of that?  

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I've not heard of it but it's familiar stuff.  The general thinking when a company does something like this is that they feel a need to "protect their brand", which amounts to claiming to be so good that they have to be more expensive - and we must agree.  But goodness only knows why a model company would do it.  Tamiya may have a reputation for quality (deserved, most of the time) but that's not quite the same as, I don't know, Bentleys.

 

This was litigated a few years ago in the UK over the sale of designer jeans at discount prices.  The result was basically that the makers can't insist that sellers charge a minimum price; but at the same time, they aren't obliged to supply sellers who do.  If a seller can somehow get stock and sell it cheap, the maker hasn't a leg to stand on.  There was another example closer to home, where Dragon refused to sell to an on-line shop in Poland because their prices were too low.  I've not kept up with how it went.

 

Will that be the effect for Tamiya?  Well, I suppose we'll have to wait and see.

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Thinking back to my years in retail, I went and found a current reference from the web;

Quote

 

Levels the Playing Field

Perhaps best of all, minimum advertised price policies level the playing field for small businesses battling with big-box retailers based on price. Springer points out how consumers can choose to buy online if the speed of ordering and delivery are the most important aspects. They can pick a brick-and-mortar store for the best in high-quality customer service, training and support if they have questions or problems after buying the product.

 

https://smallbiztrends.com/2018/03/minimum-advertised-price-small-business.html

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Could be true, I typically buy from the same shop. They usually have Tamiya at a good price. I was expecting the Tamiya Bf-109 to be in the $45 range (Canadian dollars). Instead it was $65.00. So I passed on it.

 

The first Tamiya F-14A was $89.00 Cdn, the restocked kits are $136.99.

 

Other manufacturers are still a discounted price, typically less in Canadian dollars than what I see at US retail prices.

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If they do it they are making a mistake. It will only hurt their brand. There will people that will pay the minimum price for kits but there will be many more that pass like Scooby did. 

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6 hours ago, tosouthern66 said:

If they do it they are making a mistake. It will only hurt their brand. There will people that will pay the minimum price for kits but there will be many more that pass like Scooby did. 

 

If this is occurring I’d be more inclined to point the finger at the distributor.

 

Tamiya has always printed the suggested retail in yen on their kits, they generally have been priced higher in shops though.

 

Yeah, I had that 109 in my hands on several visits. I could afford it, I wasn’t willing to pay that money.

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It will be interesting to see if Tamiya can make MAP succeed in the model world. A pretty common practice in other "niche" products markets. Ken Lawrence tried it at PCM and failed a few years ago. As a former retail fly shop owner I liked MAP (most all flyfishing products are MAP) because I didn't have to worry about setting a price. As a consumer I absolutely hated MAP because it drives up prices. Generally, MAP only works when you have a somewhat limited market where you only need to move a few thousand of an item to make a profit and demand doesn't increase greatly above that level. I don't think Tamiya can make it as a business moving only a few thousand, they need hundreds of thousands. Gonna be an interesting experiment! Personally for me, if it drives prices too high for Tamiya products, I won't buy them. Tamiya products (even with all the discounting currently going on) are still among the highest priced in the business already. 

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Good for them!  This strengthens their brand by protecting value and protects shops that might still be trying to make a living in the brick and mortar world.  I own a retail business and it is frustrating to no end to have someone bring an item to your shop that they bought on line for the same price you pay for it from the distributor or manufacturer and then have to mark up to make a living.  And why would you do that as a seller?

 

Geoff M

 

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If there's any truth to this, I'll be interested to see how this interacts with Amazon.  Over the past three years I've seen very low prices on Tamiya kits quoted me by Amazon Prime, where virtual intelligence prices things based on a complex set of factors.  (After watching my shopping habits, Amazon's "bot" now occasionally seems to spike the price down to entice me.)  For the most part I've resisted buying them since I worry about losing my go-to retailers, but I imagine Amazon probably sells a lot of Tamiya kits that way.  On the one hand, maybe Amazon itself is the biggest reason they've instituted this policy.  On the other hand, they might move a lot less product in North America.  

 

But on top of that, I've wondered whether plastic kits is even a major part of their North American business, next to RC stuff.  

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Is this world wide or for certain markets?

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for folks that think nothing of spending two hundred dollars on a piece of plastic, I ask what's the issue? 

gary

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12 hours ago, fulcrum1 said:

Is this world wide or for certain markets?

 

In the UK and Australia (and probably many other countries too), it would be illegal. However, the reality depends on how compliant the market is and how desparate the retailer is to stock that manufacturer's kits. The average bricks and mortar model shop doesn't have the buying power to influence the distributor. Even fairly large businesses will struggle to force the issue.

This may be a global directive from Tamiya or it may be something that has come from Tamiya USA and is intended only for the US domestic market (I suspect the latter and nothing similar has been seen in the UK as yet).

 

On 5/13/2018 at 3:14 PM, modelingbob said:

It will be interesting to see if Tamiya can make MAP succeed in the model world. A pretty common practice in other "niche" products markets. Ken Lawrence tried it at PCM and failed a few years ago. As a former retail fly shop owner I liked MAP (most all flyfishing products are MAP) because I didn't have to worry about setting a price. As a consumer I absolutely hated MAP because it drives up prices. Generally, MAP only works when you have a somewhat limited market where you only need to move a few thousand of an item to make a profit and demand doesn't increase greatly above that level. I don't think Tamiya can make it as a business moving only a few thousand, they need hundreds of thousands. Gonna be an interesting experiment! Personally for me, if it drives prices too high for Tamiya products, I won't buy them. Tamiya products (even with all the discounting currently going on) are still among the highest priced in the business already. 

 

80-90% of Tamiya's market is domestic (in Japan). The worldwide market represents a small proportion of their overall sales.

 

Regards,

John

 

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20 hours ago, John Tapsell said:

 

80-90% of Tamiya's market is domestic (in Japan). The worldwide market represents a small proportion of their overall sales.

 

Regards,

John

 

 

If thats the case, why their subjects then are US, British or German? Both modern and WW2. 

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1 hour ago, stalal said:

 

If thats the case, why their subjects then are US, British or German? Both modern and WW2. 

 

Because those are the popular subjects in Japan. There will always be a strong domestic market for Japanese subjects but British, German and US subjects are more popular to the average Japanese model buyer. 

 

John

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Just received an email from hobbylinc.com (based in Atlanta GA) about Tamiya price increases due to MRP.

 

Quote
Tamiya is Raising Their Prices !!

 

Tamiya is forcing sellers of their products to adhere to a Minimum-Advertised-Price
     On June 1st, Hobbylinc will be forced by Tamiya to raise our prices.
Buy now before this happens !

 

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or just don't buy from Hobbylinc...

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I will not be buying any Tamiya kits anymore and I know of many others that will follow.

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5 hours ago, tosouthern66 said:

I will not be buying any Tamiya kits anymore and I know of many others that will follow.

I doubt Tamiya are losing any sleep :D

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On 5/29/2018 at 9:52 PM, a4s4eva said:

or just don't buy from Hobbylinc...

 

Why punish Hobbylinc?  MRP is not their policy.

 

I have ordered from Hobbylinc many times and always had a good experience. 

 

If you don’t like Tamiya’s MRP then don’t buy Tamiya from anyone.  

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15 hours ago, tosouthern66 said:

I will not be buying any Tamiya kits anymore and I know of many others that will follow.

 

I don't get the logic there. They aren't raising prices or being "greedy" and trying to stuff it to the average modeler. I thought this was already clarified? Tamiya prices are what they are, and they're putting out to distributors that this is what the min price for an item must be. Apple and a billion other companies do the same thing.

 

As a 1/48 aircraft modeler, if a subject is available by Tamiya, that's the one I'm getting and I'm know many others who follow.

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31 minutes ago, 82Whitey51 said:

 

I don't get the logic there. They aren't raising prices or being "greedy" and trying to stuff it to the average modeler. I thought this was already clarified? Tamiya prices are what they are, and they're putting out to distributors that this is what the min price for an item must be. Apple and a billion other companies do the same thing.

 

As a 1/48 aircraft modeler, if a subject is available by Tamiya, that's the one I'm getting and I'm know many others who follow.

^^^This. No need to push the panic button.

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52 minutes ago, 82Whitey51 said:

 

I don't get the logic there. They aren't raising prices or being "greedy" and trying to stuff it to the average modeler. I thought this was already clarified? Tamiya prices are what they are, and they're putting out to distributors that this is what the min price for an item must be. Apple and a billion other companies do the same thing.

 

As a 1/48 aircraft modeler, if a subject is available by Tamiya, that's the one I'm getting and I'm know many others who follow.

 

Yes but Tamiya's decision is increasing the cost of purchase at the end. The issue is the norm of retailers applying the discount. Tamiya saying no to this is costing the consumer more when the current practice that people are accustomed to is taken into account. 

 

I just bought a Tamiya A for $99 from my LHS, so I am not complaining, but pointing out that Tamiya's decisions has real implications that rocks the status quo. Not an egregious move, but has real implications for some. 

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Posted (edited)

I very rarely buy from over seas sources but with one exception. Even then it's aftermarket. Domestically I buy from a LHS 80% of the time. They treat me well, and are there when I need help with something. Yet we see many local shops going under because they are not making a profit. Then we cry because we have to pay a few dollars shipping because we can't find the right paint colors. Perhaps we are the reason this happens! I have no problem with Tamiya placing a MAP price if it helps the little guy survive. I fly fish extensively, and we see this everyday. Yet have little issues with it. You learn to deal with it, and move forward. With Tamiya, you will also learn to deal with it an move forward. 

gary

Edited by ChesshireCat
spelling

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