Thoughts on Panini's new policy?

[Shi Guy]

http://paniniamerica.wordpress.com/...w-distribution-policy-mapp-pricing/#more-4754

Panini has declared 2011 "the year of the hobby shop," and as such they will be giving brick and mortar stores a 7 day head start on all new product releases as well as setting a "minimum advertised price" on all of their products. I have to say, after reading through the article, I'm not a fan.

My initial reaction is that, besides the obvious slap to the face to those who don't have a hobby shop nearby and want a product on it's earliest release date, it also ignores the drop in price that many products see after they've been on shelves for awhile. Crappy products will sit on the shelves longer, taking up more retail shelf space, never moving because the retailer can't drop the price, leaving the retailer to ultimately lose more money than if they were to simply discount the product. It also seems to ignore the stores that have embraced the internet, as most retailers should, selling both online and in their brick and mortar stores. Perhaps Panini should take a look at the recent failings of Borders due to it's sluggish embracing and improper management of internet sales, and reconsider their current plan of action.

I'd love to see more details on this, as this brief description simply seems to want to drive people away from buying boxes, and to buying singles on ebay instead. I admire their intentions, but I think this is the wrong way to go about it.

 

[PetestillRose]

Price controls are a terrible idea, especially when a price is as volatile as sports cards, there's no way this succeeds.

The real joke is that even though there isn't a hobby shop near me for almost 45 miles, even if there was one right next to my house I still wouldn't blow my hard earned money on Panini's overpriced wax so it really doesn't much matter, at least to me.

 

[Brad]

Better than UD's plan to not allow online sales for 3 months.

 

[mstng99tim]

I would think there would be some clause in the policy where the store can lower the price after a certain amount of time. Not being able to do that doesn't make much sense on Panini's part, because that might cause the stores to buy less so they don't have extra product just sitting on the shelf. My LCS doesn't sell any wax online and he does just fine.

 

[gt2590]

It won't last long IMO.

They both tried something similar in '07 and it lasted about 3 months...

 

[brouthercard]

Why doesn't Panini just increase their factory-direct cost?

 

[Gellman]

I have no idea why they would discriminate against such a large portion of the business. Plus, this isnt 1995, not everyone has a LCS to frequent, and the ones that do arent always a great place to go. Why force those people out of the ability to buy a product until its already down from the initial bump in value that a release usually gives?

This is going to be a disaster, and I cant wait to see the faces of those people "applauding at the end of the presentation" when they repeal this after a month or two of decreased sales.

 

[Card Magnet]

Awesome! I can't wait to not have access to a new product if it piques my interest because my hobby shop went out of business years ago trying to sell boxes of cards! Great job by them to make sure I don't ever think of buying their product by the box.


PANINI = FAIL

 

[Junior Griffey]

This. I could see some shops getting screwed if someone buys a few boxes from their shop and then resells them on eBay. Will be interesting to see how UD polices their policy though. I can't imagine either of these being too successful.

Better than UD's plan to not allow online sales for 3 months.

 

[Russ S.]

Who cares!

Until they get off their rumps and fix their jacked up redemption issues, they have no credit what so ever.

 

[RITM]

I guess I have access to shops if by access you mean willing to drive 90 minutes to get there. The shops I do hit are notorious for selling online. This will be good for them to be able to be the first to list.

 

[Shi Guy]

Panini posted a video of Mike Anderson, VP of Sales for Panini, detailing the plan. Some interesting quotes/details that stood out to me:

"The difference between one internet seller and another internet seller is price, and if you get into a price war nobody in this room wins."

"Rodney's done a fantastic job of allocating product, he knows where almost every case goes...he knows how much product is going to where, and by controlling the flow he's kept prices high."

"We can't necessarily tell you what you're going to sell it to your customers for, we can't tell the distributors what they're going to sell for, but we can certainly control how much we see our products advertised for. So we're going to monitor all of the resources that are out there, whether it be b2b, eBay, you name it, we're going to be watching carefully to make sure that nobody breaks MAPP pricing."

"Rodney will, as we solicit product, identify what the wholesale price is, we'll identify what the suggested retail is, we'll identify the margins that we expect to be maintained. We don't want to see anything advertised below those price points."

"We would expect, obviously, for you to support the MAPP pricing... for 30 days. We recognize... not every thing we do is a homerun. So we recognize that after a certain period of time, prices start to wane a bit, you need to get out from under existing inventory so you can buy future inventory. After 30 days your free to move about and 'business as usual" if you will.'"

"Rodney's going to have to be diligent about market price value... So if we feel like we have to adjust, Rodney can go on, announce to the world that we're reducing our MAPP pricing, and that will go into effect immediately."

"No wholesale distribution by stores for 30 days."

"We want to drive consumers into brick and mortar stores. These people that have been sitting back and ordering online, and then coming to you complaining about the prices that your charging, will now have to go into your stores to buy the latest and greatest product. *applause* "

"We want you to be able to pre-book product at wholesale prices from the distributors... We hear all the time, distributors are taking the opportunity and running prices up when something gets hot. For a limited period of time we want you to be able to buy from your distributors at established wholesale pricing. *applause* "

This plan will start with 10/11 National Treasures Basketball, which ships late July.

Panini Authorized Distributors are:
sports Images, Great American, Southern Hobby, All Sports, Hamps, Magazine Exchange, Peach State, Sweet Deal, GTS, Gold River, Universal, Grosnor

http://paniniamerica.wordpress.com/...ils-new-distribution-plan-at-industry-summit/

 

[seahawks4ever]

OK so let's get this straight.

Brick and Mortar stores are very few and far between after years and years of online retailers stealing business away.

Many people do not have a B&M store anywhere near them. Also, many people who can actually afford boxes work normal business day jobs and since B&M stores are few and far between and have been dying for years, most stores carry hours not conducive to that type of worker.

The Internet makes the box prices realistic to the demand of the consumers. However, Panini has decided that whatever THEY THINK the product SHOULD sell for is the bible for 30 days. So they decide that 2011 Plates & Patches should be $180. No one can sell below 180 for 30 days, even if the product is awful. Now, $180 is the MAPP pricing, which means B&M stores will mark them up 20-30% so the product will run $216-234 in stores (or more) for 30 days.

This is unreal. Do you want people to frequent B&M stores more often? How about a price CEILING and a price floor?

The only B&M store around me with a decent amount of wax is West Coast Sports cards. I would be happy to support my LCS and buy boxes there, except they add a 30-40% markup on the wholesale price. Using the above example, when the product hits the LCS shelves, how about having a maximum markup of 10%? That way, no online retailer will be below 180, and no LCS would be above 198?

Just thoughts from a sleep deprived person. I'll have to revisit this in the morning to see if I made any sense.

 

[flagshipchromecollector]

The Internet makes the box prices realistic to the demand of the consumers. However, Panini has decided that whatever THEY THINK the product SHOULD sell for is the bible for 30 days. So they decide that 2011 Plates & Patches should be $180. No one can sell below 180 for 30 days, even if the product is awful. Now, $180 is the MAPP pricing, which means B&M stores will mark them up 20-30% so the product will run $216-234 in stores (or more) for 30 days.

Obviously, what follows is that nobody (for the most part) will buy cases/boxes at B&M stores until prices drop, unless there is an incredible product that everyone thinks they have to have, which doesn't happen too often (in the football realm at least). B&M guy doesn't want to have no sales for a month, so he makes a deal with his buddy: I sell cases to you at cost, then you sell them on the internet, and we split the profits. B&M guy is at least making something on the cases instead of having them sit cold on his shelves for 30 days.