SURFLINER posted:rrvics posted:I may be wrong, but I believe that the very large Lionel dealers get their inventory directly from Lionel, while the smaller dealers get their inventory from a large supplier (middleman). It would make sense that the smaller dealers would have higher prices to subsidize the middlemen’s profit.
You got it exactly right!
It's been true for years that, other than a few very large dealers, Lionel dealers have to purchase their inventory from distributors.
I don't know if that's still true, but I assume so. Relatively recently, when I had a defect in an item purchased from a fairly well known dealer (though not one of the very big ones), they had the replacement sent to me directly from a distributor in Pennsylvania.
I'd be surprised if MTH didn't do the same thing. My guess is that the manufacturers aren't set up to manage hundreds of sales accounts; it's more cost-effective to let a distributor (essentually a sub-contractor) handle this. This happens in many industries.
It can get more complicated than than. Just looking at the hobby industry, recently I wanted to purchase an item made by Tamiya, and asked my local hobby shop (a Tamiya dealer) if they would order it for me. I was told that this was not an item that their distributor could get. Product is divided among different distributors - different distributors can get certain items in the product line from the manufacturer for distribution to dealers, but other items they can't.
