UP 4-12-2Also--a 20% profit margin is not going to be nearly enough to pay the bills.
Excuse me--the last time I checked, the idea of a profit was that this came AFTER the bills and all other expenses were paid. Sheeesh.
OK---I'll say NET PROFIT sheesh
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I do think that if one wanted to dig enough one could find that a brass engine was made at some point for just about any locomotive. I have an unmarked 2-6-0 Mogul that I picked up at a trainshow for not even $60. Does that mean that I can't make a 2-6-0 because I'll be competing with that brass mfg? When you have how many manufacturers making how many big boys and challengers? If MTH, BLI, and who knows how many brass manufacturers are doing this then why can't I with my little locomotives?
This does remind me of the issue of manufacturing what ends up being something someone else does. I'm pretty sure that there are locomotives that were done that may be made by me as well. I expect that. And, if my locomotives end up being one of many---so be it. I seen all kinds of ads in past MR's that basically had the same locomotive being done in brass, hybrid and what all else too. I think that the question could be asked then why do we have people constantly showing up on this forum and others bemoaning the fact that there are certain locomotives that they can't find? Maybe they're not hunting hard enough? I don't know. I'm not so naive that I'm thinking that I'll be making something that was never made before by any other manufacturer.
But, be that as it may, I'd rather be building something that they can get easier than running all over the place--trying to find it through weasel bay or what have you, paying brass prices for pieces that may, or may not be, worth what they paid for it in the first place.
UP 4-12-2I'm not a B&O fan at all, but perhaps it would make more sense to find a B&O 2-8-0 that looks good--or some other eastern road 2-8-0 that has never been done outside of maybe 50 brass models--and consider it as a more effective choice--thus hoping to guarantee yourself a market.
And that is the thing as well. We can talk about the brass models that had been made but what were the numbers---really? There is a market that has been largely ignored--except maybe in the brass collectors area---by the other manufacturers. Not as large a market, but still a market.
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/
Correct me if I'm wrong, but isn't the Santa Fe 1950 class 2-8-0 the exact same engine that PFM imported in massive quantities from United in Japan during the 1960's and 1970's? It is true as you guys have cited above that that engine was preferred by many hobbyists back then as a "generic" good looking 2-8-0, and that is well known to have been the reason there are so many of them.
If you go to any train show you can find them at reasonable prices. The PFM/United engines are virtually bulletproof, last forever, and can be upgraded to can motors--and once more, your proposed new engine will be competing against them in price.
Santa Fe modelers are known for being relentlessly cheap with their money. I have a friend, actually now an officer of the SFRHMS, Bill Vandermeer, who has been known as "Hundred Dollar Bill" because for many years he would not pay more than $100 for a brass engine. When you buy entire brass collections from an estate, it is still sometimes possible to do that, though I have never been so fortunate. It requires a gift of gab for befriending older modelers before they expire, a gift that some brass buyers actually possess.
In any case, those PFM/United 2-8-0's are common and cheap--especially in the eastern U.S. (out of Santa Fe territory)--and are cheap enough they will rival your proposed selling price.
Also--a 20% profit margin is not going to be nearly enough to pay the bills.
I'm not a B&O fan at all, but perhaps it would make more sense to find a B&O 2-8-0 that looks good--or some other eastern road 2-8-0 that has never been done outside of maybe 50 brass models--and consider it as a more effective choice--thus hoping to guarantee yourself a market.
John
I want a 4-6-6T steal locomotive such as the type that ran on the old B&A line between Boston and Worcester. I have hounded the manufacturers for years, but so far it has fallen on deaf ears.
But anyways--a run of, say, 600 1950 2-8-0's with DC base model may run about $140-175 which sort of leaves us about a 20% margin. I'm plugging in numbers as I go so be patient here--- A DCC with sound may end up with a MSRP of $275-300. And, yes, some of that will be through Chinese made motors and such. Of course I'm having arguments with my friend and myself as to which sound decoder to go with All estimates are to be based on a 25% + or -
You need a higher margin, Barry, and I think the price you're shooting for is too low. OTOH, it's your business.
I'm just wondering if you can save on labor costs by using people who are otherwise retired but wouldn't mind some extra walking around cash. Perhaps not all that practical, but it's a thought.
Andre
One thing to consider as well is how I propose to introduce the company eventually. One idea is to make wheel sets with drive wheels and trailing/lead trucks and such then frames/boiler pairings then full scale kits----it does drag the process out but then again-
How's about doing something relatively simple at first, like a drop-in cylinder saddle replacement for the Spectrum 2-8-0 so that you can make an engine more like the most numerous of Harriman consolidations, the overwhelming majority of which used Stephenson valve gear.
Something like this: http://www.yesteryeardepot.com/SP2566B.JPG
That one particular part might might be useable on several locos
Like a Pacific: http://www.yesteryeardepot.com/SP2415.JPG
Or an Atlantic: http://www.yesteryeardepot.com/SP1725.JPG
Not to mention a 4-6-0: http://www.yesteryeardepot.com/SP2301A.JPG
Notice how I;m lobbying for my favorite road?
UP modelers would benefit, too.
Would you use 1/8" axles on the drive wheels or 3 mm?
Good Grief!! Well, definitely have a lot of stuff to go through here! lol!!
Now, first off. The run numbers we've crunched out were around 400-600 pieces at the start.
Andre--1950 series 2-8-0 sounds interesting. Enough for me to throw some numbers at my excel--first some things to consider. The labour costs here are about comparable with what you have in the states. Except we think we can do this with as few as 4-6 people. Small runs in a "cottage industry" do not require large staff to assemble the kits together. Another issue that can be worked around is that of any 'hobby' industry as such. I do tend to think that wage parity with outside the hobby industries had also met with wage inflation which put the kibosh to a lot of smaller scale operations back in the 1980's. Excuse my rambling around here---this is me thinking out loud
As I read the comments here I'm thinking that the scale of this market may be about the size I'm suspecting it is then the prices may be upped a bit. BUT. I also may be putting the numbers a bit on the high side as well.
If 1000 pieces is too many, than what kind of quanities are we talking here? I may be wrong, but I don't think 1000 units is a lot, even for some of the possible locos mentioned.
How many SP C40-3 N scale cabooses ( http://www.traincat2.com/images/models/1400501A.jpg ) do you think Train Cat will sell in the next year? These are etched brass kits that come without trucks and cooplers and sell for $44.50. The HO versions will probably sell for a similar price (the Laser Kit C30-1 wooden caboose sells for about the same price). While these could be used for a free-lance layout, they won't be since a lower priced mass produced plastic model is equally suitable.
You can't sell low volume production items at a discount and the likelihood that they will be anything other than directly ordered from the manufacturer is pretty much a pipe dream. How many of these http://www.bethlehemcarworks.com/Products/Craftsman_Kit_Cars/images/Kit_241_Maine%20Central%20RPO-Baggage%20Car.jpg do you think Bethelehem Car Works sells every year at $67.50 less trucks and couplers? For that matter, how many people who frequent this forum actually know about them? The market for specialty items like the MEC cars is pretty small, but it apparently does exist and in sufficient quantity to make manufacturing worthwhile. The question is whether or not enough people are willing to pay $350-500 for a loco they really want but will never be made by the the Bachmann's, BLI's and MTH's of this world. They'd still be cheaper than brass and as I think of it, it would probably not be a good idea to reproduce anything that was made in brass in the past and still relatively easily available.
andrechapelon Sheldon, you and UP 4-12-2 are arguing about manufacturing in quantities that would qualify as "mass market" as least as far as the MR market is concerned. You can't be successful in that unless you have a great deal of capital to expend ahead of time. Personally, I don't see any point in going head to head with BLI and MTH. I think the kind of thing Barry is thinking about are locomotives the big manufacturers don't want to touch, but could be made in relatively small quantities with different manufacturing techniques, say white metal and etched brass. Of course, these locomotives would cost as least as much (based on MSRP)as the mass market offerings, but the alternative to that is buying brass (if or when available) or scratchbuilding.
Sheldon, you and UP 4-12-2 are arguing about manufacturing in quantities that would qualify as "mass market" as least as far as the MR market is concerned. You can't be successful in that unless you have a great deal of capital to expend ahead of time. Personally, I don't see any point in going head to head with BLI and MTH.
I think the kind of thing Barry is thinking about are locomotives the big manufacturers don't want to touch, but could be made in relatively small quantities with different manufacturing techniques, say white metal and etched brass. Of course, these locomotives would cost as least as much (based on MSRP)as the mass market offerings, but the alternative to that is buying brass (if or when available) or scratchbuilding.
OK, I will agree that it might require some capital investment, and may require a different business model beyond the current "build them, sell them all it ten days" approach.
But actually having something is stock to sell for more than six weeks might actually build a customer base and grow the market.
I will tell you plan, there are brands I don't buy because of this preorder, buy it now or miss it, limited production hype.
But in any event I do not see it as going up against BLI, MTH or Bachmann.
I looked at Bachmann's anual report a while back, and extrapolated some numbers from it. I may be way off, but I would bet every container that shows up has 10,000 of any given HO spectrum loco in that batch.
Even at one run a year, that suggests threy have sold over 100,000 of the 2-8-0's, and likely 30k, 40k or more of stuff like the USRA Heavy.
And while you can just "go to the store and buy it" there is by no means a glut and prices are stable, even on Ebay.
Personaly, I think it should be that way, you should just be able to go to the store and get one off the shelf.
So, 1000 pieces is too many? If so I think no reasonable price point could be found, regardless of country of manufacture or method.
One more thought - Retail price of direct marketed loco = $200.00, wholesale "value" = $120.00. With direct marketing production cost could be as high as $80-$100. 1000 pieces = $100,000 inventory investment. 1000 pieces x 10 related products = $1,000,000 inventory investment. 50% sales in short term is break even, rest are money in the bank for future sales. $1,000,000 is not really much money these days when talking any kind of business.
I will be the first to say I have no idea about current costs for this kind of work, here or in China. But in must be pretty cheap in China since I know Bachmann and Star Hobby or Peach Creek made a profit on those $100 locos I bought.
Sheldon
A new manufacturing process is needed. And, I suspect a new product, that filled some of these markets, could be offered in a kit or semi kit form if the features and prices were similar to the current RTR offerings.
And why not get Bachmann to make 10,000 of a drive that you then put 10 different boilers on?
New Zealand has a population of around 4 1/2 million people. However, you can buy kits for several NZ steam locomotive types. They ain't cheap (understandably) due to very low production volumes, but they are available (prices in US dollars here).. http://www.ironhorsehobbies.co.nz/index.php?currency=USD&cPath=124_31_32
The Kiwis do have one advantage over us. They only had a single railroad that used stanardized power. But again, the population of New Zealand is less that 1/2 the population of Los Angeles COUNTY in this country. The real question here is whether or not a locomotive could be manufactured that would appeal to a sufficient number of people to be profitable even at low production volumes as kits. That's the big question.
My own personal opinion is that the first locomotive of a line of kits be designed around a chassis that could be used to make several different prototype locomotives with just a change of boiler and tender. I would think a good starting point would be a 1950 class Santa Fe 2-8-0 with its 57" drivers, short wheelbase and the ability to look good on just about any layout. The chassis could be used as a starting point for other 2-8-0's of the same general size.
What is the price of the Athearn Southern Pacific 4-8-2 in plain DC with no sound?
It ain't gonna be anywhere near $100. In fact, it is $300 full MSRP--no sound, no DCC, fewer lights than provided by others, and no smoke. Seems to me that $450 to $500 MSRP for a new model steam engine with sound, lights, and smoke (I don't care about DCC) is not out of line at all.
What is the price of a new BLI Blueline steam engine--not the ones previously released--but the new ones coming out?
I rest my case.
I also specifically said I was using MSRP as the point of comparison, and NOT the "street" discounted price, which varies so widely.
Just because you can go out and buy previously released stuff that's been sitting around for years in inventory today for $100 (street price) does not mean you will do that tomorrow. Today's street price is no indication of the cost of bringing a new engine to market.
If you can make 'em here, and be competitive with China, I'll be the first to get in line and buy them. I wish you the sincerest best of luck.
Respectfully,
UP 4-12-2The posts above have held up Bachmann as perhaps the best example of competitive priced steam power. Not the business model I'd want to emulate--mostly made in Hong Kong or China in massive quantities, and then after it's been out awhile, they dump it at reduced prices, thus also undercutting all their dealers who still have the product in stock.
Wrong - BLI/PCM is the product dumper - Bachmann sells cheap to everyone who can buy enough and the prices remain the same. They have made the same models for decade now, introduced a few more, and added sound and DCC to the old ones.
BLI/PCM is the one who sells at one price when the release is new, then dumps the rest through FTD and other outlets at less than "regular" dealers pay.
Yes, you have to be big volume to buy Bachmann direct, but those prices don't include a "dumping" plan, just a real low price if you buy direct. This has established a 40% off street price for Bachmann products at places like TrainWorld, PeachCreakShops (yes I know John as well - tell him the other old house guy said hello), StarHobby, TheFavoriteSpot and a bunch of others. I never pay more that for Bachmann, and I have a lot of it.
UP 4-12-2Now, BLI, MTH, Athearn and others are making some really nice looking, basically nice running, steam power but even the low end pricing is pushing $350 suggested retail now, with $500 becoming more and more common for newly released engines. That is for stuff made in China at significantly less than American minimum wage, with significantly less restrictive environmental regulations, small business taxes, etc.
These are DCC with sound prices you are quoting - I have bought four new locos in the last 6 weeks, all were about $100 each at their common "street" price. One was DC the others DCC with no sound.
While the market requires DCC and DCC with sound as an option, there is still a large market for DC/non sound locos.
Bowser and Mantua lost out by not looking into ways to improve detail and DCC user friendlyness.
That sounds like a plan, maybe I will give Lee a call this afternoon.
trainsBuddy I would like a quality model of MW Atlantic streamline steamer with DCC and prem. sound. For some reason that model is not available in any form. Also a quality P42 Amtrak model with DCC and sound. Athearn makes one sans DCC, and models with DCC typically cost a lot less than when you upgrade DCC ready with a quality chip (QSI, Tsunami) and speakers.
I would like a quality model of MW Atlantic streamline steamer with DCC and prem. sound. For some reason that model is not available in any form. Also a quality P42 Amtrak model with DCC and sound. Athearn makes one sans DCC, and models with DCC typically cost a lot less than when you upgrade DCC ready with a quality chip (QSI, Tsunami) and speakers.
Isn't Fox Valley doing a model of the Milwaukee in both N and HO?
Selling Price
I sort of agree with the above post--and that's also why I have posted the responses as I have on this thread.
The average buyer is maybe willing to pay say $25 per engine more for American made--much more of a price difference than that and they'll buy the import.
Now, Bowser's steam locos were well over $100 and pushing $200 in kit form--kits that took a minimum of 40 hours with 80 hours being more likely to produce a fine looking and running engine--and they did offer USRA boilers and NYC steam in addition to just the PRR steam. Many folks still considered them to be, well, not as highly detailed as they wanted--and the market simply dried up.
Now, BLI, MTH, Athearn and others are making some really nice looking, basically nice running, steam power but even the low end pricing is pushing $350 suggested retail now, with $500 becoming more and more common for newly released engines. That is for stuff made in China at significantly less than American minimum wage, with significantly less restrictive environmental regulations, small business taxes, etc.
Tell me, honestly, how on earth is anyone going to make a new-from-the-ground-up steam engine, or even group of USRA engines common to many roads and sell it for competitive prices as compared to the Chinese, Korean, Taiwanese, etc. imports? (Bowser already did that and couldn't sell enough of theirs to make it worthwhile to continue).
I've heard secondhand that Bowser's labor costs alone at the end of U.S. production were approximately 3 times higher than the annual sales volume of their steam locomotives (though the labor force made other things too).
The posts above have held up Bachmann as perhaps the best example of competitive priced steam power. Not the business model I'd want to emulate--mostly made in Hong Kong or China in massive quantities, and then after it's been out awhile, they dump it at reduced prices, thus also undercutting all their dealers who still have the product in stock.
I'm serious, if one is going to build a steam engine in the U.S., it doesn't matter which one it is, to provide the detailing, etc. coming out of China, you should realistically be looking at a minimum MSRP of twice the Chinese price for the comparable item if not 3 times more. How you gonna sell that? Tell me. How are you going to convince the buyer to pay $1500 when the Chinese item costs $500 and is just as good?
JavelinaHi, Here's what I was getting at. My wife and I own and run a small machine shop. Business is good, but I've harbored fantasies about producing a product in one or both of two interests of mine. Model railroading is a big one, hence the post. I'm trying to determine if only a fool would attempt to manufacture a model here in the USA. I'm aware of domestic companies like Accurail that make freight cars but I'm not aware of any new domestic manufacturers of locomotives. I thought that this forum, with it's mix of styles, periods and preferences would be a great place to get ideas. I've been a machinist my whole adult life (and then some). None of the processes of making a product like a locomotive are foreign to me. While I harbor no delusions of shouldering the giants aside, I do think hobbies in general are good places for the Davids among us to offer our products and services. Lou
Hi,
Here's what I was getting at. My wife and I own and run a small machine shop. Business is good, but I've harbored fantasies about producing a product in one or both of two interests of mine. Model railroading is a big one, hence the post. I'm trying to determine if only a fool would attempt to manufacture a model here in the USA. I'm aware of domestic companies like Accurail that make freight cars but I'm not aware of any new domestic manufacturers of locomotives. I thought that this forum, with it's mix of styles, periods and preferences would be a great place to get ideas.
I've been a machinist my whole adult life (and then some). None of the processes of making a product like a locomotive are foreign to me. While I harbor no delusions of shouldering the giants aside, I do think hobbies in general are good places for the Davids among us to offer our products and services.
Lou
Most important question. Selling price? If you can sell it for less than a Bachmann Consolidation, you have a winner. If they cost $500 your market is limited or perhaps non existent.
I liked the Mantua and Bowser die cast metal kits. They were heavy, sufficiently detailed, ran well, and could be kitbashed or super detailed. I didn't buy Bowser's because they were all so PRR as to look out of place on my non PRR pike. My pike is small, so my steam roster is Moguls, Pacifics and Consolidations. Bigger stuff, Northerns, Decapods and Mallets look odd pulling the short trains which are all I have the space to run. My steam acquisition plan includes a steam switcher (not a tank engine) and maybe an American, an Atlantic, or a Mikado. I have enough Moguls, Pacifics and Consolidations to last me.
You could sell it in kit form if you could offer a price break over RTR. You would think that of all the possible rolling stock models, a steam engine would have the greatest amount of assembly labor and pushing that assembly cost off on the purchaser would allow a lower price. If in actual fact, the assembly is so simple that RTR could be sold for kit prices, then I see little point in a kit. Also bear in mind that Bowser had a difficult-to-build reputation that didn't help their sales. If you go the kit way, be sure to include extra valve gear rivets.
I think a successful product in 2010 needs to support DCC. I'd price DCC separately to make the locomotive seem more affordable. On a catalog page $99 for the locomotive, $39 for DCC encoder sounds more affordable than $139 DCC equipped. The catalog page should say "DCC is a plug in installation, no soldering".
Was it me, I'd direct market over the internet. You should be able to buy a Web site runner program that shows your catalog pages (with price), offers a shopping basket, figures total price and shipping, prints a mailing label, checks the customer's credit card, and all you have do is stick labels on boxes and take them to the post office. Take some time to make good looking catalog pages with pix. Sent RTR evaluation models to all the MRR magazines, a favorable review is a very good thing.
Look at the competition. Bowser dropped steamers. Mantua went bankrupt and stopped production. The Mantua line is being revived but hasn't regained its former cachet. Why? Bachmann created the plastic steamer market with the Consolidation 10 or 15 years ago. That Consolidation was so nice that nearly every member of the club bought one the year it came out. The detailing was excellent, good as brass, it ran better than brass, and the price was right.
Made in the USA is a sales plus. Many people will pay extra (but not too much extra) to own a made-in-the-USA product. Setting up manufacturing overseas may get you a cost advantage, but you are also setting up a future competitor.
David Starr www.newsnorthwoods.blogspot.com
That is exactly what I'm talking about here. Determine the size of said market. In this case the market for smaller locomotives is smaller than the collector dominated large locomotive market. This smaller market can then get its needs filled through a niche manufacturer rather than one who seems to be having enough issues keeping up with its own market. Then determine what those needs are and then go from there----
Barry, if you're really serious about this, you might want to contact John Agnew in New Zealand. He's the guy who runs Railmaster Exports in New Zealand which manufacturers Sn3 locomotive kits. That's a small niche market if there ever was one. His email address is: john@railmaster.co.nz. He could probably provide you with some insight as to the issues you would face.
It might also be a good idea to contact DJH as they manufactured some US prototype kits in the 80's only to give it up. DJH's email address is: sales@djhengineering.co.uk
Railmaster's kit list: http://www.railmaster.co.nz/railway/loco.htm
DJH website: http://www.djhmodelloco.co.uk/
blownout cylinder Couple of points to ponder: 1---prophets of doom were usually warning of things that MAY happen IF, and ONLY IF, certain types of actions were to continue being done. A self fulfilling prophecy is just that. if a person keeps thinking that something is impossible then that will be ---for that one. 2---If we stuck with the idea of "what sells" then you'd end up with how many mfg's making how many UP challengers, Big Boys, FEF's, et al?
Couple of points to ponder:
1---prophets of doom were usually warning of things that MAY happen IF, and ONLY IF, certain types of actions were to continue being done. A self fulfilling prophecy is just that. if a person keeps thinking that something is impossible then that will be ---for that one.
2---If we stuck with the idea of "what sells" then you'd end up with how many mfg's making how many UP challengers, Big Boys, FEF's, et al?
Uh, that is exactly what we have ended up with now: Many UP Challengers and Big Boys, and FEF's available from more than one manufacturer without too much difficulty to find them if you look.
Sure there are some lesser known steam engines I'd like to be able to own, that would have changed my preference for which road I'm modeling--so yes, perhaps 1. is true in my particular case. But I don't know that there are all that many modelers who choose UP or PRR just because it's easily available--though it is true of some--my one friend has lots of PRR, NYC, B&M, B&A steam but also has UP steam including lesser known engines--not so much because it was easily obtained, but just because he loves UP steam
If a good SP 4-10-2 was readily available, I might possibly be modeling SP.
If a good Rio Grande 4-8-2 was readily available, along with the L-76 (ex-N&W Z1a/b) 2-6-6-2, I might be modeling Rio Grande.
But presently UP 4-12-2's and other steamers are readily available, so I am buying that stuff, but still my scenery includes a Tucson scene with Saguaro desert--in the hopes that someday I'll have an SP 4-10-2, and I might get an Athearn SP 4-8-2.
I like any Southwestern steam excepting Santa Fe, and don't particularly care for streamlined steam.
UP 4-12-2 Small niche manufacturer won't be able to afford the tooling costs. Tooling costs to do a quality steam engine in diecast with brass details are large.
Small niche manufacturer won't be able to afford the tooling costs.
Tooling costs to do a quality steam engine in diecast with brass details are large.
That also depends on what type of tooling you do. Or how it is done. I'm on a learning curve with cnc lasers and such. A friend of mine and I bought a small 4x4' cnc mmilling machine from a dealer not too long ago--completely refurbished--$400. He's using this to make parts for a 1957 Lancia Fulvia that you cannot find anymore---billit aluminum. That thing can make some small parts. I'm playing with a photoetcher right now to make small detail parts for my elevators---in N scale---lotsa fun
BTW--before you even set up any facility to do this---remember another favourite of mine---single use zoning may not permit you to do ANYTHING outside of purely residential use. There was a hoohaw over someone having a greenhouse in their back yard for pete sake. So, we had to check for whether we could even do this--thank goodness we can. Our neighbourhood has a few independant businesses operating in home.
As for material---when I started mucking around building amplifiers I started up looking around for chassis fabricators and such---remember networking? OY. I can find out where I can get certain plastics/brass/aluminum and all manner of stuff. And at reasonable prices. Raw material costs have come down a tad recently too.
And as Sheldon already mentioned, most of us are only going on what is out there now. I found quite a few people on this forum and elsewhere who do NOT have anyone doing anything in their RR's. Why are they no longer seen as a market?
UP 4-12-2That's also why PRR stuff gets made--because there's legions of SPF's (slobbering Pennsy Freaks) who gobble the stuff up.
I have been in this hobby for over 40 years, have worked in serval hobby shops and managed a train department in one years ago. Sometimes I wonder if this is a self fullfilling prophecy, are there so many PRR or UP modelers because those were big railroads, or are there so many modelers because people new to the hobby see PRR and UP models available and decide that is a good choice to model since so much is available?
Would the ranks of serious B&O modelers grow if you could get afordable models of EM-1's, Big Sixes, P7's, and modified heavyweight passenger cars? Or, are the modelers (or potential modelers) already out there just waiting?
This is an extension of Barry's theroy about expanding the market.
Barry,
I'll offer an opinion about some of the questions raised here about a new manufacturer going after some of this untapped business.
Many locos could share the same drive line, example - 80% or more of the Mikados in North America shared the same driver size and spacing, and half likely had cylinders and valve gear nearly the same, now you just need a selection of different boilers and tenders - 15 or more different prototypes I would bet would be easy.
Maybe those drives could come from someone like Bachmann's parent Kader.
I'm sure with some research most of these other wheel arrangements would be the same.
One need not completely identify every market, example, again with the Mikes. Lets say you identify 8 locos you can build on the same drive that have reasonable interest, you build the other 7 versions anyway and "create" the market by putting them out there.
Is the Bachmann 2-8-0 perfect for every roadname on it? No, but they STILL sell lots of them, after all these years, and, big mainline 2-8-0's were not even on a lot of modelers radar until that loco came out.
Freelancers, which there are still a large number of, will buy anything that follows the looks of what they have and fits a need in their operational plan. So kits with a selection of optional details and unlettered versions would be a must.
Actually, this has already been done, but the quality/features/detail of that line have been outstripped by progress - Mantua. If you examine their product line you find a large amount of interchangable parts from loco to loco.
Marketing - The only way I see this working is to market directly to the public. This keeps costs down some (even if its only 10%) and makes the lower production number more workable. In the 1980's when Walthers was buying every line it could, one of the their core reasons was to insure that THEY had product to sell rather than it going to "other" wholesalers. The companies they were buying were small and had limited production, walthers did not want to put stuff in the catalog and then not be able to get it.
This is another reason they have moved away from distribution and more into their own product lines.
With the Internet and such these days, I see no need for "distribution". Sell directly to the public and/or directly to retailers.
Obviously if you do both, you must protect the retailers buy setting a list price and sticking to it in your own direct to consumer sales.
Athearn is a perfect example of how single point distribution works just fine. All the self apointed experts said it would distroy them, now they are stronger than ever.
And while Bowser does sell thru Walthers, I would easily bet that is a very small percentage of their volume, with most being direct to dealers and the rest direct to customers. Another example of the new hobby business model. I would also bet most of the Bowser product that leaves the Walthers building goes direct to a consumer, not to a hobby shop.
Barry, if you get something going, I would be interested in being the east coast marketing deptment or helping with product development. - send me a PM.
Problem or opportunity (depending on one's point of view):
Then you still have to buy the materials and find and train suitable labor (females are preferred for detailed final assembly due to better finger dexterity and accuracy with small parts)
That's why BLI and others have established minimum reservation quantities--and some big time, big name engines like the beautiful Great Northern S-2 4-8-4 are apparently not enough above the minimum reservation threshold such that they are not a real high priority at this time.
That's also why PRR stuff gets made--because there's legions of SPF's (slobbering Pennsy Freaks) who gobble the stuff up.
UP 4-12-2Usually the people who are good at manufacturing are not all that good at salesmanship and vice versa. So therefore, the entrepeneur who is going to produce trains tends to gravitate toward the area they are good at--and perhaps other areas of the business might suffer if they don't have people to cover those areas.
And this is where one falls flat on their nose a lot. Network Network Network. Find out who is good at advertising and marketing. Market research is a biggie here. What about your bookwork? Your accounting? Taxes and such? You? How do you go after your business if you spend all your time doing your books? Networking, then, is very important.
UP 4-12-2 I do think there is still a market for certain engines that have not been done. For instance, the B&O fans will take anything done for their road, as nothing correct is available save perhaps an item from Rivarossi and the USRA as-built 2-8-2 (which is not correct for most B&O engines as their cabs were modified for an extra chair on the left side)--But they really, really want to see the Big Six 2-10-2 more than anything else. People are begging BLI to do it. If that's not a "market" for a product, I don't know what is.
I do think there is still a market for certain engines that have not been done.
For instance, the B&O fans will take anything done for their road, as nothing correct is available save perhaps an item from Rivarossi and the USRA as-built 2-8-2 (which is not correct for most B&O engines as their cabs were modified for an extra chair on the left side)--But they really, really want to see the Big Six 2-10-2 more than anything else. People are begging BLI to do it. If that's not a "market" for a product, I don't know what is.
Usually the people who are good at manufacturing are not all that good at salesmanship and vice versa. So therefore, the entrepeneur who is going to produce trains tends to gravitate toward the area they are good at--and perhaps other areas of the business might suffer if they don't have people to cover those areas.
The joke within the industry, as oft-repeated by John Glaab (author of one of the Brown Book brass buyers' guide editions) is:
"Do you want to know how to make a small fortune in the train business? Start with a large fortune."
So far as market is concerned, yes, my friend, a store manager was very unhappy during September of 2008 when 7 of his good customers all died that month--and they aren't always getting replaced by new customers. I do think there is still a market for certain engines that have not been done.
Gentlemen, I feel your pain.
I do not share it.
Thanks to my choice of prototype, I have a plethora of small steam to choose from - understandable when considering that my freelance 2-6-6-2T is bigger than anything ever run in the entire country. The most drivers were under a 2-10-4T (or, maybe, 4-10-2T - it was designed to run bunker forward when working hard pushing upgrade through tunnels) and the most powerful was a 'big' 2-8-2 (some of which gave their boilers to 4-6-4s and a few of which became 2-8-4s.) Represented on my roster and available on the market today, smaller 2-8-2s, 2-8-0s, 2-6-0s, 2-6-4Ts, 2-6-2Ts, 0-6-0Ts and a couple of 0-4-0Ts. No longer manufactured, a Baldwin-built 0-8-0T (Class of 1897) which was the only Japanese prototype model I own that was ever imported to the United States (by Max Gray in the early 1970s.)
Also avalable but not on my roster - several 4-6-4s and 4-6-2s.
I will readily admit that most of my locos were purchased, as kits, in Japan in the 1960s. The present-day prices (in yen, and, especially, in devalued US dollars) are enough to make me cringe - and take very good care of my antiques!.
The bad news is that my Japanese-prototype steam has very little commonality with US designs.
Chuck (Modeling Central Japan in September, 1964)
UP 4-12-2It is utterly foolish for anyone to even consider manufacturing steam locomotives in the U.S.
It could be done on a smaller scale than what a lot of people think. I, for one, am not thinking of doing it Bowser style here. The labour costs are high, yes, but so are other aspects of the dang thing.
Cottage industries don't seem to have QUITE the same issues. The issues that do exist usually involve scale---bulk prices for parts being one. But, if one thinks that they can sell specific runs then fine. Distribution could very well be at issue as well. Go with Walthers? Horizon? Or go it alone? That type of thing.
The other issue? What business plan are we thinking of mostly nowadays? What SELLS. Problem is that we have to establish a market for the dang things. There seems to be a lack of enthusiasm for growing a market anymore. As our older RR hobbyist dies off, the market will shrink to nil. Is this where you want to go? Why bother building any sort of kit or RTR--or even RTP? Just wind the whole thing down and let MTH take care of the collector market then.
Why is there an issue with building a market up? We have a lot of competition with video games, although that market seems to be getting into some issues of its own recently. We don't seem to have a lot of time for hobbies anymore. Too many things on the go. At least those are the reasons frequently mentioned as problems. I think that we need to ask what are we doing these things for. $$$$ making? Or for the enjoyment of it? Myself, I like mucking about with stuff like this. My work is one thing. This hobby is another thing. If I manage to pull off a modicum of steam locomotive kits then fine. I'm going at this one step at a time.
UP 4-12-2Which has a better chance of selling? The limited production brass import or American-made diecast with some brass details? What would you buy?
Me? Depending on what the locomotive is, I'd be a miserable enough fellow to buy both---- But then, that's just me-----
Though it is very disconcerting for Lee English to now be manufacturing paper only in the U.S. (after nearly 40 years of his personally building trains here in America), the cold hard fact is that Bowser will NEVER make another steam engine, kit or otherwise, in the U.S. Parts will also no longer be stocked.
(EDIT - the parts for some of the freight cars are still molded in the U.S., but assembled in China).
To the best of my knowledge the last kits have been packed from the last parts. They are contemplating removing the few remaining sample locomotives from their store wall and only showing items they continue to produce (all of which are from China).
It is utterly foolish for anyone to even consider manufacturing steam locomotives in the U.S.
Real world money example (perhaps a couple years out of date now): Producing a fine can motor here in the U.S. would result in a retail price exceeding $20 for that can motor. You can buy fine can motors in China, in lots of 10,000 minimum, and have them shipped here to your doorstep for about $4 per can motor, delivered. Now, if you are competing against the likes of Atlas, are you going to eat $16 per engine to make the motors here in America, or are you going to buy them somewhere else?
I have all the respect in the world for Kadee, and the high quality standard of their freight cars. I sincerely wish them the best in continuing to produce them in America for as long as possible.
Die-cast engines cannot be made here. Too many environmental regulations on the casting operations, taxes on small business, benefit costs, etc. I personally made the plaster waste from lost wax brass casting (of the model train detail parts) into solid bricks by mixing it with cement so that it could be legally disposed of in Pennsylvania without being "hazardous waste". Many readers may not fully appreciate the effort it takes to produce diecast model trains in America...I'm sorry to say it will not be coming back until all cheap producing countries elsewhere are exhausted.
Some people don't like MTH's prices--if you made it here, you could easily take their price and triple it, and it likely would not be enough.
Who wants to pay $1500 for a diecast MTH-quality 4-8-2 made in America? I'd love to see the Rio Grande M-75 or M-78 4-8-2's--they were awesome beasts. Last time I checked, $1500 would cover the latest brass import of that engine--which offers more detail than what is typically found on an MTH model.
Which has a better chance of selling? The limited production brass import or American-made diecast with some brass details? What would you buy?
Silver Pilot grizlump9 posters who know the difference between to, too and two. after they learn that, they can go on to their, there and they're. bad spellers of the world-untie!!! grizlump ( bilingual. or doesn't pig latin count? ) Add to that posters that know the difference between also and all so and what compound words are such together, Thanksgiving instead of Thanks giving etc.
grizlump9 posters who know the difference between to, too and two. after they learn that, they can go on to their, there and they're. bad spellers of the world-untie!!! grizlump ( bilingual. or doesn't pig latin count? )
posters who know the difference between to, too and two. after they learn that, they can go on to their, there and they're. bad spellers of the world-untie!!!
grizlump ( bilingual. or doesn't pig latin count? )
Add to that posters that know the difference between also and all so and what compound words are such together, Thanksgiving instead of Thanks giving etc.
I stopped caring whether some of the posters here had ever, ever heard of a period, comma, or question mark after Good ol' Bergie once sent me a nastygram informing me that this is a model railroad forum and not an English 101 class. With that in mind I have avoided grammatical issues with the same fervor as I avoid exposure to the bubonic plague!
And there may(?) be restrictions on the shrinkability of an N-Scale steam engine but if Bachmann can squeeze in a generic(?) Consolidation there is hope for a future Uncle John's 1950 or a Zulu.
From the far, far reaches of the wild, wild west I am: rtpoteet
The Location: Forests of the Pacific Northwest, OregonThe Year: 1948The Scale: On30The Blog: http://bvlcorr.tumblr.com
tbdanny A modular system for steam loco construction? This could be taken even further - interchangeable fireboxes (Wootten or Belpaire), cabs, etc.
A modular system for steam loco construction? This could be taken even further - interchangeable fireboxes (Wootten or Belpaire), cabs, etc.
It can be accomplished fairly easily as well. Base or foundation could be the frame and boiler---choice of motors, gearing, parts and finishing details to spec. I think this type of kit approach was done in the past and done fairly well.
A friend of mine and I are thinking about doing this as a cottage, or rather, niche business. The market may not be as large as all that right at the start but there is room for growth----