Mike 1017 Posted January 31, 2016 Posted January 31, 2016 Has anyone seen the prices of petroleum based products gone down? I have not. I was at Hobby Lobby Saturday and the price of kits were just under $28.00. At some point I would think that we should see kits, paint, and glue prices coming down based on cheap oil.Mike
Ace-Garageguy Posted January 31, 2016 Posted January 31, 2016 I dunno. Look around, and you'll mostly see commodity price rises reflected in consumer products, but these days, a commodity price reduction rarely makes it to the consumer. It simply means more profit, and nobody is giving up profit.
Harry P. Posted January 31, 2016 Posted January 31, 2016 Are you serious?Once a manufacturer has his customers used to a certain price, you actually think they would reduce the price when their costs go down? No way! They just make more profit.
Daddyfink Posted January 31, 2016 Posted January 31, 2016 I remember buying a kit, an F-14 Tomcat to be exact, at my local hobby shop when I was a kid and I noticed the price was a bit more than usual. i asked the owner why and he said Oil. This was during the gas crunch of 1979. He said that it should drop again, but, don't expect kit prices to drop. He said the model companies weren't going to sell them any cheaper to him. Thus, i learned about model economics right there and then! It would be nice, but it is not going to happen
Art Anderson Posted January 31, 2016 Posted January 31, 2016 Well, the cost of oil is but a portion of the cost of manufacturing styrene plastic, and the cost of styrene used in the molding of model kits folks. It's pretty much the same with the price of those little glass bottles that Testors uses to package paint in--oil is only a portion of the feedstock for that enamel--in fact the single biggest cost there is the glass bottle.Art
lordairgtar Posted January 31, 2016 Posted January 31, 2016 Indeed Art, when you figure in design, packaging, manufacturing...the styrene's content of petro product cost is quite miniscule. When oil comes down, other factors do not.
Draggon Posted January 31, 2016 Posted January 31, 2016 Are you serious?Once a manufacturer has his customers used to a certain price, you actually think they would reduce the price when their costs go down? No way! They just make more profit.All one has to do is go to the grocery store. When gas went close to $5 a gallon, the store I frequent blamed their 200% or greater price increases on fuel costs. Prices haven't gone down since.
Lunajammer Posted January 31, 2016 Posted January 31, 2016 Furthermore, when gas prices rise again, they will raise their prices saying citing oil as the reason and will maintain their current windfall (cynically speaking, of course.)
Ace-Garageguy Posted January 31, 2016 Posted January 31, 2016 It's pretty much the same with the price of those little glass bottles that Testors uses to package paint in--oil is only a portion of the feedstock for that enamel--in fact the single biggest cost there is the glass bottle.Yeah, kinda like Coke. The contents of the can are essentially worthless, but you're paying for the can, marketing, distribution, etc.
Ace-Garageguy Posted January 31, 2016 Posted January 31, 2016 Furthermore, when gas prices rise again, they will raise their prices saying citing oil as the reason and will maintain their current windfall (cynically speaking, of course.) If you're old enough, you just MAY remember a business marketing ploy that advertised "we pass the savings on to the customer". It had more to do with buying raw materials in large volume than to the fluctuations of the cost of commodity items, but it sounded nice. Today's marketing strategy consists of concepts like "NEW PACKAGE !!! SAME GREAT PRODUCT!!!"...but when you do the numbers, you see you're getting LESS in a SMALLER package for MORE money.
MrObsessive Posted January 31, 2016 Posted January 31, 2016 (edited) Today's marketing strategy consists of concepts like "NEW PACKAGE !!! SAME GREAT PRODUCT!!!"...but when you do the numbers, you see you're getting LESS in a SMALLER package for MORE money. Bill, I look no further than the grocery store and what's in the bakery aisle. Take a look at the size of donuts lately......I swear those things are bite size as they indeed have SHRUNK in the last coupla three years. Yet the price has stayed the same............about 65¢ per donut in my local grocery store. I'm not a donut eater except for the occasional cheat day treat, but I couldn't help notice how dreadfully small they've gotten over the last number of years. Edited January 31, 2016 by MrObsessive
SfanGoch Posted January 31, 2016 Posted January 31, 2016 Bill, I look no further than the grocery store and what's in the bakery aisle. Take a look at the size of donuts lately......I swear those things are bite size as they indeed have SHRUNK in the last coupla three years. Yet the price has stayed the same............about 65¢ per donut in my local grocery store. I'm not a donut eater except for the occasional cheat day treat, but I couldn't help how dreadfully small they've gotten over the last number of years. Man, we think alike. That's the first thing I check. Entenmann's have shrunk in size ever since Bimbo Bakeries (what a great name!) bought the operation. When It comes to donuts, every day is a cheat day for me and my kid. We get our fix at Moe's Doughs. He make the best Red Velvet Volcanoes and Maple Bacon (two of the most important food groups) doughnuts.
MrObsessive Posted January 31, 2016 Posted January 31, 2016 He make the best Red Velvet Volcanoes and Maple Bacon (two of the most important food groups) doughnuts. Maple Bacon?? I gotta try that sometime, but they're not around here! I just checked out his Facebook Page and ooooooh do those look good! But when you're 330 lbs. like I once was, donuts are off limits for me! They can be just too addictive!
Rob Hall Posted January 31, 2016 Posted January 31, 2016 Mmmm...maple bacon donuts...sounds tasty...I think one of the local specialty donut shops has something like that. Regarding the oil price changes, I wonder if it is lower in China, presumably where the raw styrene is made...
Harry P. Posted January 31, 2016 Posted January 31, 2016 Oil is a worldwide commodity, price is set internationally, so buyers all pay about the same price per barrel. Unless you're one of the major producers of oil, in which case it's dirt cheap. I've never heard that China has any significant oil reserves, so I assume they pay about the same for it as we do.
Art Anderson Posted January 31, 2016 Posted January 31, 2016 Indeed Art, when you figure in design, packaging, manufacturing...the styrene's content of petro product cost is quite miniscule. When oil comes down, other factors do not.Exactly. With inflation, not everything goes up in price of course, and those things that do don't all go up at the same rate. It's the same with deflation (drop in prices), as not everything can, or will go down in price, and certainly those that drop don't necessarily go down at the same rate as well.With a model kit, tooling is by far and away the biggest single check any manufacturer writes, and that money simply has to be replenished back into the "kitty" so as to be there to fund the tooling for the next kit, so right there is a cost that simply has to be recovered in order to move forward. Tooling costs and certainly manufacturing costs don't drop due to the decline in oil prices, in fact they are still rising. Art
Harry P. Posted January 31, 2016 Posted January 31, 2016 Today's marketing strategy consists of concepts like "NEW PACKAGE !!! SAME GREAT PRODUCT!!!"...but when you do the numbers, you see you're getting LESS in a SMALLER package for MORE money. I'm one of those shoppers who actually reads labels. I can attest to the fact that product sizes are shrinking. It's the dirty little secret of food producers/manufacturers. A one-pound can of coffee is now 14-15 ounces. Same size can... just less coffee in it. They do this to almost all packaged foods.
Snake45 Posted February 1, 2016 Posted February 1, 2016 Gas prices have risen and fallen between $2 (or even less) and $4 (or more) over the last decade or so.Has Testor EVER reduced the price of their paints? No. But when gas prices go up again, they'll raise the paint price AGAIN.
Miatatom Posted February 1, 2016 Posted February 1, 2016 BTW, if you buy models at Hobby Lobby, be sure to go online and sign up for their newsletter which includes a 40% off coupon every week.
Harry P. Posted February 1, 2016 Posted February 1, 2016 You don't even need to sign up for the newsletter. Just go to their website and print out the coupon any time. Or if you have the app on your smartphone, even easier.
Art Anderson Posted February 1, 2016 Posted February 1, 2016 Gas prices have risen and fallen between $2 (or even less) and $4 (or more) over the last decade or so.Has Testor EVER reduced the price of their paints? No. But when gas prices go up again, they'll raise the paint price AGAIN.FWIW, the most expensive part of the price of a bottle of paint (if a glass bottle) is the bottle itself, and the makeup of a glass bottle does not include petroleum.Art
ChrisBcritter Posted February 1, 2016 Posted February 1, 2016 Today's marketing strategy consists of concepts like "NEW PACKAGE !!! SAME GREAT PRODUCT!!!"...but when you do the numbers, you see you're getting LESS in a SMALLER package for MORE money. Today? MAD Magazine was hitting that issue over 50 years ago. The more things change...
retired & glad Posted February 1, 2016 Posted February 1, 2016 After reading this post, I think I'll have another couple of doughnuts.
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