FWIW, Kleins now has this announcement:
Customer Notice
We have stopped accepting orders, pending a company reorganization.Customer service agents are still available to handle order queries.
We will provide more information as soon as it is available.
Rio Grande. The Action Road - Focus 1977-1983
riogrande5761 FWIW, Kleins now has this announcement: Customer Notice We have stopped accepting orders, pending a company reorganization.Customer service agents are still available to handle order queries. We will provide more information as soon as it is available.
Rich
Alton Junction
MTS accepted an order last Friday from me; I placed it primarily to use a gift certificate I had been given in October. Everything worked; what I ordered showed to be in stock. Now let's see if the order is fulfilled.
I think Hattons may have miscalculated the US market, a bit. Any discount seller relies on volume to make cash flow to sustain the business. It appears there was a big lull in sales volume between the MTS moving clearance sale, and the re-opening in Nebraska. It appears that Nebraska sales were hampered by a lack of access to the same product lines that MTS had before the corporate sale.
I had already shifted most of my online business to Midwest Model Trains. Good prices, and I can get most products within 2 days.
ATLANTIC CENTRALNobody said they were insolvent, but assuming ModelTrainStuff stays in business in one form or another, Hattons buying MTS and closing their UK operations is them effectively moving to the US.
Actually, a couple of posts have talked about Hatton's 'liquidating their assets to cover their debts' or having 'failed in the UK' etc. But it appears that is not the case.
The fact that Model Train Stuff has frozen their website means it's just as likely the 'reorganization' is MTS being sold by Hatton's to someone else. Still no evidence of some plan of Hatton's to buy MB Klein solely to close their successful UK operation and move it to the US.
Tin Can II MTS accepted an order last Friday from me; I placed it primarily to use a gift certificate I had been given in October. Everything worked; what I ordered showed to be in stock. Now let's see if the order is fulfilled. I think Hattons may have miscalculated the US market, a bit. Any discount seller relies on volume to make cash flow to sustain the business. It appears there was a big lull in sales volume between the MTS moving clearance sale, and the re-opening in Nebraska. It appears that Nebraska sales were hampered by a lack of access to the same product lines that MTS had before the corporate sale. I had already shifted most of my online business to Midwest Model Trains. Good prices, and I can get most products within 2 days.
I don't know anything about this outfit in Nebraska, but I know one thing for sure. Before all this "change" started, everything you bought from MTS was sitting in their warehouse in Cockeysville MD.
"Access to the same product lines"? That is a another statement that makes it sound like the model train business is as big as Amazon - dream on.
Today, MOST product in this hobby goes from the factory in China to the designer, "manufacturer", marketer (Walthers, Atlas, Bachmann, BLI, etc, etc) and from there most of it goes DIRECTLY to places like Trainworld, MTS, ToyTrainHeaven, and to bigger brick and mortar stores (higher volume ones who generally also have a web presence or established mail order clientele).
Very little goes to "middle men" distributurers any more.
Specifically, MTS has been buying direct from all the major manufacturers since the 1960's - long before the internet......
I think you are right about one thing, Hattons does not have a clue about the North American market.
Model trains are made in batches, they ALWAYS have been. Back in the day the manufacturers, distributors and dealers did their best to stock up inventory so that it appeared that stuff was in continious production, or nearly so.
Today that does not really happen, for a lot of reasons, but the main cause is two fold - the much larger number of "different items" being made, and the much lower profit margins with all the discounting.
So today, you preorder stuff, they make just a little more than what is preordered, when it makes it here from China, 80% or more is already sold.
"warehouse shelves" are mostly full of stuff that has arrived in the last 12-18 months, not some comprehensive inventory of a whole product line.
And when the extra 20% is sold, you wait for the next production run.
Are there exceptions to all of this, sure.
Bowser and Walthers sell their own product and also sell the other brands.
Athearn is only sold from one warehouse to dealers and consumers, they do not sell to any of the remaining "distributors".
A number of other small brands also have no extra discount for distributors and only sell directly or retailers or to the consumer.
Sheldon
ATLANTIC CENTRAL Tin Can II MTS accepted an order last Friday from me; I placed it primarily to use a gift certificate I had been given in October. Everything worked; what I ordered showed to be in stock. Now let's see if the order is fulfilled. I think Hattons may have miscalculated the US market, a bit. Any discount seller relies on volume to make cash flow to sustain the business. It appears there was a big lull in sales volume between the MTS moving clearance sale, and the re-opening in Nebraska. It appears that Nebraska sales were hampered by a lack of access to the same product lines that MTS had before the corporate sale. I had already shifted most of my online business to Midwest Model Trains. Good prices, and I can get most products within 2 days. I don't know anything about this outfit in Nebraska, but I know one thing for sure. Before all this "change" started, everything you bought from MTS was sitting in their warehouse in Cockeysville MD. "Access to the same product lines"? That is a another statement that makes it sound like the model train business is as big as Amazon - dream on. Today, MOST product in this hobby goes from the factory in China to the designer, "manufacturer", marketer (Walthers, Atlas, Bachmann, BLI, etc, etc) and from there most of it goes DIRECTLY to places like Trainworld, MTS, ToyTrainHeaven, and to bigger brick and mortar stores (higher volume ones who generally also have a web presence or established mail order clientele). Very little goes to "middle men" distributurers any more. Specifically, MTS has been buying direct from all the major manufacturers since the 1960's - long before the internet...... I think you are right about one thing, Hattons does not have a clue about the North American market. Are there exceptions to all of this, sure. Bowser and Walthers sell their own product and also sell the other brands. Athearn is only sold from one warehouse to dealers and consumers, they do not sell to any of the remaining "distributors". A number of other small brands also have no extra discount for distributors and only sell directly or retailers or to the consumer. Sheldon
Going off the addresses of shipped packages those orders from Nebraska are coming from Heartland Hobby Wholesale as a drop ship (as Kleins said third party shipper) rather than from Kleins itself. This explains the missing lines like Athearn (Horizon only) Walthers (only from them) and others. Heartland is also not a Digitrax distributor. You can not really operate like that without those major lines as a retailer. Guess that reinforces the idea that Hattons has no idea of the North American market. I could see them selling the website to Heartland- for a wholesaler that might make sense as it would broaden their market- just adding sales (and at a higher margin.) However to a regular retailer it would be taking away sales as you are missing major segments of the hobby.
Jim
Read an article in The Guardian today that said Hattons was closing and that 2023 was their last train show. the article was about how business was declining in the UK as model railroading is declining there. It was a brief interview with the owners of Hatton. Just for whatever its worth. I stumbled upon it by accident in the news feed.
edit: there is a statement about it on the Hattons webpage. Goes into detail about it.
So here is another computer glitch.
When I saw the post about the announcement I went to the MTS website and pulled up one of my wishlists. There were actually a few items available so I put one in my cart. I then went to checkout and went all the way through but backed off just before placing the order. I don't know what would have happened if I tried to complete it.
That isn't the end of the story. A couple of hours later I got an email from them reminding me that I had left something in the cart, and they gave a link to it.
I guess not everyone got the message.
Rick
hbgatsf So here is another computer glitch. When I saw the post about the announcement I went to the MTS website and pulled up one of my wishlists. There were actually a few items available so I put one in my cart. I then went to checkout and went all the way through but backed off just before placing the order. I don't know what would have happened if I tried to complete it. That isn't the end of the story. A couple of hours later I got an email from them reminding me that I had left something in the cart, and they gave a link to it. I guess not everyone got the message.
Just another example of how these are small operations most likely without full time IT people, and likely only one or two inhouse people with some knowledge/access in that area.
Changes most likely have to wait for the "guy", be he inhouse or a sub contractor.
It all seems easy if that is your "skill/business" but to many people it is not.
I did some pretty intense "tech" stuff with programable controllers way back in the 80's. Then my career and life went in a different direction.
I happily pay a very good IT guy when my needs exceed my skills.
And people pay me well for my knowledge and skills, I design and build houses, restore historic houses, etc.
What I don't do is sit in front of a computer all day. I was so happy when my career path got me "out of the office", which is where it was headed at first.
That message appears to be part of the automation that has been in place for many months. I'd get them too back before Hatton's purchased MBK.
Hattons CEO interview with Jennifer Kirk said that things changed for Hattons starting in Sept. 23. That's supposed to be when they purchased MTS. Seems the scenario where they bit off more than they could chew is becoming more likely if MTS is freezing up, too.
One thing confuses me, though. I read elsewhere that Hattons had purchased MRC. Then I read that Heartland Hobby purchased MRC. At one point, I remember seeing a sale page on MTS that focused exclusively on MRC products. Either someone is mixed up or Hattons and Heartland have/had a relationship.
So Model Railroader has confirmed Hattons did purchase MB Klein:
https://www.trains.com/mrr/news-reviews/news/future-of-model-train-stuff-remains-uncertain-amid-hattons-closure/
Thanks for finding out. Anything more to the thread? It's past due for closure.
Sad seeing this happen, but finding another vendor makese sense. It happens.
drgwcsGoing off the addresses of shipped packages those orders from Nebraska are coming from Heartland Hobby Wholesale as a drop ship (as Kleins said third party shipper) rather than from Kleins itself. This explains the missing lines like Athearn (Horizon only) Walthers (only from them) and others. Heartland is also not a Digitrax distributor. You can not really operate like that without those major lines as a retailer. Guess that reinforces the idea that Hattons has no idea of the North American market. I could see them selling the website to Heartland- for a wholesaler that might make sense as it would broaden their market- just adding sales (and at a higher margin.) However to a regular retailer it would be taking away sales as you are missing major segments of the hobby.
Hattons had the same issue though in the UK market, they managed to get into issues with Bachmann UK and Hornby on several instances, and the entire Bachmann UK line was unavailable at their store due to that (I would take a stab that Bachmann Europe probably represents about anywhere from 30%-45% of the OO scale market, it is almost a bigger product line in the UK than it is in America). But with that said, Hattons seemed to be doing fine, focusing instead on selling stuff like Rapido UK or PECO products; and people still bought from them due to their reputation for overseas shipping. They did have a few used Bachmann pieces popping up in their store from time to time, but never direct from the manufacturer. I mentioned it before, and other people have said it already; but this seems to be an effort to cut overhead costs by drop shipping. And if it means losing access to Horizon Hobby's products like Athearn, going off Hatton's past buisness in the UK they might not view it as an issue to not have a comprehensive stock of every product available in the US, as long as they can sell a stock of "enough" to keep customers coming back to the drop ship website. Especially now that they have cut out both MB Klein's warehouse in the US and Hatton's warehouse in the UK and are using a third party to handle the physical warehousing and shipping.
IC_Tom Hattons CEO interview with Jennifer Kirk said that things changed for Hattons starting in Sept. 23. That's supposed to be when they purchased MTS. Seems the scenario where they bit off more than they could chew is becoming more likely if MTS is freezing up, too. One thing confuses me, though. I read elsewhere that Hattons had purchased MRC. Then I read that Heartland Hobby purchased MRC. At one point, I remember seeing a sale page on MTS that focused exclusively on MRC products. Either someone is mixed up or Hattons and Heartland have/had a relationship.
To clarify Hattons/ Klein's has no interest or ownership in MRC. However Heartland Hobby Wholesalers is the outfit that is doing 3rd party drop ships for Kleins/ Model Train Stuff. Their address matches the shipping address for what people had been ordering from MTS. Heartland Hobby is a division of another company that owns an Audio wholesaler and also owns MRC. When MTS announced the Nebraska thing they mentioned 3rd party fulfillment so it appears that Heartland is simply filling and shipping these orders for them. Who knows what goes from here but right now that seems to be the relationship with no ownership stake just a dropshipping relationship.
kasskaboose Thanks for finding out. Anything more to the thread? It's past due for closure. Sad seeing this happen, but finding another vendor makese sense. It happens.
And yet, the MR story itself is contradictory:
"Hattons does own M.B. Klein; However, the two companies are operated as separate entities.”
"Since the announcement of Hattons closure, the status of Model Train Stuff’s website changed to reflect the current status of the company."
So, if they are separate, then why is there a "status of the company" (singular) for both?
IC_TomSo, if they are separate, then why is there a "status of the company" (singular) for both?
Precisely because they are separate.
That's in no way contradictory. Look at the chaos in sports television with the collapse of Diamond Sports Group. Bally Sports San Diego and Bally Sports Kansas City were operated as seperate entities, but they're the same company.
NittanyLion That's in no way contradictory. Look at the chaos in sports television with the collapse of Diamond Sports Group. Bally Sports San Diego and Bally Sports Kansas City were operated as seperate entities, but they're the same company.
FWIW, received an email from Walther's today that they will convert MTS points into their reward points if anyone hasn't spent theirs yet.
"Contradictory" and "chaos" are from the same bowl of language soup, but whatever.
The amount of speculation around Hattons borders on ridiculous.
Hattons owners decided, after reviewing their financial reports, that winding down the business was the best choice, instead of waiting until there was no choice. They probably did some forecasting and concluded the situation was not going to improve any time soon.
Purchasing MB Klein had nothing to do with Hattons closing. That deal was probably in the works for a year or more. The reorganising would be related to getting control of how things work and integrating the new operation into their exisiting systems. Waiting until after the Christmas sales rush makes sense.
Everything else is just speculation.
IC_Tom NittanyLion That's in no way contradictory. Look at the chaos in sports television with the collapse of Diamond Sports Group. Bally Sports San Diego and Bally Sports Kansas City were operated as seperate entities, but they're the same company. "Contradictory" and "chaos" are from the same bowl of language soup, but whatever.
I have no idea what you're trying to say here.
IC_Tom kasskaboose Thanks for finding out. Anything more to the thread? It's past due for closure. Sad seeing this happen, but finding another vendor makese sense. It happens. And yet, the MR story itself is contradictory: "Hattons does own M.B. Klein; However, the two companies are operated as separate entities.” "Since the announcement of Hattons closure, the status of Model Train Stuff’s website changed to reflect the current status of the company." So, if they are separate, then why is there a "status of the company" (singular) for both?
I mean no disrespect to anyone on here, but when topics like this come up, I often wonder about the business experience/knowledge of some of those who respond.
LOTS of businesses, even relatively small businesses, run different parts of their operation as "separate entities".
EVEN your local new car dealship is actually run as multiple "departments" that are pretty much stand alone separate businesses under one roof. New car sales, used car sales, parts, service, body shop each keep their own books, track their own sales, pay each other for goods and services and show their own profit or loss.
Yes, the service department "buys" the parts from the parts department and then sells them to the service customer. The used car sales department "pays" the service department to inspect and repair the trade-in or auction purchase before it goes on the front line.
Historically big corporations are actually made up of multiple separate companies under an umbrella holding company. Often the down stream companies operate with a high level of autonomy.
So for Hattons to treat the purchase and operation of ModelTrainStuff completely separate, especially considering it is in a different country and has to be a separate company in some way anyway, would be the proper business approach.
And yes, investing in the US market may have been seen as a hedge against changes in the UK market even if the decission to close the UK operation was not made until recently.
True we don't know all the details, and, it really is not our business.
We will eack make our own choices about who to do business with moving forward.
But unless the MTS web site is improved they still won't get my business.
Why don't I like the web site? WAY to hard to look up and find specific items. I hate flipping thru web page anfter web page of "pictures" after searching with a very specific description.
I hate being "marketed to" by forcing me to sift thru stuff I'm not interested in.
On others sites, Trainworld, ToyTrainHeaven, I can get to specific items with a minimum amount of "sifting".
betamax The amount of speculation around Hattons borders on ridiculous. Hattons owners decided, after reviewing their financial reports, that winding down the business was the best choice, instead of waiting until there was no choice. They probably did some forecasting and concluded the situation was not going to improve any time soon. Purchasing MB Klein had nothing to do with Hattons closing. That deal was probably in the works for a year or more. The reorganising would be related to getting control of how things work and integrating the new operation into their exisiting systems. Waiting until after the Christmas sales rush makes sense. Everything else is just speculation.
Agreed, well said.
drgwcs ATLANTIC CENTRAL Tin Can II MTS accepted an order last Friday from me; I placed it primarily to use a gift certificate I had been given in October. Everything worked; what I ordered showed to be in stock. Now let's see if the order is fulfilled. I think Hattons may have miscalculated the US market, a bit. Any discount seller relies on volume to make cash flow to sustain the business. It appears there was a big lull in sales volume between the MTS moving clearance sale, and the re-opening in Nebraska. It appears that Nebraska sales were hampered by a lack of access to the same product lines that MTS had before the corporate sale. I had already shifted most of my online business to Midwest Model Trains. Good prices, and I can get most products within 2 days. I don't know anything about this outfit in Nebraska, but I know one thing for sure. Before all this "change" started, everything you bought from MTS was sitting in their warehouse in Cockeysville MD. "Access to the same product lines"? That is a another statement that makes it sound like the model train business is as big as Amazon - dream on. Today, MOST product in this hobby goes from the factory in China to the designer, "manufacturer", marketer (Walthers, Atlas, Bachmann, BLI, etc, etc) and from there most of it goes DIRECTLY to places like Trainworld, MTS, ToyTrainHeaven, and to bigger brick and mortar stores (higher volume ones who generally also have a web presence or established mail order clientele). Very little goes to "middle men" distributurers any more. Specifically, MTS has been buying direct from all the major manufacturers since the 1960's - long before the internet...... I think you are right about one thing, Hattons does not have a clue about the North American market. Are there exceptions to all of this, sure. Bowser and Walthers sell their own product and also sell the other brands. Athearn is only sold from one warehouse to dealers and consumers, they do not sell to any of the remaining "distributors". A number of other small brands also have no extra discount for distributors and only sell directly or retailers or to the consumer. Sheldon Going off the addresses of shipped packages those orders from Nebraska are coming from Heartland Hobby Wholesale as a drop ship (as Kleins said third party shipper) rather than from Kleins itself. This explains the missing lines like Athearn (Horizon only) Walthers (only from them) and others. Heartland is also not a Digitrax distributor. You can not really operate like that without those major lines as a retailer. Guess that reinforces the idea that Hattons has no idea of the North American market. I could see them selling the website to Heartland- for a wholesaler that might make sense as it would broaden their market- just adding sales (and at a higher margin.) However to a regular retailer it would be taking away sales as you are missing major segments of the hobby. Jim
I can tell you this, using Heartland hobbies to fill orders at MTS prices makes no sense long term. There is not enough markup in this stuff for it to be profitable for MTS/Hattons to do that.
To sell model trains at MTS, Trainworld or ToyTrainHeaven prices you NEED to be buying at the lowest price direct from the manufacturer.
Notice the product lines not carried by Heartland? All the ones that control their own distribution.
And, they sell Bachmann, but just like Walthers, not at prices that would let a retailer compete with the Bachmann prices at MTS or the other big outlets. We have a local shop in out region who buys Bachmann direct. His prices are as low as Trainworld or anybody else on Bachmann.
The only current business model for success in this business is to buy 90% of what you sell direct from the manufaturers.
richhotrain riogrande5761 FWIW, Kleins now has this announcement: Customer Notice We have stopped accepting orders, pending a company reorganization.Customer service agents are still available to handle order queries. We will provide more information as soon as it is available. This will be a real uphill battle going forward. Rich
This will be a real uphill battle going forward.
They had a "moving sale" before the holidays. Maybe they are actually moving now and organizing the Nebraska warehouse.
I am not a big fan of Kleins. Other sites would have periodic deals on stuff that beat Klein's and TW's prices, so I would just surf the net to find them rather than go to Klein's. Whenever I shopped, Klein's hardly ever had the best price, especially when sales tax was included.
Just saying that if they have trouble, I think their prices were a bit higher than other sites at times.
- Douglas
Reorg meaning that maybe Heartland has to ramp up for more volume.
Damm 403 forbidden error.
That's normal operations. I gather up items in my cart that I know I want, then wait hours or days before I other add others or just check out my cart. I always get messages telling me I forgot to check out. Nothing to see here, and it sounds to me like they would have processed your order normally.
I'm old fashioned, when I need or want to buy something, service, inventory selection, and convenience are balanced agains the "lowest price".
I would rather a retailer have consistant competitive pricing across it whole offerings rather than have to wait for or search for the "sale".
That is what built MTS/M B Klein 60 years ago. EVERYTHING was simply 20% off retail in a time when neary every shop was full retail.
As explained above, I have not shopped at MTS for a long time and it has nothing to do with price - it has to do with "ease of use", which their web site fails at in my opinion.
I do think they are moving to a state/place with lower business costs than here in the Peoples Republic of Maryland. I personally would have left years ago except for family. The current location of MTS is in a very expensive part of the Baltimore metro area, in a county with high property taxes, lots of regulation, high labor costs, and no special shipping advantages.
So it makes sense that Hattons would move the operation.
It is typical for this type of business to save on moving costs by lowering the inventory size somewhat until after the move.