Estes versus Discounters

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BBowmaster

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Does it harm Estes’ business to buy from discounters like AC Supply or Belleville Hobby? I try to get supplies like engines from a local RC place, or Hobby Lobby if I’m out in that direction. For kits, especially new releases, I tend to go discounter to stretch my rocket budget.
 

PXR5

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I used to own a hobby store.
You're not really "hurting" a manufacturer by buying at a store or another outlet.
The manufacturers generally expect that's how their products will move.

Now, that said, Amazon is a different story.
I worked for a hobby manufacturer, and we lost a LOT of money when our product sold through the big A!!
 

Zeus-cat

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Some manufacturers prefer to not even sell to retail customers as it makes operations a lot easier. They sell to a few distributors and that's all. From their perspective it is easier and cheaper to make one shipment of 10,000 of a product to the distributor than it is to ship 10,000 packages of one product to 10,000 customers. They may get more money for each of the 10,000 units, but that profit is lost in labor, packaging, shipping, etc.
 

Bill S

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I always wondered about that. I want Estes to continue as a profitable business, but I find it hard to stomach full retail price on their products. I get them elsewhere (AC Supply usually, sometimes other vendors). I've often pondered whether Estes would make more profit if I purchased from them directly, rather than from some wholesaler (even one that charges near retail price).
 

neil_w

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I've often pondered whether Estes would make more profit if I purchased from them directly, rather than from some wholesaler (even one that charges near retail price).
Yes, generally, at least if you don't make really small orders where labor and overhead will eat up much or all of the gains.

However: Estes' business model is to sell the majority of their products through distributors. You're not hurting them by working within that system. Furthermore, I tend to feel like there's a lot of value in supporting the resellers as well.
 

Back_at_it

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Generally no. Most manufactures don't want to sell direct to the public as their main source of business. Some do but most don't want to bother. It's easier for most to simply sell to distributors and let the distributors deal with the public.

Manufacturer sell to their distributors at a price where the manufacturer is making a profit. The distributors gets pricing, generally based on volume or the type of distributor they are. What the distributor sells the item for is up to them in most cases and depends on how much profit margin they need/want to make. Keep in mind that some manufactures have instated MAP (minimum advertised price) This MAP pricing came about with the boom of online shopping. All you need to do is look at Traxxas for a perfect example of how not to treat your distributors (speaking as a former distributor for them).

With all of that said. Could Estes make more selling direct? Absolutely YES. But then they would need to deal directly with the public more often and that costs money and people, and people are expensive so in the end it might not be worth the extra dollars coming in as you very well spend more than you are making.
 

neil_w

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Generally no. Most manufactures don't want to sell direct to the public as their main source of business. Some do but most don't want to bother. It's easier for most to simply sell to distributors and let the distributors deal with the public.
I would say this varies on a case-by-case basis. Many companies put significant effort into selling direct (e.g., Apple). My own company sells both through distributors and direct, and we definitely appreciate the extra margin we get when we sell direct. Most chip vendors sell to all but the largest customers through distribution, and in many cases don't even want to talk to you if you're not buying very high volume. Some consumer products companies absolutely do not sell direct at all.

In Estes' case, I would say that if they didn't want to sell direct then they wouldn't offer free shipping or various sales and specials. Again, though, it's not intended to be the bulk of their business.
 

Woody's Workshop

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I'm poor, I buy as cheap as I can, when I can. It matters not to me where I buy something from, too much.
If I buy an Estes product, I look at it as Estes made a sale no matter where I buy it from.
They get a set whole sale price. The reseller can sell for what ever they want to.
It's their own profit they are cutting, not Estes's.
When Estes offers those specials, if I can I take advantage of it, I do.
They would not offer those specials without good cause.
Either a product that resellers/distributors don't want, or over stock, whatever.
They see the inventory sitting idle tying up funds they could use elsewhere that would move faster, and make faster funds.
If you feel bad about buying discounted Estes items from someplace else than Estes.
Just remember Estes already made the sale and collected what they wanted.
It's the reseller that is cutting his profit margin, not Estes's profit.
Also remember while they are offering a discount, they rely on volume sales to make up for it.
That's why they do it, and offer free shipping after a certain dollar amount of purchase.
It's called incentive to buy more, because no one really want's to pay shipping. At least I don't.
That should make you feel better about it.
 

Funkworks

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Does it harm Estes’ business to buy from discounters like AC Supply or Belleville Hobby? I try to get supplies like engines from a local RC place, or Hobby Lobby if I’m out in that direction. For kits, especially new releases, I tend to go discounter to stretch my rocket budget.
I don't know the facts and I think they're private, but if I were "Estes", I'd be happy to receive a huge orders from a discounter. I'm pretty sure manufacturers can easily adapt their prices based on order sources and quantities.
 

JPalmer621

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Just wanted to say watch who you buy from on the internet. Some 3rd party vendors may not keep your info private. I know people that have had there credit/debit cards compromised
 

afadeev

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Just wanted to say watch who you buy from on the internet. Some 3rd party vendors may not keep your info private. I know people that have had there credit/debit cards compromised
The above is generally true for many online retainers of all shapes and sizes.
I keep a separate "internet transactions" credit card, with no recurring arrangements attached to it. That way, when it inevitably gets compromised (roughly once a year, or so), I can replace it with minimal disruption.

YMMV
 
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