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Industry News - May 2009

Published: April 9, 2009

Maryland outlaws minimum pricing


On April 14, 2009, Gov. Martin O'Malley of Maryland, signed into law an act prohibiting the establishment of minimum sale prices for commodities or services within his state. The law goes into effect Oct. 1.

In 2007, the U.S. Supreme Court ruled in a 5-4 decision that minimum pricing agreements, which were illegal before, needed to be reviewed individually.

According to Christopher S. Finney, a Boston attorney who spoke to the Wall Street Journal, there are about 5,000 companies that have "implemented minimum-pricing policies," many of them doing so after the 2007 Supreme Court decision.

A bill called the Discount Pricing Consumer Protection Act, introduced by Sen. Herb Kohl (D-Wis.) and co-sponsored Sen. Sheldon Whitehouse (D-R.I.) would amend the Sherman Act and, according to govtrack.us, "declare that any contract, combination, conspiracy, or agreement setting a minimum price below which a product or service cannot be sold by a retailer, wholesaler, or distributor violates the Act," thus illegal nationwide.

Many hobby manufacturers and distributors had minimum price policies before the 2007 court decision, ostensibly to protect retailers from unfair pricing by competitors and brand devaluation.

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Latest CPSIA relief bill proposed


Representatives Joe Barton (R-TX) and George Radanovich (R-CA) have proposed a new federal bill granting companies some relief from the Consumer Product Safety Improvement Act (see $2 billion negative impact on toy industry) that went into effect Feb. 10.

H.R. 1815, the Consumer Product Safety Solutions Act of 2009, is one of 10 CPSIA amendment bills pending in Congress but the only one sponsored by the members of the House Energy and Commerce Committee and a total of 22 members of Congress.

The bill would clarify the applicability of certain provisions of the Consumer Product Safety Improvement Act (CPSIA) including:
  • Making lead and phthalate provisions prospective.
  • Allowing retailers a "sell-through" period.
  • Creating a temporary compliance scheme for lead content testing.
  • Mandating CPSC make public lead content testing procedures in 6 months.
  • Creating regulatory flexibility in exemption authority and inserting age consideration in exemption standard.
  • Creating broader exemption authority with higher standard for those products that cannot meet the "regular" lead exemption standard when an exemption would better preserve child and public safety.
  • Permitting component part testing.
  • Creating regulatory flexibility in the labeling provisions.
The Hobby Manufacturers Association (HMA) is urging members to contact their members of Congress and request they cosponsor and support final passage of HR 1815.

Click here to read a letter from Rep. Danovich to Rep. Henry Waxman (D-CA).

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Retailer numbers up at NRHSA show


This year's National Retail Hobby Stores Association (NRHSA) Table Top Expo at the Las Vegas Hilton saw an increase in the number of dealers attending despite fewer manufacturers at show than last year.

Final totals haven't been released yet, but NRHSA says the number of dealers at the April 15-16 show was up 10% over last year. One reason may have been the room rates, which fell to $59 just weeks before the show.

There were about 80 exhibitors at this year's show versus about 100 last year.

Given the current economic conditions, many of the dealers and exhibitors called the show - and their business thus far this year - a win. Many of the show visitors Model Retailer spoke to said their business is pretty good in 2009, with some a little down and some a little flat. Some doing a little better: "I'm up 4%. I can't complain," said Carlos Priemer of Hal's Hobby Warehouse in El Paso, Texas.

Few of the manufacturers used the show to release new products. Some have limited their plans for new releases generally this year, avoiding the costs of new tooling and getting the most out of what currently exists, producing items in different scales, paint schemes, roadnames and model variations.

Overall, the mood at the show was upbeat with some stores and businesses predicting the economy will turn around by the 2009 holiday season.

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Aerotech opens consumer site


AeroTech Consumer Aerospace recently opened ValueRockets.com, its full-featured Web store, at ValueRockets.com. The store is divided into six major product categories, including single model rocket motors, ready-to-fly model rockets and igniters and accessories.

According to the company, the intent of ValueRockets.com is to bring more newcomers to the hobby. The Web store includes "Rocketry 101" as a method of educating consumers about the various aspects of hobby rocketry as well as answering frequently asked questions. The site also includes a link to a list of hobby stores, onsite dealers and e-commerce sites.

AeroTech Consumer Aerospace is a division of RCS Rocket Motor Components (RCS) Inc., Cedar City, Utah.

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Amenco extends rebate offer


Amenco is extending its factory rebate offer through June 30. Retailers who purchase the newly released bug house kit (No. 60011) will receive a $2 direct-from-factory rebate for each kit.

The company advises retailers to send a copy of their distributors' invoices to Amenco to claim the rebate. Invoices can be faxed to 732-842-9532, e-mailed to sales@houses4birds.com, or sent via mail to the following address: Amenco, 62 White St., Red Bank, NJ 07701.

Questions may be directed to Charles Horowitz at this toll-free number: 888-480-2850.

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Bill Schneider

Bill Schneider joins Rapido


Rapido Trains Inc. of Toronto, Ont., announced that Bill Schneider will be joining its product development department on May 1.

Schneider has been involved in the retail, wholesale and manufacturing aspects of model railroading since 1982. For the last 15 years, Schneider has been responsible for product development at Branchline Trains, including the heavyweight passenger cars introduced by Branchline in December 2003 and the critically-acclaimed line of Blueprint and
Yardmaster freight car kits.

"We have had numerous requests for more American prototypes and Bill's role with Rapido is to develop new 100% American models that will fill some big gaps in the U.S. model railroad marketplace," said Rapido's President Jason Schron.

Schneider is an active HO scale prototype modeler. His New York, Ontario and Western doubledeck layout has been featured in many publications.

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Dark Horse to participate in Diamond's FOC program


Dark Horse officially announced its participation in the Diamond "Final Order Cutoff" (FOC) program. Dark Horse first announced the intent to participate in this program at last fall's Diamond Retailers summit in Las Vegas, Nevada. Dark Horse's FOC program begins on April 20.

Dark Horse's final FOC dates will be scheduled twenty days before the Diamond on-sale date for comics, and approximately three months prior to the on-sale date for graphic novels. Dark Horse will begin including FOC dates for some of its products as early as the May 2009 edition of Diamond's Previews catalog.

"We are pleased to announce this move to the FOC," Dark Horse's president, Mike Richardson stated in a press release. "This system will help every retailer who orders Dark Horse product and should lead to better business for all of us."

Dark Horse hopes that participation in the program will help to further instill confidence in the publisher's lineup of releases and continued commitment to the direct sales market.

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MRC named exclusive distributor of JTT Scenery Products


Model Rectifier Corporation (MRC), of Edison, N.J., has been named the exclusive distributor and marketing agent for the U.S. and Mexico for JTT Scenery Products, based in Garden Grove, Calif.

Akiko Kimura, vice president of MRC, said in a press release that "the authenticity of JTT trees offers modelers an alternative to conventional scale miniatures. What sets JTT trees apart are the details. JTT's foliage is light and airy and not clumped together as on ordinary scale trees, our leaves are more defined."

MRC is offering a special direct to retailer sale allowing for nearly 60% margins on trees from JTT Scenery Products.

Depending on the species and the series, JTT trees are available in a range from 1" to 18" tall, from Z through G scales. MRC is offering display and product assortment choices, with discounts above its normal dealer prices. Retailers can restock through their favorite model railroad or plastic model distributors.

For more information on this offer, contact Bob Lewen at 732-225-2100 ext. 218, or click here to e-mail him.

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Privateer Press lands Voltron license


Privateer Press and World Event Productions have announced an agreement giving Privateer Press rights to license "Voltron Defender of the Universe" for Privateer's hot collectible miniatures game, Monsterpocalypse. The new set is expected to release in early 2010 and will feature characters from the classic Voltron animated series.

Matt Wilson, Privateer Press' Chief Creative Officer and Monsterpocalypse creator, said about the agreement, "Monsterpocalypse was created with the goal of being able to feature guest stars from our favorite films and TV shows that have done so much to inspire the creation of the game."

Voltron celebrates its 25th anniversary this year and more entertainment announcements are planned, including a big-budget live-action movie on the scale of Transformers. Visit www.voltron.com for more.

More information regarding pricing and release dates, as well as news regarding the Monsterpocalypse: Voltron set, will be announced as it becomes available on www.monsterpocalypse.com.

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Athearn recalls Genesis NS GP60M models


Athearn has issued a recall of some of its recently shipped Genesis Norfolk Southern SD60M locomotives due to paint errors on the body. The following item numbers are affected: ATH67268, ATH67269, ATH67270, ATH67368, ATH67269, and ATH67270. The company asks customers to return the locomotives to the place of purchase by May 8, 2009 for a full refund. Customers will be able to order new, properly decorated product, which will ship in approximately 4 months.

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Checking in: California Hobby Distributors


We talked to California Hobby Distributors' Marta V. Renna recently, and she says plastic models are doing well for the company right now. Cal-Hobby has picked up Moebius Models kits and they've proven to be very popular. Also moving quickly are budget-priced kits by Revell and Lindberg.

The Alhambra, Calif., company is also now distributing Novus Plastic Polish (for use on models), HobbyBoss kits, and Williams trains. Cal-Hobby will be at the NRHSA Table Top Expo April 15-16.

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New hobby retail sales software developed


Mark Fleming, developer of The Desktop Dispatcher software, has developed a point-of-sale (POS) program specifically for hobby retailers called The Desktop Cash Register. The software, developed around the robust and tested FileMaker Pro database program, can run on a retailer's existing computer equipment and credit card processing system. Fleming originally developed the software for his in-laws, who own a hobby store.

The software let's retailers check customers out while simultaneously tracking inventory. It can be customized to a particular users' store and track sales, returns, lay-away, warnings about problem customers and generate daily reports. It can also generate barcodes for products and items like club cards.

It comes preloaded with more than 130,000 parts, descriptions and UPC numbers, many of them with corresponding photos. It allows users to log-in and export a reorder list to distributors' Web sites, producing orders in their desired format and eliminating handwritten lists that have to be retyped into the computer. It even shows side-by-side costs of each part, allowing the user to select the better reordering deal. If desired, the software can also print out a list of the items that need to be reordered. Other distributors' parts lists can be imported if available in Excel, tab-or comma- delimited, or dbase formats.

Fleming will demonstrate his software at the NRHSA Table Top Expo. For more information, contact him at Mark Fleming's e-mail or by calling 561-714-5240.

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