Quote from: Rabbitaway on August 11, 2019, 10:46:36 PM
As I have expressed in other responses Buchmann would appear to wish to apply restrictions in their T&Cs that are somewhat draconian based on their market position and constrict competition. This may be within legal laws but is not allowing competion in the market to operate naturally, Hattons are to be commended in pushing back on this and hopefully this should that create better pricing and more choice for us as customers

I am not aware that the nature of the dispute was about discounting, and while never disclosed by either party it is understood to be more to do with Hattons taking on the mantle of manufacturer and wholesaler in direct competition in breach of T&Cs of supply, the 66 in 00 especially being something of a red rag to a bull..

Quote from: Rabbitaway on August 11, 2019, 10:46:36 PM
As I have expressed in other responses Buchmann would appear to wish to apply restrictions in their T&Cs that are somewhat draconian based on their market position and constrict competition. This may be within legal laws but is not allowing competion in the market to operate naturally, Hattons are to be commended in pushing back on this and hopefully this should that create better pricing and more choice for us as customers

Arguably, BAchmann's T&Cs promote competition (among retailers) to an extent by stopping the big boxshifters squeezing the little local model shops out of the market. In this case by hindering one entity becoming both the dominant retailer and manufacturer, and in the case of the limitation on discounting in the first 90 day (perfectly legal btw as it is time-limited and applied equally to all retailers) by preventing big players using loss-leaders to gain market share and promoting competition on terms other than price such as customer service, and after-care...

I'm always amused on threads like this where there are suggestions that these large multinational companies are operating totally illegally.

Again we also have no idea whether Hatton's have "pushed back" or anything of that ilk. They're not going to throw away the sunk costs of their 66, but the length of time it's been going on suggests that neither company wanted this to be the solution. Neither company wins.

Quote from: njee20 on August 12, 2019, 07:58:39 AM

They're not going to throw away the sunk costs of their 66 ...

Hattons aren't going to toss away a steady stream of income from selling Bachmann products, just because of the sunk costs on one model. In the end it must have been a financial calculation for them. That's what makes it so intriguing.

Let's hope they produce more models in N. Who knows, it might even be the start of a new golden age! 

If they're £100k in on the 66 (which doesn't seem implausible) they need to sell a lot of Bachmann products to recoup that, and they'll know about pre-orders of the 66 which will compound that. Obviously it will have been a financial calculation, but I don't share the sentiment of others that Hatton's are "sticking it to the man" by not throwing away their existing portfolio, and that this is indicative that we'll see a Bachmann-rivalling range from them in due course.

Hello all,

My understanding is that this is less about the 66 (though I am sure that will have irritated the management at Barwell) and more about Hattons supplying their Hattons-brand models - Warwell, RHTT, container flats, 66, Beyer-Garrett etc - to other retailers, thereby becoming a direct competitor to Bachmann.

I believe that it is very clearly stated in their T&Cs that they do not supply competitors. 

Other retailers who commission models, such as Kernow and Trains4U, have not fallen foul of this policy because they sell the models exclusively.

Among big corporations I suspect it's commonplace - it just raises eyebrows in the usually genteel world of model trains!

cheers

Ben A.

The question there is when are they a competitor? Gaugemaster manufacture plenty of things which are retailed through other shops, but not items that are in direct competition with Bachmann. It's a blurry line.

Arguably products like the RHTT/FEA etc are good news for Bachmann, as people will want 66s to haul them. Not so much now...

It's hard to believe that sales of Hattons' own products to other retailers, either now or in the future, would outweigh their loss of Bachmann revenue.

And potentially their own products to end customers, we don't know the exact terms of Bachmann's objections.

Presumably, Bachmann made a policy decision years (if not decades) ago about supplying stock to potential customers whom they regarded as potential or actual competitors.  If so, this would have been done on the basis of projected or potential gains and losses, not just involving one customer but (again, potentially) any & all customers.  It will be a commercial secret as to what further calculations they may have undertaken in the case of Hattons. 
The question that now arises is, what will Hattons do about their likely loss of market penetration, turnover and profit?  Their turnover will undoubtedly decrease, but their fixed overheads (such as rent/mortgage interest, utilities and depreciation) will not.  There are other overheads which may or may not decrease, e.g. wages, if overtime payments change or staff are laid off.  Still others will reduce, e.g. packaging, postage & courier charges. 
If nothing else changes, this leaves Hattons with a problem - do they increase the margin on their sales by reducing the discount they allow customers or do they take the hit completely in their profit after tax, or even in the form of losses reducing reserves?  None of us is in a position to say what this will be.  One thing they must examine, however, is the room for manoeuvre (if any) they have with Bachmann if they change tack with their own products, though they may feel that knuckling under to their supplier's pressure may be impossible to swallow.  This will have to be looked at in the light of their long-term view of the retailer as a producer in the market place as it continues to change and develop.
I await developments with interest.

SheldonC states "None of us is in a position to say....."

How right Sheldon is. So many experts within this thread (some of them writing repeated volumes) seem to know everything but it all seems to be guess work. Maybe we should follow something else from Sheldon "...await developments with interest" rather than pretend to be knowledgeable.

It will not be long before either boredom sets in or some facts become known.

Of course, but people have been speculating for a year. So much discussion on here (and forums the world over) is based on speculation, opinion etc.

If you aren't interested then skip past the thread, I think it's a very interesting dynamic. When there's nothing left to say it'll naturally peter out and die a death, like all the DJM threads did.

Or someone can lock it.

This dispute has been going on for some time, certainly all this year . Hattons would have been able to back down many months ago and presumably carry on as they were. I do know that legal people became involved at some point earlier this year which would of course have made any amicable settlement more difficult. They have however made a business decision to carry on with their plan with full knowledge of Bachmann's position . I think they have made a brave but high risk decision. I wish them all the best.

Gibb's rule 13 

Quote from: class37025 on August 12, 2019, 06:22:40 PM
Gibb's rule 13 

True indeed.....