Paddy

It is sad to see Barrie disappear from YouTube as I found his videos interesting and entertaining. I do hope he is well as he seems to have battled health issues over the years. Any news would be appreciated. Kind regards Paddy

Personally, I believe Hornby should give Simon a non-exec position on the Board. Simon’s experience of the industry and knowledge of Hornby is invaluable and would be an excellent addition in helping to guide Hornby forward.. Kind regards Paddy

Hi Folks, Remember that Hornby tried lower spec models with Design Clever and got lambasted for it. It would be a brave manufacturer who went down this route again. In Hornby’s defence they do have Railroad and Railroad Plus, the latter which I believe is a great idea. Mind you, the prices of Railroad models are steadily rising so how long before similar criticism are leveled at those models? Bottom line, the days of low cost, high specification models is behind us as that was a short term “benefit” from Chinese manufacturing and globalisation. The positive thing with OO is that we have enjoyed several decades of highly detailed models with reasonably large batches resulting in a plentiful supply of pre-loved models. An example is the range of Mainline wagons from the 1970/80s which are lovely models, well decorated and readily available (often as new in box) for a few pounds - a bargain. Kind regards Paddy

Hi Folks, This one goes around and around and the answer always seems to come down to "if there was a huge market for such models then a manufacturer would service it". At the end of the day, we are not talking about the models here but rather affordability which is subjective and highly personal. One person may look at the new Hornby Dublo locomotives and consider them a bargain, others less so. Ultimately, if there is a market for models at these prices they will sell in sufficient numbers. Rest assured, if the market for "expensive" (subjective) highly detailed models dries up the manufacturers will do something different. One could argue that Hornby is trying this with TT:120 as the amount of separately fitted detail on these models is less and the prices keener... Kind regards Paddy

Keep hoping they will do a Class 47 in original XP64 livery. Kind regards Paddy

It is clear to see that the folks at Hornby have worked exceptionally hard to deliver a profit (again). No doubt, like many companies there is an element of smoke and mirrors but well done to the team. Three things that concern me (and I am a Hornby shareholder) are: 1. The expected change in CEO. History has shown us that changes in leadership at Hornby can lead to disaster. Lyndon has done a good job of steadying the ship and focussing the company on growth. Lyndon also seems to have a good understanding of the hobby business which I believe is vital. Hopefully, they will not replace Lyndon with someone who thinks selling “toys” is simply a case of flashy images on a website. 2. Quality control. It is all very well producing expensive new models (assuming they can get them delivered) but they need to be of high quality. There are people who will pay hundreds of Pounds for a model but the expectation level will be very high. Hornby need to get their arms around these issues quickly as in the days of social media “bad news” travels fast. 3. Finally, the comment about replacing one website with twenty seven at the beginning of 2021. No doubt this has been done to give each set of customers a personalised experience but it also sounds expensive and a maintenance nightmare. One can only hope these websites share the vast majority of their functionality and the differences are only skin deep. I had to read this line in the report several times as I kept thinking it must be the other way around i.e. 27 replaced by one! 😉 Kind regards Paddy

With regards to share price movements, it should be noted that over 90% of the shares are owned by two private equity organisations. The amount of free shares to be traded is therefore quite small. Edit: Plus share valuations are all over the place at present. Kind regards Paddy

This is very interesting and rather exciting. However, I am struggling to see what one will run in terms of British outline? Surely, these launches from PECO must be part of a coordinated release with one or more RTR manufacturers? Otherwise, it is a case of building very quiet and sleepy GWR branch line layouts. 😀 Still, I wish PECO every success and look forward to seeing future developments and releases. Oh and made in the UK to boot! Kind regards Paddy

Hi Folks, I know this thread is about Hornby's tier system but it does feel a wee bit unfair that only their "prices" come in for examination. Prices have gone up for most suppliers of model railways and there are various reasons for this. The one thing I suspect is true for them all is that very little "profiteering" is going on. I also think that focussing on the "price" misses the point and one should really talk about "value". The definition of "value" will differ from person to person and covers almost all things in life. If price was our only concern then we would all drive around in Dacia Sanderos (other low cost vehicles are availabe) rather than paying "inflated prices" for Audi, BMW, Mercedes etc. The bottom line is that what I may consider reasonable value for a model may be significantly different from others (could be higher or lower). Ultimately, the concensus seems to be that the UK model railway market wants highly detailed, very accurate and feature rich models. If this is true (and there seems to be little evidence to the contrary) then this will inevitably come at a higher price. If sufficient people believe that a model offers value for money then it will sell whatever its price and a profit will be made. If the contrary happens, and such models do not sell profitably then the manufacturers will have to review their business models. This may mean, accepting a smaller market for high-end models which in turn will mean even higher prices. Again, not an issue if there are sufficient people who accept the value in the offering. The challenge is with higher prices, expectations grow and people will demand these models to be "perfect" or as near as possible. Shoddy workmanship and poor design will not be tollerated and customer service needs to be excellent when issues do occur. I am reminded of a story that an Audi salesman told me many years ago. At the time, the salesman was working for VW and they had a VW Golf advert on television where a chap was being driven mad by a squeak in the car. The tag line, was that the squeak was his partner's earring and not the wonderfully engineered and high quality (more expensive) Golf. The challenge was that, VW owners took the advert literally and according to the salesman the dealership was inundated with customers cars where every small issue was highlighted and expected to be fixed. If there is a maximum price people are willing to pay for a model train and we exceed this then we may have to accept our cloth being cut accordingly. We may want all manner of details and features but this simply may not be possible at that price point. Models will have to become less complex to lower the price or the market really does become a toy for rich people (as it was in the days of Bassett Lowke etc.). The thing to remember though, is that even in the 1930s this created an opportunity for othese to enter the market. Hornby Dublo was considered revolutionary when launched and a few decades later, overpriced and undercut by Tri-ang. History may repeat itself... If not, then I suppose this is where the second-hand market comes in and people's ability to model. Fortunately, in OO there have been many years where very good models have been released. These older releases may not offer all the "Bells and Whistles" of today's models but they are still very acceptable. One may have to compromise and look for the value in a Hornby Merchant Navy from the year 2000 rather than lusting after the 202x version. Don't get me wrong, I do feel and understand the frustration that some people express over ever rising prices. These changes not only affect model railways but many other consumer products. Take a look at the price of white goods as an example. Many of us have become used to having what we want, when we want it at low prices. In large part, this has been made possible due to the ridiculously low manufacturing costs in China and gloabalisation. The "West" has been able to import deflation from these countries and mask the real structural issues within our own economies. All this has been funded by massive amounts of personal and governmental debt. The world is changing with some seasoned commentators predicting a move away from offshore production especially for strategic and tactical products/services. We may all have to accept that going forward the cost of product/services will rise and outstrip incomes resulting in a perceivable drop in living standards (which is a personal value again). We live in interesting times... (and that is a huge understatement). EDIT: I should have added that I am an N Gauge modeller so our back catalogue is somewhat limited compared to OO. 😉 Kind regards Paddy

Hi @Wheatley This one really surprised me as well. I know the person in question can be a wee bit silly on occassion but he obviously has some talent and skills. The eletric/paddling pool video went far beyond silly and I agree positively dangerous. The young chap should put his efforts in to more productive persuits like his current series on building an OO loco from scratch (IMHO). Kind regards Paddy

Hi John ( @Dunsignalling) Definately, having one's own manufacturing facility would have to be a medium to long term goal. Having said that, how long have these issues around Hornby been going? It would require a significant investment but never say never... As to ownership, did not realise that but as with most things in life I am sure there are ways. I thought Rapido had its own factory or am I wrong? Anyway, as a shareholder and modeller I want to see Hornby prosper and get back to being the icon it should be. Kind regards Paddy

Hi @30801 Oh, I totally agree with you but until they get the QC issues resolved at source they need to take the hit and inspect in Margate. We all know this is not the right way to do it (expensive etc.) but it needs to be done. The Hush Hush seems to have been another problem child which has ruined the experience for several of their customers. Unfortunately, in these days of social media our mistakes/shortcomings rarely remain private! The elephant in the room is should Hornby group get back in to manufacturing? This question has been covered numerous times on various forums and we all know the arguments about cost etc. However, there is merit to being in control of one's own destiny. Given the broad nature of Hornby's portfolio, it could be argued that setting up their own manufacturing facility could be made to pay. I am not suggesting that production should be brought back to the UK (that train has probably now departed for good unless you are selling really high end/tech products) but setting up their own facility in China or some other lower cost centre where the appropriate skills can be found. Is it high risk? Yes, but it will allow Hornby to be in control and not have their business buffetted by various suppliers. Ultimately, it comes down to do you want to be a commissioner or manufacturer. If you cannot do the former effectively then look at the latter. Kind regards Paddy

Another thing that frustrates me with Hornby (railways) is the marketing seems to be all over the place. They have an amazing brand like "Bassett-Lowke" and they waste it on steam punk - why? Bassett-Lowke was crying out to be used as a launch vehicle for Hornby entering the O gauge market at some future point. Instead, Hornby uses B-L to market a bunch of old tool products with bits of scrap stuck all over them? There is nothing wrong with steam punk modelling but should it really be a priority for Hornby? Also, what is going on with Horby Dublo? By all means have a retro/heritage (high price) range but stick to remaking the original HD releases initially. You are selling to a collector base, I would want releases of Duchess, A4, N2, etc. and even some tinplate coaches? Instead, you get a mix of 2-rail products (new designs, coaches from standard range etc.) all at high prices and supplied in HD 3-Rail packaging! For me, this all shouts at a lack of joined up thinking and a scatter gun approach of "how can we make some money". The risk here is that you devalue your brand and confuse your customer base. Hornby need to get back to basics and their #1 priority needs to be product quality and customer satisfaction. There should be a zero tollerance on poor quality with nothing leaving Margate that is incorrectly made or runs poorly. If the odd item escapes in to the wild then the issue should be resolved quickly and to the customer's total satisfaction. At present, you have a company trying to sell at high prices to a customer base who does not trust them to deliver. If Hornby get the quality sorted, then their customers may not "like" the prices but they will say "you get what you pay for". Companies like BMW, Audi, Lexus, Apple etc. have been doing this for decades. Kind regards Paddy

Hornby is effectively a private company as the vast majority of its shares are owned by Pheonix Asset Management. As long as PAM are happy to underwrite Hornby, they will continue in their current form. Disclosure - I am a Hornby shareholder. It saddens me to see all the recent reports of product quality issues that seem to have hit Hornby. The vast majority of the people working for the company seem very passionate about what they do and I am sure they did not want these issues to occur. There is no doubt Hornby are acting aggressively in the market but that is business. Not all companies are "touchy feely", think of Microsoft in the past, Oracle etc. and these are rather successful! Hornby is a small company and I fear that they are spreading their resources too thin. Their competitors are able to focus and cherry pick which reduces potential risk. Hornby seem wedded to the notion that they are an "all things to all people" model company. Given Hornby's size this may be the wrong approach commercially although I respect them enormously for trying (as a modeller). There could be merit is splitting the company up or atleast forming independent business units with their own P&L but under a centralised back office. Off the top of my head, this could be Railways (Hornby, Oxford Rail, LIMA etc., Cars (Scalextrix, CORGI, Oxford etc.) and Models (Airfix, Humbrol etc.). Kind regards Paddy

I wonder if the change in CEO is related to Henry de Zoete joining the Board recently? Could Henry be stepping up? May be it is one of those moves companies make from time to time where the CEO search is not able to find any suitable candidate so Lyndon then remains as both Chairmain and CEO. Kind regards Paddy