How's your Fly Shop doing?

Discussion in 'Fly Fishing Forum' started by Steelie Mike, Nov 18, 2009.

  1. Flyborg

    Flyborg Active Member

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    Gotcha.

    That's not something that will ever change though. Vendors scale their margins to provide incentive for shops to order more.
     
  2. Mike

    Mike Active Member

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    Couple of issues here:

    Cabela’s is not the only seller of the Sage XP. Check out the Anglers Pro site. They have a wider selection than Cabela’s. There is some type of story here but I’m not sure how it goes.

    Also retailers that buy larger quantities from the manufactures do get deeper discounts and incentives. That is fair and legal. But those retailers also need to spend their money up front which ties up cash flow. They buy rods, reels and soft goods in January that aren’t sold until May and sometimes not until they are discontinued and put in the legitimate discount bin. So risk, the cost of money and inventory carrying costs take away some of the that discount.

    The decline of the fly fishing retailer is due to all the factors mentioned in this tread.
    • Stagnant market size
    • The economy – people not spending as much if at all
    • The cost to keep up inventory
    • Cost of lost sales due to low inventory
    • Internet competition and the free shipping subsidy (at 10% sales tax WA is a real loser)
    • People taking advantage of a shops inventory to check out stuff and then buying it cheaper on line
    • Low balling retailers (Ebay and bundling products) which until recently manufacturers failed to address
    • Changing demographics - aging and saturated customer base
    • Much more accessible used equipment market - Look at the Classified section on this site, it is very active. Not just “want to sell” but also “want to buy”
    • Small business management skills
    • Dried up capital (loans) to small business
    • Slow time of year for product sales
    The market will shake out, but to do the see and touch, some us may have to drive further. Then the cycle will start again, just not sure which direction.

    If you like your local fly shop and feel that you are getting value in either service or product, the best thing you can do is buy stuff there. Without customers walking in, some of the shops as we know them won’t survive.
     
  3. martyg

    martyg Active Member

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    Mike - how do you figure that the large retailers "spend their money up front"? Do you sell to / produce for any of those large retailers?
     
  4. pmjasper

    pmjasper Member

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    If there is any doubt, I just wanted to apologize to Marty for my response to his initial post. I do not doubt his experience in the business, nor did I want to come across as he was being untruthful or misinformed. I may have used my terminology incorrectly or gave the preception that one case is the standard throughout the business. Again, that may or may not be the case but the one thing I can say with certainty is that for my buddy in NJ, and his dealings with Penn Fishing Tackle, this was the case.

    Thanks all.
     
  5. Mike

    Mike Active Member

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    I was in Purchasing and Materials Management for over 20 years.

    Mike
     
  6. martyg

    martyg Active Member

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    Then you know that many of the big guys go NET 60 - even on FOB goods (from the time that it lands in their DC, and not when it x-factories) - and that NET 60 really means more like NET 90.
     
  7. Steve Saville

    Steve Saville Active Member

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    Large retailers do not buy up front. They run large "accounts payable" balances just like other businesses. I kinda wanted to stay away from this because I shop at all kinds of places for the items I need to participate in my flyfishing hobby. I support my local flyshop but they don't always have what I want. I have supported Wholesale Sports on occasion but they rarely have what I want. I go to Cabela's and look/sometimes buy depending on what I'm looking for. I eat lunch there on occasion which I cannot get at my local shop. All of the rods and reels, lines, books, etc. are basically the same price. The question, I believe, surrounded the demise of some of our best shops, including The Morning Hatch. It was a travety to see it go by the wayside but businesses fail from time to time. That's the nature of capitalism. Flyshops are not in a cutthroat business like Walmart and Kmart but then you can't buy a decent flyrod in either place. The economy has a good deal to do with it but some shops continue to thrive by offering trips, closeouts, lessons, etc. Others do not because of location or lack of quality service. Part of the issue is also the competion by suppliers such as Sage, Ross, Abel, etc. To keep their business going profitably, they have to continue to build the better mouse trap or fish trap in this case. We as flyfisher have to amke a choice as to what and where to buy the items we want. Buyingon line is sometimes cheaper but not always and you can't touch or feel what you're getting or insure the quality of what you bought is what is acceptable. It's a big game called capitalism. It's what our country was founded on and it will continue to as such, at least for the forseeable future. You have to make up your mind as to what part of the big picture you want to be in and then go for. Grousing about it isn't going to change a thing.
     
  8. bigfun4me

    bigfun4me Team Infidel

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    Pmjasper, I was the Penn rep in the NW for seven years and I'm going to have to stand behind MartyG on this one. There are programs available to keep the small retailer competitive.
     
  9. Flyborg

    Flyborg Active Member

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    Yep. They pay when they want to, and if you don't like it, deal. Meanwhile, if you ship something incorrectly or fail to follow one of their guidelines in their 200+ page shipping manuals, you get fined.
     
  10. fishin jimmy

    fishin jimmy New Member

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    So I'm in New England - its tough here as well. Been a member of the 10% club - unemployed for past 6 months. I go to several local shops & avoid the big box stores - cannot ever find what I want, or need in them. In 3 fly fishing clubs.
    - I see Charlie Shadan at Evening Sun Fly Shop, Pepperell, MA tonight to pick up about $100 of stock for a TU club meeting raffle next week. I always announce at the TU meeting what shop was supportive prior to the raffles & where they're located. I'll spend my own money there also, its such an addiction.
    - I go to Stone River Outfitters, Manchester, NH for exotic materials, mostly talk with Nate Harris for saltwater, or Dan Fitgerald for salmon/trout.
    - W.S. Hunter for spey stuff - Mike is the man. Only shop around who does spey equipment & classes.
    Yea, I go on line - but mostly buy from dealers who are at out of area shops.
    - The clerks at Cabelas, and their ilk know squat about flytying or equipment. Talk spey & they just look at you...in disbelief.
    - Charlie, Nate, & Mike know where to fish, can recommend what to use & are all ok guys as well. I'm told the flytying material sales have taken off. Shops hold flytying & fishing classes, bring in the converts - even our local library is holding seminars & classes. However, I do not see "gold" necks, or many $700 rods being sold.
     
  11. Be Jofus G

    Be Jofus G Banned or Parked

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    Strange, I went to the Cabelas in West Virginia and the guy in the fly section really knew his shit. So did the guy in the hunting and archery section. :confused: Sounds like that store has a much better manager than the one in lacey. If you can't find someone in Washington to hire with extensive flyfishing experience, you're probably a pretty krappy manager. It's not Cabelas fault, well, other than keeping a bad manager around.
     
  12. pmjasper

    pmjasper Member

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    I think what this thread has shown more than anything is that there is no one specific reason for fly shops going under.

    Obviously, a good majority of us are undergoing some "interesting" financial times and now more than ever we have to stretch our dollar. In the end, it's your overall decision on where you shop. I would only say that if you value the service provided by your local "mom and pop" shops over the bigger box stores, then at least occasionally, you should try to spent a few dollars in their establishment.

    Best wishes to all and hopefully you guys can get out this weekend and get a few fish.
     
  13. Split Bamboo

    Split Bamboo Member

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    In my 'perfect' world the local fly shop would be thriving, along with the local hardware store where the oldtimer remembers the project you were working on last year. The local baker makes your favorite bread daily, and the butcher will trim your favorite cut of meat as needed. Add in the independent bookstore, electronics dealer and appliance dealer.

    Things change and 'progress' is not always warm and fuzzy. I have always looked at an economic downturn in a Darwinian sense, like a cold winter. It is harsh and the weak often die a slow painful death. But the strong will survive. In most cases there will always be room for the well managed boutique retailer. Best of luck to everyone out there fighting to survive!
     
  14. lylelovett666

    lylelovett666 Active Member

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    I'm not one to go into a shop,ask advice and the leave without making a purchase.This is almost always a fly purchase based on what I'm told is the hot bug.usually around $10 for four flies.Funny thing is I get the exact same flies off of the net for about .55 a piece.This it seems to me is yet another example of prices getting way out of hand and turning another purchase to the net.spend $10 and get 4 flies or spend $10 and get 17.All shops seem to plod on with these prices for gear as if the internet doesn't exist.
     
  15. dennysmith

    dennysmith New Member

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    does anyone here know how anything really works? whether it be in the fishing industry or in any other industry. you guys act like because we are speaking to a hobby that business should be run differently.

    in almost any mfg to wholesaler/retailer and wholesaler to retailer relationship, pricing is based upon volume (dollars or units)-whether you are a flyshop buying rods, a grocer buying produce, a coffee company buying beans or best buy buying electronics. it is just the way it is.

    hell. go to your local coffee stand. get a punch card. that free coffee you get after x-many purchased is your volume discount.

    volume always wins.

    msrp is there to protect the small retailer/specialty shop. if there was no msrp, big box and the biggest of specialty would step in and begin discounting. its always the big guys pushing the msrp envelope. and they can get away with it as it applies to their income statement because volume always win. as long as what they are selling their merchandise for is greater than what they are paying for it, they run a gross profit. sheer volume will allow them to run a net profit. smaller retailers can not afford to have their margins squeezed anymore because the volume will never materialize...and they will always be undercut by the big boys.

    there are plenty of smaller retailers/specialty shops that are doing really well...because they are managed well. will they make millions? no. never. the volume is not there.
     
  16. NomDeTrout

    NomDeTrout Fly Guy Eat Pie

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    that my friend is typical boutique upselling and i don't blame them. alot of small stores know if you come in to get reel spooled up or to buy a reel and rod or something, you'll also likely buy an assortment of flies based on their advice.

    scenario:
    you walk into a fly shop early morning before you head out to the water to new line. you ask them "hey so whats been bitin over at blahblah river?"
    guy at counter walks over and shows you an assortment of flies and says you'll be good with these. You end up walking out of there with 10$ worth of flies.

    Is this good service or typical upsell? who knows. I give them the benefit of the doubt and say they're genuinely helping me out and i'm genuinely buying it because I want to help the local shops out.
     
  17. NomDeTrout

    NomDeTrout Fly Guy Eat Pie

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    thanks for the breakdown on the basics of how a business is run...i don't speak for everyone here but i think most people know how it works...
    not sure if your intentions was to sound condescending but many people on this forum not only does this as a hobby but also run businesses of their own in the fishing/fly fishing industry and many others as well.
    but despite what you think, yes there are plenty of smaller retailers that are doing well...the problem is the one that is NOT doing well, not because of bad management but because of the condition of the economy and the market.
     
  18. Flyborg

    Flyborg Active Member

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    The box stores do discount, regularly, and no manufacturer has the nuts to tell them not to. That's why the MSRP is a joke. It does nothing to protect the little guys, and it keeps them from being able to effectively manage their inventory.
     
  19. NomDeTrout

    NomDeTrout Fly Guy Eat Pie

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    correct. and if you think alot of major stores actually follow MSRP, you're batshit crazy.
    at the end of the day, the manufacturer could give a rats ass about how much you discount your products as long as they're getting their share which is the cost price stores pay them.
     
  20. lylelovett666

    lylelovett666 Active Member

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    Just did the math on what I've saved buying my fly rods off the net.When you put together discounts,lack of sales tax and freebies like free line, for five rods it comes out to close to $400.That's hard to argue with.
     

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