When I lived in CT a few years ago, I have seen hobby shops take a turn towards being more of an arts & crafts shop. Same with the LHS up here in NH, although there are some modeling, R/C, trains, etc... Most of the hobby/modeling supplies are very limited, old and expensive.
Why are brick-n-mortar hobby shops becoming a thing of the past? Online shops you say!
I am well into the process of opening my own up. Let me tell you something that you might not know. A lot of those online shops with really cheap prices and every kit in stock - ARE WHOLESALERS! Or affiliated with the wholesaler/distributor.
In order for me to receive certain percentage discounts, I have to order a certain dollar amount per order (it's different for each distributor). Some distributors put minimum quantity limits on certain items, example: 12 each of one color/brand of paint. So I would have to order 12 bottles of Testors #1103, even if I only needed 2 or 3. Same with tools, brushes, etc... Now here's the kicker - when all said and done, the discount that I pay for the item is pretty dang close to what I could get it for at Wal*Mart.
Scenario:
So let's see, I stocked my shelves with thousands of dollars worth of merchandise and it's not moving very quickly. Customers come in and browse, leave because they can find it $3.00 cheaper online or they are looking for something else and don't want to wait for the shop owner to order it. (remember, not much discount if no big orders are placed) So the shop owner looks into setting up shop online... AHHH can't compete with the prices. Cost money for a merchant account, gateway (for credit card processing), SSL certificate, monthly charge and per transaction charge, online server hosting fee, not to mention setting up the online catalog and shopping cart. There goes that $2.00 profit per car model kit and then some.
Oh heck, I want to trade in my hobby shop and become a distributor.
What do you mean I need a big warehouse with a loading dock?
Revell requires a minimum $3,000.00 order purchase and I have to buy kits in lots of 12.
Other manufacturers are similar and reps come out to inspect the warehouse.
What have I gotten myself into?
At least I don't have to pay rent on the store front. I guess the upside is that I can get my modeling kits and supplies a little bit cheaper than I used too and my stash is growing. But for some strange reason my wife thinks I should sell some of this stuff sooner or later.