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Post a Bargain! (no discussions / questions) (was Bargain Hunters)


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Yes . Regretfully I have to say I gave into temptation and got GWR 2-8-0T . Last one. Too good to miss at £60. And I've just been texted to say it'll arrive tomorrow. I'm away but if it's correct , that's some service (post free)

 

Oh, you got that. It went out of stock between my visiting the page and ordering. So I had to make do with a BR one, which to my surprise has just been delivered.

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A few points arising from recent posts that are discussing sale items, perhaps it might be time to mention a few related points?

 

A manufacturer decides to produce an item, after his initial market research makes it appear to be a viable product. The selling price of that item will be a TRADE price. (ie not to the general public but from his warehouse. The retailer of course has his own markup, and this determines the price we pay).

The price the manufacturer decides to set, is made up of 2 components. (1) production costs which are fixed (materials, wages, packaging, factory costs etc). and (2) variable costs (manufacture of tooling, research & development etc, ie a one-off start up cost). However, the price, though reflecting all of these, is set dependent upon how quickly he wants to make a profit. So, he may decide that he wants this to be within 1000 items in the 1st year (say). If he makes 1200, then from selling 1001 on he is on a winner. If he sells 1150 at his initial price and then finds the remainder on the shelf, he may well sell the remainder at a lower price. He can probably go quite low and still make a profit as by this time the variable costs have been paid off and only the production costs remain. Hence he gets cashflow - at a profit - to keep his financiers happy. All good business methods. Now, you might then say that because these items are being sold off cheaply, the product is a failure. Not so, all still going at a profit, generating cashflow and actually cheaper for him than holding on to them and selling them slowly at the original price. Later on, he may indeed make a further identical batch, and still sell them at the origanal price. This time round, his profit will be greater per item ( no variable costs this time) so once again he can afford to cut prices if the batch doesn't sell quickly enough. But if he does, good profits for him, helping to sustain the business.

As for these sale items (at the retailer or manufacturer level) being returns, not actually legal for them to be sold as genuine new items. They have to be declared as ex-returns, refurbs, seconds or whatever.

 

Stewart

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The price the manufacturer decides to set, is made up of 2 components. (1) production costs which are fixed (materials, wages, packaging, factory costs etc). and (2) variable costs (manufacture of tooling, research & development etc, ie a one-off start up cost). However, the price, though reflecting all of these, is set dependent upon how quickly he wants to make a profit. 

 

And of course on top of the costs directly related to a given product, there are overheads to cover. Overall these have to be taken from sales income, but it doesn't have to be evenly spread across everything sold.

 

It is pretty clear that Hornby pricing is based on what the market will bear, not on the costs for a given item. E.g £15 for a 4-wheel coach which must have paid off development and tooling costs decades ago. (Though I have no idea who IS buying them at that price).

The price the manufacturer decides to set, is made up of 2 components. (1) production costs which are fixed (materials, wages, packaging, factory costs etc). and (2) variable costs (manufacture of tooling, research & development etc, ie a one-off start up cost). However, the price, though reflecting all of these, is set dependent upon how quickly he wants to make a profit. 

 

And of course on top of the costs directly related to a given product, there are overheads to cover. Overall these have to be taken from sales income, but it doesn't have to be evenly spread across everything sold.

 

It is pretty clear that Hornby pricing is based on what the market will bear, not on the costs for a given item. E.g £15 for a 4-wheel coach which must have paid off development and tooling costs decades ago. (Though I have no idea who IS buying them at that price).

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Which is exactly part of what I am saying. The manufacturer (in this case, specifically Hornby) is a company looking to make a profit. The price it sells at is set to deliver what they think is maximum profit. They cover their fixed costs on every sale; the judge how quickly they recover the variables, add that to the fixed costs, then add a % for profit, as much as they can get away with.Common business practice. After variables have been paid off in that initial period, profit % goes up; if sales drop they can afford to drop the price as the market forces demand.

 

Stewart

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In normal accountancy parlance, the split of fixed and variable costs is the opposite to what Stewart had posted.

 

The cost of a tool is a fixed amount, whether you make 1 unit or 100.000.  Wages are fixed - they cost so much per month regardless of the numbers made or sold.

 

Raw materials are however variable; the more you make the more you need to buy and the more you have to pay.

 

 

However (and I think this is the point Stewart is making) once you decide to go into production, and quite perversely, your fixed costs become variable and variable costs become  fixed.  So the cost of materials for a single item is a fixed amount, but your wage bill needs to be divided by the number of items made and sold - and so becomes variable.

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I also have a business plan.

 

Just buy these days what fits in with my layout, not a lot left on my wish lists fortunately.

 

Scan this very useful thread for bargains often. Local model shops (to me) also have the odd bargain, including Hattons - (occasionally)

 

I personally will never pay full RRP for Hornby or Bachmann. Silly RRP prices these days.

 

Brit15

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You have been busy Stewart, thanks

.....As for these sale items (at the retailer or manufacturer level) being returns, not actually legal for them to be sold as genuine new items. They have to be declared as ex-returns, refurbs, seconds or whatever...

Last year I paid a lot of money for an engine from a well known and established retailer (not in Cornwall, or Liverpool or Sheffield).  It was out of production and I should have known better.  It was well wrapped but the acutal manufacturers packaging was seriously damaged (including the internal vacuum formed plastic which had split and marked the surface of the model).  The engine was sent back and I was refunded.   At the time the retailer commented that he had been able to make good the surface finish and that the model would go back up for sale.  Sure enough it is back on his web site and two months later it is stil for sale.  I don't think this retailer deals in second hand models and there is no suggestion that this model is anything but 'new'.  The asking price is far too high for it to be secondhand!

 

Regards

 

Ray

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I also have a business plan.

 

Just buy these days what fits in with my layout, not a lot left on my wish lists fortunately.

 

Scan this very useful thread for bargains often. Local model shops (to me) also have the odd bargain, including Hattons - (occasionally)

 

I personally will never pay full RRP for Hornby or Bachmann. Silly RRP prices these days.

 

Brit15

As a general rule,I think that no one is going to disagree with that.However,many model retailers....for example Kernow,Hattons,Locomotion Models (NRM).....commission special models from all the manufacturing companies.We now have Phil Sutton 's Rail Exclusive entering the fray(to great acclaim).No discount with any of the above.So what do you do if it's a must have?

Some of these include: the Ivatt Atlantics,the O2,the APT-E,theBeyer Garratt.

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So gutted I missed this yesterday  :beee: . Oh well, maybe another day...

If it's any consolation, I didn't think I had missed it, but got a refund today for two items that were sold out after 'unprecedented demand' and lack of supply (despite being able to buy them on the website!).
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Agree Ian re the "must haves"

 

I try not to "must have", The Sutton 24 is a beaut, but too expensive for me. The other week I got a blue Bachman Modelzone special edition weathered 24 for under £70, always wanted one (a blue 24), via this topic from Invicta.. It'll do for me, after a renumber.

 

Brit15

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Todays bargain, 99p from b+m bargains

 

Illuminated tweezers

 

 

I duly visited the B&M in Priory Square today where I couldn't find said tweezers.

On asking an assistant who was topping up the make up items I was told "We haven't had those for ages"!

 

Same regarding the magnetized tools. None in stock.

Shucks - missed again!

 

Keith

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Ooh, i can see a delboy "this time next year we'll be millionaires" scam coming on!

 

Both nantwich stores have both items, if i see any in there tomorrow i'll grab some of both itmes if anyone is having trouble getting some

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Sorry guys I must have beaten you to it . I'm away from home but informed by domestic authority that package turned up at 9.30 this morning. It should be my GWR 2-8-0 T That's incredible I think I only ordered 1pm yesterday

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I also have a business plan.

 

Just buy these days what fits in with my layout, not a lot left on my wish lists fortunately.

 

Scan this very useful thread for bargains often. Local model shops (to me) also have the odd bargain, including Hattons - (occasionally)

 

I personally will never pay full RRP for Hornby or Bachmann. Silly RRP prices these days.

 

Brit15

Absolutely agree. The last Bachmann purchase for me was 64xx. Since then acquired Olton Hall @ £47, D16 @£89, Rood Ashton Hall @ £80 and now 42xx @£60. The key is it was bargains that drove the last 4 purchases. So will keep an eye out for bargains at Hawkins, Model Zone (WH Smith) and Hornby direct. I reckon next opportunity may be as it approaches Hornby year end as they try to max sales and reduce stocks

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I duly visited the B&M in Priory Square today where I couldn't find said tweezers.

On asking an assistant who was topping up the make up items I was told "We haven't had those for ages"!

 

The B&M in Cannock had both items but I had to ask for them.

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