I am thinking of opening my own RC car webshop in the UK. It seems like with Arrma, you CAN NOT just have a webshop. what the heck?

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So I've got in touch with the UK Arrma distributor and it said I have to have a physical hobby shop where they come and check and only then I can order some Arrma cars. I've spoken to the official German Horizon Hobby distributor and they said the same, they said about some regulations?
Do you know wtf is this? Like how absolutely impossible they want to make it for someone to make an RC business if they only give you stock if you have a physical shop? we're in 2023 and people do stuff online.
do you know anything about this? It seems like instead of being able to just straight open a webshop to sell stuff, you gotta put in way more money and employ people to start an RC store. I find it ridiculous.
 

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Same in the US. It’s a brand protection measure. You don’t want every wahoo that can pop up a website selling your brand. Plus, they don’t need you selling their products online……they already do that. They do need brick and mortar stores to help customers.
 

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So I've got in touch with the UK Arrma distributor and it said I have to have a physical hobby shop where they come and check and only then I can order some Arrma cars. I've spoken to the official German Horizon Hobby distributor and they said the same, they said about some regulations?
Do you know wtf is this? Like how absolutely impossible they want to make it for someone to make an RC business if they only give you stock if you have a physical shop? we're in 2023 and people do stuff online.
do you know anything about this? It seems like instead of being able to just straight open a webshop to sell stuff, you gotta put in way more money and employ people to start an RC store. I find it ridiculous.

horizon is protecting their brand, they don't want thousands of dealers.
 

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Could be worse Horizon could make Arrma like Ecx and only allow sales from a hobby shop, the only place you can find their cars online is eBay. And parts are only available online directly from Horizon or on eBay.
 

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No idea, but do your market research.
I have yet to see any RC store that isn't struggling. Can't imagine it's different in the UK.
Yes, there is a high demand right now, but think 2 years into the future. You are not going into that business to make loads of money and if you are your own best customer you will fail quickly.

Good luck, else try ebay.
 

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So I've got in touch with the UK Arrma distributor and it said I have to have a physical hobby shop where they come and check and only then I can order some Arrma cars. I've spoken to the official German Horizon Hobby distributor and they said the same, they said about some regulations?
Do you know wtf is this? Like how absolutely impossible they want to make it for someone to make an RC business if they only give you stock if you have a physical shop? we're in 2023 and people do stuff online.
do you know anything about this? It seems like instead of being able to just straight open a webshop to sell stuff, you gotta put in way more money and employ people to start an RC store. I find it ridiculous.

For Established Branded companies ,they see webstores that pop up WITHOUT a physical Brick&Mortar shop to back it up as "possibly" shady..

Look at it from their business point of view..
If you were them would you send a pallet full (let alone a box) of your products & parts to a online shop that you Can Not Verify or by sending a trusted representative to visit and look around?



I suppose the other simple way you can get around that (physical shop) requirement is to develop your own "brand name by becoming Well Known", like Kevin Talbot , Raz Shifrin , Rich Duperbash etc.

Then they will be More than willing to knock on your door and send products & parts to.
So, that's definitely an option for you. 💪😎👍

**********

No one here on AF will trample on your dreams.
IF you really want to open up a online store, I'm sure we all will support you in your endeavors.
More power to you!
 
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Wonder if its anything to do with counterfeit goods?
I think it would be extremely difficult to make counterfeit Arrma products. they could then either just make their own version of RC cars and sell cheaper but more ? I might be wrong here.
I just thought if I'd say I want to make a webshop where I sell a brands items, they would be more than happy to allow me so I create them new money, new ads etc. I might be super naive here tho :D

Same in the US. It’s a brand protection measure. You don’t want every wahoo that can pop up a website selling your brand. Plus, they don’t need you selling their products online……they already do that. They do need brick and mortar stores to help customers.
Weird, because they actually answered. there was a rather big store that is only online here in the UK (rcgeeks) and I called them out on it and they actually said they stopped serving them because they closed their in person store o_O

No idea, but do your market research.
I have yet to see any RC store that isn't struggling. Can't imagine it's different in the UK.
Yes, there is a high demand right now, but think 2 years into the future. You are not going into that business to make loads of money and if you are your own best customer you will fail quickly.

Good luck, else try ebay.
I don't understand your argument, because you're trying to protect me rather than talking about why they are doing this. I mean no offence btw, just my thoughts. I mean if I will struggle, that's my problem. Arrma selling 2 extra cars to my small business, that's all they care about I thought :D

For Established Branded companies ,they see webstores that pop up WITHOUT a physical Brick&Mortar shop to back it up as "possibly" shady..

Look at it from their business point of view..
If you were them would you send a pallet full (let alone a box) of your products & parts to a online shop that you Can Not Verify or by sending a trusted representative to visit and look around?



I suppose the other simple way you can get around that (physical shop) requirement is to develop your own "brand name by becoming Well Known", like Kevin Talbot , Raz Shifrin , Rich Duperbash etc.

Then they will be More than willing to knock on your door and send products & parts to.
So, that's definitely an option for you. 💪😎👍

**********

No one here on AF will trample on your dreams.
IF you really want to open up a online store, I'm sure we all will support you in your endeavors.
More power to you!
that makes sense thank you. so what they want is to only allow shops who would actually help customers with the RC cars, not just sell them. that makes sense. I was naive thinking its only good for Arrma if someone else comes in to sell their products, thats why my wonderings.
the pallet example is not right, the way I approach money right now, I would only buy stock what I can pay right now, then work with the profit. Perhaps this is a naive approach too.
I don't see myself becoming Kevin Talbot, however Raz, Tomley or Rich is not necessarily hard. if you watch the most viewed videos of some particular youtubers and their videos in general, you can see a pattern and understand why they are successful. I see super interesting and useful content from youtubers who are maintaining their dirty cars in a dirty garage and they wonder why they stopped at 30-40k subscribers 🤷‍♂️
btw, are Kevin, Raz and Rich selling Arrma cars? or why do you say that?
Another question to @all? what is the deal with businesses like Jennysrc ? they cannot buy from Arrma? they gotta buy from shops with full price? cuz they don't have a physical shop nor they sell cars actually.
 

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So I've got in touch with the UK Arrma distributor and it said I have to have a physical hobby shop where they come and check and only then I can order some Arrma cars. I've spoken to the official German Horizon Hobby distributor and they said the same, they said about some regulations?
Do you know wtf is this? Like how absolutely impossible they want to make it for someone to make an RC business if they only give you stock if you have a physical shop? we're in 2023 and people do stuff online.
do you know anything about this? It seems like instead of being able to just straight open a webshop to sell stuff, you gotta put in way more money and employ people to start an RC store. I find it ridiculous.
There is a minimum order too, surprised they didn't tell you that. Pretty sure you need to order 5 figures worth of stock on top of a brick and mortar. The value changes. But I think it was in the $50k range USD recently.
 
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There is a minimum order too, surprised they didn't tell you that. Pretty sure you need to order 5 figures worth of stock on top of a brick and mortar. The value changes. But I think it was in the $50k range USD recently.
That'd make sense. Any idea how the distributing prices look like for cars and parts? How much I can buy them for? I am trying to calculate margins and if it would worth actually going for opening a small shop and just starting w Arrma +Traxxas cars and parts.
 

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...

that makes sense thank you. so what they want is to only allow shops who would actually help customers with the RC cars, not just sell them. that makes sense. I was naive thinking its only good for Arrma if someone else comes in to sell their products, thats why my wonderings.
the pallet example is not right, the way I approach money right now, I would only buy stock what I can pay right now, then work with the profit. Perhaps this is a naive approach too.
I don't see myself becoming Kevin Talbot, however Raz, Tomley or Rich is not necessarily hard. if you watch the most viewed videos of some particular youtubers and their videos in general, you can see a pattern and understand why they are successful. I see super interesting and useful content from youtubers who are maintaining their dirty cars in a dirty garage and they wonder why they stopped at 30-40k subscribers 🤷‍♂️
btw, are Kevin, Raz and Rich selling Arrma cars? or why do you say that?
Another question to @all? what is the deal with businesses like Jennysrc ? they cannot buy from Arrma? they gotta buy from shops with full price? cuz they don't have a physical shop nor they sell cars actually.

Depends on who you ask within the company..
The PR folks will say , Yes! it's all about maintaining good customer service and Brand loyalty..
The bean counters will tell the company CEO, we are squeezing maximizing as much margin/profit out of our authorized dealers/sellers...

Basically
You'll have to understand Franchising or the process of becoming an Authorized Dealer..

In a nutshell, both process requires you to-
1. Provide proof of business -establishment and overall 'atmosphere' of a certain level- that you can sustain Long term [think something as simple as a coffee cafe' (Starbucks), clothing shop(Victoria's Secret), or even a shoe store (Nike), etc etc]

2. You will need to "maintain" a certain amount of inventory [BOTH in Products ,ie different model lineup or categories AND their supporting Replacement parts.] That's how these OEM Brand manufacturers make their money through their franchisees.
You MUST pre-purchase/commit to a certain amount of parts, ie: HobbyTown here in the USA must have $250,000 (I'm not BS-ing or making that number up.) in parts inventory. I'm not sure if that's per store or if you can spread that out between several stores..

3. You need to sign a contract to maintain some sort of sells quota.. per month / quarterly / annually...

Those are the main bullet points.. There's a lot more to it but you get the idea.



**********************

Kit Breakers like Jenny's are in a grey area of the sells chain.
If you become a kit breaker online shop, then YOU will have to provide support to Your customers, ie: replace DOA ESCs, Brushless Motors, Diffs etc etc.

Because they certainly don't offer Official Arrma Warranties or can they call up Arrma Corporate and have them provide support to Jenny's customers etc.? I believe not.
 
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Depends on who you ask within the company..
The PR folks will say , Yes! it's all about maintaining good customer service and Brand loyalty..
The bean counters will tell the company CEO, we are squeezing maximizing as much margin/profit out of our authorized dealers/sellers...

Basically
You'll have to understand Franchising or the process of becoming an Authorized Dealer..

In a nutshell, both process requires you to-
1. Provide proof of business -establishment and overall 'atmosphere' of a certain level- that you can sustain Long term [think something as simple as a coffee cafe' (Starbucks), clothing shop(Victoria's Secret), or even a shoe store (Nike), etc etc]

2. You will need to "maintain" a certain amount of inventory [BOTH in Products ,ie different model lineup or categories AND their supporting Replacement parts.] That's how these OEM Brand manufacturers make their money through their franchisees.
You MUST pre-purchase/commit to a certain amount of parts, ie: HobbyTown here in the USA must have $250,000 in parts inventory. I'm not sure if that's per store or if you can spread that out between several stores..

3. You need to sign a contract to maintain some sort of sells quota.. per month / quarterly / annually...

Those are the main bullet points.. There's a lot more to it but you get the idea.
Thanks for the info!! Im definitely not into the 250k usd game yet. What about what Jennysrc does? They are selling Arrma parts but they re not really official? Is that legal? I mean I guess it is cuz they do it for ~20years
 

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Hobby shops here in the US are struggling: a lot of them have closed in the past year or so, and some of them have been in business for over 25 years.

My local RC shop is a Traxxas Premium Dealer and an Arrma dealer. One of the reasons they stay open is their outdoor and indoor RC tracks, which are a source of revenue. Another reason is that they are one of the few remaining RC shops after the others have closed.
Thanks for the info!! Im definitely not into the 250k usd game yet. What about what Jennysrc does? They are selling Arrma parts but they re not really official? Is that legal? I mean I guess it is cuz they do it for ~20years
Jenny's RC buys new vehicles, breaks them down into parts, and sells the parts. There is no warranty on Jenny's parts (other than DOA electronics), so they don't have to be an authorized dealer.
 
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Hobby shops here in the US are struggling: a lot of them have closed in the past year or so, and some of them have been in business for over 25 years.

My local RC shop is a Traxxas Premium Dealer and an Arrma dealer. One of the reasons they stay open is their outdoor and indoor RC tracks, which are a source of revenue. Another reason is that they are one of the few remaining RC shops after the others have closed.

Jenny's RC buys new vehicles, breaks them down into parts, and sells the parts. There is no warranty on Jenny's parts (other than DOA electronics), so they don't have to be an authorized dealer.
Thanks! I believe loads close down then what remains will be busy. My local hobbystore is trash for this very reason. They re so busy that many times I drive down 40 minutes to them just to wait in the queue 30min then leave, because they're so busy I just cant wait for them.

Good to know the Jennys model and afterparts business is at least free go. I see Hot Racing has tons of sales too based on ebay and Amazon ratings. Why is that btw? It would not worth putting patent on 3-400 parts for 3-400million?
 

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That'd make sense. Any idea how the distributing prices look like for cars and parts? How much I can buy them for? I am trying to calculate margins and if it would worth actually going for opening a small shop and just starting w Arrma +Traxxas cars and parts.
That's the other problem. These companies know this is a labor of love (almost a hobby business) and the margins are among the lowest around.

You can expect gross margins in the 20% range and even as low as 10% margin is not unheard of for some things like kits.

No one is making a killing in RC except the guys at the very top of the largest companies.
 
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That's the other problem. These companies know this is a labor of love (almost a hobby business) and the margins are among the lowest around.

You can expect gross margins in the 20% range and even as low as 10% margin is not unheard of for some things like kits.

No one is making a killing in RC except the guys at the very top of the largest companies.
wtf, that is insane. It would almost worth me buying Arrma cars for shop price and still trying to sell them for a profit, lol!

so the biggest business can be for small people like me to just make aftermarket parts so we can make 2-300% margins on our 100-200(max) scale sales. jeeez
im pretty sure to be frank that the FTX cars are made for like £30 and are sold for £60-70 brushed and £105-110 brushless.
 

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wtf, that is insane. It would almost worth me buying Arrma cars for shop price and still trying to sell them for a profit, lol!

so the biggest business can be for small people like me to just make aftermarket parts so we can make 2-300% margins on our 100-200(max) scale sales. jeeez
im pretty sure to be frank that the FTX cars are made for like £30 and are sold for £60-70 brushed and £105-110 brushless.
Yeah that's why it's a big ask for a discount from a hobby shop (sponsorship) because that means they essential make nothing off you.

Most of those discounts are factory rebates. 30% off on a kit is a steal of a deal
 

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Hobby shops here in the US are struggling: a lot of them have closed in the past year or so, and some of them have been in business for over 25 years.

My local RC shop is a Traxxas Premium Dealer and an Arrma dealer. One of the reasons they stay open is their outdoor and indoor RC tracks, which are a source of revenue. Another reason is that they are one of the few remaining RC shops after the others have closed.

Jenny's RC buys new vehicles, breaks them down into parts, and sells the parts. There is no warranty on Jenny's parts (other than DOA electronics), so they don't have to be an authorized dealer.
But how do they get wholesale prices on Arrma/horizon/Traxxas cars?? :unsure:
 
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