Hornby announcement 8th May

[jjb1970]

Something to keep in mind is that models are no different to anything else in that there is no fixed cost of design and manufacture, different companies have different technical capability and are managed (or if they're lucky, led) differently, have different distribution arrangements, expectations for return on investment, different borrowing costs, different head counts etc etc. So whilst what one supplier has to say about manufacturing something may be completely true for their efforts whilst simultaneously being completely irrelevant with respect to those of others.

[adb968008]

Something to keep in mind is that models are no different to anything else in that there is no fixed cost of design and manufacture, different companies have different technical capability and are managed (or if they're lucky, led) differently, have different distribution arrangements, expectations for return on investment, different borrowing costs, different head counts etc etc. So whilst what one supplier has to say about manufacturing something may be completely true for their efforts whilst simultaneously being completely irrelevant with respect to those of others.

I wouldn’t be surprised if cash flow plays a significant part of it.

The tooling might be ready and waiting in China for the commitment of funds for production from Europe but erstwhile have to wait their selected place in the line.

 

In Trier two weeks ago, I had an interesting conversation with a Swedish man telling me how amazing it is that obscure SJ prototypes, albeit from a princely price, are now becoming available, the story is the same across Europe with all kinds of low production high prices models becoming available in otherwise lesser produced prototypes from Belgium, Holland, Italy even Greece.

 

There is only so much capacity in China, and if everyone is tooling up, the first with funds for pressing plastic will surely win the race, with the slower paying customers pushed to the back of the queue.

 

I could imagine in China the prize is in getting the money for the tooling, as afterwards they know your at their leisure for production using it and invariably setting up and making 2-500 of them is the lower end of profit and higher cost of their cost scale So making stuff off of that tooling is possibly less lucrative, and with revenue streams globally coming in, take the big money first.

 

On the UK side is it beyond possibility that the first toolings are fast as the initial investment money is there, but as it is spent, and stocks unsold, that without further investment capital projects slow awaiting funds to return from stock sales ?

 

Whatever the reason in this world Money talks and solves most problems.

Edited May 12, 2018 by adb968008

[dibber25]

And yet Auccuracraft have just managed to get a model from measurements to shelves in a mere 8 months - admittedly just a wagon, but a very highly detailed one. If it matches their Irish Rail equivalents in detail and accuracy, they seem to have found a way to get to market quickly using Chinese production. One aspect (that Andy's interview with them at Rails) revealed is that they do their own CADs in-house, unusually these days, which according to them, cuts out a lot of the initial delays. But they are so far not planning to reveal their plans in advance, despite having almost duplicated a DJM product being developed in parallel - and a little further off from production - so your point about costly duplication is very real (as happened with the Class 71). They seem to have obtained a very reliable production partner, which others might envy. But they have also said that they are are now seeking views of British modellers as to whether they would prefer their current practice of announcing only when models are imminent, or whether we would prefer announcements way in advance, with no guaranteed delivery timescale. Interesting that they feel the need to check that.

 

Kernow seem (according to others on here) to have shortened their time from announcement to shelves, by cutting out their previous use of a middle man, as have Hattons, both with locomotives this time. But we do not yet know (publicly - there are a few on here who seem to have better inside info) as to why that has been possible. You may well be right that each of them has a honeymoon period (as did Rapido, who are now stuck in a whole host of delayed models, mainly North American) but then fall into the same problems as the rest.

 

What is evident is that there is, as yet, no agreed way to obtain or announce new models. Each of these companies is risking large amounts to suit their particular way of doing things. Quite how much Hornby's financial interest in Oxford, and their unique production capability, will improve their own fortunes is something we must await in due course.

 

Meanwhile, Bachmann have kept quiet......

 

Yes, that's exactly it. It's all fine while they are 'new' producers and small operations with only a handful of products. It's keeping all the 'plates spinning' that becomes the issue and avoiding the very fluid situation which exists with factory premises, experienced assembly staff, and operating costs, in China. Cash flow also affects some more than others - retailers with income from selling a wide range of products have an advantage over small manufacturers who have to use the income from one product to fund the next. One wonders, too, about the working relationships, which are fine until - inevitably - sooner or later there's a need to reject a product. For a long time, Hornby had a broadly similar programme each year with roughly the same number of new toolings spread through the year, roughly the same number of re-liveries and so on. Scheduling production and predicting delivery dates is a lot easier when you're following an established procedure with the same people. New factories, new people and a lot more organisations at this end all vying for production slots are bound to make things difficult with adherence to dates, and sometimes quality, being less consistent. (CJL)

Edited May 12, 2018 by dibber25

[robmcg]

Perhaps Hornby are unwilling or unable to put a lot of money up front then, even if they have the tooling, or indeed don't mind if the buyers are left waiting, so long as they have plenty of existing product on the shelves? 

 

This would fit in with their banker's desires, presumably.

 

As ever I shall continue to enjoy Hornby models, new or otherwise.

[leopardml2341]

Totally astounded - all that fanfare for that - save the money - you can use it to put in redundancy packaged when the company goes under .........

S'ok(some would say), probably came from the pension fund...

[leopardml2341]

"We have no fewer than 29..." would have been better as well!

"We have 29 items..." is shorter still, and arguably more accurate - but nowhere near as 'media attractive'.

[rovex]

"We have 29 items..." is shorter still, and arguably more accurate - but nowhere near as 'media attractive'.

How about,

 

"we have more than 28" ?

[jjb1970]

This may end up being a case study in poor expectation management and marketing.

 

Take a step back from the bubble and this should have been a very positive story and a nice surprise for modellers. The Duchess and Peckett are both beautiful models and the additional releases will be welcome. The IEP had certain issues which hopefully will be corrected on the next one but in terms of appearance it is superb. Some of the other stuff won't excite many people here.

 

By mismanaging expectations Hornby seem to have turned what should have been a positive story into a negative one and snatched defeat from the jaws of victory.

[brack]

As an attempt to disprove the old adage of "all publicity is good publicity" it's been quite successful...

[Steamport Southport]

If the idea of an announcement is to get people to spend money, then they've got more than a couple of hundred from me just on Pecketts. With a lot more to come as I'll be picking up at least two Duchesses.

 

I don't think I'm alone. H&P Peckett packs are sold out virtually everywhere and the others seem to be doing well. 

 

 

 

 

Jason

[The Stationmaster]

It could be that we would share that concern. And yet, and yet......Hattons have just managed to announce a very up-specced Class 66 (not a kettle, I know) for only 150 sovs, about the same as the age old moulds from the same old, same old. (Piko have done much the same with mainland Europe models in the last year or two). There would be appear to be some innovation left to tackle the inexorable rises we have lately seen.

 

In Hattons case one part of the 'innovation' is simple - they are missing out one step in the selling chain so therefore one stage of mark up.  Don't forget that the likes of Hornby, Bachmann, Heljan and Dapol (for many of its products) have to puta mark up on the price they are charged by the factory - if they didn't they would simply go out of business.  So there is an ex-factory price, then there is a wholesale price, then there is a recommended retail price - that being the mark up which the retailer gets and if the retailer discounts basically he is simply cutting his profit on each item.

 

With commissioned models coming direct from concerns which are retailers. or sold direct by independent producers one stage of mark up is no longer there because they are simply making the mark up on the ex factory price.  Inevitably their models will either be cheaper than one from a concern which has to wholesale to retailers or their profit margin will be greater - or both.  Their prices aren't lower because they're charities but because of their place in the supply chain from factory to you or I.

[The Stationmaster]

If the idea of an announcement is to get people to spend money, then they've got more than a couple of hundred from me just on Pecketts. With a lot more to come as I'll be picking up at least two Duchesses.

 

I don't think I'm alone. H&P Peckett packs are sold out virtually everywhere and the others seem to be doing well. 

 

 

 

 

Jason

Quite so.  I have no problems with what they announced (although I do wonder about an own goal in pumping out so many Princess Coronations so quickly?) but the way in which it was tackled by the 'announcement of an announcement' approach.  In today's marketplace that sort of approach suggests something exciting, novel, different, or so on and that was the expectation that understandably grew and frothed around this announcement.  They could just as easily have used The Engine Shed to hint and then announce the locos or the Peckett +wagons and would have got as much sales interest as these items have achieved anyway.

 

Similarly if they use the the 'announcement of an announcement' approach in the future are people just going to say 'oh, another Peckett coming then', or 'some more Year 2 models brought forward, I wonder which it will be?', or 'yet more reintroductions of 1960s accessories - not my scene so I won't bother to look'.  The technique of encouraging expectation in your market is well known of course - all sorts of companies use it - but most don't misuse and once the own goal has been scored the supporters tend to get a fractious.

[bill_schmidt1]

but the way in which it was tackled by the 'announcement of an announcement' approach.  In today's marketplace that sort of approach suggests something exciting, novel, different, or so on and that was the expectation that understandably grew and frothed around this announcement. 

Another manufacturer has been making loads of "announcements of an announcement" for quite some but never gets the flack Hornby have seem to. I do think Hornby are missing a trick by not using The Engine Shed for these type of announcements though. 

[Mike Storey]

In Hattons case one part of the 'innovation' is simple - they are missing out one step in the selling chain so therefore one stage of mark up.  Don't forget that the likes of Hornby, Bachmann, Heljan and Dapol (for many of its products) have to puta mark up on the price they are charged by the factory - if they didn't they would simply go out of business.  So there is an ex-factory price, then there is a wholesale price, then there is a recommended retail price - that being the mark up which the retailer gets and if the retailer discounts basically he is simply cutting his profit on each item.

 

With commissioned models coming direct from concerns which are retailers. or sold direct by independent producers one stage of mark up is no longer there because they are simply making the mark up on the ex factory price.  Inevitably their models will either be cheaper than one from a concern which has to wholesale to retailers or their profit margin will be greater - or both.  Their prices aren't lower because they're charities but because of their place in the supply chain from factory to you or I.

 

Clearly. But does that account for a 25% difference (as was suggested in the previous post)? Other independents have not necessarily applied such a great differential in their pricing. Indeed, one retailer/commissioner, having adopted an independently generated model wagon, upped its original retail price by around 50%. I see the logic in what you are stating, but I do not see it being used consistently in practice. Indeed, Piko, who sell through multiple chains, have managed to find a way of significantly reducing their RRP whilst still maintaining three distinct levels of detail/sophistication. So there must be other factors beyond the bleedin' obvious?

[dibber25]

Clearly. But does that account for a 25% difference (as was suggested in the previous post)? Other independents have not necessarily applied such a great differential in their pricing. Indeed, one retailer/commissioner, having adopted an independently generated model wagon, upped its original retail price by around 50%. I see the logic in what you are stating, but I do not see it being used consistently in practice. Indeed, Piko, who sell through multiple chains, have managed to find a way of significantly reducing their RRP whilst still maintaining three distinct levels of detail/sophistication. So there must be other factors beyond the bleedin' obvious?

 

Every model will have a different journey through from idea to finished product. There may be many factors which affect an individual item - perhaps a partial re-tool at some point, a change of supplier of components, a change of manufacturer (the trade calls them 'vendors'). Unless one knows the course to market of the particular model it is impossible to say why a price might go up. It may simply be because of a change in the exchange rate (payment is made in US dollars) or it may be that increased costs in the meantime have made a tight margin into a loss, and the price has had to be increased early in the chain. Each stage of the process then has a mark-up which will need to be adjusted upwards. It's never going to be consistent, because every manufacturer is different, every 'commissioner' is different and every individual project throws up its own set of issues. One thing is pretty certain, though. I don't see anyone getting rich out of making model trains. (CJL)

[Coryton]

Clearly. But does that account for a 25% difference (as was suggested in the previous post)? Other independents have not necessarily applied such a great differential in their pricing. Indeed, one retailer/commissioner, having adopted an independently generated model wagon, upped its original retail price by around 50%. I see the logic in what you are stating, but I do not see it being used consistently in practice. Indeed, Piko, who sell through multiple chains, have managed to find a way of significantly reducing their RRP whilst still maintaining three distinct levels of detail/sophistication. So there must be other factors beyond the bleedin' obvious?

 

Here's my (somewhat ignorant) view:

 

A model has to cover design costs, production costs (including transport etc.), overheads, and leave some profit.

 

Production costs may be he same no matter who orders a model, but the rest is going to be somewhat variable.

Do you try to recover all the design costs in the first batch, or spread it over several?

Overheads can vary wildly between companies, and are going to be different for a 'pure' manufacturer and a retail company that has gone into model commissioning. 

 

I would have thought that the variability in the above could easily outweigh the effect of removing one stage of mark-up in the chain. 

[Godfrey Glyn]

The acid test for the 8th May announcements from Hornby will be whether they have received orders for the whole production of the more 'interesting' items - and several sources have indicated that they have already and within the week - and whether the model shops have been desperately wanting to get their hands on the more toy like items that form the basics that are sold regularly to customers. I suspect the normal model shop will have welcomed these items as they produce a steady income from people who buy models but do not know about RMWeb, let alone follow the various Hornby threads.

From Hornby's point of view these additional production slots, if that is what they are, have been effectively utilised by the company. One must only hope that they have done their financial calculations such that the extra production will give them a good return and build the financial confidence of the firm. If that has indeed happened then we may see more goodies ( those models that generate happiness amongst the RMWeb fraternity!) next year.

 

Godfrey

[NickC]

I’ve just noticed that all of the new Pecketts that have been announced have delivery dates in 2019, so why announce them in 2018 when they are still a year away from delivery? Much better to have announced them as part of the 2019 range.

They have even delayed one of the previously announced 2018 Pecketts to Feb 2019.

It makes the mid year announcement even more of a damp squib.

Edited May 13, 2018 by NickC

[robmcg]

This may end up being a case study in poor expectation management and marketing.

 

Take a step back from the bubble and this should have been a very positive story and a nice surprise for modellers. The Duchess and Peckett are both beautiful models and the additional releases will be welcome. The IEP had certain issues which hopefully will be corrected on the next one but in terms of appearance it is superb. Some of the other stuff won't excite many people here.

 

By mismanaging expectations Hornby seem to have turned what should have been a positive story into a negative one and snatched defeat from the jaws of victory.

 

For what it's worth there are still recent 'sold out' models made by Hornby in the last year, sitting on shelves in shops outside mainstream search engines, SWS and Clan Line for example still available at about £190 and £150 respectively in NZ....  and being a retail shop you could if you lived in Auckland even test it before you buy it.

 

I just bought a 21C3 MN for under £140,   also as I understand it, Olivias in the UK stock things not commonly found at the bigger stores albeit often a bit pricey., 

 

but I say this only as a reaction to the fact that the Duchesses and small industrials are very nice models, and that at least was a positive for the '29 new products' thing.. albeit the grim truth for we 'must have it now' types, of which I am one, is that new products from Hornby are less common than we have been use to. 

[GordonC]

As an attempt to disprove the old adage of "all publicity is good publicity" it's been quite successful...

 

I'd have to doubt the accuracy of that if its left a section of your target market disappointed

[Dunsignalling]

For what it's worth there are still recent 'sold out' models made by Hornby in the last year, sitting on shelves in shops outside mainstream search engines, SWS and Clan Line for example still available at about £190 and £150 respectively in NZ....  and being a retail shop you could if you lived in Auckland even test it before you buy it.

 

I just bought a 21C3 MN for under £140,   also as I understand it, Olivias in the UK stock things not commonly found at the bigger stores albeit often a bit pricey., 

 

but I say this only as a reaction to the fact that the Duchesses and small industrials are very nice models, and that at least was a positive for the '29 new products' thing.. albeit the grim truth for we 'must have it now' types, of which I am one, is that new products from Hornby are less common than we have been use to. 

Taking a wild guess, retailers with stocks of models no longer available elsewhere, often still have them because their prices exceed those asked by the "usual suspects", who will have long since sold all they had. 

 

Still generally cheaper than chasing them on eBay though.

 

Dunno if Hornby releases have slowed by all that much. Hornby releases that interest me have, but that's not the same thing.

 

John

Edited May 14, 2018 by Dunsignalling

[Scottish-Exile]

I was after a Bachmann Tops numbered Class 85 which had just sold out at all the usual places, and was getting £40-£60 more than retail on eBay. Eventually got one 2nd hand at the same price they had been retailing for.

 

A couple of days later I was in the shop at the local Llangollen Railway and they had one brand new, in the cabinet at the standard selling price (RRP-15%). Adding in my postage, it would have been cheaper to have got the one in the shop had I been there a couple of days earlier.

 

So worth looking out for other retailers who may not always advertise online etc. when you're after a recently 'sold out' model.

[Mike Storey]

Taking a wild guess, retailers with stocks of models no longer available elsewhere, often still have them because their prices exceed those asked by the "usual suspects", who will have long since sold all they had. 

 

Still generally cheaper than chasing them on eBay though.

 

Dunno if Hornby releases have slowed by all that much. Hornby releases that interest me have, but that's not the same thing.

 

John

 

Very true - I have found a few things in the past at Olivias, new and boxed, when that I thought I had long missed the boat with them selling out elsewhere. True, the price was sometimes higher, but at least they were there, and sometimes I found some very good bargains. 

[Oldddudders]

 

So worth looking out for other retailers who may not always advertise online etc. when you're after a recently 'sold out' model.

 

Yes. Early last year on one of my visits to the UK I was after a Hornby Channel Packet - at that time said to be as rare as rocking-horse poo. Paignton Model Shop had one in their display case, and at a good price, too. 

[scottishlocos]

All

 

Hornby have more or less ignored D&E modellers a few new liveries but not much to go on

 

As for the accessories which are as old as the hills most are available and still in reasonable quality from bargin bins at swapmeets shows and model shops nobody is going to buy these when there are lots of them around at pocket money prices

 

Dave