stonesboy Posted March 11 Share Posted March 11 I know this is not model railway but interesting to see that Hornby obviously have sufficient capital available to expand the business. Link to post Share on other sites More sharing options...
Robin Brasher Posted March 12 Share Posted March 12 Some of the Corgi Toys are useful accessories for 0-gauge layouts. I have heard that the recent Corgi replicas of the Corgi Toys of the 1950s and 1960s have been very successful, 1 1 Link to post Share on other sites More sharing options...
Pmorgancym Posted March 12 Share Posted March 12 Nora huge acquisition though is it, they've effectively bought one of their own customers 2 Link to post Share on other sites More sharing options...
RMweb Gold JohnR Posted March 12 RMweb Gold Share Posted March 12 It should be noted that Hornby already own Corgi, this is just the model club that is being acquired - they offer limited editions of classic corgi models. I see from the reports that the expected margin of the sales is just 15% - seems low to me? https://thebusinessmagazine.co.uk/corporate-finance/kent-based-Hornby-acquires-corgi-model-club/ 1 Link to post Share on other sites More sharing options...
RMweb Gold ITG Posted March 12 RMweb Gold Share Posted March 12 3 minutes ago, JohnR said: I see from the reports that the expected margin of the sales is just 15% - seems low to me Operating margin usually means after all costs, but before tax. Not that I have a clue on what the norms are in this industry. Ian Link to post Share on other sites More sharing options...
1andrew1 Posted March 12 Share Posted March 12 Interestingly, the Corgi Model Club also distributes Dinky Toys although most stocks seem to be exhausted. https://corgimodelclub.com/pages/dinky001 Link to post Share on other sites More sharing options...
1andrew1 Posted March 12 Share Posted March 12 (edited) From Hornby's website Quote The management of CMC is joining Hornby, with Guy Stainthorpe appointed as the Brand MD of Corgi. CMC was established in 2021 as a third party partnership with Hornby, creating and selling contemporary editions of classic Corgi Models from the archives through a monthly subscription model, and has grown significantly since then. Through the purchase of £400,000 of existing stock from CMC, which will be sold directly to Hornby customers in the future, and an additional consideration of c. £200,000, Hornby is adding c.£2M of revenue at a 15% operating margin and more than 6,000 active subscribers. A performance-related earnout has been put in place for Guy, payable based on the future profitability of both CMC and the wider Corgi business over the next three years. An earn out is payable to Jim (entrepreneur behind the club) based on profitability of CMC over 3 years from acquisition. https://polaris.brighterir.com/public/Hornby/news/rns/story/rn44ojx Edited March 12 by 1andrew1 Link to post Share on other sites More sharing options...
andyman7 Posted March 12 Share Posted March 12 (edited) 6 hours ago, JohnR said: It should be noted that Hornby already own Corgi, this is just the model club that is being acquired - they offer limited editions of classic corgi models. I see from the reports that the expected margin of the sales is just 15% - seems low to me? https://thebusinessmagazine.co.uk/corporate-finance/kent-based-Hornby-acquires-corgi-model-club/ ...and they already license the name to the CMC, are involved in the design and have the rights to use the tooling. 35 minutes ago, 1andrew1 said: Interestingly, the Corgi Model Club also distributes Dinky Toys although most stocks seem to be exhausted. https://corgimodelclub.com/pages/dinky001 They acquired some of the overstocks from the DeAgostini Dinky Toy partworks to sell, they're not a distributor as such. Essentially, the CMC has been doing more to curate the Corgi brand and acquire new customers than Hornby itself was doing, so it makes sense to bring the key CMC personnel in house to manage the brand. Edited March 12 by andyman7 Link to post Share on other sites More sharing options...
Robin Brasher Posted March 12 Share Posted March 12 Hornby does need to improve its marketing of the Corgi brand. I was not aware that Corgi are still producing the Vanguard range although I did know about the Corgi Model Club models which, I understand, have been a huge success. The Corgi Model Club marketing does not suit me as I am only interested in a few models which I like to cherry pick. If you join the model club you get a huge discount on the first models and then you receive a model each month at around 60% of the full price whereas if you just buy the models you are interested in you know that other people are paying a lot less. I thought that at around £34 plus postage the models were rather expensive compared with a discounted price of around £11 my Oxford Diecast Rolls Royce from Hattons but I understand that £34 is the going rate for diecast cars now. Link to post Share on other sites More sharing options...
RMweb Gold Dunsignalling Posted March 12 RMweb Gold Share Posted March 12 TBH, I'd always assumed it was in-house already. 😊 The few O-scale diecasts I've bought have been mostly Oxford Diecast Ice Cream Vans, in any case. Link to post Share on other sites More sharing options...
Pmorgancym Posted March 12 Share Posted March 12 9 hours ago, 1andrew1 said: From Hornby's website https://polaris.brighterir.com/public/Hornby/news/rns/story/rn44ojx Acquiring 'stock' that's your product that you already sold to them a year earlier?? Link to post Share on other sites More sharing options...
RMweb Gold ruggedpeak Posted March 13 RMweb Gold Share Posted March 13 So in theory Hornby have bought the business (without stock) for £200k, for which they get 6000 subscribers (£33.33 per subscriber) and an additional £2m of turnover with a margin of £300k a year. £2m of turnover pa is £333.33 for each of the subscribers, which is basically every subscriber paying their full 12 months of £24,99 and the £3,99 postage per month (£336 pa). Throw in efficiencies from not selling the product to CMC for them to handle and ship etc, the margins should be improved. The Club says it is now shipping to Europe, which suggests significant growth potential. So for less than 1 year's CMC operating margin Hornby have got 4% uplift in total company revenues. Given Hornby's overal margin is -12%, the 15% from CMC is a positive! On the face of it a sensible deal. 1 Link to post Share on other sites More sharing options...
1andrew1 Posted March 13 Share Posted March 13 (edited) On 12/03/2024 at 23:03, Pmorgancym said: Acquiring 'stock' that's your product that you already sold to them a year earlier?? Did Hornby sell them the stock? I thought the Corgi Model Club just licensed the brand and the designs from Hornby and did their own sourcing. From their website "Hornby have given us the exclusive rights to re-produce some of the rarest and sought after models from their 1960’s catalogues." Edited March 13 by 1andrew1 Link to post Share on other sites More sharing options...
Pmorgancym Posted March 19 Share Posted March 19 On 13/03/2024 at 23:24, 1andrew1 said: Did Hornby sell them the stock? I thought the Corgi Model Club just licensed the brand and the designs from Hornby and did their own sourcing. From their website "Hornby have given us the exclusive rights to re-produce some of the rarest and sought after models from their 1960’s catalogues." Part of the deal is they have acquired stilofk work xxxx 1 Link to post Share on other sites More sharing options...
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