A friend in the club I’m in said that he’d heard that BLI may be in trouble. Not trying to start a rumor here but has anyone else heard this? I haven’t and with what seems to be a fairly popular brand, I’m sceptical of this information.
Rick
I have heard the same rumor, but I’m not sure it’s true. I thought I heard some people talking about how BLI may go bankrupt
Perhaps. They are moving a lot of stock, though. I believe that, through dealers and their own Outlet Direct, they have moved five (5) PRR Duplex T1’s in the past week alone. Small change in the grand scheme, but if it can be taken as an indication of overall sales, I think they are merely correcting an inventory problem(s). We’ll get a better sense if, when their blow-out at Factory Direct Trains ceases in the next day or two, they announce some other “let’s get 'em moved out” sale. IOW, could be a temporary cash shortfall, but with the money that seems to be leaving member’s pockets on this forum, across the board manufacturer wise, I think they are doing okay.
BLI and any importer of Chinese stuff may need to take a look at their finances carefully. Exchange rates with China have been an issue with folks in DC. I believe costs for Chinese stuff may already be on the rise. Look at P2K prices following Walthers acquisition of Life Like. I have no inside info, but I suspect the party is over for really cheap stuff from China.
First, I have absolutely NO indication BLI and or PCM is about to go into bankruptcy, or that they are in any financial difficulties of any kind. This is just a general observation. Keep in mind that bankruptcy in this country is a legal and financial strategy, and often has little to do with ACTUAL company performance.
Example: You have an LLC. While paying principle officers’ (who are also usually owners/shareholders) salaries of over $2 million, the business “loses” over $1 million. They declare bankruptcy, possibly getting out of union AND business contracts, and retirement obligations, and defaulting on debts, and later “emerge” from bankruptcy with a whole lot less debt load, less overhead burdens, and the same “management”, still pulling down the big bucks. Ain’t life grand !?
Well, there’s a bit more to it. For instance, we shouldn’t forget the dozens of households who work for the firm for much less, but who can now continue to pay their mortgages, send their kids to good schools, replace their beater, help pay for Grandma’s knee surgery…
BLI has had at least two major fire sales to blow out products when the stock was not moving and money was probably tight. They have been blowing out products again since Christmas with FDT and continue to offer models that are overstocked at extrememy low prices.
The latest Blow outs are fairly large and must be to raise money like before. I certainly hope they continue to bring us great products, but maybe not so fast. Most of us can’t purchase everything we want when various new models come in every month.
It would seem with all of their new products in the past five years, they would get it together and continue of offer us great models for many years.
I would like to point out their new Blue Line Product line just recently announced. It is low cost and should make them a lot of money if we like them.
Virginian,
Good thing Congress cracked down on personal bankruptcies recently. Who says those campaign contributions from the banking industry don’t buy access and redress the wrongs plaguing America? [;)]
As any recently arrived immigrant will confirm. “America, a great country.”
Jon [8D]
RedGray62,
Had a conversation with owner of BLI this past weekend at Big-E show in West Springfield, MA. He seemed quite upbeat. Their display stand included BLI, PCM and FDT.They’re introducing new models: brass Cab Forward in G-scale(Bloody thing is huge. Example was on display. Very nice.), New Haven I5 in brass and brass hybrid(on display), new product line “The BlueLine” with proprietary sound system.(also on display) They have previously announced new Hudsons with Scullin drivers, a Dreyfus Hudson.
The owner noted that competition is increasing and BLI is responding to it by refining their business model and innovating as in the BlueLine product line introduction. They like some of their peer corporations(Atlas and InterMountain come to mind) are moving to a reservation/limited production run model that will give a more accurate reading of what offering will succeed and what will not. In this model once you get enough reservations to cover costs plus profit you produce enough to cover reservations plus an increment to cover demand that may be untapped by reservations. Not perfect but better than blindly producing a model and hoping it will be successful. The BlueLine with its proprietary sound system reduces costs by eliminating what BLI characterizes as high licensing fees to use QSI and LokSound systems in their BLI and PCM lines respectively.
For several years BLI has been soliciting input from modelers as to what they want produced. With the move to reservation/limited production runs modelers will still have input as to what is produced but reservations system will act as a check to what the customer wishes for and what the customer will actually buy in sufficient numbers to be profitable.
Does any of this resolve the question raised by your club member friend of
Well, I used a little bit of credit to make the engine purchase happen. The actual funds is ready to go in the account and will be transferred to pay off the credit bill without one penny of interest paid. That makes me what Credit Card Companies like to call “Deadbeats” Customers who use credit and pay off in full before the grace runs out and interest gets charged. But Credit Cards are useful in a Internet Situation where you need to make the sale happen very quickly or someone else will get the goods before you do.
I hear Congress is fixing to run a bill to enforce credit card holders to have a fee imposed. In this case of the T1 purchase it was availible and shipped very quickly. Where did the engine or other 4 copies come from? Returns?, Warranty problems? Other types of returns? Who knows?
The recent experience with Broadway on this particular purchase hardly indicates a company teetering on the bankruptcy. I recall 4 seperate employees were involved in my particular sale alone either by phone or email. Hardly a bankrupt company.
If China says the US Dollar is no good inside thier lands and impose thier own Money, it would make things very expensive in a hurry. That is one reason why I say: Why bother having stuff made over there and shipped here? China would like to keep spending on the 20 dollar walmart toaster to be built but rake in 100 dollars income each. That will enrich them very quickly.
To say a company is bankrupt such as Broadway is rumor.
Why?
I point to Riverossi. They had ads everywhere and everyone was in a race-horse lather all over the new 2-6-6-6. Ebay bidding went nutz on these units and ferociously defended the 350- mark and in some cases who had the most money wins. One day the sun came up and we all heard the word: Riverossi is KAPUT. Finished. That is that folks.
Would Broadway see the same fate? Who knows? I do notice that when they first started to produce HO engines and established a website, they would update the thing VERY V
Does factory direct trains sell at MSRP or at a sale price??
Sale. The PCM’s Y6b is retail close to 750 before taxes (About 10% in my state) the FDT will offer you a copy at just under 400 dollars. Once our dear Uncle Sam awakens from his Pre WW2 tax laws and understands just how much non-taxed commerce is occuring on-line in the USA we might all be made to be actually paying taxes online.
ok. Thanks.
I hope BLI & PCM will continue delivering such great models as the Big Boy, ALCO FA’s… etc.
I’m sure that for producing you need to calculate exactly and I think it’s only normal that BLI (but also others like Atlas) needs a certain amount of pre-orders to get a project going.
Best Example is the just released PCM ALCO FA/FB which was a little behind schedule but it’s a wonderful model and the DCC/Sound version is already sold out and very hard to find at stores.Those who pre-ordered did get their models and the rest is practically forced to hunt down these engines.
I always pre-order and have currently dozens of stuff pre-ordered (E8;E7;F3;F7;Cab Forward…) but don’t need them to arrive at the announced date. So what if it takes a year more? As long as they are done I’m already happy.
The more a manufacturer announces the better the chance that he will hit a jackpot and if one model gets a huge amount of orders it may also push along some other models as well.
Ex: I pre-ordered the BLI NYC 20th Century Limited Hudson only because they mentioned that they will release the Passenger cars as well. Now I hope that annoncement will happen soon.
Conclusion: I hope that BLI will continue for a long time and every company has its bad times and good times now just let’s hope that the good times are back at BLI.
I’ve been hearing the “BLI is in trouble” rumor for over two years now. I’ll believe it when it’s a news story and not a gossip story.
Whatever is happening, I’m glad! Got my second On30 Galloping Goose last week, complete with DCC and sound for $99.00. They were originally offered for $299.00. The previous one came for $149.00. So for $250 I got two of them. Can’t help but like it! [:D]
A few months ago we were talking about Lionel’s decision to put train sets on the shelves at Target. What happened to those?
Well, a friend went there to look at one after Christmas for her kids. Right after the holiday, Target put them on sale - about 70% off, as I recall. The shelves emptied quickly, and she was out of luck by a day or two.
Is Lionel in trouble because they’re moving product at a discount? How about Target? No, I think this is just smart inventory management. Those BLI Hudsons, DCC and Sound, have been on sale at Trainworld for months now. Also remember that the market, particularly for sound-equipped engines, is changing rapidly with the introduction of newer, better and cheaper decoders, and many more factory-sound engines at good prices. The older models will sit on the shelves for a long time if companies keep selling them at MSRP, so the well-run businesses like BLI and Walthers are giving us all a break and doing themselves a favor at the same time.
Yeah, life is good. But, like others on the forum have mentioned, when you see something in model railroading that you like, better grab it now because it might be gone tomorrow.
Is BLI/FDT having financial problems right now? If you go by what some hobby wholesalers are saying…the answer is yes. Stay tuned, odds are there are going to be a number of significant changes in the manufacturers over the next 18 months.
CNJ831
Safety Valve,
Sales tax about 10% in your state? Do you have a state income tax? If so, time to start organizing a tax rebellion! Throw the rascals out.
Unfortunately Uncle Sam is all too aware of what magnitude of on-line commerce is going on. States are also aware of “missed sales tax revenues” due to on-line purchases. It’s only a matter of time before both impose a process to track and collect taxes on such transactions. [soapbox] If there’s one constant lust in a politician’s heart it is the lust to forever have the government hand in your wallet.
The folks in D.C. have never rescinded some of the taxes imposed during WWII. Check out the sticker on new automobiles-the fed tax goes back to WWII. That bad guy Nixon rescinded the fed tax on autos for a short time in '73 as a means to improve U.S. economic performance. When it comes to taxes Uncle Sam has short term memory loss; what was a temporary stop gap tax more often than not becomes a permanent fixture in the country’s tax code.
Consider the after tax dollars you spend on model railroad product: if you tucked some money into an account bearing interest you pay tax on the interest earned. Huh? I already paid tax on my gross earnings, now you’re going to tax what I earn on what’s left? Yes we are! The state you live in will
I’d guess part of the reason for the BLI ‘fire sale’ is that they did pick some kinda limited-interest items to produce. There are only so many UP or N&W steam fans out there afterall. They seem to be coming out now with more USRA engines that could be used for a number of railroads (and by free-lancers).