Solution to High Costs, Limited Runs and Greed

Model Railroader General Discussion (Model Railroader)
1

The solution to these things are simple. Since it is obvious that the manufacturers are totally out of touch with the majority of model railroaders, charge outrageous prices not because of costs but because of greed, there is a simple solution.

Form a company that will make (in the United States) a line of highly detailed and high quality engines, rolling stock, structures, track etc and price them at a cost that “everyone” can afford.

Who’s gonna step up and do this?

Although I am not a big fan of rising prices, limited runs etc. could it be that Walthers, Athearn, LifeLike, Kato etc are doing what the market dictates they do or are they truly missing the obvious?

2

Ain’t gonna happen…

When Hitler asked Dr. Porsche to create a “people’s car”, Porsche created the Volkswagen. A great idea at the time, but how many poor families do you see these days driving around in a Passat?

What you’re asking for is model RR socialism.

Besides, everything you want IS out there:
High quality, detailed engines (made in USA)? Bowser.
High quality, detailed rolling stock (made in USA)? Accurail, Bowser, Branchline, Red Caboose, Intermountain, Westerfield, F&C, Sunshine.
High quality, detailed structures (made in USA)? AMB, Branchline, DPM, Campbell.
High quality, detailed track (made in USA)? Micro Engineering.
High quality, detailed etc (made in USA)? Musket Miniatures.
Made at a cost that everyone can afford? Well, everyone can afford at least ONE offering by all of the above. But when you get into the greed and consumerism that’s prevalent in our society, those who can afford 12 of each shrinks considerably.

The closest we’ve got to this “everyman” ideal is Walthers. Although it appears that they’ve become enamored with the high end, RTR craze, they DO still offer quality, across the board products at affordable prices.

The theme of your gripe seems to be your wanting of Kato engines at Tyco prices. Not gonna happen.

3

Bowser already does this, although some would question the detail of the locos.

4

You obviously haven’t had to acount to the government for all the handouts they have given everyone. You would be amazed at what it costs to add a worker to a business and if you ever did you would be outraged. Unfortunately our permanent upper crust politicians convince everyone that the person who attempts to create a business is a greedy SOB (unlike them). The only way you could produce a product of high quality in the US at a cheap price in the model field would be to clone it.

5

instead of that let’s create companies that don’t actually exist, put up pictures of fictional products (basically take a picture of a prototype to photoshop and fake it up a bit so it looks like a real model). Then set the price at almost to good to be to true. Then, see if the big companies will try to compete by lowering prices. O and I said companies because just 1 will have no impact on the market.

6

good idea
looks like Mining Models is open for business!!!
Mitchell

7

davekelly:

Sounds like you want a firm who produces these models at little or no profit. And what do you propose is the motivation for such a venture? And why do you think the hobby needs products produced by a non-profit organization?

Businesses don’t charge the prices they charge because they want to rob people blind – they charge them because most people will pay those prices. Supply and demand, and all that.

I don’t like high prices any more than the next guy, but if people with money are getting interested in the hobby and can pay the prices, then more businesses will get into the market – which is actually a good thing.

And if, as you suggest, prices are inordinately high, then that also suggests that its possible for someone to dramatically undercut the competition and steal market share from all these overpriced vendors. If producing high quality models and charging far less for them than the going prices is so easy (as you suggest) then why aren’t there price wars going on as vendors try to steal the market?

I suggest to you the opposite scenario is actually what is going on.

Until recently, hobby prices have been artificially depressed (growing slower than inflation) and now the price adjusting that is going on is actually a result of the industry experiencing a long-overdue pricing catch up. If the prices reach the level that no one can afford, the hobby will die and it will all be over.

Problem solved. [;)]

8

I think folks here have misinterpreted my posts and I’m glad y’all did!! I was basically posting the solution for the various gripes that are out there.

Ray,

While I would love to have Kato engines at Tyco prices - it ain’t gonna happen, but if you read the various posts throughout the past you see gripe after gripe about the manufacturers charging outrageous prices for their stuff. There is a reason for Kato’s price. If a similar item could be produced and offered for a lower price it will happen. I do believe that models, like other products are affected by a thing similar to the law of dimishing returns. A 10 percent improvement might incur a 10 percent increase in cost. A further 10 percent improvement, however, might incur a further 15 percent increase in cost. If you want a perfectly scaled model - it’s gonna cost a bunch more than one that is 90 percent accurate.

ndprr,

Exactly. This is why folks are moving offshore. Manufacturing, software coding, legal services etc etc etc. But a review of many posts have confirmed that many folks consider others wanting more money as greed while their wanting more product for less price (thus keeping more money) is not greed.

Joe,

Believe me I agree with your reply (I’ve had more courses in supply and demand than I care to recall)! Read the posts under the $$$$ and threads like this and you’ll see that many people believe that the there is a great conspiracy between the manufacturers, distributors and even the LHS to become jet setting millionaires at our expense. I don’t believe that prices are outrageous, it all depends on what you want. To read many of these posts would have you believe that any company that wants to make a profit or LHS owner that wants to pay his/her mortgage is simply greedy.

My post that starts this thread is a response to the numerous posts and replies that abound on this forum. I’m simply pointing out that if the manufacturers are truly

9

DAVE:

Prices are based on what traffic will bear and ROI - return on investment. Manufacturer’s (and dealer’s) have to make a profit, or they go out of business.

New people in the hobby need the LHS to get them started and answer questions.

The ‘Newbie’ using EBay so he can buy on the ‘cheap’ doesn’t help himself, nor do the powerhouse discounter’s answer question’s. Look at recent question’s on the forum - “what radius track fit’s on a 4x8 sheet of plywood”, “what brand (fill in the blank) should I buy”?, or my favorite, the "what’s your favorite _______ ? (POLL).

The LHS’s used to handle and fulfill this market based on what they stocked. I bought what I saw, touched, and felt. - and I LEARNED. Most of all, I stayed in the hobby.

ALL incompetent businesses fail. LHS’s are being killed off by the discounter’s who steal their business wilth lower prices by not letting customers look touch, and feel ,hiring minimum wage types, not answering questions or giving advice - what the budding hobbiest needs. Larger cutomer base means larger runs, and lower cost’s for everybody.

Now I shop for best price - when I know what I want. I’ve been in the hobby 50 year’s - I’m entitled - but I shop first where they have the SELECTION I want. - the brand’s I want, not they like. EVERYONE should shop where they like. That being said, there is an understandable hue and cry over loss of ‘discount’ from those who’s PRICE comes first.

What is less understandable, is those crying the loudest over possible loss of discount, point to the loss of new people ito the hobby as justification. Taint so.

If every model product made were reduced to 10 cent’s tomorrow, all of us pro’s would load up the truck, but we wouldn’t get any NEW members.

I guess there’s enough greed to go around.

10

Orsonroy /jfugate

Ray & Joe:

Refreshing post’s.Thumb’s up!.

DG

11

What we as consumers fail to grasp is the risk side of the businesses that we rely on for the product we buy. How much does it cost to bring a “new” offering to the LHS or online vendor in hard dollars, only to have that product flop in the market completely? Did MTH decide to bring out a Pennsy K-4 because it was an obscure engine that had never been produced, or one that is tried and true with a large following of fans? We as modellers/consumers need to vote with our feet, supporting good quality and reasonable prices. Otherwise we have to hope Walthers or Horizon buys China next!

12

sorry china us mine, I traded my old car for it yesterday, the old dictator seemed to be happy to be rid of it.

13

Unfortunately, the consumers in this market are emphatuated with R to R rolling stock and super detailed sound equipped locomotives. We want DCC and we want it installed and ready to run out of the box. Prices have jumped accordingly. The kit is now more of a specialist item produced in lower numbers, so these prices have gone up as well. I have no doubt that there are many on this forum that would object to this comment, but just look at what the hobby suppliers are bringing to market. Have they got it wrong? I don’t think so. The production runs of most locomotives seem to sell out quite well, so someone is buying up all this stuff. The price increase in this hobby has more to do with the market demand for more technology, features and details than anything else.

14

I’ll go work for the company. I want 25 bucks an hour, full benefits and a retirement package when I’m 55.

15

Some very well thought out replies here. My Wife and I just closed a business after 15 years due to my failing back. I know from experience that our small Mom and Pop Photo Studio, 1800 Sq Feet cost an Average of $250 a day to open the door, that was just for overhead like Rent, Untilities, $2.00 Gal Oil , $1800 a month health insurance, Yellow pages ETC. People would think how can you charge $XX for an 8x10, when I can get one at Wally Mart for $1.85 The raw cost of materials is a small part of the cost of an item. We worked 80 hours a week in our busy times, and ate Manwhich and Peanut butter in the slow times. After 15 years the most we cleared was $20K. That’s $10K each. Not every Business owner especially one who is doing something they love is an Enron Exec. I’m sure the founders of Athearn, Walthers and I know Kalmbach all paid their dues. You can’t have it both ways, at least not for long, High Wages, good benefits, but cheap products. Someone’s got to lose. I feel for the sweatshop worker who can’t get medicine for their kid or food in some Asian country who sits there painting little scale people thinking how spoiled we must be If we can be concerned about 1/4" people. Believe me, I’m a right wing, conservative, former business owner, not some bleeding heart, but if there is one thing I beat into my kids head it’s that some poor Chinese Prison Laborer, probably made that FREE cell Phone.

I’ll climb down off my box. Good thread

16

If this is what you want why not do it yourself? What is stopping you?

Thanks!

17

I don’t meant be churlish, but this subject has been bandied about so much that there is no stuffing left in it. But, what the heck…

Everyone is entitled to make a living, whether in China or in Texas. Everyone makes decisions about how they will spend their money, or how they will USE their money. Trains, unless you are a wealthy walk-in who can point to a new brass loco, once a month, and fla***he platinum card, are NOT AN EXPENSIVE HOBBY!!! I am nicely set up with a mid-sized layout for about half the cost of a motorcycle, for gosh sakes. Drive down any back lane, anywhere, and see how many snowmobiles, motorcycles, RV’s, aluminum boats with 10 hp motors, and so on are draped with canvas or tarps in peoples’ back yards.

What is a car battery worth? $80 bucks for a decent one? How about one tire? The same. Many of us gloat that we just collared a P2K SDwhatever for $40 on e-bay, and it’s the second they bought THAT MONTH!!!.

Why can’t we be happy running one or two locos? Why are some of us lamenting the costs because we can’t afford our 20th loco?

This is absurd, to me. We all have to live within our means. If you can’t afford to be in the game, them’s the breaks!!! Many of us are doing just fine with modest investments.

18

I agree with the last post, I once wanted everthing new that came out, but with family needs and bills taking the bulk of the income, the days of living rent free with mom and dad are gone. So that made me focus my modeling on predominatly one era, turn of the century 1900 era IC, I do have one new diesel to run at the club back home where my folks live, but thats it. For the most part what is comming out new and high doller doenst fit my era. I rely on ebay and the local show for older AHM and Manuta cars and locomotives. The couple of people that I know that have hobby shops do it as a second job or are a full line shop with more than just trains. I agree that the online discounter has put a big dent in the mom and pop shops, I try to buy localy when ever possibly, then ebay if they dont have it. Lots of stuff on ebay is just folks cleaning out some of thier inventory and is a excellent way to avoid high costs of new trains. Just my 2 cents

19

No joke. I was at Target the other day with my wife. They had a portable CD player - you know, that you strap to your belt, go for a jog with, etc. - listen to it with headphones.

No joke Ladies & Gentlemen - $9.99. That’s nine dollars and ninety nine cents. The amount of technology packed into that ten dollar package is simply mind boggling.

There is NO WAY that could be done in the United States. Frankly, I hope other countries realize we’re taking advantage of them and stop giving us such low prices. $10 for a CD player is ridiculously low. Somebody on this planet is getting ripped off, and it’s not you and me, that’s for sure.

20

“Who’s gonna step up and do this?”

Easy answer: Nobody! No firm could expect/attempt to do what you’re asking and still make a profit.

Besides, in most scale there are a large variety of very affordable items for just about any interest. This is particularly true in N and HO scale. If you can’t find what you’re looking for–and at a good price–you aren’t looking hard enough.

As for the manufacturers being “out of touch.” I doubt it! I think that most of them are very much in touch with their customer base, and continually try to stay in touch.