KR Models business model etc

[frobisher]

In their defence, KR haven't yet not delivered a model.

 

However, for a manufacturer primarily using a crowdfunding model, they appear more like a Christmas Club style venture than anything else.

 

Crowdfunding needs a constant, consistent level of communication, as to where things are, what will allow things to proceed to a next step etc.  Currently seeking any proper evidence of that.

[pete_mcfarlane]

I'd throw a few of comments into the bear bit:

• KR models isn't DJM. DJM seemed to put about half an hour's thought into the next model before bunging out a press release for the fanbois to froth over, and you never saw anything about the model again. With KR we are getting progress updates, CADs etc. 
• There's been a shift in the industry over the last few years, to the point where an individual can set up their own RTR model railway company, and outsource the manufacturing to China. That's great, and we're getting loads more models out of it, but it does mean that you are dealing with a very small business where one or two people do all of the back office functions. So you'll get a few rough edges in communications, and whether people want to accept this in return for more models is up to them, but it strikes me as something worth putting up with for more toys. Those of us who build kits have been happily coping with the idiosyncrasies of small traders in return for the stuff we want for years....
• I'm not sure what the problem is with them being based in Canada. It's a first World country with consumer protection laws, and buying stuff from overseas is not really a novelty these days. I suppose they could pay for a PO box address and shell company in the UK to make it look like they were a British company. but that would push the costs up for not much value.

[MidlandRed]

40 minutes ago, The Stationmaster said:

They do?????  I read this and immediately looked at their website - where every Class 89 price they show includes VAT, and says so.  What exactly are you looking at and where are you looking from; somewhere outside the UK perhaps where no doubt they would exclude VAT because UK Vat doesn't apply?

 

And yes - we seem to be in agreement that KR's website is a mess.  It still strikes me as weird, and unprofessional, that somebody selling British outline models into the UK from a foreign country - or indeed selling to any other country - does not make clear on their headline ('come on') price that it does not include VAT. (or any other local sales tax).  And of course none of this explains where that extra 25%, on top of UK VAT, has come from.

 

Maybe I'm used to UK shopping procedures but when I have occasionally bought on line from the USA (not model railway items) it has always been made clear  right from the start that the price does not include the appropriate sales tax. 

However what Accurascale’s website doesn’t make very clear is you don’t have to pay anything up front for a pre order (they offer this as an option). So in effect the website does point the unwitting towards funding AS in advance.

 

I do find these ‘dismantle a model maker’ threads extremely odd - well maybe not - armchair internet observers who think they know how to run someone’s firm better than they do is quite a popular pastime across the internet.

 

KR Models appear to have committed an RMWeb cardinal sin - apparently (though as always it’s only conjecture) ignoring sage advice from RMWeb experts (noting they often disagree with one another as well). Whether that was in time to do anything about it is also unknown. Well I suppose it makes a change from object flinging at Hornby (and likely in reality the TV star himself). 
 

Meanwhile one would get the feeling as an occasional observer of this forum that the sun shines out of the proverbial of Accurascale - I’m an admirer of what they do but I’m sure they are not 100% perfect!! It sometimes makes me wonder whether some of the usual suspects (with the stone throwing at some firms) actually have more than a model making interest 😉

[jjb1970]

The sad thing about DJM was that when he could motivate himself to do something and make an effort he could oversee development of very good models. He was completely unsuited to trying to set up and run his own business (I think he lacked basic competence in multiple areas to put it mildly) but he was a pretty talented modeller and when actually working at what he should have been doing was pretty good at the model side of things (though not so much on mechanisms). 

[Bernard Lamb]

3 hours ago, Ouroborus said:

 

You perhaps need to be more careful in your wording.   I could only find two posts (Bulleid and Clayton) that were made "on here"  that sought an EOI.   Other EOIs postings were not made by KR Models and linked from elsewhere.

 

 

 

KR made few posts on here partly due to the reception he received, so technically you are correct and we have others to thank for the publicity. His business methods were widely known and others posted material that could only have come from KR that gave more details. 

Also note the UK email addresss. AFAIK the original intention was to import the models into the UK and to despatch from here.

Bernard

 

[woodenhead]

8 minutes ago, jjb1970 said:

The sad thing about DJM was that when he could motivate himself to do something and make an effort he could oversee development of very good models. He was completely unsuited to trying to set up and run his own business (I think he lacked basic competence in multiple areas to put it mildly) but he was a pretty talented modeller and when actually working at what he should have been doing was pretty good at the model side of things (though not so much on mechanisms). 

His ego got in the way of commonsense - remember when Dapol claimed a massive chunk of the N gauge market in one set of announcements - and when it became obvious it was undeliverable he jumped ship and set up on his own where he again began to run away with things.   It's not as if he didn't have previous, but people were so in awe of him that discussions about the previous business collapse could not be had, i.e. he had form, got a reprieve with Dapol, then started another business which failed spectacularly.

 

It's sad really, his fall and that of LLC showed the risk involved with Crowdsourcing if you don't balance the income with the expenditure. 

 

Bringing it back to KR Models it demonstrates why people are still nervous of the business model employed, though perhaps some of the problems with the body on the Fell indicate that maybe KR Models understands better the need to keep within a development budget in order to deliver the model at the stated price and make a profit.  I am still not convinced that this business model is the right one to deliver a class 40, but for lesser known oddities it seems to be working for KR Models.

[jjb1970]

The thing that turned me off DJM (apart from his bombast) was his propensity to blame factories in China and start stories about all sorts of nefarious deeds, how he was a victim of evil factory owners blah blah blah. My personal view then and now is he played to some deeply unpleasant prejudices to try and evade responsibility for his own ineptitude.

[MidlandRed]

When I visited their stand at Warley they seemed very friendly, and were entertaining @Jenny Emily - they were all dressed in KR outfits with their names on - all impressive I thought. 
 

I know their Fell turned out not to be as detailed as some models at the high end are these days - however I personally know of several people who’ve bought them and are very pleased (warts - well perhaps more realistically, skin blemishes (dependent on your outlook) and all). I guess we should be thankful firms are willing to make models of such quirky prototypes. 

[The Stationmaster]

2 hours ago, MidlandRed said:

However what Accurascale’s website doesn’t make very clear is you don’t have to pay anything up front for a pre order (they offer this as an option). So in effect the website does point the unwitting towards funding AS in advance.

 

I do find these ‘dismantle a model maker’ threads extremely odd - well maybe not - armchair internet observers who think they know how to run someone’s firm better than they do is quite a popular pastime across the internet.

 

KR Models appear to have committed an RMWeb cardinal sin - apparently (though as always it’s only conjecture) ignoring sage advice from RMWeb experts (noting they often disagree with one another as well). Whether that was in time to do anything about it is also unknown. Well I suppose it makes a change from object flinging at Hornby (and likely in reality the TV star himself). 
 

Meanwhile one would get the feeling as an occasional observer of this forum that the sun shines out of the proverbial of Accurascale - I’m an admirer of what they do but I’m sure they are not 100% perfect!! It sometimes makes me wonder whether some of the usual suspects (with the stone throwing at some firms) actually have more than a model making interest 😉

I quoted Accurascale as an example when it was mentioned that they do not include VAT in their prices.  

 

There are plenty of others I could quote who are basically commissioners just like KR and are or have ben 'one man bands'.  Most of them are registered with financial details easily, and freely, accessible on the 'net.  All of them give postal addresses and contact details and always have; all of them have either announced or advised details of their proposed model on RMweb and/or other online media and have published regular updates or updates when they have anything to say, to customers and intending customers.  Most of them have interacted in some way or another with RMweb members or via Facebook.  I can't remember any of them throwing their toys out of their pram because of adverse comments made on RMweb about their models - but I'm happy to be advised of things I have missed.

 

There are variations between them regarding pre-payment or staging of pre-payments or simply asking for a deposit or not asking for any advance payment of any kind.  The majority have funded their business from their own resources - in some cases by mortgaging their home to obtain the necessary capital.   I think the majority have kept going however one or two, and DJM is not alone in that respect, have failed and taken some customers' money down with them.  Notably in those cases which I know about (two) their financial details were freely available on the 'net and while detail was lacking there were warning signs for those who cared to look.  And in those cases even the masses of UK consumer protection and transparent insolvency proceedings could do little or nothing to protect customers' money.  But at least the procedures allowed claims for that money to be freely legally registered against the failed company during its winding up process.

 

 

And - from what I have seen of them if at any time they became aware of structural weaknesses in their business they have set about correcting them, or learning for the future, as quickly as they could.  Something which KR still needs to do.

[Roy Langridge]

3 hours ago, The Stationmaster said:

They do?????  I read this and immediately looked at their website - where every Class 89 price they show includes VAT, and says so.  What exactly are you looking at and where are you looking from; somewhere outside the UK perhaps where no doubt they would exclude VAT because UK Vat doesn't apply?

 

Accurascale’s website shows you a VAT inclusive price if it knows where you are and that VAT is due. If it doesn’t know it shows a VAT exclusive price. If you look back through the various threads you can find instances where people have been confused - I have seen this myself. 
 

Roy

Edited January 8, 2023 by Roy Langridge

[The Stationmaster]

40 minutes ago, MidlandRed said:

When I visited their stand at Warley they seemed very friendly, and were entertaining @Jenny Emily - they were all dressed in KR outfits with their names on - all impressive I thought. 
 

I know their Fell turned out not to be as detailed as some models at the high end are these days - however I personally know of several people who’ve bought them and are very pleased (warts - well perhaps more realistically, skin blemishes (dependent on your outlook) and all). I guess we should be thankful firms are willing to make models of such quirky prototypes. 

I don't argue particularly so much with lack of detail on the Fell but the all too obvious mistakes which were made.  Getting it noticeably wrong is rather different from missing out a few handholds or footsteps on the body side or making a hash of the lights. 

[cctransuk]

1 minute ago, The Stationmaster said:

I don't argue particularly so much with lack of detail on the Fell but the all too obvious mistakes which were made.  Getting it noticeably wrong is rather different from missing out a few handholds or footsteps on the body side or making a hash of the lights. 

 

Perhaps the Fell was an (unannouced) 2 for 1 offer - you got 2 (half) models for the price of 1!!! 😄

 

CJI.

[pete_mcfarlane]

1 hour ago, jjb1970 said:

The thing that turned me off DJM (apart from his bombast) was his propensity to blame factories in China and start stories about all sorts of nefarious deeds, how he was a victim of evil factory owners blah blah blah. My personal view then and now is he played to some deeply unpleasant prejudices to try and evade responsibility for his own ineptitude.

Publicly blaming your subcontractors is never a good look for any business, even when it actually is their fault. 

[Bernard Lamb]

6 minutes ago, Din said:

 

 

 

Not quite sure why people are rambling about Jewish Business Tactics or "the worst of capitalism" but then you find some certainly bizarre posts on the internet...

But this whole thread is supposed to be about business methods.

I post on the forum and am quite open about my work and my family background,

Most people find the extra information that I can bring to a topic of interest and of use to them.

I also do not hide behind some ridiculous web name.

Please do not make snide remarks about me and just throw them into the air.

If you want to know why I write how I do then please have the courtesey to address me directly.

Do you feel KR to be mainstream or on the fringe as regards their business methods?

Some of us have had religious and or family or school or work backgrounds and have developed high ethical standards and do not believe that certain methods are in the best inerest of society in the long term. I respect all people with such views but do not always agree with them. Colin asked that people keep it civil. Please stop your rudness but by all means join in the discusssion

Bernard

[john new]

5 hours ago, Bernard Lamb said:

 

KR made few posts on here partly due to the reception he received, so technically you are correct and we have others to thank for the publicity. His business methods were widely known and others posted material that could only have come from KR that gave more details. 

Also note the UK email addresss. AFAIK the original intention was to import the models into the UK and to despatch from here.

Bernard

 

Given the comments from IIRC @The Stationmasterit is quite clear from that advert/show stand poster that no extras other than the shipping fee are mentioned. That implies £185/£275 plus P&P is what you will pay depending on whether it is DCC chipped - nothing about extras for local taxes and/or customs fees. Out of curiosity, as I didn't want/buy one, what did people actually pay for the GT3? A second query is did the higher priced one come with the sound chip and speaker installed, you have to assume it would do so from the advert but it doesn't specifically state they are to be factory fitted rather than supplied as home fit extras.

[chris p bacon]

For info, KR stated back in 2019 that shipping was to be £4.50 for the UK.

[GWR-fan]

1 hour ago, chris p bacon said:

For info, KR stated back in 2019 that shipping was to be £4.50 for the UK.

 

No doubt this was for goods shipped within the UK when the production run of the GT3 was  to be shipped to the UK and distributed locally.

[JDW]

Having started reading this thread, I had a quick look at the KR Models site and picked a loco at random, the British Steel Hunslet. The price at the top of the page, and in the "select livery" etc boxes, is shown as £150 to £233.33, yet lower down in the blurb as £180 to £280, with no clarification. I did find that confusing, though having read here assumed the difference to be VAT. 

 

On going through to my basket, the initial postage cost was £23 but changed to £4.95 when I changed the country to UK. The proice was shown as £180 with a note saying that it included £30 VAT. I suspect it's got more to do with the standard North American way of not adding VAT until the checkout than any malicious or nefarious intent, but I'm not sure ignorance or lack of technical ability excuses it either when a large part of your market is in a country where it's expected for prices to include VAT. It might well seem totally normal to the KR folks over there, they might be wondering what the fuss is about... but it's important to understand the market you're selling into - not just the models, but the nuances and the technical and commercial expectations. 

 

One other thing I've noticed in KR's adverts (and I stress, I see it in others too, but it pops up much more in KR's, or at least I've noticed it more) is poor grammar. The one shown by Bernard Lamb a few posts back for example. "a ready to run model of the GT3 Gas Turbine RTR Loco" - for a start, all those extra capital letters hurt my eyes. Gas turbine and loco aren't names, they don't need them. But it's definitely not a model of a "Gas Turbine RTR Loco". Or even of a gas turbine RTR loco. [For clarity, RTR stands for "ready to run", a term which describes the model not the prototype and indicates that it's not a kit]. "To" should be "to" as it's a continuation of the sentence that started two lines above. "DCC ready" (lower case) but "DCC Sound" - why the upper case S, sound isn't a name? (You could probably argue that it should really be "Brings" not Bring as well, if you're being pedantic, as a company [KR Models] is really an "it" not a "they". It brings, they [the people] bring.)

 

I know it makes me sound like a pedant, and lots of people might not even notice, but to me that's the point. It's about getting things right, being accurate. Lots of people might not notice the Fell roof error, it doesn't make it right. And not caring enough to proofread, or get someone with a better level of English to do it, to me that's a sign of the general attitude of a business or organisation. I'm not trying to have a go at the writer, and it's not just KR, I think it's an important point in general - if they can't be bothered to get their publicity right, and think it doesn't matter, it's a red flag that says "what will their product/service/etc be like?" 

8 hours ago, Bernard Lamb said:

(NB - I know we can't all be perfect at it, and yes, we all make errors from time to time, even in print - I'm sure the BRM team will agree on that - and it's not the end of the world, but I'm speaking here about consistency not just a one-off)

Edited January 8, 2023 by JDW

[jjb1970]

A lot of UK websites adjust prices based on where you are, in many cases you also get a pop-up box asking if you want prices in your local currency and International shipping options. I find it a useful feature, as it allows me to see prices in SGD without VAT and how much shipping will cost. I know it's not difficult to deduct VAT and convert currency but it does make on-line shopping a little easier.

[john new]

10 hours ago, The Stationmaster said:

They do?????  I read this and immediately looked at their website - where every Class 89 price they show includes VAT, and says so.  What exactly are you looking at and where are you looking from; somewhere outside the UK perhaps where no doubt they would exclude VAT because UK Vat doesn't apply?

 

And yes - we seem to be in agreement that KR's website is a mess.  It still strikes me as weird, and unprofessional, that somebody selling British outline models into the UK from a foreign country - or indeed selling to any other country - does not make clear on their headline ('come on') price that it does not include VAT. (or any other local sales tax).  And of course none of this explains where that extra 25%, on top of UK VAT, has come from.

 

Maybe I'm used to UK shopping procedures but when I have occasionally bought on line from the USA (not model railway items) it has always been made clear  right from the start that the price does not include the appropriate sales tax. 

£150 base cost plus £30 VAT at 20% for UK = £180 so correct.

Edited January 9, 2023 by john new

[jjb1970]

8 hours ago, pete_mcfarlane said:

Publicly blaming your subcontractors is never a good look for any business, even when it actually is their fault. 

 

Indeed, you can outsource work, you can't outsource responsibility for what you are supposed to deliver. A misconception many businesses have.

In DJM's case it went particularly bonkers as he was accusing factories of theft, when the evidence indicates all the factories were doing was requesting payment for work done before releasing deliverables.

[Darius43]

I also recall that DJM was alleged to have indulged in some international travel to attend air shows, presumably using the proceeds of his enterprise to do so.  As far as I am aware KR Models has not indulged in that kind of behaviour.

 

Cheers

 

Darius

[TheCoffeePot]

On 07/01/2023 at 21:07, Legend said:

Oh I know someone else will say someone would have produced the Leader etc , well where were they ? 

 

 

 

Last time it was hinted at was Loconotion Models approaching Dapol to produce one back in 2008. That gives some idea as to how extremely rare and difficult it is to get such prototypes in RTR form if you're unable to build or purchase a kit out of difficulty rarity etc. It's why I payed up front for the kernow beattie well tanks and the bulleid diesels back in the day. It was vital to produce confidence in these commission projects so more people would venture into providing us with more sort after models and now we have the likes of Accurascale, Rapido, The National Railway Museum etc literally making the unthinkable happen like j70's instead of relying on the whims of Hornby and Bachmann to never touch such subjects. So again I'm putting my money down on my desired prototypes even in risky situations because as some people have mentioned what other chances are there?

 

Even so I don't disparage the criticisms and observations but people emotionally invested do tend to jump into more toxicity than constructive statements so I'm hoping people's persistence in the negativity doesn't push into self fulfilling proffacies. I'd much rather do a hack job myself to improve a cheap and cheerful model than to see businesses failing and no models made at all.

[GWR-fan]

3 hours ago, Darius43 said:

I also recall that DJM was alleged to have indulged in some international travel to attend air shows, presumably using the proceeds of his enterprise to do so.  As far as I am aware KR Models has not indulged in that kind of behaviour.

 

Cheers

 

Darius

 

There may have been a "research" trip to the National Railway Museum back when the GT3 was in development.

[AY Mod]

7 hours ago, TheCoffeePot said:

Last time it was hinted at was Loconotion Models approaching Dapol to produce one back in 2008.

 

Locomotion/NRM have not had any involvement with a Leader model.

 

(Correction follows in a later post)

Edited January 9, 2023 by AY Mod
Correction