Financial Woes Continue

Discuss Hornby Model Railway products and related topics here. This includes (Lima, Rivarossi, Jouef, Electrotren).
Bigmet
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Re: Financial Woes Continue

Postby Bigmet » Mon Apr 16, 2018 11:54 am

If we want the choice we are going to have to pay for it is the brutal truth. Both Bachmann (their Kader parent actually) and Hornby have had financial problems. Yet these are the two that supply 'full ranges' in OO rather than 'mostly locos'. The present choice in RTR OO rolling stock contracts massively if these two were not active. Now look at where the competition is hottest: locos. When the going was easier - that happy time ten years and more ago - there were only three significant RTR OO players. Why have so many competitors piled in since? It has to be because they saw a profit opportunity. And where do you make the most profit? Locos.

Bach and Hornby's loco prices are not out of step with the other competitors, and there is now a lot more product all bidding for the same customer spend. Some of the price increase has to be because the volume case for each model subject has declined, so fewer purchases to recover the development costs. Hornby in particular got their volumes wrong on loco production over the past few years, leading to some hefty discounting. I rather suspect that when the going was easier there was the possibility of cross subsidy between locos and rolling stock to keep the price of the rolling stock down. Not any more, so we are having to pay full price for the rolling stock.

Comparison to Dapol and Oxford will become possible once both have the same scale of sustained rolling stock introductions. Dapol are largely churning ancient and inferior tooling - which should be cheap - but I have already seen comments about the Yeoman hoppers to accompany their class 59 which are advertised at circa £40. Oxford are still fighting their way in to the market using whatever start up funding was committed. It's when the next cycle of rolling stock development funded by the profit of the present range commences, that the real pricing for a sustainable business emerges.

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D605Eagle
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Re: Financial Woes Continue

Postby D605Eagle » Mon Apr 16, 2018 5:09 pm

Oxford I remember stated when they moved into the railway model game stated that they could always be more competitive than the others because they owned the factory their stuff was made in, thus one less level to pay. However I have heard rumours that they don't own their own factory. The time taken for new announcements to hit the shelves would also suggest that the new models they have produced aren't selling as well as they hoped.

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Re: Financial Woes Continue

Postby End2end » Tue Apr 17, 2018 9:00 pm

I'm surprised that Hornby have not done a tie in like with Harry Potter for the 2017 Murder on the Orient Express remake.
I can't think of a more famous train film.
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Bufferstop
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Re: Financial Woes Continue

Postby Bufferstop » Tue Apr 17, 2018 9:50 pm

A Murder on the Orient Express tie in would be more appropriate to one of Hornby's continental acquisitions, they already do most of the rolling stock needed.
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Bigmet
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Re: Financial Woes Continue

Postby Bigmet » Fri Apr 20, 2018 1:45 pm

Change is afoot. Dealers have been told that Hornby's TTTE franchise ceases at year end. Disengaging from the children's toy market.

6412
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Re: Financial Woes Continue

Postby 6412 » Fri Apr 20, 2018 4:09 pm

Quick question what does TTTE stand for :?:

6412
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Re: Financial Woes Continue

Postby 6412 » Fri Apr 20, 2018 4:50 pm

Ok just answered my own question, didn’t think about Thomas :oops:

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Bufferstop
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Re: Financial Woes Continue

Postby Bufferstop » Fri Apr 20, 2018 6:08 pm

Wonder if Bachmann will pick it up, they already have most of the models.
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Bigglesof266
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Re: Financial Woes Continue

Postby Bigglesof266 » Fri Apr 20, 2018 8:24 pm

Bigmet wrote:Disengaging from the children's toy market.


Sounds to me like there's finally someone with some common sense at the helm of Hornby.

6412
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Re: Financial Woes Continue

Postby 6412 » Fri Apr 20, 2018 8:29 pm

Wonder how profitable thomas has been for Hornby? There is also the question of how many have started with Thomas and then moved on to other Hornby products?

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Bufferstop
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Re: Financial Woes Continue

Postby Bufferstop » Fri Apr 20, 2018 8:38 pm

I've never thought of Thomas as a way into railway modelling. There seems to me a bit of an age gap between following the Thomas stories and understanding what goes on in main line or heritage railways.
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Bigmet
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Re: Financial Woes Continue

Postby Bigmet » Fri Apr 20, 2018 9:55 pm

6412 wrote:Wonder how profitable thomas has been for Hornby?...

You would have to guess they have made money on it in the past, as the range was steadily expanded.

One thought is that the relatively new owner of the Thomas rights is Mattel. And Mattel is a major toy trade business 'not doing well at all'. Just possible they went to Hornby with a significant licence fee increase for 2019, and that made the decision for Hornby.

And of course Hornby still have all the physical tooling. So there is quite a range of future possibilities, given how tooling has 'migrated' in the past.

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flying scotsman123
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Re: Financial Woes Continue

Postby flying scotsman123 » Fri Apr 20, 2018 10:03 pm

Bigmet wrote:One thought is that the relatively new owner of the Thomas rights is Mattel. And Mattel is a major toy trade business 'not doing well at all'. Just possible they went to Hornby with a significant licence fee increase for 2019, and that made the decision for Hornby.


Wouldn't surprise me, they've been doing the same to heritage railways running Thomas events.
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trainlover23
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Re: Financial Woes Continue

Postby trainlover23 » Sat Apr 21, 2018 1:17 pm

Bufferstop wrote:I've never thought of Thomas as a way into railway modelling. There seems to me a bit of an age gap between following the Thomas stories and understanding what goes on in main line or heritage railways.



I disagree with that statement. I would think it was a two way thing in that it encouraged children to BECOME interested in the real railway and then as they get older become interested in modelling railways as they see it.

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alex3410
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Re: Financial Woes Continue

Postby alex3410 » Sat Apr 21, 2018 9:36 pm

I think they need to keep the 'toy train sets' as a way into the hobby/starter set (i still remember getting my first train set from my dad), but it will be interesting to see how they refocus and if Bachmann will take over the Thomas range.


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