Rant- orders taking too long

[selector]

Barry, I have just now seen your kind comment about my non-model scenery.  Thanks very much.

I would have to do my wife the courtesy of arranging my own funeral if I were to take a serious stab at trying to copy in scale a setting in the real world.  I'd go mad first, then have the big infarct...probably all in the first hour.

-Crandell

[ATLANTIC CENTRAL]

MisterBeasley

Just on an off chance, I looked it up at Trainworld last Saturday.  They now have an online shopping-cart system, so I was a bit afraid that I might be ordering a phantom item.  (They are still, as we say in the computer biz, getting the bugs out.)  But, here it is Tuesday and my Car Float is now sitting in my workroom.  Plain lowest-cost UPS shipping, too. 

Thanks once again to the online dealer that gets my vote and my business when I can't get something at my LHS.  Oh, and the price was 24% below MSRP.

I buy from several local shops, but also from Trainword. I have always had good service and great low prices from them.

Sheldon 

[ns3010]

I'm still waiting for my Atlas Genset. And I'll be waiting till June, even though I preordered it in August...

The good news is that I'll be paying less than MSRP for it. The LHS where I ordered it has everything below the prices in the Walthers book. I only put a deposit on the Genset because they said they didn't know the final price at that time.

[MisterBeasley]

Back to the original rant, I'd like to offer a counter-example.

Last year, I figured out how I could work a car float operation into my layout expansion.  I waited patiently for the Car Float Apron to become available at Walthers, and bought one, very early in the cycle since I didn't even have benchwork yet, but I knew I'd need it and would have to have one to take measurements.  Then, I watched with horror as the car float model itself went from Out of Stock to the dreaded status of Retired.  I've been looking in shows and online for months now.  One local shop laughed at me when I asked for it.  Someone from the forum suggested his own shop, on the west coast of Canada, but they had sold the last one by the time I contacted them.

Just on an off chance, I looked it up at Trainworld last Saturday.  They now have an online shopping-cart system, so I was a bit afraid that I might be ordering a phantom item.  (They are still, as we say in the computer biz, getting the bugs out.)  But, here it is Tuesday and my Car Float is now sitting in my workroom.  Plain lowest-cost UPS shipping, too. 

Thanks once again to the online dealer that gets my vote and my business when I can't get something at my LHS.  Oh, and the price was 24% below MSRP.

[blownout cylinder]

UP 4-12-2

I've also read (but don't know if it's true) that most small businesses fail from lack of capital--ie just not enough cash flow.  So very few folks would be able to start from scratch and have the working capital to "make it".

I've heard basically the same thing as well although that aspect is frequently also the result of poor business decisions as well. A good example usually tossed up is Microsoft haviing barrells of $$$$ and being able to dominate through sheer size over companies like Lotus but a few insiders in Lotus have quite frankly stated that Lotus screwed up--not microsoft stomping on them.

You can have $$$$ but still fail.

[IRONROOSTER]

UP 4-12-2

...

Within the model train industry, even if one is just operating a store and not making your own, it is going to tie up massive amounts of money.  Customers expect inventory.  Just from the many comments on these forums regarding lack of inventory, it is very clear that customers expect a good selection.  That alone ties up more money than you would ever think.

...

 

A hobby store in my area some years back failed in less than 6 months.  I don't know for sure, but I think lack of inventory was the reason.  He had a lot of shelves but each with just one or two things on them. I visited the first week after he opened and it looked like the end of a going out of business sale.

Given the way hobby stores are closing, I think it must be a tough business these days. I love shopping at a well stocked hobby shop and usually buy something.  But there seem to be fewer every year.  Internet and train shows seem to be the wave of the future.

Paul

[UP 4-12-2]

I wouldn't want to borrow money either, but unfortunately, it is usually reality.

If I wanted to open my own engineering firm, I'd have to shell out over $10,000 just for one copy of the design software we use (Bentley Microstation and Inroads), before I bought a single computer or anything else.  Consulting engineering is a tough way to make a living--if I had any real brains, I'd have chosen something else.  I actually think model trains is an easier business, but also less lucrative for most who are involved.

I've also read (but don't know if it's true) that most small businesses fail from lack of capital--ie just not enough cash flow.  So very few folks would be able to start from scratch and have the working capital to "make it".

Within the model train industry, even if one is just operating a store and not making your own, it is going to tie up massive amounts of money.  Customers expect inventory.  Just from the many comments on these forums regarding lack of inventory, it is very clear that customers expect a good selection.  That alone ties up more money than you would ever think.

The family that owns Bowser was not poor--they had other investments, and of course it maybe helped that the one son married a young lady who happened to be a millionaire.  Yet the realities of the business are such that they routinely had to borrow large sums of money from the bank.  If you are in the mail order business, you can't usually pay cash for an entire run of new locomotives that comes in.  That's the main reason nobody wants to have extra stock today.

I've only heard secondhand what the cost to buy Stewart was, and can't quote it here, except to say it was well north of 1 million dollars, and was identified by financial analysts as a "good investment" (not necessarily true since some items needed updating to today's standards to sell well).  Just to pay the interest on that loan, they must sell a lot of trains each month--plus update the product line.

Now that's not a start-up business at all...but I think some are underestimating the capital required for a start up. I'm told you need two full years income for all employees to start up and make it.

I could identify products that would sell very well (like the B&O Big Six 2-10-2 that all B&O fans covet), but I don't have any front money or all the tooling skills required to start my own train business, or I'd do it myself.

John

[blownout cylinder]

selector

If I were "modelling" in this hobby I would have something recognizable to people who know the location, and I would have rolling stock running through it that 'fits'. 

Crandell, I seen your work. I still think that even if this is all coming out'n your head it is still "replicating" something. Hence it is still "modelling"-----and you do darn good at it---so there--

 

 

[ATLANTIC CENTRAL]

To John, Barry, and anyone still listening,

John, I understand your position and it is based on reasonable data - from the present and past - the future may be different.

I also understand and agree with Barry, having worked in the model train/hobby shop business and having been self employed most of my life I think it/something can be done successfully.

One limiting factor is thinking you must follow all the "rules" of money set by others in business - this is a big mistake in my opinion and it is what limits your perspective John.

One of the largest fortune 250 companies in this country is privately held and has never borrowed a dime in 60 years. They started in a basement and now have plants and facilities all over the world. Many said that would not work - but it did.

John brings up being wealthy in the first place - well in my view, borrowing money to start businesses is a bad idea - business startup capitol should come from investors willing to wait for success and is best provided by those involved in the business.

I have considered going into the model train business several times, but never felt I had the right product or a good means to produce it - but if I did the last place I would go is a bank - I would use cash on hand or sell some real estate or other investment - the cost of borrowed money is still way to high for startup businesses in my view.

Government regulation is also a problem here in the U.S. That is why the businesses I currently choose to be in are one man, home based, proprietorships - no payroll taxes, no expensive book-keeping, no expensive insurances, no lawyers, no accountants, no OSHA, no need to borrow money.

Personally, this government is choking small businesses and it is now about to get even worse.

On the plus side I do think many of the newer current manufacturers have missed the boat, leaving lots of opportunities for growth of the industry.

Meanwhile I did get to Peach Creak Shops yesterday and picked up the new Bachmann 2-6-6-2 - very nice and very reasonably priced at $221 (non sound version). Also had John order me some other stuff - not pre-order stuff, just stuff he was out of at the moment.

Sheldon

[UP 4-12-2]

Barry--

I'm not looking for a renaissance of scratch building in America--the thirty- and forty- somethings of today are too busy trundling from one school event to another to have time for that, and most twenty-somethings are still getting established and finding a wife before resuming whatever train interest they had as a child (or discovering trains new).  All the folks I know who would scratch build are older, with kids out or nearly out of the house.  You just don't see young guys doing it.  If China becomes too expensive, there will be another country to exploit even with the unrest factored into the equation (sorry, no pc here).

You are correct--you won't need 30 people.  Most of the model train companies are really not that far from being a cottage industry themselves.  They employ less than you might think--which is one reason products get delayed.

However, the amount of labor to produce even a small run of 300 to 500 units is quite a bit.  Then the challenge for the small industry is how do you muster the manpower to handle orders, QA/QC, shipping/receiving, marketing/shows and still actually find the time to make and assemble the product in a timely fashion (at least to whatever state of assembly you choose to offer)?  It's hard--you need some staff--and they need to get paid regularly, so you'll have to borrow cash to pay them (unless you are blessed with wealth already).

Many times those smaller enterprises are really good at wearing some of the hats--but to obtain and keep loyal customers, all the hats need to be worn at least somewhat well.  Unfortunately, the list of small American model train manufacturers who have come and gone is quite long.  Bowser has bought the remnants of at least 23 other small model train companies--with Stewart merely being the latest (and by far most expensive).

If you can be the Exactrail of HO locomotives at a reasonable price, I'll get in line with everyone else to buy them (and enjoy my slice of humble pie).

Respectfully submitted--

John

Humble pie is best served cold!

 

[blownout cylinder]

UP 4-12-2

Ok, perhaps I'm just a dumb civil design engineer, but things are just not as simple as what I'm getting out of Barry's post.  Just because you can get a cnc machine for $700 does not mean one can churn out price competitive models here in the good ol' USA.

OK--just how many people do you think I'm gonna be employing here? Some time back I mentioned that the scale of manufacturing will not be anywhere NEAR the level of Bowsers'. Cottage industry vs mainstream hobby industry. Small establishments at home vs factories or warehouses.For runs of anywhere from 300 to 500 locos I'm not going to need 30 people even----

As for price competitive models--if the jobs end up in Africa, which they very well may, all those labour cost savings will be eaten up in all kinds of issues that come into play when you go into politically unstable areas on this globe. So one can see that if the hobby does go into the stratosphere there will be a renaissence in the scratchbuilding end of things

I'm not saying that there will be no challenges---far from it. But I'm also saying that we really need to think that there has to be more to doing this than just making $$$$. This "But it costs $$$$$" can be nothing more than a mental block to thinking OTHER. If all the guys who went and did all this stuff that we now take for granted took the current view that so many do now---we might not be doing very much of anything.

[selector]

UP 4-12-2

I think the thing that is being either forgotten or totally ignored in this discussion is this:

Most of the manufacturers are not sitting on piles of cash, and as such, they choose to produce the items they believe will have the broadest market appeal...

Beggin' yer pardon, but this much of your message is inherent in my own post one page back.

-Crandell

[UP 4-12-2]

Nice idea, ain't gonna happen.

Too many perfectionistic hobbyists would take advantage of any policy like that.

The Caboose in CT actually had a similar policy into the 1990's:  Buy any brass model you like, and if you don't like it or want to trade it in on something else, they'd give you the exact amount of money you had invested in it!

I did the trade-back once, with a Westside SP 4-10-2 that I should've kept.  (The item I traded it back in on turned out to have hidden problems).

They ended that policy during the early 1990's.

The most reputable brass dealers still give you anywhere from 7 days to 14 days during which you may return a brass model if you are unhappy with it.  Individual train dealers like M.B. Klein do still have similar policies--a period of time in which you may return a model for refund or credit--but that is not supported by the manufacturers, only something provided by the elite best dealers on their own terms.

John

[jwhitten]

 I think pre-ordering is just fine. But I think there ought to be another component-- the mfgr's should have to HOLD the money for an equal amount of time while we inspect the product and put it through its paces and decide we like it.

[UP 4-12-2]

Barry--

John Glaab's favorite quote (not sure if uniquely his):  "Wanna make a small fortune in the train business?  Then start with a large fortune!"  Or as better translated, the manufacturers do this for the love of it and not the money--because there's way better investments.

Ok, perhaps I'm just a dumb civil design engineer, but things are just not as simple as what I'm getting out of Barry's post.  Just because you can get a cnc machine for $700 does not mean one can churn out price competitive models here in the good ol' USA.

I absolutely guarantee you, if there was any way at all Bowser could have kept production in this country, they would have done it.  It wasn't about the need for more profit as some have alleged, it was about their very survival in the marketplace, period.

I very well remember Lee English's great joy when they bought their first screw-making machine, as well as other things Bowser did!  He is one person that thoroughly enjoys physically making the trains (or just about any small machine shop work).

Now they can buy any screw you want from China and have it shipped here for less than the cost they can make it here, period. (That might offer a clue as to why the used cnc machine and other equipment is available so cheaply here).  Same with any can motor you want.  There is simply no way on earth you are going to make a can motor in the US and compete with Athearn, Walthers/P2K and Atlas on price.  Ain't gonna happen.  They can buy the motors in China and import them here for less than 20% of the cost per motor of making them here.  Multiply that by the price of an entire model, and you have a very serious price disadvantage. 

Even allowing for QA/QC issues with foreign made product, nobody is going to make a new locomotive and assemble and paint it here in the U.S.  It ain't going to happen, and those of you who think you can do it--go ahead and try--others before you have.  They saw the economics and gave up and moved production elsewhere.  People are not going to pay $1000 for a fine American made steamer if BLI can provide a Chinese made one for $300--and, yes, you really are looking at a price disadvantage of that much on a high quality RTR steamer.

Oh the sky is falling--what will happen when the Chinese become too expensive?  The same thing that happened with the brass market.  When Japan became expensive, they moved to South Korea.  When South Korea became expensive, they moved to China.  When China becomes too expensive, they'll find another cheap supplier and train them from scratch, too.  I think some are already quietly working on what was Taiwan as the "next solution".

John

 

 

 

[blownout cylinder]

fwright

There are only 2-3 companies in China with the know-how and skill and labor force to produce reasonably good locomotives at a reasonable price.  A given importer has to reserve a time slot for his particular production (unless you are Bachmann, which is owned by the manufacturer Kader).  Miss getting everything ready in time for your slot, and you have to reschedule another one months down the road.  Or something goes wrong on the line for the previous production run, and you have to accept the delay that had nothing to do with your production.

This is where things get really hairy. Outsourcing labour to another country is not the panacea that some have thought it would be. Many considerations were not given much thought in the rush to save on labour costs begin with. And, if ANY of those few mfg's in China go broke----then what?

fwright

Production runs are getting smaller.  Why?  How many locomotives are you willing to buy in a given year?  There are only so many model railroaders buying so many locomotives (the same is true of passenger cars).  With Atlas, Stewart, Kato, MTH, Athearn, Rapido (new), and Walters all competing for the same plastic diesel model $$ with many more different models than were available in the past, the sales of a given model are going to be less than in the past when there were fewer choices.

The amortization of tooling over smaller production runs and Chinese inflation are leading to price inflation - which reduces the number of sales, which reduces the size of the production run, which increases tooling amortization costs, and so on.

So. Many of the Mfg's you mention are also competing with the SAME model as well. How many Big Boys, how many FEF's, how many large locomotives as compaed with, say, a Santa Fe 2-8-0? There are more of the large locomotives than the smaller one's out there as well.

As for the amortization of tooling, this can get pretty silly at points. I went and came across a 4'x6' cnc miller/cutter awhile back. I went and bought the thing from this industrial surplus dealer for just under $700.00. That included everything for it. Cutters everything. While mucking about with a friend who has WAY MORE EXPERIENCE with these things I came across the amortization aspect. Now, amortization with, say, a $15,000 piece of equipment is logical but a $700.00 cnc cutter/miller? Most of the people I talked with in the last little while are telling me of all these pieces of equipment that are now on sale at these places can be had for rediculous prices. Come on now----

And what about all the newer ways of mfg that can be done practically in your own home? Much of what we are hearing now are dating back how far? 30-40 years back? Amortizing equipment that may have cost a factor of about 6-8x what I am seeing in some of these dealers now?

Historically there is this little--problem--of the first steam locomotives in England. Remember them? 1830's? Was there a market BEFORE the locomotives showed up? Technically no. That market which we now are the beneficiaries thereof had to be BUILT UP...it had to be built up through HUMAN activity---the $$$$ sure did not do it.

Sure, it costs $$$. But you are not going to make $$$ without something happening--

[UP 4-12-2]

I think the thing that is being either forgotten or totally ignored in this discussion is this:

Most of the manufacturers are not sitting on piles of cash, and as such, they choose to produce the items they believe will have the broadest market appeal.  Bowser, for example, is still a family-owned business.  Also, they are still paying for the acquisition of Stewart.  With perhaps very limited exceptions, the model train manufacturers do not have deep pockets.  For that reason, the manufacturers must have a "hit" every time--even if that means they might lose 10% of sales.

So far as the numerous statements that "pre-orders constitute their market research"--with limited exceptions, I do not buy that at all.  My understanding is that for most companies the pre-orders only set the final production quantities--and not that they determine if a product gets made at all.  (This may not apply to BLI).

John

[andrechapelon]

I understand what your saying Andre, but fear you have been lulled into the old trap that so many  americans are trapped in.   That the "Capitalist" decide what we as consumers want and need.  I'm reminded of the car salesman who makes the buyer beileve he needs the car more than he need to sell it. Remember we are the free market without us they (the capitalist) cannot exist. 

Dude, you are so far off base, it isn't funny. I am a capitalist (although certainly not in Warren Buffett's league) and have provided seed money to start a business. It's a small business, I grant you, but it is profitable. And then there's the reason I have a smile on face today.  Well over a decade ago, I took a risk on a company that the financial "pundits" were ready hold a funeral for. Today, it's one of the largest companies by market cap in the world. You may well have bought one or more of its products and if you have, I thank you for that. What you fail to understand is that company actually created a market. Several times as a matter of fact. Look up the stock symbol "AAPL" on Yahoo finance some time and look at the max chart for  stock performance since the early 80's. It's been a wild ride.

I didn't say that the capitalist DICTATES what we buy, I said he/she decides what the most appropriate way to allocate that capital and makes a best guess estimate as to what will actually sell. And what's actually on the market can actually sway the market in a different direction. When's the last time you saw a station wagon on a new car dealer's showroom floor? First it was the mini-van, introduced by Chrysler and rapidly copycatted by every other car company. Then it was the SUV. Nobody really knew in advance those would become the hot sellers (and later drags on the market) that they did. Those two vehicle types essentially killed the station wagon. Too bad, I like station wagons. But all the sniveling and boohooing I could do won't bring them back.

You say the capitalist could not exist without us? Well, it also works in reverse. We cannot exist without the capitalist, a side of the equation a lot of people seem to forget, especially around here. In any case, it's their capital. They get to decide how much risk they're willing to take and in what they will invest. Whether or not I think current manufacturers are a bunch of gutless wienies because they won't make what I think they should make is irrelevant. It's easy to criticize some manufacturer for not catering to your whims when you're unwilling to cough up your own money to risk producing product or service for sale.

Markets are created, they don't exist before hand. There was no market for air travel before the airplane and there was no market for sound and DCC equipped locomotives before BLI created that market and there was no market for highly detailed plastic steam locomotives before Bachmann created it. Well, at least not here. The Europeans got the jump on us with with new offerings from ROCO, Maerklin, Fleischmann, Trix et. al, while we were still fat dumb and happy with the outdated offerings from manufacturers that have now either gone out of business or exited certain segments of that business (e.g. Bowser).

Sheesh. It really chaps my hide when people who've probably never actually risked capital go around telling me how capitalism works.

Andre

[blownout cylinder]

selector

Nope, I won't be forcing the manufacturers to do anything silly, like to fill warehouses with goods valued at 2010 dollars and hope to move much of it when 8 years are past, taking in money valued where the dollar will be in 2018.  Instead, I'll continue to take up FDT on their very heavy 1 cent deposit, as I did on the Q2.  If the engine doesn't materialize, I will move on, just as FDT will.  I won't gnash my teeth, tear out my hair, threaten to hold my breath until I die, or any other wastes of my time

Why does a person have to go either way? Look. One does not need to go either whole hog and do nothing but fill warehouses with stuff that'll take years to empty out or do nothing but pre-order---and then do that ONLY to satisfy one section of the market. Why not both? Come on now--we know the market for small locomotives is NOT THAT HUGE in the first place yet we keep thinking that we'll have warehouses stuffed full of 'em. Not one single person/plant/thing has stepped forward and done a survey of ANY sort to determine just what size of market it potentially/really is now. I know that one was apparently done by/for Bowser(?) some time back but-- I'm in that process right now of doing a survey to see what kind of a market exists---I do have me suspicions here--

As for the profit/risk factors. One thing that profit was for was reinvesting INTO your business. Into the idea of GROWING the market--which we seem to have "forgotten" about It was really not for itself-----

selector

Mind you, I could learn to make my own engines.  In fact, I'd pretty much have to if BLI went belly up.

And if it does there will probably be a lot running around going on that learning curve----

[fwright]

 I guess I have taken a little different tack for my model locomotives.

I determine in advance what my ideal roster should be.  For instance, my free lance HOn3 roster needs a 4-4-0 for passenger service.  The only thing in the past is the Spartan FED Baldwin 4-4-0, which was produced in greater numbers than the market was willing to buy at the time.  The combination of lack of detail and poor running made modelers shun them despite the low price.  Both detail and running problems can be overcome with some significant work and $$.   Because of lack of anything else, the going used price is now well over $100.  But it is a plan if I don't want to scratch build, and I can't convince a manufacturer to make one.

MMI announced a D&RG Baldwin 4-4-0 but has never received enough pre-orders to make a go of it.  I did pre-order my needs to confirm my interest, and reiterate my interest to PSC whenever I get the chance.  However, the On3/On30 version didn't get enough orders either to do the die cast MMI, so it has been converted to a strictly brass project at a higher production price and smaller numbers.  Bottom line is that there aren't enough of us modeling early narrow gauge (earlier than the '20s).  Big power rules the day, even in narrow gauge.

I have also filled out Blackstone's survey in the hopes that they will do a C-16 or smaller locomotive one of these days.  If they announce one, I will definitely pre-order to encourage them to go to production.

I don't see pre-orders or delays or limited runs as evil.  I see it as a way to get models produced of prototypes that likely won't sell in sufficient numbers if done as anything other than a mostly pre-sold limited run.  By doing my part to reduce the manufacturer's risk, I am encouraging him to produce things he otherwise couldn't or wouldn't.

The capitalist market is a 2 way street.  It takes a willing buyer and a willing seller.  If I as a buyer sit back and do nothing (perfectly within my rights), then the chances of the manufacturer producing what will please me are significantly smaller.  If I participate with pre-orders, filling out surveys or making my wishes known to the manufacturer, and supplying prototype or other helpful data - which buyer are you going to be more likely to support as a manufacturer?

All customers are not created equal.

"You just can't get good customers any more" - joke from a Malcolm Baldridge planning session

my thoughts, your choices

Fred W

....modeling foggy coastal Oregon, where it's always 1900....

[BATMAN]

 Ah yes . The model railroad manufacturer. The last great bastion of Capitalism. The auto industry, the Banking industry and on and on. How come the socialist hoards never bail out a failing MRR company.

 

                                                          Brent

[simon1966]

nyflyer

That the "Capitalist" decide what we as consumers want and need.  I'm reminded of the car salesman who makes the buyer beileve he needs the car more than he need to sell it. Remember we are the free market without us they (the capitalist) cannot exist. 

You hit the nail on the head.  To that end, if no one bothers to pre-order then the manufacturers will change their methods. 

IMO, this very situation of pre-ordering has come about due to market pressures.  The customer has been asking for better detailed, more rail road specific product.  The pre-order is one way that a manufacturer can meet that need without a huge risk to their business.  The alternative is mass produce more generic models that modellers can then customize.  But it seems in this day of R-2-R that modellers don't want to do that.  It is not as if the manufacturers are saying "here is what we make, take it or leave it" but more "Do you want this? if not we won't make it"  As Sheldon points out, the pre-order system is effectively doing their market research.  If you don't want to participate then don't.  Let your $$ do the talking.

[nyflyer]

Main Entry:  capitalism   !ka-pu-t/ul-+iz-um

Pronunciation:   \ ˈka-pə-tə-ˌliz-əm, ˈkap-tə-, British also kə-ˈpi-tə-  \ 

Function:  noun

Date:  1877

Results
1877an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production,goods that are determined mainly by competition in a free market and the distribution of

Merriam-Webster Online Dictionary copyright © 2009 by Merriam-Webster, incorporated

 

"Given that the manufacturers are the capitalists, not the customers, it is they who get determine what they will produce and how much".

 

I understand what your saying Andre, but fear you have been lulled into the old trap that so many  americans are trapped in.   That the "Capitalist" decide what we as consumers want and need.  I'm reminded of the car salesman who makes the buyer beileve he needs the car more than he need to sell it. Remember we are the free market without us they (the capitalist) cannot exist. 

 

 

[simon1966]

A company that goes bust is of no service to its share-holders or its customers.  If a MRR manufacturer finds a low risk way to run its business, be profitable and is successful at doing it, why on earth should they trade that in for a higher risk strategy?

If you don't like to pre-order, like me, then don't.  Perhaps you will get the chance to purchase the models you want later at a discount, perhaps you won't?  There really is no point in getting all upset about it.

How the system works is really quite clear, you can either go with the flow and participate or not bother.  I don't think BLI will be losing any sleep that Sheldon is not pre-ordering any of their locos, and since Sheldon is blissfully happy we should all just mellow out and be happy to.

I should point out that there has not yet been a pre-order locomotive announced that I just "have to have" so it has so far been very easy to resist any urge to pre-order anything.

 

[IRONROOSTER]

fwright

...

OTOH, if you are willing to pre-order or invest in a reputable manufacturer, and put up with the inevitable delays when things go wrong, you can get an item you really want in your hands a lot sooner, and possibly at a lower price if he doesn't over produce.

my thoughts, your choices

Fred W

 

The 3 things I have pre-ordered were items I really wanted and could afford.  The manufacturer/importers were reputable firms.  I also was willing to wait the 6 months to a year to get them.  Plus I got discount on the price. 

I have a short list of other things I would be willing to pre-order should they become available, but otherwise I wait until they are actually in stock, preferably at a train show where I can actually see them.

Truth be told I have enough stuff to keep me going for years.

Enjoy

Paul

 

[andrechapelon]

nyflyer:

"I GUESS WHAT I'M TRYING TO SAY, IS YOU ARE THE CUSTOMER, MAKE THEM EARN YOUR BUSINESS, NOT TELL YOU WHAT YOU WILL GET WHEN THEY FEEL LIKE GIVING IT TO YOU!  BELEIVE ME WHEN THERE BOTTOM LINE STARTS DROPPING THEY'LL START WORKING FOR YOUR BUSINESS RATHER THAN JUST EXSPECTING IT!

It's called CAPITALISM, still the greatest system in the world, "USE IT"! 

As a rant, that may sound good. Unfortunately, there's a fly in that particular ointment. It's the capitalist who gets to make the determination of what's manufactured, when and under what conditions a good or service is offered.

Given that the manufacturers are the capitalists, not the customers, it is they who get determine what they will produce and how much. You certainly have the right not to participate in the current MR market as a customer, and maybe that will work if enough people stop particpating and the manufacturers realize they're losing business. However, they're the capitalists and it's their capital at risk. The only choice you have is to buy or not to buy with or without complaint.

Personally, I wouldn't mind pre-ordering if the mfgs produce something I actually want badly enough. So far they haven't, so I'm a non-participant, just like I'm a non-participant in the market for luxury cars, McMansions, corporate jets, etc.

Andre

[selector]

The guys selling you engines are big boys in and of themselves.  They'll run their businesses or run them into the ground.  Building a bunch of 4-8-4's in metal with decoders and sound when there is only a weak market is plain stupid...period.  I would much rather they do their homework and plunk bucks where they know they'll get a hefty return, and then be solvent to stick around for round two.  We have a fully subscribed Q2...where?  Gone.  Second round of Y6b's where?  Gone.  How're the 2-10-0's doing from BLI?  I suspect they're becoming scarce, even if some had to be discounted to keep them moving.

Nope, I won't be forcing the manufacturers to do anything silly, like to fill warehouses with goods valued at 2010 dollars and hope to move much of it when 8 years are past, taking in money valued where the dollar will be in 2018.  Instead, I'll continue to take up FDT on their very heavy 1 cent deposit, as I did on the Q2.  If the engine doesn't materialize, I will move on, just as FDT will.  I won't gnash my teeth, tear out my hair, threaten to hold my breath until I die, or any other wastes of my time.

Mind you, I could learn to make my own engines.  In fact, I'd pretty much have to if BLI went belly up.

-Crandell

[fwright]

nyflyer

Don't pre order!  Force the manufacturer to produce an item and put it on the market.  All your doing by pre ordering is removing the element of risk for the manufactures.  "Everyone want's one. Good, we'll make it when we get around to it.  Not enough intrest, then we don't make it. Sorry all people who pre ordered better luck next time".  Can't you see they are using you for there own market research (and not even cutting you a check for it).  Make them earn your business, by fourcing them to do a little research for themselves and putting out a product based on there results.  That's what will keep the good companies around and rid the industry of trend followers and free riders. 

"I GUESS WHAT I'M TRYING TO SAY, IS YOU ARE THE CUSTOMER, MAKE THEM EARN YOUR BUSINESS, NOT TELL YOU WHAT YOU WILL GET WHEN THEY FEEL LIKE GIVING IT TO YOU!  BELEIVE ME WHEN THERE BOTTOM LINE STARTS DROPPING THEY'LL START WORKING FOR YOUR BUSINESS RATHER THAN JUST EXSPECTING IT!

It's called CAPITALISM, still the greatest system in the world, "USE IT"! 

 

You are totally correct, but forgot that it cuts both ways.  You want the manufacturer to take all the risk.  Risk has a price tag associated with it.  If you ever worked in contracting, you know that getting a contractor to agree to a fixed price contract usually results in a higher final price than a Time and Materials contract because the contractor has to price risk into his costs.  The more risk in the service or product he has to provide, the higher the price must be.  On a Time and Materials contract, the buyer assumes the risk, but also profits from a reduced price if the buyer manages the risk for the vendor.

On the supplier side, not many folks know how to price risk properly.  Most contractors and businesses assume all will go well, and price accordingly.  Actually, things rarely go well so the contractor starts losing money.  To make up the losses, he over-prices the inevitable change orders after the customer is locked in.  Or he over-prices follow-on support or maintenance work or parts.  Or he cuts corners to cut costs.  Or he eats his loss.  Or he quits before the contract is finished, and doesn't deliver.

The problem for the contractor/business who prices risk properly is that he is seen as the high-priced, but high quality supplier.

Applied to the model railroading business, risk translates into lack of sales.  A manufacturer is at risk for 1) a bad reputation because of poor design, poor quality control, or poor prototype fidelity; 2) over production; 3) bad reputation due to late delivery, under-cutting dealers to blow out remaining stock, or under-cutting prices paid by the 1st round buyers.  Notice that 2 of the 3 problems cited in #3 can be fixed by fixing #2.

NY Flyer's post assumes that the mr manufacturers behave like other large corporations - their primary drive is to stay in business.  Model railroad manufacturing - for the most part - is not totally profit driven.  Most are single owner, privately or family owned businesses.  Their need for profit depends on individual circumstances and is not driven by Wall Street expectations or stock holders.  Usually, the items that are produced are oriented around the business owners' personal desires, not maximizing profitability.

The fallout of the differences is that model railroad businesses bail (go out of business) when they can't foresee a viable business model, or key people lose interest, lose their health, and/or get tired of whining customers.

As for market research, it's unaffordable, and results are going to be less than rewarding.  To keep one guy on payroll traveling the country doing research is at least $100K a year (probably twice that).  If I produce 10,000 widgets a year based on that research, I've added at least $20 per widget at retail.  And who does my researcher talk to?  People at shows, people at meets, and he reads the hobby media.  All who have agendas and very seldom represent the 50% of the market who are lone wolves or who don't go to shows or post in the forums.  Why do dealers stock a lot of product you are not interested in, and wouldn't touch under any circumstances?  Because it sells, and there are a lot of modelers not like you.  A typical LHS stocks at least 20,000 different items, and I might have an interest in 200 of them if I had an unlimited budget.

My bottom line take:  I agree.  If you really dislike pre-orders and delayed product arrival, don't buy from the manufacturers that are guilty of those practices.  Buy from those who don't take pre-orders and who don't announce their product until it arrives.  But be prepared for higher prices.  And it still may sell out before you read the advertisements or visit your LHS.

OTOH, if you are willing to pre-order or invest in a reputable manufacturer, and put up with the inevitable delays when things go wrong, you can get an item you really want in your hands a lot sooner, and possibly at a lower price if he doesn't over produce.

my thoughts, your choices

Fred W

[climaxpwr]

Problem is, even by using us as a free market research tool, they still dont get it.  How many copies of the UP Big Boys and a gaggle of F units do we really need on the market.  The "I can make it better than X company" is really getting old in my book. Also keep in mind that during the heyday of brass, it was the only medium to produce models of that caliber. Plastic injection molding and diecasting just wasnt up to that level yet like it is now.  I read in interview with the gentleman running PFM in the late 70's about the rising cost of brass models and his take on things.  He basicly said that PFM was working hard to keep costs down so that the average modeler that desired one of thier models, could afford to have atleast one example on thier model railroad.  Even then they were not cheap if you take into account the average income back then.  But now brass is out of site price wise due to Limited Runs, along with material cost increases ect.  Gee look what we have now, Limited Runs in other mediums and rising prices.  Anybody remember when Bachmann took like 3-4 years to get the first Spectrum Dash 8-40C's to market.  They are much better now, either waiting till the arrival time gets close or not saying much at all like in the case of the recent GP7's.  With hobby budgets on life support for many modelers for the near future, I dont think we have seen the worst of Limited Runs, delayed models or ones announced then put on hold or never made.  I think by not preordering, things would only get much worse in the short term, maybe in the long term as well. That approach is filled with unknowns on our end, known only to the big wigs running these model companies.  I will say with the advent of internet, ebay, e-retailers and your LHS, finding most any model isnt to difficult even long after the release date.  If you missed the inital release or couldnt afford it, camp out on ebay, scour online shops and attend train shows, the model will turn up and the hunt is half the fun most of the time.   Now this all works if the companies will produce the models.  Weather issues during the winter months can delay things.  The Olympics in China a couple years ago slowed things down as factorys normaly producing trains, put those on hold to make Olympic items.  Also these new engines, loaded with features are more prone to engineering issues that might crop up as production ramps up, shutting it back down to solve issues.  Until things improve, enjoy what you have, take a breath and relax, its only a hobby and not supposed to be stressfull.   I myself get more fustrated at the job market that leaves me layed off each winter, then I cannot afford to buy the models I want, when I want them the most.  So I stock up on my craftsman kits I enjoy so much, keeps me busy during the long cold winter with little to no outlay in money, no waiting on models to be released.  The only problem is when I run out of glue!   Cheers  Mike