Hello everyone,
I'm just curious, but there has been several posts on the boards over the last few years from various people complaining or should I say "stating" that the cost of being in the Model RailRoader hobby is quite expensive and in some aspects I would have to agree; as I think many of you might. I'm not trying to rehash those posts in any way, we all know about it so there's no sense in openning that old wound but I have a new question.
What I would like to know now is, do you think that the cost of our hobby will come down, as not only the US markets but the Global markets head into recession? And when do you think we will to see some kind of drop in prices of MRR items such as loco's, freight, buildings, track......all of which are made of plastic that is directly related to petrolium prices in the making of said plastics. Or at least that was the excuses the industry was using when crude oil was pushing $147 a barrel. Does anyone else have high hopes that even though you may not have the money to purchase MRR items because of the recessions happening globally, that the prices for items in the hobby will eventually come down to normal levels? Whatever that may be?
What say you people? I'm curious to hear your thoughts on this.
AJ,
I really do not see prices going down on model railroad items. You might see some inventory clearances by some dealers. It is true that petroleum is used in styrene plastic models, but if there is 50 cents of plastic in a train model I would be suprised. Fuel for transportation/manufacturing also weigh in here.
As the global economy falters, we will just see less new models arrive at our dealers. We do not need model trains to survive. I have never seen them listed as food/clothing /shelter type items.
Myself, if I lose my job before my planned retirement in 3 years; I will just have to 'rough it'. At least my house is paid off, and I can start my defined pension at any time. The bright side is I have lots of 'kits' that need to be assembled!
Jim
Modeling BNSF and Milwaukee Road in SW Wisconsin
Oh yeah the prices will be coming down. I am just waiting for the deals to pop up. It is possible that the companies could go the way of the Big 3 and hit congress up for some money however.
Peter
I guess a lot of this depends on what China decides to do. They may choose to support their manufacturing exports by keeping their currency artificially low, which many experts say it is, or they may simply let their export prices rise and concentrate on their internal economy.
As demand falls, we may see reduced production to stabilize prices, like we see in oil. Or, they may just cut costs by just producing more copies of existing models, but introducing fewer new ones.
My guess is we will see a stabilization of prices, but not much change either up or down.
<begin soapbox> I think that a serious problem was turned into a crisis by election-year politics and hysterical media attention. Suddenly, obscure banking terminology was on everyone's mind, pounded into us every hour by both CNN and FOX. The fixes might have had more of a chance if consumers hadn't gotten scared and crawled into their burrows, but now all measures of consumer confidence are down, and that's one of the biggest things that drives the American economy. So, I'm urging each of us who does have a steady job and isn't in trouble with his mortgage to take some of that money you're saving on gasoline and heating oil right now and go down to your LHS and spend it. Get that locomotive, or that DCC system. It's highly likely that your LHS is sweating this more than you are, and a bit of consumer confidence is what these shops need right now. <end soapbox>
It takes an iron man to play with a toy iron horse.
Probably not. I think some cost increases hadn't been passed along yet as manufacturers/importers didn't want to hike prices too fast. Other things like rising living standards overseas aren't going to reverse easily. If things get a little worse, there will be some going out of business sales. But that's only a one time opportunity and not healthy for the hobby long term.
Enjoy
Paul
First what recession?
I spent $168.00 this month on the hobby for 2 N Scale Atlas locos( on sale for 2/$89.00),a MRC Tech II power pack (like new $10.00),structures and several freight cars.I will be ordering more shortly.See I trying to help the failing economy.
Yes the price of the hobby has risen over the past few years but,thanks to the computer one can save mega bucks by simply shopping on line.
I use to be one that complain loudly about the higher prices till I seen it didn't do any good so,I went the next step and beat the manufacturers at their own game by buying at discount.
No..The price bubble hasn't burst yet nor will any time soon as long as there are modelers willing to fork over $149.99 for a plastic locomotive.Sorry,but,that's a cold fact.
Larry
Conductor.
Summerset Ry.
"Stay Alert, Don't get hurt Safety First!"
MisterBeasley <begin soapbox> I think that a serious problem was turned into a crisis by election-year politics and hysterical media attention. Suddenly, obscure banking terminology was on everyone's mind, pounded into us every hour by both CNN and FOX. The fixes might have had more of a chance if consumers hadn't gotten scared and crawled into their burrows, but now all measures of consumer confidence are down, and that's one of the biggest things that drives the American economy. So, I'm urging each of us who does have a steady job and isn't in trouble with his mortgage to take some of that money you're saving on gasoline and heating oil right now and go down to your LHS and spend it. Get that locomotive, or that DCC system. It's highly likely that your LHS is sweating this more than you are, and a bit of consumer confidence is what these shops need right now. <end soapbox>
MrB:
Bingo! Give this man a taller soapbox. Things will get better. But I don't want to stray off topic...
On-topic...this hobby is a Depression baby, folks. It's not going away.
What I *would* like to see more of is candle-lighting, instead of darkness-cursing. Why not come up with some new, cheap way to do something, and present it here, so we can all do it too? This hobby doesn't have to be expensive. It really doesn't. Of course, nobody wants to believe that, for whatever odd reason, but it's true.
BRAKIE No..The price bubble hasn't burst yet nor will any time soon as long as there are modelers willing to fork over $149.99 for a plastic locomotive.Sorry,but,that's a cold fact.
I agree. And if you want proof, just visit eBay. For many years buyers there have been forking over much more than they should on a variety of common MRR items. You can argue endlessly as to why, but the fact remains that it happens - and way too often.
Maybe there are too many rich people in this hobby?
Any argument carried far enough will end up in Semantics--Hartz's law of rhetoric Emerald. Leemer and Southern The route of the Sceptre Express Barry
I just started my blog site...more stuff to come...
http://modeltrainswithmusic.blogspot.ca/
Spending for our hobby wants (which are not NEEDS, in any economic model) is discretionary spending. You can't eat or wear that latest 32-powered-driver, 2-smoke-unit, DCS ready offering from MTH, nor will it shelter you from the cold. The same is true of Atlas flex track.
That said, while we complain about how expensive everything is (especially when compared to 40 years ago) we will spend, up to the point where the budget yells, "STOP!" If we forego the trips to the Grand Canyon (no more steam ) or the nearest casino we end up with an unplanned source of funds. Thus, the manufacturers and distributors have little incentive to lower prices.
Also, now that the election-year econobabble (mostly generated by people who have problems balancing their own checkbooks) has softened, I expect things to start climbing out of the hole they've dug and get back up to speed. Somehow, they always do.
Chuck (modeling Central Japan in September, 1964 - behind schedule, under budget)
You will see more "blow-outs" as stuff that represents a lack of liquidity preys on the minds of shop owners who have to make ends meet. Other than that, what we pay for our models, even discounted at 40%, is still well above what the various pre-customer suppliers/retailers pay for the items themselves. There's a healthy mark-up in MSRP in any hobby. So, don't expect to see too many sales where things are flying off the shelves at 50% off or some such thing...won't happen. Too many people are too keen and involved in the hobby, and well enough heeled and determined to stick to it.
Gotta have our fun.
Of all the posts so far, I'd have to say that Jim (jrbernier) is likely to be closest to foreseeing the truth about what is likely to happen in the near future. Certainly, the one thing you will not be seeing over the course of the next couple of years is a decrease in the price of any new major model railroad items. There remains a small minority of hobbyist willing to pay as much as is asked for new items and this is unlikely to change dramatically. At best, look for a leveling off of pricing at the current figures for things like locomotives, rolling stock and major structure kits. However, don't be surprised to see things like track and operating systems increase further.
I think that you are going to see both increasing consolidation of the major compaines supplying RR items, as well as a number of the secondlevel manufacturers dropping out of the game altogether (including some current "big named but limited supply" locomotive importers). Look also for production runs to further decline in size to the absolute minimum. Likewise, a dramatic reduction in new offerings, to be replaced by re-runs and perhaps a further resurgence of the pre-order-only availability of any major items. The only obvious bright spot I foresee is a probable spike in major stock reduction sales at increased discounts and a flood of secondhand items on eBay and the like, as some folks try to recoup a measure of cash from their previous investment in the hobby.
It should be noted that, unlike during the Great Depression which spurred the hobby of model railroading, too few individuals today have the necessary skills to utilize everyday materials, nor have the inovative nature that once prevailed among hobbyists. Likewise, recall that the hobby 70 years ago was very small in size, with model railroaders in all the scales combined totalling fewer than 15,000 individuals. That's probably about the same number that are the "serious" modelers of today. For most of this latter group, their hobby involvement will probably weather the coming financial difficulties rather well but I think the numbers of everyday hobbyists is in for a decided constriction.
CNJ831
Autobus Prime This hobby doesn't have to be expensive. It really doesn't. Of course, nobody wants to believe that, for whatever odd reason, but it's true.
This hobby doesn't have to be expensive. It really doesn't. Of course, nobody wants to believe that, for whatever odd reason, but it's true.
I second that! One of the great things about model railroading is that there is almost always some inexpensive, time consuming project to do. For me, it's trees; I need a gazillion of them. I bought some foleage and trunks at a train show for less than half of a $20 bill, so I have the stuff to make over 100 trees. Because of the economy, my employer will furlough the entire workforce for the weeks of Thanksgiving, Christmas, and New Years Day. Guess what I'll be doing a lot of those days? Yep, reforestation!
If I finish all those trees, I have about 100 unpainted HO people to paint (I may even get my girlfriend to help with those if I take her out to dinner).
Granted, LHSs need customers, but I can't afford to be one of them. Besides the LHS, some ways to buy what you need are to shop smart. It's amazing what you can find on eBay, Craigs List, and at train shows that are really good deals. Sure, you have to know enough not to spend more for used than new, or to buy broken-down junk, but if I had bought all of my train stuff new, I'd be into my layout 20 grand (if you include my brass locos), buying it all used/discounted got me there for about $3,500 (including the 14 brass locos).
For me, much of enjoying the hobby is in managing my layout like a real struggling railroad - shopping with a tight budget.
Phil, I'm not a rocket scientist; they are my students.
What I think will happen will be totally dependant on what credit terms are available to manufacturers, distributers and buyers. You see most model railroad stuff is made in the Far East and that trade is totally based on Letters of Credit. International trade flourishes with Letters of Credit because these gaurantee payment to the company that are the beneficiaries of such letters if the conditions specified in the LC are met. These terms usually include such terms as quantity of the items ordered, delivery to specified point and a requirement that the items be ewxactly what was ordered.
Now to get a Letter of Credit issued to a vendor, one has to have a credit line with am issuing bank or enough cash on hand to cover the letter of credit's face amount. It is unlikely that a distributor has enough cash to do that so they need a bank or several banks to be willing to finance these deals. So in credit crunches, guess who suffers.
Now take it down to the next level, many buyers of anything like to pay with a credit card. Many issuers of these cards are curtailing the credit lines they offer to the card holders or they charge a very hefty interest rate or membership fee for the priviledge. So I suspect many credit card holders (even those who who aren't maxed out) will be loathe to buy anything with them even when they pay off the outstanding balance each month.
So based on these realities, I see a bleak time ahead for everyone in this hobby.
Irv
The standard hobby 'dealer' discount is 40% (and 4% additional for paying the bill within 30 days). If the dealer can purchase in 'jobber' quantities(like some of the big on-line dealers), they can get an additional discount. Some special hobby items are sold to dealers at a 'short' discount(30 percent). A lot of craft items have a 50% or 100% markup! For a LHS to get a better discount, many times a jobber will have specials to clear out stale inventory. This usually happens on 'seasonal' items, and scale model trains usually are not in that catagory. Train sets/grass mats/foam tunnels many times are discounted after Christmas to clear them out.
The 'blow out' prices you see at train shows and web specials are usually manufacturer overstock. Life-Like was famous for this and there used to be lot of P2K E units and PA's available for a very low price at train shows. There were a lot of deals 10 years ago, but the manufacturers have become more selective on the production runs. I see MB Klein does not do 'pre-order' anymore, and Toy Train Heaven is having 'blow out' sale emails every week - Usually on things I am not interested in!
If you have an job/income stream, there may be some 'deals' you are going to run into when a LHS fails. But for the most part, one can find decent on-line discounts on most model railroad items if they bother to look around. There are even some LHS that will 'deal' with you for cash or pre-payment.
Jim Bernier
CNJ831 It should be noted that, unlike during the Great Depression which spurred the hobby of model railroading, too few individuals today have the necessary skills to utilize everyday materials, nor have the inovative nature that once prevailed among hobbyists. Likewise, recall that the hobby 70 years ago was very small in size, with model railroaders in all the scales combined totalling fewer than 15,000 individuals.
It should be noted that, unlike during the Great Depression which spurred the hobby of model railroading, too few individuals today have the necessary skills to utilize everyday materials, nor have the inovative nature that once prevailed among hobbyists. Likewise, recall that the hobby 70 years ago was very small in size, with model railroaders in all the scales combined totalling fewer than 15,000 individuals.
CNJ:
I think the skills and ingenuity are out there, and they seem to be coming out more, lately. Necessity is the mother of invention, although it would be great to reach that level of invention without having to need it. Maybe the inventors are always inventing, but nobody really pays much heed until they need to. :D
It doesn't take many people...it never did; pick up a few issues from any year from the beginning until now, and you see the same names over and over. All you need is one person to come up with an idea that all of us can copy.
(I do think we could learn a lot from those old-timers. I read old '30s Model Craftsman magazines all the time, and have gotten a lot of ideas there, but more than that, I've come to realize that 1935 wasn't so long ago, and hobbyists then were like hobbyists now in more ways than we might think.)
Just a casual observation from my part of the world (northeast Atlanta suburbs), the LHS here has been absolutely packed with customers for the last 6 monts or so. Have never seen it so crowded before. Even the wife and kids have been commenting about how crowded the store is when we go in there on weekends. I started doing just browsing with the family on weekends to see what's new and coming in on weekdays to do the "real" shopping, but now it's even busy during weekdays. I realize this is just one store in one town. Jamie
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I don't see the prices going down either. The only forecast I have of MRR prices falling will go with quality as well. If you want something of good quality you will still pay through the nose for it. I think that a MRR company might offer something that is more affordable for the average consumer for someone to get started in the hobby, but it'll still be life like or tyco quality. The good stuff will always be expensive. More and more competition (such as many manufacturers of decoders and such) will help drive prices down but I don't think they'll be significant
Modeling the N&W freelanced at the height of their steam era in HO.
Daniel G.
Economy has not slowed yet in our home. Savings first before anything else, and trains last after everything.
Slowed only in frequency of visits to the hobby shops. (For me that can be TWO stores...) if I go, I try to hit em both on the same day or when I have an appointment for something else in the area and hit em both on the way home.
Weekly? Wonderful! Once a month? Ok. No big deal. Once every three months?
Asking the store to ship to my home by Postal Mail? because gas is 8 dollars a gallon and milk 10 dollars a gallon?
What about the store? When we finally come out of hard times and enjoy spending again, will the train store still be there?
Some of you will fluff up like big hen and cluck at me telling me about all sorts of internet train buying I can do without driving all the way to the store.
And rightly so.
However, I am old. And the last of a breed of customer who enjoys going to a hobby shop to look over and buy trains in person and meeting others who may also be buying stuff for thier club or home with trains too.
Heck of alot more fun and a great social oppertunity I think. Good for the store and possibly good for local oppertunity.
Much better than a cold and impersonal bidding war on Ebay in the last 3 seconds with a very large pay pal account 100% focused on blasting 1000 dollars against a out of production 40 dollar walthers kit.
How long will we enjoy GOING to a actual hobby shop. ESPECIALLY now that wall street is beginning to poison our Chinese production of these train things we buy at the store hmmm? that nice 14 dollar athearn car I just ordered might arrive with a 50 dollar tag next summer. That would certainly slow my economy down.
At the risk of beating my usual dead hosre, it may soon become apparent that the dominant monthy publication in this hobby has done its readers a great disservice by spending page after page and barrels of ink teaching them "what to buy" instead of "how to make" or "how to do" things in this hobby.
It is quite possible to do great things in model railroading without spending huge sums of money, but only if you've learned some skills and techniques. That's what people ought to expect to learn from magazines (and it used to be the case).
Folks - I know almost nothing about economics and price movements in time of financial adversity. I do know that history is not a bad guide as to previous ways in which modelers reacted to a slow down in the economy and if prices rise or fall or remain much the same during a time like this. From reading magazines, newspapers, watching TV and from personal experience I have these observations to share.
I am pretty certain, that MRSP's usually don't come down to ease declining sales - often bulk buys and end of line specials or slow moving stock can be discounted to encourage sales, but if you are in retail, LHS or online, then there still needs to be cash or borrowing power to restock - or invest in - new products that usually seem to be a few bucks dearer. If sales of a newly planned model look less than satisfactory then a model manufacturer my well put some planned new model releases on hold for a while or abandon it altogether. R&D can come to a sliding holt unless there are some tax benefits for maintaining it.
In some industries, inferior raw materials are used or new places of manufactcure a sought where labor is cheaper in an endevour to reduce costs and maintain or increase profit levels.
I guess though that in all reality we will just have to wait and see.
Cheers
Bruce.
From my personal point of view and having modeled through times of financial adversity and uncertainty it has been my experience that as long as your income remains intact and all else remains equal then most things stay pretty much the same from an individual point of view.
And there is another problem.
I like MR Magazines, Trains Magazines etc.
For months now the Internet has provided me with ALL the information I care to drink at the great trough of advertising, Trainshow imagery, factory news letter talking about upcoming product etc.
When MR does come out and they have this big splasy ad of a new choo choo from Bricks Liner Importer... it's already been taken apart, discussed, debated, horsed about, alterantives and potential problems brought up... dozens of posts made about this choo choo....
MR is actually one month or MORE lagging behind with the now old news ho hum advertising on that nice new engine.
Oh wait... it's not going to arrive until what year?
No worries, hang around ebay long enough it'll show up usually at pricing less than what the factory would like you to pay for new.
Heck dump the obselete magazine and issue a PDF because this new and improve forum buries me in even more current and fast moving up to the minute advertising.
Maybe when manufactors quit trying to revive a dying dinosaur of advertising tatics long dead and save the dollars to make cheaper and better items... we might all benefit.
Sure I can take up a boat and use it as a hobby on the sea. A very expensive hobby. I can do trains for a hobby instead. Not so expensive. But in real hard times similar to 1929? well.. dont think anyone will be doing much of anything other than gunsmithing and woodchopping.
Gas is under $2 and the barrel is approaching the 40's..............I don't see my grocery bill coming down? What makes anyone think that your LHS and manufacturing will lower prices to keep you coming in the door? This economic mess is the scam of the century. Baby boomers retirement 401K's are being wiped out as I type this. Be a lot of scratchbuilding for these folks to hone their skills. Now every employer has an excuse to lay you off. I know I have bought less than $100 worth of MR stuff the last 9 mos. because of all this. And I won't be buying any in the near future. I also have other friends that quit purchasing or limit their purchases. I see tough times ahead. It's not so much will they discount it, but will we have a job to pay for it. Hope I'm wrong........
I think the biggest problem is people are afraid to spend theyr'e money on anything that is not nessecary. In my opinion that is bad for the economy. I spent $650.00 at my LHS in the last month or so. I spent about 400.00 the month before that. Sure I could have gotten a better deal if I bought online but I don't mind spending a little more at the LHS because I want them to be there next year.
N Scale Diesels......I like 'em
JimmydieselfanI think the biggest problem is people are afraid to spend theyr'e money on anything that is not nessecary. In my opinion that is bad for the economy...
Hum, it seems to me that this country already spent their money on things that were not nessecary over the past ten years - and look where it got us.
Last ChanceEconomy has not slowed yet in our home. Savings first before anything else, and trains last after everything. Slowed only in frequency of visits to the hobby shops. (For me that can be TWO stores...) if I go, I try to hit em both on the same day or when I have an appointment for something else in the area and hit em both on the way home. Weekly? Wonderful! Once a month? Ok. No big deal. Once every three months? Asking the store to ship to my home by Postal Mail? because gas is 8 dollars a gallon and milk 10 dollars a gallon? What about the store? When we finally come out of hard times and enjoy spending again, will the train store still be there? Some of you will fluff up like big hen and cluck at me telling me about all sorts of internet train buying I can do without driving all the way to the store. And rightly so. However, I am old. And the last of a breed of customer who enjoys going to a hobby shop to look over and buy trains in person and meeting others who may also be buying stuff for thier club or home with trains too. Heck of alot more fun and a great social oppertunity I think. Good for the store and possibly good for local oppertunity. Much better than a cold and impersonal bidding war on Ebay in the last 3 seconds with a very large pay pal account 100% focused on blasting 1000 dollars against a out of production 40 dollar walthers kit. How long will we enjoy GOING to a actual hobby shop. ESPECIALLY now that wall street is beginning to poison our Chinese production of these train things we buy at the store hmmm? that nice 14 dollar athearn car I just ordered might arrive with a 50 dollar tag next summer. That would certainly slow my economy down.
Chance, I appreciate your comments, but you should note that for some of us, it isn't a matter of desire or preference, it's more of a factor that traveling to a local LHS is either not possible, nor worth the gasoline. The closest LHS in my area is run by a total jerk, and his prices are above list, and his railroading selection is worse than his attitude. The next one is 30+ miles away, and while run by a nice gentleman, again has little to offer other than very basic items (atlas snap track and the like). After that, you're looking at over a 70 mile drive....
When I travel down country for work we often detour to more train oriented shops in MA and CT when time permits, but the reality of our situation is I have to mail order. I would much prefer to live a few miles from an amazing train shop, but that's simply not the situation for me. Sadly, as stores fail or people retire, I think more and more of us will be in a similar situation as myself.
Per eBay, I agree that prices can get ridiculous. This may not make sense to you, as in your case as someone who has been in the hobby for a long time, you've been able to pick up new releases as they occured, either from the manufacture or from your LHS.
However, it is often the only place I can find out of print items (rolling stock, locomotives, kits, etc). For someone new to the hobby, it is an invaluable resource for that purpose, and worth (to a degree, naturally) the overpricing of the product. Like any system, you have to set your limits on what you can afford to spend - and I don't mind spending $60-70 for a factory painted Atlas DC Central Vermont diesel, simply because I don't know if I'll find it
a. again.
b. and at a cheaper price.
Cheers.
I'm trying to model 1956, not live in it.
Midnight Railroader At the risk of beating my usual dead hosre, it may soon become apparent that the dominant monthy publication in this hobby has done its readers a great disservice by spending page after page and barrels of ink teaching them "what to buy" instead of "how to make" or "how to do" things in this hobby. It is quite possible to do great things in model railroading without spending huge sums of money, but only if you've learned some skills and techniques. That's what people ought to expect to learn from magazines (and it used to be the case).
While I see your point and agree with it, most magazines print what their readers like to read. It seems to me that most of the readers aren't that interested in scratch building anything but woudl rather buy a shake-the-box kit to come up with a representation of a building or a vehicle if they have to build anything.
I grew up building models because my parents could never afford to get me a train set. And when I got older, I wasn't interested in trains but I was still interested in plastic models. So I never built anything else.
As a model railroader I have built buildings and I've tried to scratch build stuff from cardboard and toothpicks. Most of those efforts were not that good but it did give me some idea of what I wasn't capable of doing and what I didn't know. Had there more articles in the train magazines about doing things like this, I might have learned something. But I don't think most of the readers would have appreciated such articles.
But that brings me to another related topic. And it isn't necessarily a complaint so much as it is an observation. We live in a society where dumbing down everything seems to be the accepted norm. So why shouldn't the same be true of model railroading? Besides, do we all know how to use tools or even the difference between right and left handed monkey wrenches?