The Future of Rocketry or the Demise of it.

[CPUTommy]

Thats my point exactley, They stand behind there product.

I have the same situation with some of my distributors. For that to happen there has to be a system in place and money makes that system run.

I consider my direct purchase money in the bank for aerotech to do some R&D imagine if everyone only bought from the lowest priced dist, that companys (whom ever it would be) bottom line would not be as much as if everyone bought direct. There is a happy medium.

Please also note that I never said or infered or meant to say that they dont stand behind there product. They do. Unlike some retailers who are in it for the buck or two. Im also not saying anything negative about the retailers, or one or two specifically. That is not my intent.

"A good company supports its product, a great company builds a product that supports itself."
My intent is to give a motor company (estes,aero,animal,etc..) my business, even though its NOT the cheapist on the net.

 

[sunward]

..Theroy: We are our own worse enemys and are acually helping the sport/hobby of rockets to diminsh right before our eyes....

no. Manufacturers and retailers are the problem.

Please understand, I dont work for estes ..

yet a few years ago, hobby stores were complaining that it was cheaper to buy Estes products at Walmart - motors and kits - then what it cost them from the distributors.

Even last year, Estes products were at a chain in Canada at crazy low prices. Estes' response was this was the "mass market."

... They dont have a phone number, only email.... ...

never buy online unless the site has a phone number and physical address posted.

...What I've noticed in the hobby industry is that it's becoming more commonplace for manufacturers to compete with their resellers. ...

RC sales seems to be the worst. But rocket companies are just as bad. And in ways other than just offering a lower price.

... A company manufactures a product, and tries to sell direct to the consumer only, and realizes it can sell more with a distribution chain.

Many companies don't realize it is expensive to sell online. It is another business altogether.

As a manufacture, you must have the local hobby stores and online retailers to survive. You can't do it on your own. It would not be a problem for me if you were to buy Sunward products from my retailers instead of online direct from me. It is offered as a service as the complete line is available.

When I started in business, I didn't even sell directly. Maybe 50.00 a year in direct sales. After a few incidents - with resellers - I did start selling direct, at full retail with just the occasional sale.

I would still prefer to sell to distributors and retailers as there is less cost and time involved.

 

[gagreen]

personally, id much rather spend my money and get my motors from rah, wildman, or anyone but the supplier direct. I absolutely do not agree that at makes more money by you buying direct or they would be a sole direct sale business. AT and CTI's bread and butter are their distributors in the field or online and most our online dealers are also on site providers in their locality. AT saves, more than likely, in the long run by sending out bulk orders over having to hire more warehouse employees to package up smaller personal orders. From a manning perspective i wouldn't even touch direct non bulk shipments if i were as large as AT. I would push my motors onto my vendors and let them spend their dime to promote them driving up the sales for the vendor and in turn driving up orders from AT itself. AT and cti rarely do any advertising compared to their dealers. Why? simple answer is that they are keeping their sales up by relying on the dealers to promote their product.

So looking at this if at or cti relied or profited largely from smaller orders of a few motors at a time over shipping large bulk orders to suppliers to resale then they would do that. That takes more man power and man power does not come cheap. AT and estes provide the service as a service for people to get exactly what they need if their supplier does not have it and usually only at msrp to not undercut their own piggy banks that are their resellers. AT will not price itself out of business (i hope they learned from the airlines how not to make money) on wholesale prices to their distributors. Its their resellers that keep them in business in the first place. Rocketry is a very small market esp hpr motors without resellers who can offer competitive prices and sales the market would be extremely smaller.

I would also like to point out that many of "online discount rocketry sites" are run locally somewhere and generally are onsite vendors who without online sales would not be able to keep supporting on site sales. On site vendors make or break a launch for me. Generally ill order online and pick up onsite and skip hazmat if at all possible.

Please dont take this as an attack, your theory is sound but just seemed short sighted and weighed to heavily on thinking that manufacturers of motors do not make a decent profit even at wholesale pricing, they do.

Personal experience with this is the mark up of beauty supplies (mom is a hair stylist and private business owner) the shampoo's, conditioners, etc etc that are marked "for sale in a prof salon only" are quite pricey (but worth IT) the supply house sells them much cheaper, no i will not divulge the mark up. but the shampoo companies still make money and most have been in business longer than ive been alive, and they do not sell direct to anyone.

This theory does not work in every industry but it is a working business model and will continue to work as long as the manufacturers do not sell wholesale below a profit for themselves.

just my humble opinion

 

[dave carver]

I wouldn't feel bad about Aerotech in particular. NAR spent hundreds of thousands of their members dollars fighting the BATF for which Aerotech benefited greatly- all without thanks to the NAR members from AT.

You are wrong about this. AeroTech and other rocket companies put out substantial amounts of money along with the hobby to put the ATFE down. I don't know who put out what but I do know Gary Rosenfeld was in this fight from the begining when it was his company that started getting letters from the ATF.

 

[GuyNoir]

You are wrong about this. AeroTech and other rocket companies put out substantial amounts of money along with the hobby to put the ATFE down. I don't know who put out what but I do know Gary Rosenfeld was in this fight from the begining when it was his company that started getting letters from the ATF.

The bulk of the funding to pay for the litigation was from individual modelers who donated to NAR and TRA.

 

[dave carver]

The bulk of the funding to pay for the litigation was from individual modelers who donated to NAR and TRA.

Yes, Bunny. I know this. I also know the manufacture's were among the largest single contributers. They'd have to be, the future of their companies were at risk. To say they did nothing during the time just to reap the benefits is wrong and is simply bashing.

 

[dasein668]

What is the name of your brewery? I am a hombrewer and BJCP Certified Judge, I belong to the Central Florida Homebrewers. Maybe your beer is distibuted here in Central FL! That would be cool!

Rising Tide Brewing Co. We're only in Maine at the moment, unfortunately!

 

[bjphoenix]

I like to support my local businesses whenever possible. More often than not they don't have the products that I want so I have to purchase elsewhere. Recently I bought some plywood fin material from my LHS, for a lot more money than I could have bought it for online. I wanted to buy some E9's but they were out of them.

 

[bjphoenix]

Ooops I forgot to address the topic of the thread- the future of our hobby rests with today's young people. If we get more young people interested in the hobby then our suppliers will do better, the public will be exposed to the hobby more and accept it more.

 

[Highpowerrocketyahoo]

I don't know if it's just me but has anyone noticed lately there has been a lot of people on here "getting out of the hobby". Kind of disturbing. I know as with any hobby a small percentage of people will come and go, this is normal and healthy. People try a hobby and ultimately some don't like it and leave to pursue other hobbies. That's kewl. But lately it just seems to me like A larger number than usual are leaving....wish them all the best understand, just sad to see...

 

[Csinclair]

Incorporating just saves a little money at tax time and avoids a small business owner having to buy workmans comp for himself.

My first business is a C corp and this state REQUIRES the owner to have workmans comp as well as all employees. My second business is Sole Propertieship which means NO COMP !!!!

Was funny, they classified us and my employees as clerical, (it was a low rate) then some guy decieded to change our clasification to sheet metal workers (highest rate possible)

Yeah, Massachusetts is horrible unless your Illegal, or lazy...

Tom

Strange, thats completely backwards from Delaware. In Delaware Sole Prop needs workmans comp, officers of a corporation or LLC do not. Of course I still have to keep it on my employees no matter what.

 

[Gus]

Aerotech used to not compete with their dealers.

Then they had the fire and most of their dealers went away.

Some stayed.

Then the BATFE came and even more dealers went away.

A few stayed.

Some of those few remaining dealers did a lot to support the NAR/Tripoli case.

If Aerotech did anything, they weren't nearly as visible as some of their dwindling number of dealers.

Then Aerotech went into direct competition with the few remaining dealers who had been so loyal. Aerotech only sold the lower power starter items, at a much reduced cost (less than what most dealers paid) ostensibly to attract in new fliers.

Unfortunately the starter items were the biggest sellers, so the dealers couldn't really compete on their biggest selling items anymore. The dealers were invited to return their unsold inventory of those items to Aerotech for a refund, but the dealers would have to pay the shipping (they already paid the shipping to receive the items). So it made more sense for those dealers to just blow out those items at their cost just to try to get their money back.

But then Aerotech informed them they weren't allowed to advertise discount prices. It was OK to give a discount price, you just couldn't advertise that price online. So now the dealers had no way to attract people to their sites to buy the same product that Aerotech itself was offering for substantially less.

That was the point at which some of Aerotech's long time dealers, the ones who kept them going after the fire, and through the BATF suit, finally gave up on trying to sell Aerotech's product.

CPUTommy, I appreciate your willingness to spend a little extra to support those in this hobby who deserve it. I try to do that, too. But with regard to Aerotech and their dealers, I think you've picked the wrong horse. I don't sell motors, but I've watched some friends who do show incredible loyalty to Aerotech and receive very little loyalty (or even basic fairness) from Aerotech in return.

As for me, what little high power I fly I try to buy from the vendor at my local launches. They sell Cesaroni and Road Runner, but no Aerotech.

 

[RocketT.Coyote]

I often cannot get the needed supplies locally. Ordering online makes sense especially with gas prices soaring. Discounts and offers of free shipping are the icing on the cake.

 

[tibadoe]

I often cannot get the needed supplies locally. Ordering online makes sense especially with gas prices soaring. Discounts and offers of free shipping are the icing on the cake.

Same here.

 

[dave carver]

I don't know if it's just me but has anyone noticed lately there has been a lot of people on here "getting out of the hobby". Kind of disturbing. I know as with any hobby a small percentage of people will come and go, this is normal and healthy. People try a hobby and ultimately some don't like it and leave to pursue other hobbies. That's kewl. But lately it just seems to me like A larger number than usual are leaving....wish them all the best understand, just sad to see...

I talked with Bruce Kelly at a launch about how long people stay with HPR. He said the most only last 2-3 years.

 

[english_1969]

But id rather ensure aerotech has a "better" bottom line than company XXX...... who only retails the motors.

WHERE you purchase their motors likely has no better or worse affect on their bottom line. This would be consistent with nearly ever other business in the world.

In fact, given the industry model, you may be costing them more money and lowering their bottom line because they need to staff for and have resources in place to service you directly.

While I cannot speak to AT's specific situation, in most distribution models, manufacturers are more profitable when they sell through the distribution network instead of directly....despite the differences in selling prices.

W

 

[stickershock23]

price has absolutely 100% NOTHING to do whit why and where I buy.

Customer service is.

SO I support my local vendors And vendors who have done me good.

I am a HARD core CTI fan, because they ALWAYS do good by me.

 

[troj]

Something to consider in all of this...the amount of paperwork required to ship one motor is about the same as that required to ship two dozen motors.

So, while the gross profit margin may be higher when you order direct, the net margin may be smaller, depending on your order size, due to the overhead incurred.

If ordering direct makes you happy, then by all means, do it. If your goal is to benefit the manufacturer as much as possible, then try to do fewer large orders, as it reduces overhead, resulting in a larger net profit.

At the end of the day, you have to do what you think is right, and what works for you.

-Kevin

 

[rdbones]

price has absolutely 100% NOTHING to do whit why and where I buy.

Customer service is.

SO I support my local vendors And vendors who have done me good.

This is where I stand too !!!!

There are vendors out there that go above and beyond in the customer service arena, and those that used to but are now sorely lacking!!! I would rather spend more of my hard earned $$$ with a vendor (big or small) that has good C.S. !!!

 

[luke strawwalker]

Yes, Bunny. I know this. I also know the manufacture's were among the largest single contributers. They'd have to be, the future of their companies were at risk. To say they did nothing during the time just to reap the benefits is wrong and is simply bashing.

This is good to know, but let's not sugarcoat who had the most to gain by having the BATFE decision overturned either...

Certainly more than the average non-HPR flier did, that's for sure!
Later! OL JR

 

[JPVegh]

If our hobby meets it's demise it will be because people lose interest. You want sport rocketry to thrive? Get your kids involved, then get your neighbors kids involved, then get your neighbors neighbors kids involved. If you're not a member of the NAR or Tripoli join one or both and encourage others to do so. Membership has it's benefits that extend beyond the individual member.

As for supporting manufacturers and vendors, if the hobby is strong and thriving then there will be enough support to go around. It's win win for everyone.

 

[Pat_B]

I don't mind spending my money locally, at a slightly higher price, but there are few hobby shops around who provide any service that's worth it. Most concentrate on RC products and are very knowledgable in that area, but don't have any product knowledge in rocketry. So I'd certainly pay them more if I were to get into RC and they can answer my questions, but not for rocketry products where my knowledge far exceeds theirs.

Not only that, but brick and mortar stores still have the option of also selling online. Online sales is just another form of marketing and isn't restricted to just online vendors without a storefront.

 

[JDcluster]

Another reason to support your local vendors!
How many online outfits will honor warranty claims (other than the manufacture)?

Cheap is how Walmart wins. They can do 100X more volume than your Mom & Pop shops; essentially putting them out of business! I rarely shop at Walmart due to their lack of local support to economy.

JD

Tom, about your support post. As I understand it, after talking with at least 2 retailers, Aerotech requires its dealers to support warranty claims. As I understand it, Aerotech will eventually re-reimburse the dealer.

 

[troj]

Cheap is how Walmart wins. They can do 100X more volume than your Mom & Pop shops; essentially putting them out of business! I rarely shop at Walmart due to their lack of local support to economy.

WalMart is one of the worst thing that can happen to a community!

I have to be desperate and have no other options before I'll step foot in one of their stores.

-Kevin

 

[JDcluster]

Where is Bruce Kelly today?
He was the mastermind behind HPR magazine.

JD

I talked with Bruce Kelly at a launch about how long people stay with HPR. He said the most only last 2-3 years.

 

[10fttall]

I have to be desperate and have no other options before I'll step foot in one of their stores.

Yeah, me too. I so enjoy making 6 different stops and spending 150% more for my purchases! But the customer service makes up for it. It makes all the difference. If I want to know which ketchup is saltier, Pop can tell me by gosh. I'm so glad to have that extra little touch. And I appreciate the fact that all Mom and Pop's employees are all on the road to being independently wealthy, have an impeccable health plan, and 4 weeks off every year. I also love to operate parking meters or at least park in some cramped little lot that tests my precision maneuvering ability to park at Mom and Pop's store. And I've never really been partial to the construction industry, so it's cool how Mom and Pop just keep using that small leaky old building.

 

[boomtube]

Deal directly with the manufactures and all of the vendors go out of business or deal with the vendors and the manufactures go out of business.

Heads we loose tails. . .and we’re still loosing?

Something’s not right here.

With the nearest hobby shop, that has much of anything to offer for either of my hobbies, better than 140 miles away it isn’t difficult to understand why I don’t visit it very often.
And why would I spend $XXX amount on gasoline just for the privilege of paying MSRP as well as state sales tax when I can E-Shop and spend $X amount on shipping and no state sales tax..

As for whom I do business with? Whoever it is that can give me the best price for a comparable or identical product.

If the manufacture goes out of business because somebody is selling their product for less than they do directly; whose fault is that?

Mine; because I’m frugal or the manufacture for having a bad business model?

 

[dave carver]

Where is Bruce Kelly today?
He was the mastermind behind HPR magazine.

JD

I imagine he's still in Salt Lake City watching grandkids grow

 

[luke strawwalker]

Yeah, me too. I so enjoy making 6 different stops and spending 150% more for my purchases! But the customer service makes up for it. It makes all the difference. If I want to know which ketchup is saltier, Pop can tell me by gosh. I'm so glad to have that extra little touch. And I appreciate the fact that all Mom and Pop's employees are all on the road to being independently wealthy, have an impeccable health plan, and 4 weeks off every year. I also love to operate parking meters or at least park in some cramped little lot that tests my precision maneuvering ability to park at Mom and Pop's store. And I've never really been partial to the construction industry, so it's cool how Mom and Pop just keep using that small leaky old building.

Yeah... I hear ya...

Went to the local Western Auto (before WA bought by K-mart or Sears or whatever and subsequently folded) to get a few little odds/ends for a plumbing project and priced some tires while I was in there... I asked them "what's the cheapest 235/75R15 you can get??" After about three minutes of flipping through the supplier charts and and another minute or so furiously tapping away on the adding machine, he pulls the ribbon off the adding machine and tells me "$66 bucks"... I say "thanks" and pay for my half-dozen pipe fittings and glue and leave.

Sorry, no sale... I'm not paying $66 for the same off-brand no-name tire I can get at Walmart all day long for $40 (at the time-- as anybody who's bought tires in the last couple years obviously realizes this was several years ago).

It's rediculous. Mom-n-Pop can certainly share in the blame for their own demise...

Later! OL JR