Hornby 2023 Annual Report

[The Stationmaster]

On 07/10/2023 at 12:55, BachelorBoy said:

 

I agree. But I also wonder why trading standards or someone can't stop them from doing it?

 

 

I think Trading Standards only get involved if they receive a complaint.  And does it then need a certain number of complaints to trigger action?  They certainly won't be going after Hornby over the Deltic unless someone shouts - they've got better things to do with their time..

Edited October 9, 2023 by The Stationmaster

[Standards_in_OO]

I don’t have a problem with Hornby increasing the run on something they said was a limited edition. I bought the HD Current condition Flying Scotsman because I wanted it, not as an investment opportunity so it would not bother me if they suddenly made more. If anything, it’s reassuring if something went wrong and the item needed returning then it is more likely there would be a replacement in stock. 

[adb968008]

The risk is, that those who do care, collectors, decide to exit that particular market in expectation that there will no rarity value, or worse still, the expectation of discounts down the road due to over production.

 

Thats brand damaging, because its not product specific.

 

A lot of what is bought is down to fear of missing out, but if theres not fear of missing out then theres no need to rush to buy either… which means product idling time in a warehouse costing money, sometimes for years.

 

Every model is like a glass of beer, the more you drink now, the less there is later… but drink too slow whats left at the bottom goes flat… drink too fast you need more… but what a model is, isnt 2 pints of beer, each models capacity is determined by the size of the glass… they key is serving the right beer with the right glass.

 

in the case of the deltic, they changed the size of the glass and its created froth, but equally its reduced its long term potential by drinking more now… demand is finite.

Edited October 8, 2023 by adb968008

[cctransuk]

33 minutes ago, adb968008 said:

The risk is, that those who do care, collectors, decide to exit that particular market in expectation that there will no rarity value, or worse still, the expectation of discounts down the road due to over production.

 

Thats brand damaging, because its not product specific.

 

A lot of what is bought is down to fear of missing out, but if theres not fear of missing out then theres no need to rush to buy either… which means product idling time in a warehouse costing money, sometimes for years.

 

Every model is like a glass of beer, the more you drink now, the less there is later… but drink too slow whats left at the bottom goes flat… drink too fast you need more… but what a model is, isnt 2 pints of beer, each models capacity is determined by the size of the glass… they key is serving the right beer with the right glass.

 

in the case of the deltic, they changed the size of the glass and its created froth, but equally its reduced its long term potential by drinking more now… demand is finite.

 

If it pe*s off 'collectors', it's fine by me!

 

I know - the market relies on 'collectors', yadder yadder yadder ........

 

CJI.

Edited October 8, 2023 by cctransuk

[ikks]

29 minutes ago, cctransuk said:

 

If it pe*s off 'collectors', it's fine by me!

 

I know - the market relies on 'collectors', yadder yadder yadder ........

 

CJI.

Yes I can see what you are saying and tend to agree but I became a "collector" almost 50 years ago, I guess by default as I did intend a layout all those years ago based on the WCML circa 1956-61 which in all reality ain't gonna happen now!. Just got too old, have no room..........all the usual suspects!, so I am cataloguing all of those Scots, Jubilees, Stanier Pacifics etc.etc. to sell. Any more like me out there?? GOOD news is Swmbo has agreed on a small shunting layout in a corner of the house so I am actually going to do something😁😁!.

Mike

Edited October 8, 2023 by ikks

[cctransuk]

6 minutes ago, ikks said:

Yes I can see what you are saying but I became a "collector" almost 50 years ago, I guess by default as I did intend a layout all those ago based on the WCML circa 1956-61 which in all reality ain't gonna happen now!.

 

That doesn't constitute a 'collector'.

 

A 'collector' obsessively buys models, but won't open the packaging for fear of diminishing their rarity / value.

 

He / she probably stores them in a 'gloat' cupboard, away from artificial light!

 

I knew someone whose loft was crammed up to the rafters with unopened models - you name it, he had one 'up there'; and yes - I did see them!

 

CJI.

[ikks]

2 minutes ago, cctransuk said:

 

That doesn't constitute a 'collector'.

 

A 'collector' obsessively buys models, but won't open the packaging for fear of diminishing their rarity / value.

 

He / she probably stores them in a 'gloat' cupboard, away from artificial light!

 

I knew someone whose loft was crammed up to the rafters with unopened models - you name it, he had one 'up there'; and yes - I did see them!

 

CJI.

Sorry CC full post coming up I stuffed up

Mike

[smr248]

6 hours ago, adb968008 said:

The risk is, that those who do care, collectors, decide to exit that particular market in expectation that there will no rarity value, or worse still, the expectation of discounts down the road due to over production.

 

Thats brand damaging, because its not product specific.

 

A lot of what is bought is down to fear of missing out, but if theres not fear of missing out then theres no need to rush to buy either… which means product idling time in a warehouse costing money, sometimes for years.

 

Every model is like a glass of beer, the more you drink now, the less there is later… but drink too slow whats left at the bottom goes flat… drink too fast you need more… but what a model is, isnt 2 pints of beer, each models capacity is determined by the size of the glass… they key is serving the right beer with the right glass.

 

in the case of the deltic, they changed the size of the glass and its created froth, but equally its reduced its long term potential by drinking more now… demand is finite.

Beer is a much better investment though...

[luke_stevens]

On 07/10/2023 at 16:51, Markwj said:

Hi Jason

can’t find anything to say there is an announcement next week, do you know what day and where did you hear it?

cheers

mark

From Hornby's Facebook Page (Tuesday 3rd Oct 23 at 10:45)

[adb968008]

6 hours ago, cctransuk said:

 

That doesn't constitute a 'collector'.

 

A 'collector' obsessively buys models, but won't open the packaging for fear of diminishing their rarity / value.

 

He / she probably stores them in a 'gloat' cupboard, away from artificial light!

 

I knew someone whose loft was crammed up to the rafters with unopened models - you name it, he had one 'up there'; and yes - I did see them!

 

CJI.

Thats the narrow minded view of a collector.

 

I think we are all collectors, in some way of something, be it manufacturer, class, region or era loyalty.  One can be a collector of GC 1959 and still run it.

 

But even if you were a hardened collector of GC 1959, if you saw umpteen models released from one manufacturer all end up in the bargain bin 6 months after release, what you going to do when some GC 1959 loco turns up ? Rush out and buy 6 for renumbering and weathering ? Or maybe buy 1, and wait on the rest ?.. but down the road, the next GC 1959 model may wane your interest in the first and you simply move on…

 

thats how to damage your brand.

 

 

Alternatively, make a reasonable number that suggests close to a sell out, and keep some urgency around it, and hence not much discounting. Fomo means our GC 1959 collector may buy a couple knowing he's both locked in and not going to see his money on a flagpole saying mug. Some ways down the passage of time another may follow to get a follow up spike in interest…

 

So now weve gone from buying 1, to buying a few and not seeing everything in a bargain bin and thinking never again for that tooling.

From a business perspective, your no longer throwing 6 figures at a capex tooling your going to write off in year one, to something with a longer term value.

 

Who seriously will ever buy a class 71 again, £60 will still get you one on ebay.

Yet the Bulleids just keep on coming, drip fed one at a time, even at £265.

Edited October 8, 2023 by adb968008

[BachelorBoy]

Books that are first edition/first printing are more valuable than second editions.

 

Perhaps model makers could label their products in a similar way. 

 

That way the "gotta-have-it-at-any-price" collectors can pay more for the first production run, and Hornby makes more profit from them.

 

Then the company cuts the price to be attractive to mere mortals for the second and subsequent runs (which might actually be better as problems with the first run are fixed). 

 

 

[The Stationmaster]

Quite alot of misunderstanding of ;collecting' going on here I ythink.  A good few years back i knew a really committed Hornby collector - he bought one of every R number issued hence he had a full collection of what Hornby had made,  Rather like collecting say, British issue postafge stamps where y get a complete collection you need an yun franked example of every one ever issued by the ost Office.

 

Collecting is I think no more onsee=ssive or peculiar than many other hobbies - it is something that some people do and it stems from all sorts of things such as - in his case - an interest in Hornby,  Another chap I knew collected Trix Twin and there have been plenty of Hornby Dublo collectors around over the years.  And apart from protecting their collections from anything damaging such as light most collectors are more than happy to show their collection to other people they know and trust.

 

Admission - I collect postcards and certain official railway documentation.  Both of these, but especially the latter, are sources I use to answer queries or explain things here on RMweb.  Part of what I collect is because of an interest I developed back in my youth and another reason for collecting that stuff is that I find it interesting to trace historical development of various procedures.  There are others who share my interest and we sometimes get the chance to share notes or discuss things when trying to understand the unusual and the 'exceptions ro the rule'.    

 

Similarly some people like to see how a model railway company's products have changed and developed over the years.  And the goal of every collector I've ever met is completeness of the range of the things they are collecting.  Oh, and some definitely fdo it fir financial reasons but that is a dangerous trap because like every other market tastes and therefore prices change all the time although quality/condition and rarity will always have a major impact on prices for many things.

 

I collect things which interest me and from which I can learn.  Maybe that might perhaps make me obsessive; I haven't got a clue?

[Johan DC]

On 07/10/2023 at 13:42, adb968008 said:

It all depends on how many were made in each batch doesnt it ?

 

How many W1’s do you have ?

i’d wager not many have 2 or more.

I have one, and if I would see one in a bargain bin, might consider a second. But it seems they sell. At Hattons there is a second hand one of the fictive liveries for £299. The latest one, the Fourth (!) in original dark grey, is sold out on pre-order.  No idea how big the batches are. But I guess smaller than J15 ones... 

[ColinB]

5 hours ago, Johan DC said:

I have one, and if I would see one in a bargain bin, might consider a second. But it seems they sell. At Hattons there is a second hand one of the fictive liveries for £299. The latest one, the Fourth (!) in original dark grey, is sold out on pre-order.  No idea how big the batches are. But I guess smaller than J15 ones... 

I bought the latest Hush Hush from Hornby as I wanted to see if they had fixed all the faults on the very first one I bought and I have to admit they did, really nice loco. I should resell the original one but it was a bit of a lemon, so I don't really want a ton of negative feedback.

[Mr chapman]

Imagine being annoyed more people were buying model trains. One minute it's we need to attract more people and the next it's don't make more of XYZ. 

 

Ask yourself are you collecting because YOU want one or because someone else might want one later... That's not a collector that's an investor. And investments are always a gamble.

 

I was happy when another run of 21c1 Channel Packet was announced. Having bought one first time around was I annoyed that it was suddenly devalued? No! I remembered one to 21c2 Union Castle. 

[ColinB]

2 hours ago, Mr chapman said:

Imagine being annoyed more people were buying model trains. One minute it's we need to attract more people and the next it's don't make more of XYZ. 

 

Ask yourself are you collecting because YOU want one or because someone else might want one later... That's not a collector that's an investor. And investments are always a gamble.

 

I was happy when another run of 21c1 Channel Packet was announced. Having bought one first time around was I annoyed that it was suddenly devalued? No! I remembered one to 21c2 Union Castle. 

I run all the locos I buy even the Hornby Dublos. I had a few limited edition Hornby's from the 1980s that I sold recently. I think I broke about even on most of them, so definitely not a money spinner. When you look on EBay they are quite a few collectable Hornby locos that are listed for £200 plus, but they never sell. The only ones I have found that do seem to increase in value are the Wrenn Unbuilt West Country/Battle of Britain locos and the Royal Scot ones. They are special with the sprung loaded middle wheel but not as good as a modern Hornby but for some reason hold their price.

[adb968008]

16 hours ago, Mr chapman said:

Imagine being annoyed more people were buying model trains. One minute it's we need to attract more people and the next it's don't make more of XYZ. 

 

Ask yourself are you collecting because YOU want one or because someone else might want one later... That's not a collector that's an investor. And investments are always a gamble.

 

I was happy when another run of 21c1 Channel Packet was announced. Having bought one first time around was I annoyed that it was suddenly devalued? No! I remembered one to 21c2 Union Castle. 

 

I too am happy with my 21c1, I bought it new in a sale for £120.

How much did you pay ?

I didnt buy to invest, but I do try to avoid giving money away unnecessarily.

i do find it annoying to buy something at £230 only to find it a few weeks after release at £160.

 

The 2023 release HST is currently reduced from £362 to £229.. £140 saving at TMC today.

Doesnt fill me with confidence, but it does embolden me to cancel pre-orders and wait, afterall you need patience in lead times today anyway and theres little loyalty for preordering.

The more the industry produces, the more models become “nice to haves” rather than “essentials”.

There is only so many modellers, the variety dilutes the spend.

This means make too many, more sales emerge.

some may like that, especially the savvy ones. But sell offs reduce manufacturer investment potential in newer models, and hence lowers the future range for everyone.

 

which is why I say be-careful who you alienate, the hobby needs stability, pushing customers out of the boat wont solve the problem of producing too many.

 

…look at the whisky industry in the 1980’s when collectors lost confidence, regular tastes changed prices crashed and the companies over produced… lost 3 decades, most distilleries are were fire saled to the French owned drinks companies. Today that 70’s whisky lake is earning French shareholders an absolute fortune.

 

 

 

Edited October 10, 2023 by adb968008

[BachelorBoy]

16 hours ago, Mr chapman said:

And investments are always a gamble.

 

I

 

So is crossing the road. 

 

But you reduce the risk of being run over by looking left and right, etc.

 

If you don't do the same when investing, then you're not really investing. 

 

 

 

 

 

[MG 7305]

Most of my career was in inventory management and I gained a MSC in the subject from Cranfield Institute of Management (CIT).  CIT quoted that it cost 25% of the nominal value to hold inventory in a warehouse (obsolesence, rent, insurance, shrinkage, handling etc).  The global company I worked for used an annual costing of 24%. I managed an inventory of USD 54 million and got the turns up to 6.4 per year which was very good for the industry but was seriously dragged down by the projects team.  My targets were turns and service. perhaps not relevant to this thread but certainly to the accounts.  We were really focussed on what we called excess stock, that is to say what was on hand after six months and what was not anticipated to sell in the next six months.  Sales and Marketing were presented with the numbers every month and pressed to explain what their plan to shift the inventory was.  It is interesting to observe what Accurascale are doing.  They understand these things and work hard to sell "excess" stock.

 

It would be illuminating to understand where Hornby stand in all of this and how their accounts value obsolete stock.

Edited October 11, 2023 by MG 7305

[jjb1970]

Collecting is just another hobby/interest and is no more 'right' or 'wrong' than any other part of the model railway bubble. If people enjoy accumulating boxes which will never be opened then good luck to them, they help to keep manufacturers in business, someone will buy all that stuff when they pop their clogs and if it gives them pleasure then what's wrong with it? Most collectors aren't so extreme and collect stuff for which they have an interest or a theme. I collect HO brass, it's just displayed and seldom runs but I enjoy viewing the models and they give me a lot of pleasure. 

My issue with adjusting numbers if something was advertised as a limited edition is a question of principle. It really doesn't bother me if manufacturers make as many as they can sell and I think in many ways the concept of 'limited edition' has become devalued to the point of being meaningless and has had quite a baleful effect. But, regardless of that, I also think if a manufacturer advertises something as limited to xx units, then it should be just that, limited to xx units. Just as I'd have no issue with a static model sold as a static model but if advertised as amn operable layout model then I expect it to be just that, an operable layout model. 

[smr248]

Somewhere along the line I think that I've accidentally become a collector.  Does anybody know the cure?

[RAF96]

3 hours ago, MG 7305 said:

We were really focussed on what we called excess stock, that is to say what was on hand after six months and what was not anticipated to sell in the next six months….

 

3 hours ago, MG 7305 said:

…quoted that it cost 25% of the nominal value to hold inventory in a warehouse…

Taking those 2 points together then marketing need to shift stuff while it still has a value. New old stock becomes very expensive stock unless it has a rarity value, but if it had it would already have gone.

I am pleased Marketing and Sales is outwith my bailiwick. I’ll stick to Engineering.

[adb968008]

7 hours ago, MG 7305 said:

CIT quoted that it cost 25% of the nominal value to hold inventory in a warehouse (obsolesence, rent, insurance, shrinkage, handling etc). 

 

It would be illuminating to understand where Hornby stand in all of this and how their accounts value obsolete stock.

 

 

4 hours ago, RAF96 said:

 

Taking those 2 points together then marketing need to shift stuff while it still has a value. New old stock becomes very expensive stock unless it has a rarity value, but if it had it would already have gone.

 

 

R3171 

https://uk.Hornby.com/products/lner-p2-class-2-8-2-2001-cock-o-the-north-era-3-r3171?_br_psugg_q=r3171

 

Announced in the 2013 catalog, on shelves in 2014.

https://www.modelraildatabase.com/locomotives/details/2472/
 

Original rrp £89.99, today £127.49

 

seems to have followed the British governments route of marketing… if in doubt, inflate your way out.
 

All those k1 and 71’s seem to have finally gone.

Edited October 11, 2023 by adb968008

[BachelorBoy]

On 08/10/2023 at 23:48, cctransuk said:

He / she probably stores them in a 'gloat' cupboard, away from artificial light!

 

I knew someone whose loft was crammed up to the rafters with unopened models - you name it, he had one 'up there'; and yes - I did see them!

 

 

I do hope the loft was insulated, and heated or air-conditioned as necessary.

 

[BachelorBoy]

7 hours ago, smr248 said:

Somewhere along the line I think that I've accidentally become a collector.  Does anybody know the cure?

Don't fight it ... work with it.

 

Apply for jobs with museums.

 

(It's not unusual for museums to keep 90% of their collections in storage, never to be seen by the public.)