Hornby Tier System

[adb968008]

On 23/12/2023 at 07:14, Dunsignalling said:

 

There's a simple and practical way to maintain the issue of a collectible document whilst helping to eradicate the problems Hornby has with deciding production batch sizes. 

 

Issue it eleven months later and repurpose it as a Yearbook, or Christmas Annual, call it what you will. All the other features you mention would be unaffected. Hornby can then canvass dealers for orders in plenty of time to plan production more effectively. They can cease to worry about cats getting out of bags, because the bag will no longer have a date on it! 

 

That would transform the "catalogue" portion into a record (a celebration, even) of what has actually been delivered through the year rather than a wish list of what might arrive next year or the year after; which it has been for far too long.

 

Real models could be pictured instead of amateurish side-on mock-ups that frankly ceased to represent good examples of what can be done with photoshop more than a decade ago. In short, it would become an accurate and relevant work of reference for future collectors. 

 

Nobody who wishes to know about the progress of any new item they desire, what it might finally look like, or when they'll be able to buy it, will be any the wiser from consulting the catalogue as it currently exists.

 

That's what the website is for. 

 

John

sounds like a chicken and egg situation to me.
if you announce before you make it, you can collect orders but theres a wait.

if you make it before you announce it, your guessing how many to make, but theres a mad scramble.

 

The solution is to own your production line, then you can turn the right taps at the right time, but that era has passed.

[BachelorBoy]

1 hour ago, The Stationmaster said:

Apparently the catalogue is very popular and that would seem to have explained its continued existence.  But the most recent issues have been verging on works of fiction for much of their content.  So if it sells, if it is popular, and if it creates net revenue. I think retaining it in a revamped form makes commercial sense.

 

 Where responsibility for it will lie I don't know but I'd hardly expect it to be with all of the different people concentrating on the various - disparate - issues you mentioned.

 

Fair points, but you also should consider how much damage it does by raising expectations which Hornby then doesn't meet.  

[BachelorBoy]

19 minutes ago, adb968008 said:

The solution is to own your production line, then you can turn the right taps at the right time, but that era has passed.

That would also mean employing a lot more capital.  I think the last time I looked, Hornby's return on capital employed was something like minus 32%.

[woodenhead]

34 minutes ago, adb968008 said:

The solution is to own your production line, then you can turn the right taps at the right time, but that era has passed.

Would it though, the ability to spin up or down a production line sounds like a lot of vacant or unused capital expenditure waiting for those times when you need it.  Not many companies operate on that basis these days, very much just in time and sweat your assets to the max all the time,

 

All very good having a base facility turning out goods on a consistent volume so you are getting the best out of the outlay, but for any peaks you'd find a partner and use their capacity (pre-booked of course to reduce cost).

[Dunsignalling]

1 hour ago, adb968008 said:

sounds like a chicken and egg situation to me.
if you announce before you make it, you can collect orders but theres a wait.

if you make it before you announce it, your guessing how many to make, but theres a mad scramble.

 

The solution is to own your production line, then you can turn the right taps at the right time, but that era has passed.

You seem to get the wait anyway, in many cases!

 

The problem with Hornby's current MO is that it almost always results in producing less than the market wants, or more than it will absorb.

 

Too few, and speculators who manage to get product make a hefty profit at a reputational cost  to Hornby. Optimum margin to Hornby then only comes with the year two output, so long as they get that quantity right (which they often don't). Too many and Hornby end up selling the surplus at a discount and again fail to obtain the optimum margin.

 

The solution (even at the greater overall scale of Hornby's operation), is to follow the "New Boys" practice in taking orders from dealers and pre-orders from individuals, adding a modest excess to accommodate late/casual buying decisions, and ordering that quantity from the factory.

 

That should create a better budgeted margin, discourage speculators by avoiding artificial shortages, and reduce the need to bring forward year two batches, which too often results in greater delay to other new models in the pipeline.

 

None of that can happen while Hornby remains shackled to a traditional announcement/catalogue routine that ceased to be appropriate the day they off-shored production over two decades ago. 

 

The thing that astounds me is that they have done little or nothing to address the issue in all that time. It must have cost them millions in lost profits.

 

John

Edited December 24, 2023 by Dunsignalling

[Harlequin]

I just realised that there's a major difference between the way Hornby have worked in the past and the way the "New Boys" now work.

 

The New Boys all announce at a moderately early stage of development and issue updates as development proceeds (Edit: And thus there's time to gauge demand before the order is placed with the factory) whereas Hornby have in the past said "We're going to make XYZ" (in a big fat annual catalogue) and we hear nothing more until the model is released.

 

If they are to assess the potential size of the market and order accordingly, as described above, Hornby will have to announce models at the CAD stage - and they would do well to then be more interactive to avoid the fundamental problems that sometimes appear when it's too late.

(I hear you all saying, "Well, duh!" but it's just dawned on me.)

 

Of course this mainly applies to the sort of 4mm Hi-fi models we're interested in. TT:120 and trainsets are a different kettle of fish.

Edited December 26, 2023 by Harlequin
Clarity

[The Stationmaster]

On 24/12/2023 at 13:43, BachelorBoy said:

 

Fair points, but you also should consider how much damage it does by raising expectations which Hornby then doesn't meet.  

As I said  'vergng ona work of fiction' (in some respect.  And n doubt formany they would indeed create dissapointment when no-delivery follows. 

 

On 24/12/2023 at 15:21, Harlequin said:

I just realised that there's a major difference between the way Hornby have worked in the past and the way the "New Boys" now work.

 

The New Boys all announce at a moderately early stage of development and issue updates as development proceeds whereas Hornby have in the past said "We're going to make XYZ" (in a big fat annual catalogue) and we hear nothing more until the model is released.

 

If they are to assess the potential size of the market and order accordingly, as described above, Hornby will have to announce models at the CAD stage - and they would do well to then be more interactive to avoid the fundamental problems that sometimes appear when it's too late.

(I hear you all saying, "Well, duh!" but it's just dawned on me.)

 

Of course this mainly applies to the sort of 4mm Hi-fi models we're interested in. TT:120 and trainsets are a different kettle of fish.

Regrettably as far as Hornby is cincerned that has in recent years (and in soem cases in easlier times) only been teh start of.  their assessmentt of demand has been abysmal - somethinselss well so Year 2 production leaps forward - very often into a sated market where it won;r sell or with little or no thought about variants which also means things that won't sell are made while things that will sell are not made.

 

Therir seeming 'knowlege' of the market - which in some instances didn't even reflect retailer feedbakl through theur own reps, has frequently been next to useless hence the 'unsold' heap in the warehouse gets ever bigger (whatever their accountant likes to call it).   Chuck in getting the number balance wrong between different coaching stock types and they got themselves to where they are today - loss of market share, decline in the real value of sales. and a pile of unsold whatevers costing them money twice over.

 

Hopefully - at least with more professional marketing, selling, and informed Brand Managers  - we might now at last begin to see the growth of genuine, and sustained, recovery in the company's fortunes.  The move away from the annual 'big bang' announcement fest and the trade ordering scramble which follows it will undoubtedly help them to move forward from their outmoded  1970s approach to selling and taking trade orders.

Edited December 26, 2023 by The Stationmaster

[tomparryharry]

One of the first rules of business:- Have a look at how the competition does it. 

 

Keep your business flexible; be prepared to change it. 

 

Have a look at what the customers would like to have . Be honest. If it's a niche model, then tell the client that it's not a viable project. BUT! If the client would want it, then expect to pay.

 

Engineering (in any scale) there is no such word as 'cant' unless you're going around the bend....

 

You can't really knock Triang.  Both them and Bachmann have set themselves up as 'the' people in model railways. Give them a couple of years to sort themselves out.

 

As a personal observation. Steam Punk? Oh dear...

 

Remember.. The only thing that's worse than being talked about, is not being talked about.

 

Enough of negative press though. It must be a least 6 months since we had a 'totally exclusive ' release of Flying Scotsman! 

[Legend]

The whole point of the catalogue is to showcase what is available now and in the coming year . Where it has gone wrong is in the uncertainty of production/manufacturing slots with perhaps Hornby being over ambitious .  So they really need to settle on production slots ahead of the catalogue . They also have to better estimate sales of new items , which is where they have been getting it wrong in recent years . Not just locos but carriages ( too many brakes or first class not enough seconds) and wagons . 
 

But I do see that securing a finite amount of production slots in the year is the critical item , with respect not just for the catalogue , but for cash flow and account /business forecasting . The latter two are probably most important and the catalogue should simply follow information on the forthcoming years plans that are already there. 

[Dunsignalling]

12 hours ago, Legend said:

The whole point of the catalogue is to showcase what is available now and in the coming year . Where it has gone wrong is in the uncertainty of production/manufacturing slots with perhaps Hornby being over ambitious .  So they really need to settle on production slots ahead of the catalogue . They also have to better estimate sales of new items , which is where they have been getting it wrong in recent years . Not just locos but carriages ( too many brakes or first class not enough seconds) and wagons . 
 

But I do see that securing a finite amount of production slots in the year is the critical item , with respect not just for the catalogue , but for cash flow and account /business forecasting . The latter two are probably most important and the catalogue should simply follow information on the forthcoming years plans that are already there. 

 

Unfortunately, the catalogue is the epicentre of the mess; it's position within Hornby's business processes is fundamentally flawed. 

 

Hornby either haven't realised or won't accept that the way the catalogue functioned when they made stuff in house, simply doesn't work with production outsourced to contractors to whom they are but one customer of many.

 

Production slots (the sizes of which are geared to quantities) have to be booked before the catalogue is published, and the need for secrecy dictates Hornby cannot invite orders from the dealer network until it has been.

 

Matching supply to demand has thus become sheer guesswork, and the only surprise is that they occasionally guess right. What usually ensues is a chaotic juggling act involving dealers getting a fraction of what they order, other items getting "bumped" into next year to free up more production capacity for a loco that has turned out to be in greater demand than expected, or both. 

 

The tragedy for the health of the business is that successive management teams have watched this scenario unfold, to a greater or lesser degree, every year for the past two decades, and none came up with a "solution" before tiering!

 

Given the other forces in play, if Hornby are ever to get their supply issues under control, they need to radically rethink the purpose and timing of the catalogue. It must only be issued after dealer requirements have been ascertained and quantified production slots confirmed; it's no longer the place for "news".

 

John

 

 

 

 

 

 

 

Edited December 27, 2023 by Dunsignalling

[BachelorBoy]

10 hours ago, tomparryharry said:

 

You can't really knock Triang.  Both them and Bachmann have set themselves up as 'the' people in model railways. Give them a couple of years to sort themselves out.

 

Yes I tend to think of Hornby as really being Triang still.

 

But Triang/Hornby or whatever you want to call them, have been given decades to sort themselves out.  

 

Remember, Hornby share price today is lower than it was thirty years ago.

 

 

Edited December 27, 2023 by BachelorBoy
added share price

[adb968008]

10 hours ago, Dunsignalling said:

 

Unfortunately, the catalogue is the epicentre of the mess; it's position within Hornby's business processes is fundamentally flawed. 

 

Hornby either haven't realised or won't accept that the way the catalogue functioned when they made stuff in house, simply doesn't work with production outsourced to contractors to whom they are but one customer of many.

 

Production slots (the sizes of which are geared to quantities) have to be booked before the catalogue is published, and the need for secrecy dictates Hornby cannot invite orders from the dealer network until it has been.

 

Matching supply to demand has thus become sheer guesswork, and the only surprise is that they occasionally guess right. What usually ensues is a chaotic juggling act involving dealers getting a fraction of what they order, other items getting "bumped" into next year to free up more production capacity for a loco that has turned out to be in greater demand than expected, or both. 

 

The tragedy for the health of the business is that successive management teams have watched this scenario unfold, to a greater or lesser degree, every year for the past two decades, and none came up with a "solution" before tiering!

 

Given the other forces in play, if Hornby are ever to get their supply issues under control, they need to radically rethink the purpose and timing of the catalogue. It must only be issued after dealer requirements have been ascertained and quantified production slots confirmed; it's no longer the place for "news".

 

John

 

I’m a Hornby customer, and i’m struggling to maintain interest in their product.

Save a few bright spots (2mt, turbomotive), its starting to feel like a circus at the end of its act.

 

I’m not even sure i’m their target customer any more, and the catalog means nothing to me for years.

 

I got a 2MT with a free christmas tree and a free 0-4-0 before christmas. Neither the tree nor the 0-4-0 had any bearing on my decision to buy the 2MT.

 

The trees in the garden with lights on it, and is quite nice, the 2MT is awaiting its turn to run. The 0-4-0 is sitting with half a dozen other 0-4-0s in the garage like the ghosts from christmas past, with nothing for them to do, I dont want to throw them away, but arent worth the effort on ebay.

 

Before changing the catalog, they first need to identify who it is they are trying to reach.

 

is the 2MT the last of the old school ? Is the Black 5 the 2nd coming of new tech, is railroad the future ?… I dunno, but they need to solve that one before spending money on brochures to put it in.

 

 

 

 

Edited December 27, 2023 by adb968008

[Hroth]

9 minutes ago, adb968008 said:

I’m a Hornby customer, and i’m struggling to maintain interest in their product.

 

I'm in the same boat.

 

I look at things that Hornby have announced and thought "Thats not very interesting".  Even the TT:120 has failed to grab my attention.  I bought one of the trainsets, but there has been little in the way of interesting followup.  If Hornby stick in the groove they have dug for themselves in OO and TT and nothing is announced on the 9th that piques my interest, then no matter how they re-arrange the deckchairs*, they may well lose me for the next 12 months too.

 

I might even dabble with O gauge, and as Hornby don't have a finger in that pie, and O tends to the expensive, thats a load of modelling cash that won't go anywhere near them.

 

* And, to throw a bone to topic relevance, that includes incentivising retailers by dropping the loathed tier system!

 

[Dunsignalling]

55 minutes ago, Hroth said:

 

I'm in the same boat.

 

I look at things that Hornby have announced and thought "Thats not very interesting".  Even the TT:120 has failed to grab my attention.  I bought one of the trainsets, but there has been little in the way of interesting followup.  If Hornby stick in the groove they have dug for themselves in OO and TT and nothing is announced on the 9th that piques my interest, then no matter how they re-arrange the deckchairs*, they may well lose me for the next 12 months too.

 

I might even dabble with O gauge, and as Hornby don't have a finger in that pie, and O tends to the expensive, thats a load of modelling cash that won't go anywhere near them.

 

* And, to throw a bone to topic relevance, that includes incentivising retailers by dropping the loathed tier system!

 

 

Me too, and I have been mainly underwhelmed by Hornby since before the pandemic, so it's not an effect of that.

 

I have still been spending, on (more) S15s, Adams Radials, 700s etc. but Hornby's recent SR subjects have been the Lord Nelson, of which I've bought one that I didn't really "need". I've also had one air-smoothed MN but am waiting for variations I want before committing to any more. The two recent, updated, West Countries are both out of period for me, so have been ignored. If I'm honest I already have far more of those than I need anyway!

 

I have a Caprotti Black Five on order, despite having serious reservations about Hornby's latest lighting gimmick, which must have originated under the previous regime.

 

After that, nothing. I've amassed all the coaches I require from the existing Hornby range, and most of my new wagons now originate elsewhere in Kent!

 

Whither Hornby? Or (I hope not) wither Hornby.

 

Where they go from here is entirely dependent on the new team, and I really want to be inspired come January 9th. Only time will tell.

 

John  

 

     

Edited December 27, 2023 by Dunsignalling

[phil gollin]

.

 

I tend to agree.

 

Hornby has lost its way, both in general and, specifically, regarding the "Southern".  Someone seems to have convinced them that there are no, or limited, numbers of "Southern" subjects left to be done, whereas there are many, many, whether pre-grouping, grouping, steam BR or contemporary  -  I find it depressing that a (if not THE) major manufacturer can be so easily deluded.

 

As for TT  -  I'm too heavily invested in OO to change, but they need to get the small steam shunters and medium steam engines out  SOON to give modellers some variety.

 

( Happy New Year, and 9th of January. )

 

.

[Ravel]

Catalogue style was fine when everyone else in the market did that, the factories could guarantee it and the market was large enough; even Bachmann have moved to the 'little and often' model.

 

Still no Electrostars, or reruns of the 466s. Seems like a number of lost opportunities in the pursuit of by-gone eras. 

 

 

 

 

[Dunsignalling]

11 minutes ago, phil gollin said:

.

 

I tend to agree.

 

Hornby has lost its way, both in general and, specifically, regarding the "Southern".  Someone seems to have convinced them that there are no, or limited, numbers of "Southern" subjects left to be done, whereas there are many, many, whether pre-grouping, grouping, steam BR or contemporary  -  I find it depressing that a (if not THE) major manufacturer can be so easily deluded.

 

As for TT  -  I'm too heavily invested in OO to change, but they need to get the small steam shunters and medium steam engines out  SOON to give modellers some variety.

 

( Happy New Year, and 9th of January. )

 

.

TBH, that was traditionally a Bachmann problem, but Hornby's recent obsession with closing the gaps in large LNER steam traction seems to have crowded out much more than Southern prototypes.

 

Hornby now seem to be switching their emphasis to the LMS.

 

Now, I've always thought too much emphasis on one group over a short period is unwise (and Hornby has done it with Southern models in the past).

 

Creating a situation of "too much to afford" for one group alongside "nothing for me" for the others cannot be a route to maximising overall sales.  

 

John

 

 

[The Stationmaster]

15 hours ago, Legend said:

The whole point of the catalogue is to showcase what is available now and in the coming year .

I agree absolutely that that is what it was.    And it didn't work - and had long ceased to work - for all the various reasons spelt out in recent posts.

 

Quite what the new management will do with it is not going to be clear until we see it but I think we can fairly certainly drop the recent past Hornby idea of a catalogue as you describe it.  And there are several obvious reasons for change - firstly it had become a work of near fiction, secondly it wont fit releases being announced at several times over the course of the year (unless supplements are issued), and thirdly while it is a great thing to drool over I wonder how many people use the 'net in preference to find out what is on offer where and when and at what price?  So it has to change and move forwards from the 1970s to todays world.

 

As far as new models are concerned we simply do not know what will happen.  I think that it's a fair guess that a new LNER pacific every 5 minutes will not figure as heavily as i it has in recent years.  But beyond that a lot in future is going to depend on what the Brand Manager decides and how he obtains and uses various forms of market intelligence, plus - maybe? - historical success/failure of earlier models (but properly assessed instead of guessed?).  All we do know is that the choice will be made by different people from those making it in recent years.

[Roy Langridge]

Pleased to see the tier system gone, hopefully the retailers will now be better supported.  
 

When the tier system launched I decided that for me Hornby was embargoed until it went: the only two Hornby models that I have bought since then were existing pre-orders with retailers who I was not prepared to kick by cancelling as it was Hornby’s treatment of them that led to my position, one was a 14 car APT that arrived shortly after, and the other an 88DS that only recently arrived. 
 

Have I missed purchasing from Hornby? No. In fact, the very fact that in the time the tier system has come and gone roughly equates to the time it took for my 88DS to arrive says a lot. 

I will keep an eye on what Hornby now offer, but they have a long way to go to win back my business. 
 

Roy

[Steamport Southport]

On 26/12/2023 at 16:18, tomparryharry said:

One of the first rules of business:- Have a look at how the competition does it. 

 

Keep your business flexible; be prepared to change it. 

 

Have a look at what the customers would like to have . Be honest. If it's a niche model, then tell the client that it's not a viable project. BUT! If the client would want it, then expect to pay.

 

Engineering (in any scale) there is no such word as 'cant' unless you're going around the bend....

 

You can't really knock Triang.  Both them and Bachmann have set themselves up as 'the' people in model railways. Give them a couple of years to sort themselves out.

 

As a personal observation. Steam Punk? Oh dear...

 

Remember.. The only thing that's worse than being talked about, is not being talked about.

 

Enough of negative press though. It must be a least 6 months since we had a 'totally exclusive ' release of Flying Scotsman! 

 

Loads of comments about Steam Punk, yet they seem to have sold an awful lot of them. 

 

Maybe people on here aren't the intended audience for them?

 

Plenty of people commenting in this section are openly admitting they don't buy Hornby. So why comment at all....

 

 

Jason

[AY Mod]

26 minutes ago, Steamport Southport said:

they seem to have sold an awful lot of them. 

 

Evidence? Numbers?

 

They weren't traditionally injection-moulded mass-produced items. There seemed to be few stockists and clearance of stocks was evident.

 

Hopefully we can see more inspired and better executed products in future years than those items were.

[tomparryharry]

40 minutes ago, Steamport Southport said:

 

Loads of comments about Steam Punk, yet they seem to have sold an awful lot of them. 

 

Maybe people on here aren't the intended audience for them?

 

Plenty of people commenting in this section are openly admitting they don't buy Hornby. So why comment at all....

 

 

Jason

Aha, Jason, not so fast!

 

When Hornby bought out the 42xx, There were-was hundreds of pages on froth. Then, when the little Avonside came along, it started a new trend of high-end models. Good for them, I say. People do indeed buy Hornby; perhaps they don't want to admit it... "Who? Me? Never" sort of thing. 

 

I can foresee the demise of the yearly catalogue, and (from a personal perspective) it would take a lot of pressure off the people making false promises. I'd much rather see a new model unexpectedly, than have a promise which may, or may not, happen. 

 

Do I want to see Hornby prosper? Yes, without question. Why? Because Hornby now know full well, they have competition to the degree unheard of in recent years. When the new Toad was released, it was pretty much right on the money. The prairie, new coaches, all good stuff. 

 

Remember, Hornby Hobbies have a quite large product catalogue, and it's not just Flying Scotsman, if you get my drift... Scalextric, Airfix, and the TT model line. 

Edited December 27, 2023 by tomparryharry
A bit more clarity, perhaps.

[Michael Hodgson]

1 hour ago, Roy Langridge said:

Pleased to see the tier system gone, hopefully the retailers will now be better supported.  
 

I will keep an eye on what Hornby now offer, but they have a long way to go to win back my business. 
 

 

Roy

 

Quite agree, they've essentially lost my business in recent years,  That's not to say I haven't bought any Hornby, but it's not been whatever stuff they are currently pushing out, it's been through ebay, second hand etc.  The one new prooduct I probably will go for is the Caprotti 5, but even here I'll be waiting till it comes out, not pre-ordering.

 

 

14 hours ago, BachelorBoy said:

Yes I tend to think of Hornby as really being Triang still.

 

 

That's simultaneously a commercial advantage and disadvantage, though they haven't yet tried bringing back the Battlespace range.  They don't seem to be winning either way.  Their financial results do seem to suggest management changes were long overdue.

 

As for catalogues and perhaps it's my Scottish blood, but I've always had a mental block against the idea of being expected to pay for what is essentially mere advertising matter.  It's not as though you get a free Cuneo print on the front cover any more.  But really, £10.99 .... or 4 instalments of £2.75 ... so expensive they allow you to buy it on tick!  B*gger that! 

[gwrrob]

31 minutes ago, tomparryharry said:

When Hornby bought out the 42xx, There were-was hundreds of pages on froth.

 

I don't remember the froth for this model as it dates from Hornby's design clever era and wasn't the build quality not great here. Never reached the potential it justified.

[Dunsignalling]

39 minutes ago, Steamport Southport said:

 

Loads of comments about Steam Punk, yet they seem to have sold an awful lot of them. 

 

Maybe people on here aren't the intended audience for them?

 

Plenty of people commenting in this section are openly admitting they don't buy Hornby. So why comment at all....

 

 

Jason

Claims of selling an awful lot of anything only be substantiated if one knows how many were made.

 

In the case of Steampunk, I think it was more a case of selling a lot of awful models. 🤢

 

The point many of us have made is that we formerly spent a lot of money with Hornby, but have got out of the habit through a lack of product aligning with our interests and difficulty obtaining what does. What I'm expecting to buy from them this year is little more than 15% (in cash terms, not number of models) of my typical annual expenditure a decade ago.  

 

If Hornby get their act together (sharpish), great, If they carry on the way they have in recent years, I'm not sure I can continue to care! Plenty more fish in the sea.....

 

John