Thursday, January 29, 2009

Major League Paintball Held Hostage, Day 28

"The PSP is pleased to announce that for the 2009 Season all of our events will host an exclusive manufacturers' tradeshow. In an effort to respond to the overwhelming request of our industry's manufacturers and sponsors, companies will now only be able to represent their own brands within the tradeshow."

The above is a partial quote from a PSP press release sent out this morning. I'm sure some of you received it, too. It appears to be a more moderate version of what the Millennium is doing this year. (If you missed those posts and are interested look here and here for some background.) It is also a form of protectionism. In the last couple of seasons vendor sales have been soft. So soft almost nobody has made any profits in the process. (And more than a few have struggled to break even.) Soft sales encouraged a few vendors to offer mainstream products at cut rate prices well below msrp and map pricing and that in turn further eroded an already weak sales environment. Given that situation this move appears (there's that word again) to make some sense. However --
There's more to it than that. The PSP is changing the model of what sponsorship is and what it receives in return. What was a vendors village of diverse retailers is to be a manufacturers tradeshow with the proviso the manufacturers are selling retail. The result is that manufacturers prices are protected and they become the only game in town. Which means potentially higher prices to the customer--assuming there are any. Customers, that is.
Is this really a good idea? Probably not. Will it work? Depends on what you (or I) mean by work. Will it protect the manufacturers and their appointed reps? Yes, but that only means at the event site for the duration of the event. Will it garner sufficient sales to be worthwhile? Guess we will see. Will it, by the end of the year, turn World Cup into a legit tradeshow (with direct sales on the side)? If it does will the PSTA still need Paintball Extravaganza? (And what about Mary?)
Other problems remain but aren't really the PSP's problem. One of them is manufacturers competing against retailers for retail business. Another is manufacturers selling to retailers who don't uphold manufacturers guidelines.


raehl said...

I think everyone has missed what this really does.

The manufacturers can sell at MSRP, and thus *NOT* undercut the real brick and mortar paintball retailers that happen to be in the area of the event.

This is just the next step in having a price structure that allows paintball to support itself long-term.

Baca Loco said...

Nicely done, Chris. (And I almost mean that with all sincerity.) :-)