A news alert from the 2010 Industry Summit:

[blowoutcards]

A news alert from the 2010 Industry Summit:

Panini tells Summit retailers: No more ‘blind eye’ toward distribution

Panini America officials headlined Monday’s first full day of the Sports Collectibles Industry Summit in Las Vegas by announcing sweeping, comprehensive changes to the company’s distribution network.

“These are things we’ve wanted to do for 10 years,” Panini VP Mike Anderson told a room that included more than 100 hobby shop owners. “We are no longer turning a blind eye to the problem that has been killing margins for hobby stores.”

Anderson and Panini hobby sales director Rodney Alsup outlined their plans – slated to launch in the fall – that strives to address one of retailers’ most pressing concerns: Online sellers’ negative impact on brick-and-mortar profit margins and key buyer relationships.

Among Panini’s pledges to an enthusiastic retailer audience at the Summit:

* Re-authorizing all brick-and-mortar hobby shops. Only authorized stores – and potentially, a handful of authorized show retailers – will be able to purchase and sell Panini product directly.

* A dramatically reduced wholesale distribution network. Anderson noted that, currently, as many as 50 entities operate as quasi-wholesalers, through online services such as DealernetB2B, eBay, individual websites or through a sub-distribution sales force. Going forward, Panini will appoint and promote a select number of authorized distributors – perhaps as few as four nationally, Alsup said.


* A no-tolerance policy for distributors who sell to non-authorized retailers. “If people do not abide by the policy, we’re done with them,” Alsup said. “No warnings.”

* A no-tolerance policy for retailers who attempt to wholesale product, rather than selling directly to collectors. “Again, no warnings,’’ Alsup said. “They will be black-listed.”

* A clear distinction between wholesale and retail businesses. “You are one, or you are the other,” Anderson said. “And never the twain shall meet.”

The Panini executives credited CEO Mark Warsop for the company’s renewed commitment to integrity in distribution and admitted that, prior to Panini’s purchase of the former Donruss/Playoff LP in early 2009, the company made distribution choices that were not in its or the industry’s best long-term interests. Some of those choices included selling significant a volume of new issues and closeouts to online retailers, and allowing certain wholesale distributors to develop and operate online retail businesses.

“We turned a blind eye toward those things, because, honestly, we had to. Our ownership needed the money, and we perpetuated the industry’s problem,” Anderson said. “But under Panini ownership, we work for a CEO who is allowing us to do what should’ve been done 10 years ago. We are well structured, well financed and committed to doing what is best for the brick-and-mortar stores who are the lifeblood of this hobby.”

An enthusiastic Industry Summit crowd of 114 brick-and-mortar store operators applauded repeatedly during the Panini presentation.

Jeff DeGraw, an Illinois-based retailer, said Panini’s presentation addressed his concerns so thoroughly “it was like they were listening in on our retailer welcome meeting [Sunday] night. This was clearly our No. 1 issue, and they’re taking a stand in support of us.”

Said Mike Fruitman, a Colorado-based retailer: “I have just two words: ‘Thank you.’ ”

Among the other initiatives discussed during Panini’s Monday session:

* The company continues to destroy any returned NBA trading card product to protect collectibility.

* The company is willing to implement a MAP (minimum advertised price) program, but believes its authorized distributor and retailer qualifications may address the new-release pricing issue without a formal MAP initiative.

* Anderson and Alsup said more details regarding the distribution initiative will be announced this summer, including the formation of a brick-and-mortar standards committee.

* Panini is initiating an upgrade of its hobby ordering systems and schedules.

* The NBA Adrenalyn XL trading card game launch has been an unquestioned success, thanks to strong marketing support including a mobile tour. The company plans to extend the Adrenalyn brand to football and hockey as part of its investment in re-developing a youth collecting segment.

* The company will launch a new product tentatively called “The Vault,” which will feature compelling autographs and memorabilia swatches from sports, history and pop culture. Alsup indicated the initial release may be available as early as December 2010.

“Salvation is not going to come in the form of some new whiz-bang, wow, big-hit product,” Anderson said. “It’s just good honest blocking and tackling, and that’s what we’re doing here.”

BSCM, Beckett Blog, Beckett Media, Beckett.com, Hobby StoriesLeave a Comment

[frozenntimesports]

Perhaps a better announcement would have been:

"We are going to stop making products that suck moose balls." That would have gotten our attention.

[Joe71]

Some people in the economic community would call this price fixing.
I find it interesting that a company in a niche hobby would try to tell the market what they will pay for the product they produce.
The market should regulate itself. If you make crappy cards that are not worth anything then you get stuck with the inventory.
Panini created this problem by selling off the products they could not sell.

[BAMBAM]

All I can say is FINALLY SOMEONE GETS IT

Might be harder to enforce then they think because money always talks in this business but at least the distributors who try to create phony shortages and sell product like stock brokers instead of distributors might have to pay for the BS they've been getting away with for too long. Are you listening Topps and especially UD (IF you make it through next month) ?

[eluna25]

Originally Posted by blowoutcards

“We turned a blind eye toward those things, because, honestly, we had to. Our ownership needed the money, and we perpetuated the industry’s problem,” Anderson said. “But under Panini ownership, we work for a CEO who is allowing us to do what should’ve been done 10 years ago. We are well structured, well financed and committed to doing what is best for the brick-and-mortar stores who are the lifeblood of this hobby.”

How should we feel about this comment?

We needed your money so we allowed things to happen, for 10 years, that we normally wouldn't tolerate. Now that we have your money, we're going to "fix" things.

I thought WE, the consumers, were the lifeblood of this hobby? Let's see how Panini survives without my and hopefully others lifeblood.

[BAMBAM]

Originally Posted by eluna25

How should we feel about this comment?

We needed your money so we allowed things to happen, for 10 years, that we normally wouldn't tolerate. Now that we have your money, we're going to "fix" things.

I thought WE, the consumers, were the lifeblood of this hobby? Let's see how Panini survives without my and hopefully others lifeblood.

Do you SERIOUSLY think UD and Topps haven't allowed the same things to go on for years as well ? Seriously ? The fact that one of them is stepping up to make changes should be supported instead of bashed.

[gman71]

Originally Posted by eluna25

How should we feel about this comment?

We needed your money so we allowed things to happen, for 10 years, that we normally wouldn't tolerate. Now that we have your money, we're going to "fix" things.

I thought WE, the consumers, were the lifeblood of this hobby? Let's see how Panini survives without my and hopefully others lifeblood.

They'll survive just fine. For every person who swears they'll never buy a thing again,5 more replace you

[77ncaachamps]

Originally Posted by BAMBAM

Do you SERIOUSLY think UD and Topps haven't allowed the same things to go on for years as well ? Seriously ? The fact that one of them is stepping up to make changes should be supported instead of bashed.

REALLY?!?

Now that Panini is the SOLE NBA card producer they can throw their weight around just like they're planning to do.

Can you say, "Monopoly?"

[BAMBAM]

Originally Posted by gman71

They'll survive just fine. For every person who swears they'll never buy a thing again,5 more replace you

Exactly right. The one thing I wonder though is if this was all just blowing smoke up the angry LCS owners butts or if they are going to try their best to enforce this. Going to be tough but some abusers are clearly obvious in this industry. One thing that can't happen is they give LCS owners carte blanche and then they begin to abuse the system. A lot of greedy people in hobby stores gouged people for decades in the 90's. Hopefully when the bottom dropped out more of reputable ones survived and are still around to reap the benefits of an equally distributed industry.

[BAMBAM]

Originally Posted by 77ncaachamps

REALLY?!?

Now that Panini is the SOLE NBA card producer they can throw their weight around just like they're planning to do.

Can you say, "Monopoly?"

No but I can say equality and fair share. When retail and wholesale become the same its never good for any industry. When distributors are filling their pockets and gouging on premium products by selling back door to the highest bidder it's never good. IF Panini abuses their power it will only hurt them as people will not buy from them.

[eluna25]

Originally Posted by BAMBAM

Might be harder to enforce then they think because money always talks

You said it best right there. They obviously let you know what they were and probably still are about, THE MONEY!

Originally Posted by gman71

They'll survive just fine. For every person who swears they'll never buy a thing again,5 more replace you

Oh most definitely. They already have you and BAMBAM to replace me.

[Zerokruel]

This is actually great new! I really hope Panini can enforce this. This is the kind of value people should want in the hobby community. What we have had before in the community was cut throat business that just killed the hobby and drove the prices of product down and litteryaly deflated the value of any current card. This is fantastic news!

If ANYONE thinks PDLP was the only company for years that turned a blind eye, you're in denial. Everyone did, they are just the first to try and fix it. I don't care if they are big or the only company licensed in one Basketball (Topps i.e. Baseball anyone?), this is a big step forward.

[natbornkiller]

does that mean no more 20 and 24 box cases from pdlp

[Shimey013]

Originally Posted by eluna25

How should we feel about this comment?

We needed your money so we allowed things to happen, for 10 years, that we normally wouldn't tolerate. Now that we have your money, we're going to "fix" things.

I thought WE, the consumers, were the lifeblood of this hobby? Let's see how Panini survives without my and hopefully others lifeblood.

Topps, Upperdeck and Donruss has turned the blind eye for years..They have even admitted to it, but they never did anything cause they didn't care, it was all about them and not the consumer..thats why Donruss is gone, UD is about to be gone and Topps is falling behind too...

Good to see Panini gets it..Good to see someone is finally going to do something about it. It may be hard to enforce, but atleast someone finally acknowledges and is going to make a needed change. This is a great move and will be great for the hobby. I just hope that this for the hobby and the BnM stores, that it should do and people don't try to take advantage of it, so it will also help the consumer....Thank panini for getting it...Thank you for wanting to make that change that has been needed for years...Its about time someone steps up to the plate..we can only hope UD and Topps Follows suit.

[gman71]

Originally Posted by eluna25

You said it best right there. They obviously let you know what they were and probably still are about, THE MONEY!

Oh most definitely. They already have you and BAMBAM to replace me.

Not I. I don't break any wax. I leave my gambling for the blackjack table

I let others break the wax then get desperate to at least break even after

[anusinha]

So what exactly does this mean? Panini will only sell to their "authorize" B&M stores and a couple distributors? Will BO not get any Panini products?

[solt0131]

Originally Posted by anusinha

So what exactly does this mean? Panini will only sell to their "authorize" B&M stores and a couple distributors? Will BO not get any Panini products?

Yes, unless they become authorized. UD tried this two years ago and it failed miserably. Same thing will happen with this genius plan.

[C_Corner]

Originally Posted by anusinha

So what exactly does this mean? Panini will only sell to their "authorize" B&M stores and a couple distributors? Will BO not get any Panini products?

I was wondering when someone was going to think about this. BO is one of those companies that's a distributor and retailer. That's the reason why we all get to buy cards from them so cheaply. They buy at distributor prices direct from panini, then sell at near wholesale prices to us. That is exactly what Panini is talking about putting a stop to. BO will no longer be able to do both. They are going to have to either stop selling to regular customers like us and become a "distributor", or they are going to have to buy products at normal retailer prices, which means they will not be able to sell to us at wholesale prices. If Panini actually enforces these ideas they could flip this entire industry upsidedown. WOW

[anusinha]

Originally Posted by C_Corner

I was wondering when someone was going to think about this. BO is one of those companies that's a distributor and retailer. That's the reason why we all get to buy cards from them so cheaply. They buy at distributor prices direct from panini, then sell at near wholesale prices to us. That is exactly what Panini is talking about putting a stop to. BO will no longer be able to do both. They are going to have to either stop selling to regular customers like us and become a "distributor", or they are going to have to buy products at normal retailer prices, which means they will not be able to sell to us at wholesale prices. If Panini actually enforces these ideas they could flip this entire industry upsidedown. WOW

If Panini pulls that crap and UD goes under, then I guess it Topps only for me and maybe ITG.

[stumpfreeman]

Originally Posted by C_Corner

I was wondering when someone was going to think about this. BO is one of those companies that's a distributor and retailer. That's the reason why we all get to buy cards from them so cheaply. They buy at distributor prices direct from panini, then sell at near wholesale prices to us. That is exactly what Panini is talking about putting a stop to. BO will no longer be able to do both. They are going to have to either stop selling to regular customers like us and become a "distributor", or they are going to have to buy products at normal retailer prices, which means they will not be able to sell to us at wholesale prices. If Panini actually enforces these ideas they could flip this entire industry upsidedown. WOW

BINGO! This will not work. Companies were turning a blind eye because they needed the sales to survive. I fail to see how this will be good for the consumer. Online sales of boxes are necessary in todays market. Cutthroat is good for the consumer, as long as you do your research and decide where to draw your own line when it comes to quality.

[bbtt123]

Originally Posted by C_Corner

I was wondering when someone was going to think about this. BO is one of those companies that's a distributor and retailer. That's the reason why we all get to buy cards from them so cheaply. They buy at distributor prices direct from panini, then sell at near wholesale prices to us. That is exactly what Panini is talking about putting a stop to. BO will no longer be able to do both. They are going to have to either stop selling to regular customers like us and become a "distributor", or they are going to have to buy products at normal retailer prices, which means they will not be able to sell to us at wholesale prices. If Panini actually enforces these ideas they could flip this entire industry upsidedown. WOW

Its more like...holy crap!! people would actually have to visit a B&M store?!?!?!? such new wave thinking on their part...oh wait...I remember when all you had was B&M stores and it was PART OF THE HOBBY!! I understand the whole issue, and I hope BO comes out good in the end, but a few things have really changed over the years, think of these things:

1) Taxes- if the government demaned all internet orders be taxed accoring to state, then I'm only saving about 5% from my B&M regular prices, granted 5% over a case can be big, but most B&M stores I know discount further if you place an oder for a case. The tightening of who can do and sell what by card companies is no different than car suppliers like GM and Ford, hell they even demand what flagship dealerships look like. The internet has its place, but I see these company's trying to help those who have overhead costs become level operations with those internet dealers who operate with no overhead at all.

2) The B&M experience- For me, only being 27 I dont have alot of collecting experience, but I can remember one fond thing, the fun of going to the local card shop. Granted all places are different but for me as a kid collecting, even thru to the point of when I stopped collecting 7 year ago, going and hanging out was just fun. We used to just go to the shop to see others bust packs, and see if anyone had something you could trade for, or just sit and talk about sports and sports cards. Now everyone buys online, and well..sits in front of a computer and does the same thing, its fun and all, but you lose some of the sport of collecting I think.

[stumpfreeman]

Originally Posted by bbtt123

Its more like...holy crap!! people would actually have to visit a B&M store?!?!?!? such new wave thinking on their part...oh wait...I remember when all you had was B&M stores and it was PART OF THE HOBBY!! I understand the whole issue, and I hope BO comes out good in the end, but a few things have really changed over the years, think of these things:

1) Taxes- if the government demaned all internet orders be taxed accoring to state, then I'm only saving about 5% from my B&M regular prices, granted 5% over a case can be big, but most B&M stores I know discount further if you place an oder for a case. The tightening of who can do and sell what by card companies is no different than car suppliers like GM and Ford, hell they even demand what flagship dealerships look like. The internet has its place, but I see these company's trying to help those who have overhead costs become level operations with those internet dealers who operate with no overhead at all.

2) The B&M experience- For me, only being 27 I dont have alot of collecting experience, but I can remember one fond thing, the fun of going to the local card shop. Granted all places are different but for me as a kid collecting, even thru to the point of when I stopped collecting 7 year ago, going and hanging out was just fun. We used to just go to the shop to see others bust packs, and see if anyone had something you could trade for, or just sit and talk about sports and sports cards. Now everyone buys online, and well..sits in front of a computer and does the same thing, its fun and all, but you lose some of the sport of collecting I think.

I think online sales are necessary because they can reach out to thousands of people who don't live anywhere near a store, more volume=lower prices. I'm sure blowout will get around this by having 2 price lists, retail and wholesale. Paninni must think people are sooo addicted to sports cards that they will pay any price.

[bbtt123]

Originally Posted by stumpfreeman

I think online sales are necessary because they can reach out to thousands of people who don't live anywhere near a store, more volume=lower prices. I'm sure blowout will get around this by having 2 price lists, retail and wholesale. Paninni must think people are sooo addicted to sports cards that they will pay any price.

I'm not saying online doesnt have a place, but everyone bags on LCS owers due to price differences, with a more level playing field they can all make money and still be competitive, but instead of it being such a wide gap, just narrow it a bit so the shop owners dont get the bad rep. Three things make a difference between B&M and online, overhead, taxes and overall experience, you can never compete when your paying for a space/bills plus any employees, when others have 1/4 of your cost to operate PLUS they can bulk buy.

[papajim]

Pat/Chris, Any comments on the subject??

[kajshack]

I love hanging out at the LCS, but they are the only ones benefiting from this initiative.