Quote:
Originally Posted by m.arndt
(Post 109208)
Sorry to disrupt this thread, but since Hoffman, you have been in this thread, any chance you might be able to shed some light on why does it seem like distributors are giving you guys (smaller online Canadian stores) the shaft when it comes to getting product?
It feels like the past year especially, you guys don’t get the treatment you deserve from distributors. Product arriving seems to be so slow this past year. MLs arriving several months after TRU and EB Games have sold out.
If this is the new normal, how else can a smaller online stores survive without asking customers to pay up front? I’d imagine preorder cancelations have skyrocketed this past year with product being held up so long by distributors
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Good question, which unfortunately does not have a super clear answer. But I can try to provide some context. Hasbro is definitely one company where there has been a marked shift, so I'll focus on them as an example.
Small companies can not get a direct account with Hasbro. Not only would it be unfeasible from a minimum order perspective, it just isn't an option. If you look into it, they direct you to specific distributors.
About 2-3 years ago there was an un-communicated but obvious change in how Hasbro handles solicitations. It used to be that the distributors could solicit well in advance, which in turn allowed retailers to confidently offer pre-orders.
At a certain point though, Hasbro instituted 'solicit dates', which applied to their direct account holders (which includes said distributors). It just so happens that this solicit date happens to coincide with the large retailers receiving their stock.
I can't say for sure that this was a strongarm tactic by places like Wal-Mart and Target, but it seems like an fair hypothesis. Regardless, it's an unfortunate reality.
To clarify though - I don't think it's the distributors giving us the shaft, I think it's Hasbro de-prioritizing them.
As for the Canadian retailers like TRU and EB Games, it's even less clear. I don't know if they have direct accounts with Hasbro or if they go through a Canadian distributor. I suspect that EB Games might be tied in with GameStop, but TRU may use a Canadian distributor. That, or they get some priority from Hasbro now that there is no TRU in the US.
We actually did use the Canadian distributor for a bit, but the issue with them is that they can't guarantee orders of specific waves. They kind of work in the old generic toy method of 'order a product line and get whatever case pack is available'. They were great when we got a wave early, but they also burned us on a couple of waves.
Using ML as an example, that is definitely part of the reason we have significantly cut back on what we offer and require up front payment. It would happen often that customers with pre-orders would run out to TRU to buy a wave and then dump their preorders. That can still happen, but generally those who are ok with paying up front are generally doing so because they just want to secure an order and not drive around looking for product.
I could make a positive argument that says that it's a good thing that the product are easier to find at retail these days, however it's also still the case that the retail stores may only get a case or 2 and then the product dries up. In Canada, every single product line is a total gamble.
Sorry for the long post. Hopefully there's a bit of useful insight in there. Feel free to ask me questions any time, I'm generally ok with sharing as much info as possible, as long as it isn't confidential or business sensitive.
