Competition in the UK RTR model rail market

[andyman7]

Hopefully mods will agree that this is a sensible place to share this topic. Lots of discussion in the manufacturer threads is less about specific new announcements and is more a general debate on the state of - and direction of - the UK RTR market, so perhaps a dedicated thread is the right way to go.

 

In an environment where Chinese manufacturing costs are rising, production capacity is limited and the UK RTR market has become very specialised, it's interesting to se some of the scenarios being played out. There is a school of though that wants some sort of nice gentlemens' club in which all manufacturers talk to each other, don't duplicate, and of course produce models to the price point and level of detail that suits an individuals' proclivities. However, capitalism doesn't work like that and such behaviour is in any case illegal under competition law.

 

What we have seen is that as disposable income has been squeezed and costs have risen there is a real fight to try and optomise the trade off between profits in the supply chain, security of supply, cash flow and identifying profitable ventures.

 

This year we are really beginning to see the direction of Hornby's strategy. Themes - cute, small superdetail locos (it is obvious these are proving a hit); continuing to try and dominate the superdetail prenationalisation carriage market; leveraging the Paddington and Harry Potter licenses; getting HSTs and IEPs out there (if you get the supply right, lots of coaches and power cars that people will buy); and getting budget items out there that youngsters and those on more limited incomes can afford when thefull fat offering will be out of reach - the 66 is a loco seen everywhere and my son knows the Hornby one is achievable and looks good to him; the Hattons/Bachmann one is out of reach and in any case not aimed at him. Most interesting to me is the Mk2f, which not only competes on price but is potentially playing on getting to shops in quantity when the Bachmann supply is limited.

 

Bachmann are going through a perod of transition. We are of course not privy to commercial details but there is no doubt a lot of their product is now extremely late in delivery, and the change of factory imposes a further holdup. Their products are generally excellent but no longer cheap, and their markets are being nibbled at one end by more budget offerings and at the other by single model manufacturers or commissions making the 'ultimate' versions of models in their range. The risk here is less about Bachmann as a company and more about the continued development of the Branchline range given that it is one of the smaller divisions.

 

Whilst the 'blue' and 'red' teams still underpin the RTR offering, the likes of Heljan, Oxford, Dapol and the plethora of single model/retailer commissions mean that there is a lot of competition for what is a niche business in the overall scheme of things. All of this is against a background where the retail high street model shop has disappeared at a rapid rate in the last 15 years - a trend which seems to be anticipating what will happen to the rest of the high street rather than being a 'blip'. The big box shifters are all into manufacturing these days, whilst niche retailers who udnertsnad their margins and customers can make a living in the right circumstances. The traditional customer base is ageing but there is a sense that in the digital age, craft type pursuits are proving attractive to younger people, and programmes such as the Great Model Railway Challenge are opening peoples' eyes to a pastime that is so past the mainstream that it's actually quite cool to some, helped by the rise of geek chic (!).

 

Thoughts?

[The Johnster]

It is a competitive market and the primary purpose of the companies involved in it is to make profits for their shareholders; satisfying customers is a secondary consideration, albeit a very important one.  From our point of view it looks wasteful and damaging when duplication takes place, which it does quite a bit.  The idea of a 'gentleman's agreement' to prevent it, though, would very quickly and rightly attract the attention of the monopolies commission.

 

The companies have to take risks, as do those people who invest their money in them, and it is in recognition of this that we accept that reasonable profits are made, but it is very important that nothing compromises the competitiveness of what is a free market subject to the iron law of supply and demand.

[mdvle]

Complicating things is the fact that for most intents and purposes much of the business of our hobby is in China, and they don't have and thus don't have to play to the same laws.  Then add in the fact that it is a relatively (in a world scale) small business concentrated in a small part of China, and there is a very good chance that at least at the Chinese factory level everybody has a pretty good idea of what the others are designing.

 

So while there may be no "gentleman's agreement" as such, if a company wants to avoiding duplication on niche items should be at least somewhat possible.

 

The semi-good news is that the Chinese economy seems to be slowing down, which will presumably reduce wage pressure, thus slowing the price increases that have become such a fixture of this hobby.  But I say semi-good because one of the reasons for the slowdown is things happening outside of China reducing demand for Chinese goods as tariffs and currency fluctuations take their toll.

 

Regarding limited production capacity, I am not sure how true that is.  The big news at the beginning of last summer was the sudden closure of a Chinese factory, throwing a bunch of companies around the world into a scramble to find new production.  Yet less than 6 months later most of those companies have indicated that they have new factories and things are back to normal.  We also have an example of a Chinese factory with capacity to spare who tooled up a model for the UK market and offered it up in some sort of an agreement with an existing UK outfit (*).  The bigger issue will simply be how much product can be put into the UK market in a year and still have everyone make a profit.

 

The demise (or not) of the high street is likely too complicated an issue for here, but like many things it is likely a combination of factors and not one simple reason.

 

The traditional customer base is not "aging", it is what it pretty always has been - the 40 to 70 or so age group who have had the time and money once the kids are grown up.  What has changed - or more accurately disappeared - is the tradition of every young boy have a trainset but if we are honest the only people who lost on that were the people selling trainsets.  Most of those kids left those trains behind as they hit their teens and never returned.  The kids who are interested in trains still get trains as kids, and then return to them as they get older, which adults discovering the hobby through YouTube or podcasts or Facebook or etc.

 

I suspect that one of the biggest changes to the hobby, driven by the ability of China to deliver highly detailed models and a great variety of different models each year combined with the easy ability to share information and research is a growing trend to smaller, more detailed and specific layouts.

 

 

* - http://www.rmweb.co.uk/community/index.php?/topic/137339-revolution-announces-n-gauge-vea-van/

[Steamport Southport]

Competition is all fine and dandy as long as they don't do anything illegal or what could be deemed a bit obnoxious.

 

If we didn't have competition then we would probably still be stuck with old Triang Hornby stuff from the 1970s. I vaguely remember how it was before Airfix, Mainline and Lima came along. Hornby was stagnating and needed a good kick up the backside.

 

Just look at the Hornby catalogue in 1975. Nine steam locomotives and seven diesels. 61 models in the entire range. This announcement there was over 400 new items. Would they be doing that if there wasn't competition or would they be resting on their laurels?

 

http://www.hornbyguide.com/year_details.asp?yearid=12

 

 

I also don't buy the idea that it's Hornby and Bachmann that are picking on the other companies and trying to put them out of business like has been suggested by some. Dapol weren't exactly slow on releasing rival models to half of the Graham Farish range. Did that give Bachmann/GF a similar kick up the bum? Yes, they upped their game. Was Dapol wrong doing that? Not in the slightest.

 

 

 

Jason

[Sir TophamHatt]

Good musings indeed.

 

I'm all for competition but I'd rather not have it at the expense of a loco/unit.

 

I'd hate to think one manufacturer is producing yet another version of some coaches, or a loco instead of bringing something new to the market, because "it's easier" or they think it'll sell like hot cakes.

 

I still think the Electrostar (IE 376/7/8/9) or Desiro (TPE, WMR, SWR, 360, 185) could be made without too much effort, fairly quickly. But I hear rumbles of a 91 refresh... after we already have a 91 around.

 

I'm not sure the 170 refresh will be worth it and don't get me started on the new 158... but that seems to be just one manufacturers problem - announce, but give no real effort to bring it to market in a sensible amount of time. And by the time it is produced, technology will have moved on so much that it'll be obsolete already.

 

So yes, I'd rather have less competition but more choice in numbers of different stock.

[JohnR]

I'm not sure the 170 refresh will be worth it and don't get me started on the new 158... but that seems to be just one manufacturers problem - announce, but give no real effort to bring it to market in a sensible amount of time. And by the time it is produced, technology will have moved on so much that it'll be obsolete already.

 

So yes, I'd rather have less competition but more choice in numbers of different stock.

 

I can see the argument for these two models to be refreshed - not DCC ready, and lighting options are limited. However, the delays with these projects seem to indicate that rather than a minor upgrade, we are seeing two completely new models, which I'm not sure are called for. 

[34theletterbetweenB&D]

Competiton is typically regarded as a sign of healthy demand, as in X, Y and Z seem to make a good thing out of selling these items, surely we can get a piece of the action? I would be gloomy about RTR OO's prospects if ten years ago there had been over a dozen active and competing manufacturers and commissioners, but now we are down to half a dozen. Whereas it is the other way around.

 

And competition is doing its job of providing choice, as we see models emerging of the same subject in basic, mid range and premium options,again generally regarded as a healthy sign.

[mdvle]

I don't think anyone is suggesting that there never be duplication.
 
As hinted above, duplication can be a benefit to us if it means a better version of a model gets released because the original model has fallen victim to the passage of time and the company has ignored updating themselves.
 
Similarly, there are some prototypes that are popular/common enough that 2, possibly in some cases 3, different versions can make all involved a profit.  In the diesel era the most likely example of this would be the class 47.
 
There will also be models that, either because it means using the old tooling that is already paid for or because the market can support it, where a detailed but higher priced model and exist with a simpler but more affordable model.
 
The issue some of us have is where, for whatever reason, 2 companies have decided to go ahead with brand new models of the same prototype and there likely isn't the market to allow both to make healthy profit, or in some cases even cover the costs.  Yes, in some cases this will because circumstances mean that the duplication wasn't discovered until it was too late for either company to back down but in some cases it seems to be more a case of a larger company attempting to "defend turf" and hurt the smaller company.  Not illegal, but not necessarily good for the overall health of the hobby if it ends up reducing competition.
 
 

I'd hate to think one manufacturer is producing yet another version of some coaches, or a loco instead of bringing something new to the market, because "it's easier" or they think it'll sell like hot cakes.

Well, the goal is to make profits so the company stays in business.

 

I still think the Electrostar (IE 376/7/8/9) or Desiro (TPE, WMR, SWR, 360, 185) could be made without too much effort, fairly quickly. But I hear rumbles of a 91 refresh... after we already have a 91 around.

The class 91 model is a representative of its time, and it is long overdue for a modern version.  Simply put for anyone who is buying the modern detailed models the existing Hornby 91 is not an option, its details are lacking/crude and the model would immediately catch the viewers eyes in the wrong way as looking out of place.

 

The DMU/EMU issue is an interesting one.  There are still many British Rail era units that people want and likely should be done, and perhaps some (more) of the current DMU/EMU families should be done.

 

I would guess, as I am not familiar enough with them, that there will be 3 possible issues

1. the "belief" that anything longer than a 2, or maybe sometimes 3, car unit doesn't sell
2. it's not so much the effort, but the cost.  Either tooling up entirely separate sets of molds (the most expensive way) or tooling the molds to allow different versions (cheaper, but still costly) may not be viewed as generating enough extra sales to justify the cost.  While at a quick glance the Electrostar family may look the same the differences in front ends, connections within units, etc all add to the cost.
3. related to 2, for most of the market one Electrostar/Desiro looks that same as any other so if while many people may buy the first version released (say a 377), fewer will buy a 376 "because I already have one".  Then add in the very small operating areas, lack of liveries, and for some overhead electrics and you end up with a model that probably should be done but likely wouldn't sell enough units to cover the costs of making it.

Also remember that as the number of unique vehicles in a unit goes up the costs go up as the tooling costs go up.

 

I'm not sure the 170 refresh will be worth it and don't get me started on the new 158... but that seems to be just one manufacturers problem - announce, but give no real effort to bring it to market in a sensible amount of time. And by the time it is produced, technology will have moved on so much that it'll be obsolete already.

I suspect Bachmann UK would disagree with the effort part, they appear to be a victim of circumstances out of their control as parent Kader dealt with a necessary restructuring.

 

As for the worry about obsolete, not an issue as Bachmann have taken the opportunity to "up their game" and the EPs of the new models coming out now that the Bachmann pipeline is moving again show very nice looking models.

 

[HonestTom]

The duplication we see is, I think, an unfortunate side effect of the manufacturing process rather than any deliberate attempt to steal a march on the competition. I don't know that Rails would have commissioned the Terrier if they'd known that Hornby had the same prototype in the works. And I feel sorry for Kernow, who planned a 1366, then Heljan announced the same, so Kernow switched to a 1361, and Heljan did one of those too.

 

With current models, it takes so long to get from planning to production that I think there's a bit of a damned-if-you-do, damned-if-you-don't situation regarding making your intentions known. If you announce your model too early, then you can wind up with such a long period until release that potential buyers get frustrated. I know I've given up on the Bachmann 94xx, and the Kernow D600 Warship has been in development so long that I'm pretty sure it started out as a modern image model. But if you announce close to release, you wind up with a situation like the one with the Terriers, where both manufacturers are too advanced to back out.

 

That being said, I think the market can support duplication if there's sufficient difference between models to give buyers a choice. For example, the Oxford Radial is not as detailed as the Hornby one, but is significantly cheaper. Hornby even duplicates within its own range, thanks to Railroad.

[The Stationmaster]

Where do you get the line about 'limited production capacity' when there are firms in China falling over themselves, and in some cases offering incentivising deals to get business from the UK?   It might perhaps be that it's now wonder there's some of the duplication we see beacuse of that capacity being there although I suspect some of it is more likely down to lack of originality of thought and relying on wish list harvesting and not placing as much attention as used to be given to sales intelligence and customers views gathered by real human sales reps visiting retailers' premises and talking to real people instead of shuffling electronic chaff. 

 

As has been said on numerous occasion in the past it is illegal for manufacturers to 'put their heads together' in respect of future developments although it has to be said that one can sometimes get the impression that various Chinese factories might not be quite so 'watertight' and people running different factories do meet socially - there's no law against that and after all they're doing the jobs for their customers.  And of course it's not unknown for Chinese factories to help each other put with, say, running something off a moulding machine while the other firm has a busy spell.

 

So perhaps a partial answer to duplication might be an early stake in the ground although that cause immense frustration (for reasons I'm far too mature in years to understand) among people who seem to think that once something is announced it should leaping out of a container on a UK dockside to a fanfare of trumpets a few weeks later.  Different firms do their announcement part of the process in different ways - simples, and that's the end of that.  But then of course delays in development can occur anyway - sometimes for human reasons (not getting on with the job) but more often because of research problems or technical problems and errors, each of which has to be sorted.

 

Then of course you get the situation with delayed announcements - such as the policy now resumed by Hornby where they are going for an annual big bang approach instead of phased 'leakage' of information over the course of a year but with something saved for year end announcement.  Hornby reverting to that approach has probably cost Dapol a couple of thousand £s with its GW large prairie and maybe somebody in the chain some money on their alternative 'Terrier' because both were obviously well underway at Hornby before the competitors oin view of the length of Hornby's normal development cycle.  If news had crept out earlier a 'keep off my grass' message might well have had some impact as it did with the ill-fated Hattons by DJM 'King'.

 

With ever more concerns entering the UK model railway market including occasional commissioners coming and not lasting plus properly managed crowd funded schemes the big thing the market has now got is increased competition.  In some respects more people out there are after our money.  But in some respects is this more imagined than real for much of the market?  For instance a few (nowadays very few) 'wow I like it' items apart I buy solely to suit my area/period of interest so, for example despite the apparent quality etc of Accurascale's output they have yet to produce a single thing which I will buy; same goes for Mr Hatton's 'exclusives'; but this year Hornby will get several hundred £s more of my money than last year; I've yet to learn if Bachmann will have anything to tempt me and spending with them on previously announced items depends solely on when those items arrive - but I won't spend that money on anything else if Bachmann's delivery is delayed.   In the past a big part of the market was undoubtedly the 'I like that so I'm having one, or more' market and that, I suspect, is mainly where any domestic belt tightening has hit and also where the death of deep discounting on new models has also had an impact.  The market might have shrunk (but at times I really wonder if it has), it has definitely changed because the content of the cake has changed and more slices have to come out if it but a lot hasn't changed apart from greater selectivity in buying

[D9020 Nimbus]

As far as N gauge is concerned, most of the main diesel classes have been modelled to a good standard—or are planned (class 50), other than the 25/3. There is quite wide coverage of GWR types, mixed coverage of LMS types, little coverage of the SR (just the unrebuilt Bulleids, the N, C, Q1, M7 and Terrier). LNER "big" engines are plentiful although the V2 hasn't been made for some time and could do with a retool, and there are NO LNER tank locos available (the Farish J94 hasn't been made for some time).

 

British N gauge was all but moribund in the early 2000s, but the arrival of Dapol on the scene prompted Bachmann/Farish into action. More recently, Dapol's concentration on O gauge has led to little from them, and little from Farish either—Farish did not introduce any new loco models during 2018. However Dapol are showing signs of life again(class 68, class 50, Bulleid light Pacific "on" again) and Revolution Trains are increasing their involvement, particularly via the collaboration with Sonic Models. I wouldn't be surprised in the least if Revolution Trains/Sonic Models becomes the main manufacturer in N Gauge within the next five years. On the other hand Farish may be prompted into action, now they've "lost" the 56xx—there may be more announcements, but, I fear, few new products over the next few years.

[andyman7]

Where do you get the line about 'limited production capacity' when there are firms in China falling over themselves, and in some cases offering incentivising deals to get business from the UK?   It might perhaps be that it's now wonder there's some of the duplication we see beacuse of that capacity being there although I suspect some of it is more likely down to lack of originality of thought and relying on wish list harvesting and not placing as much attention as used to be given to sales intelligence and customers views gathered by real human sales reps visiting retailers' premises and talking to real people instead of shuffling electronic chaff. 

 

 

There are others who can provide more detail but what I have picked up from the informed sources on RMWeb (i.e. those who have been involved in sourcing production) is that fine scale model production does not just need a Chinese factory that can knock out plastic mouldings - it needs a particularly trained and skilled workforce that is a bit less ten-a-penny than you imply. Add to that the fact that British RTR model commissions (which might typically be 1-2000 pieces) are not going to be as attractive to someone trying to amortise their production capacity when offered, say, a US commission for 5-10,000 pieces and I'm not so sure as you that this isn't a problem.

What's the evidence? Well, I would have thought the erratic supply of red box, blue box, special commission and other models for quite some years now suggests a systemic issue.

Edited January 12, 2019 by andyman7

[woodenhead]

Well I never I'd see the day that there would be three competing RTR MK1 coaches ranges in O with prices at the £200 mark.

[Butler Henderson]

I've always been bemused on how Dapol got away copying other manufacturers wagons - led to the ultimate competition when you can find the same basic wagon under numerous different brands

[andyman7]

I've always been bemused on how Dapol got away copying other manufacturers wagons - led to the ultimate competition when you can find the same basic wagon under numerous different brands

Can you elaborate? I'm aware that Dapol currently and in the past has owned tooling used by other manufacturers but that's not copying. 

[Coryton]

I've always been bemused on how Dapol got away copying other manufacturers wagons - led to the ultimate competition when you can find the same basic wagon under numerous different brands

 

Putting aside the question of whether Dapol has done this (not something I'm aware of if they have), the general view here seems to be that it is (somehow) quite legal to copy a model, as the Great British Locomotive series seems to have done.

[Dunsignalling]

I've always been bemused on how Dapol got away copying other manufacturers wagons - led to the ultimate competition when you can find the same basic wagon under numerous different brands

I think it's a lot more complicated than that. In the aftermath of the demise of Airfix/GMR, and Mainline, tooling and rights were cast to the four winds. 

 

The Mainline stuff ended up split between Replica Railways and Bachmann, but to make things even more interesting, models from both had "Bachmann" moulded into them. Replica  offered (and still do in certain cases)  coaches with their origins way back when, that Bachmann have never sold, e.g. their Mk.1 BG, the ex-Mainline Mk.1 RB and (formerly) the LMS open third that appeared to combine an unreleased Airfix body with a Mainline underframe/bogies. Bachmann's (original) Bulleid and Thompson coaches were reputedly, at least in part, developed by Airfix before their end came.

 

Airfix was even more complex, with most of it initially passing to Dapol. The original Dapol Terrier, later passed on to Hornby, appears to have Airfix origins in line with the known provenance of the 14xx, Dean Goods, 4F and 2P all of which passed through Mainline and Dapol's hands before ending up with Hornby. Also, Hornby's J94 started off as a Dapol product.

 

The same goes for the wagons (the notional 10' wb 7-plankers on steel underframes being one that Hornby should have avoided) and coaches/siphons all of which went to Dapol first (despite some of them also passing through Mainline en-route).

 

Dapol clearly passed much material to Hornby; interestingly the LMS Restaurant car, but none of the other LMS coaches, plus the B-set, Auto coach and Siphons, which presumably carried an exclusivity agreement that some of the wagons did not. 

 

Also, just to muddy the waters further, some Dapol wagon bodies can trace their origins back through Wrenn to Hornby Dublo.

 

All fascinating stuff, but if any "copying" did happen, it was an awful long time ago, and not necessarily by who one might instinctively blame. In any event, I doubt the parties involved could unravel all of the 1980/90s to-ing and fro-ing, even if they any of them were that bothered.

 

What is clear, is that some very old models are still being turned out under various names, and that a few of them hold up surprisingly well forty-odd years on.  

 

John  

Edited January 13, 2019 by Dunsignalling

[jjb1970]

A staple of articles on the manufacturing side of model trains is that the UK market is something of a minnow and the factories serve the big markets as their priority. Also, that the supply/demand balance is tilted in favour of factories. Is either assumption true?

 

If I look at North American HO the default seems to be manufacturing runs of models, some manufacturers produce to pre-order and although the market appears to be bigger than ours I'm not actually sure it is that much bigger and I'm pretty sure that the change in market size is nothing like being proportionate to the difference in population size. If I look at Europe, most of the real interest there is from smaller manufacturers, with the traditional big boys struggling and although the overall European market is bigger than ours I'm not sure that it is that much bigger and if you take Germany and perhaps Switzerland out of things (and it should be noted that a lot of enthusiasts of Swiss trains are not Swiss) then I think British OO is a pretty big market in terms of model trains. So I think the British market is still big enough to be of interest to the manufacturers, it's interesting that Revolution are working with one of them to help them enter the UK N gauge market directly.  Bachmann and Grafar's UK program remains comprehensive and Kader still clearly see our market as a significant one.

 

On factories, it appears to go through periods of difficulty when a major factory goes out of business, disrupting production and causing chaos for a while. However, at the moment the message seems to be that model train factories are looking for work and that it is very much a buyers market. The factories are clearly more than willing to work with smaller customers such as model shops and crowd funding projects.

 

On competition, it's a free market and it is for the suppliers to manage their affairs and make their own decisions on whether to go head to head on certain models. Any company can co-operate to develop technology and jointly develop products but market distorting collusion and price manipulation is illegal. The idea of some sort of cartel to assign rights to models might seem superficially attractive but it wouldn't benefit anybody (least of all customers), it'd be illegal and personally I think competition is good.

[34theletterbetweenB&D]

...the general view here seems to be that it is (somehow) quite legal to copy a model, as the Great British Locomotive series seems to have done.

The intellectual property rights protection it would appear is limited by the fact that process skill is required. You cannot copy such a physical item by the simple press of a button on a photocopier or recording machine.

 

The GBL productions while clearly copies from some form of scan of a model (see the GBL reproduction of 'model only' items like NEM  coupler pockets not present on the full size prototype) also reveal some imperfections arising from the process. The GBL Peppercorn A2 is an example that reveals this very clearly, there's asymmetry between the left and right sides of the firebox, not present in the Bachmann model which was used as the source (see those NEM coupler pockets and the structure of the Cartazzi truck interior, exactly as the Bachmann original).

[Mike Storey]

There are others who can provide more detail but what I have picked up from the informed sources on RMWeb (i.e. those who have been involved in sourcing production) is that fine scale model production does not just need a Chinese factory that can knock out plastic mouldings - it needs a particularly trained and skilled workforce that is a bit less ten-a-penny than you imply. Add to that the fact that British RTR model commissions (which might typically be 1-2000 pieces) are not going to be as attractive to someone trying to amortise their production capacity when offered, say, a US the commission for 5-10,000 pieces and I'm not so sure as you that this isn't a problem.

What's the evidence? Well, I would have thought the erratic supply of red box, blue box, special commission and other models for quite some years now suggests a systemic issue.

 

Evidence?? Look at Rapido's threads. Also look at Athearn's and other's production problems.

 

We tend to look at matters very parochially on here. Piko's attempts to rejuvenate the main European market, with their very clear three class offer (entry, mid and expert levels) has yet to prove its worth, but it is exactly what many on here have been crying out for from the red and blue boxes.

 

Accuracraft appear to have found an innovative way around the oft-reported chasm between off-shored design and production, against the intended domestic outline specification, simply by ensuring domestic CAD capability. They have as yet no reported issues with follow-on production issues, still in China. But such quality comes at a cost, albeit not so great a difference with more mundane outputs, that we are put off. We have not yet seen any comment on this from the larger players, so do not yet know if this apparently simple twist is a game changer, or that the Irish team are rather better (and rather better funded) at the game than the rest.

 

Certainly, the history of DJM's involvement, where knowledge and experience could beat a lack of capital, have suggested that the MR game is rather more convoluted than we had hoped. FTG's initial burst of enthusiasm, ended in a sell-out which, whilst it ensured FTG could continue in some form. radically raised the cost of what should have been a reasonably routine item of rolling stock, to a surprising RRP.

 

So, given we do not yet have the ideal design and production methodology, the year or two ahead, remains an experiment. Competition is undoubtedly vital to explore what the best combination could be, in the near term. But in the longer term, given post-Brexit uncertainty, Chinese domestic economic uncertainty and international trading volatility, the exigencies of UK domestic demand seem almost irrelevant. There will always be a hard core of modellers who will pay something for anything. But given that anything has been unobtainable in many cases, for multiple reasons, the marketing end of the equation continues to be guesswork. We are already a niche market, but many niche markets have become rather lucrative in recent years. Ask vegans......

[mdvle]

One of the difficulties in making comparisons is that everything is not equal.

 

Some of the companies involved have very high overheads, through salaries and accountants and other professionals, as a result of being listed on the stock market.

 

At the other end of the spectrum we have companies where the "staff" have full time jobs elsewhere and are producing models in a large part I assume due to personal desire to see them produced.

 

Similarly some sell only through authorized retailers, while some either only sell direct or sell direct with retail sales being at a higher price.

 

As for the question on size of markets, regardless of what some one here appear to think the UK is a very sizable market in the model train space (one of the reasons why, despite the moaning, UK prices are often on the low side compared to elsewhere in the world).

 

Just in terms of population the UK would rank 5th in model railway markets (US, Japan, Germany, and barely France are larger) but when you consider the percentage of the population in the hobby it is likely the the UK comes in 2nd.  The lack of accurate numbers make comparisons difficult but the evidence - number of magazines, number of shows, number of retailers, and now number of products all show a hobby that is a lot larger than in other countries.

[Coryton]

A staple of articles on the manufacturing side of model trains is that the UK market is something of a minnow and the factories serve the big markets as their priority. Also, that the supply/demand balance is tilted in favour of factories. Is either assumption true?

 

If I look at North American HO the default seems to be manufacturing runs of models, some manufacturers produce to pre-order and although the market appears to be bigger than ours I'm not actually sure it is that much bigger and I'm pretty sure that the change in market size is nothing like being proportionate to the difference in population size. 

 

 

An interesting point. I have the impression that proportionately far fewer people in the US are interested in trains than in the UK, based on the reaction I've had from staff when I've shown an interest. (Could you imagine someone on a preserved line in the UK offering a cab ride to a passenger just because they made the effort to walk forwards to look at the (diesel) engine at the front?)

 

On the other hand there is clearly enough interest in the US for railway magazines to exist and be sold in mainstream shops.

 

Looking at the circulation of UK and US modelling magazines would tell you something, I suppose.

 

But railway models of any kind must be a small market compared to other injection moulded objects that Chinese factories churn out.

[Nearholmer]

Market saturation?

 

I'm not sure anyone has raised this possibility in the above, but as I see the announcements, read the reviews in RM, and read the "Confessions of a Stasher" thread here, I do wonder if it is a possibility, in mainstream 00 at least.

 

The suppliers seem to be quite clever at avoiding it, by moving into "industrials', and there is a near-infinity of prototype locomotives, carriages, and wagons left to "do", and the re-mastering to a higher standard thing is taking-off, but still, I do wonder.

 

What could, of course, put the brakes on is a significant change in interest rates, which would probably severely curtail the optional spending a a lot of mortgage-payers, as well as increasing costs for suppliers to some degree.

 

An interesting spectator sport!

[Coryton]

One of the difficulties in making comparisons is that everything is not equal.

 

....

 

Just in terms of population the UK would rank 5th in model railway markets (US, Japan, Germany, and barely France are larger) but when you consider the percentage of the population in the hobby it is likely the the UK comes in 2nd.  The lack of accurate numbers make comparisons difficult but the evidence - number of magazines, number of shows, number of retailers, and now number of products all show a hobby that is a lot larger than in other countries.

 

I'm sure you're right, but as you say everything is not equal and for example exhibitions are much more practical in a small, densely populated country than one where people are more spread out even if overall there are the same number of interested people.

[The Johnster]

One of the difficulties in making comparisons is that everything is not equal.

 

Some of the companies involved have very high overheads, through salaries and accountants and other professionals, as a result of being listed on the stock market.

 

At the other end of the spectrum we have companies where the "staff" have full time jobs elsewhere and are producing models in a large part I assume due to personal desire to see them produced.

 

Similarly some sell only through authorized retailers, while some either only sell direct or sell direct with retail sales being at a higher price.

 

As for the question on size of markets, regardless of what some one here appear to think the UK is a very sizable market in the model train space (one of the reasons why, despite the moaning, UK prices are often on the low side compared to elsewhere in the world).

 

Just in terms of population the UK would rank 5th in model railway markets (US, Japan, Germany, and barely France are larger) but when you consider the percentage of the population in the hobby it is likely the the UK comes in 2nd.  The lack of accurate numbers make comparisons difficult but the evidence - number of magazines, number of shows, number of retailers, and now number of products all show a hobby that is a lot larger than in other countries.

 

Not that I'm disagreeing (I don't know enough about the subject to do that), I think it's only fair to point out that, as per your point about things not being equal, US modellers are more likely overall to have very large layouts, taking advantage of the footprint size cellar than most merkan houses have, with large numbers of locomotives and rolling stock; 100 car freights seem to be the norm, quadruple headed.  In other words, 4 times as many locos and not far off twice as many wagons as a UK equivalent layout capable of operating scale length trains, and that sort of layout is the norm there where here it lives in clubs and we tend to have BLTs or shunting puzzles at home.

 

Everything is the same except when it's different.

Edited January 12, 2019 by The Johnster