[Gary]

From the last set of Hornby accounts the cost of sales represented 47.2% of turnover. This is the pure production cost and excludes all the UK costs of marketing, admin, R & D, etc which are shown seperately in the Hornby accounts. So the production component of a £58 wholelsale loco before VAT is about £27.

You could probably double that at least for UK manufacturing taking into account all the extra detail now fitted less not having to ship the models halfway around the world less admin costs of monitoring production halfway around the world.

So allowing for a 15% retail mark up and VAT the effect of UK production adds about £40 to the discounted selling price of a loco to the customer.

So a discounted £85 Class A3 or A4 would have to sell for a discounted £125 if produced at the factory in Margate.

Now that simply cannot compete with Bachmann in the UK and that is why Hornby had to move to China or go to wall. Hornby said all along that it was competitive forces that made this move several years ago inevitable.

OK there may be production issues and if retailers do have certain feedback about this surely the correct approach is to contact Hornby directly and return stock that is deemed unsaleable.

If Bachmann produced in Europe the whole industry might not be going through the upheaval it is going through but they don't and it is/has!

Happy modelling
Gary

 

[Gary]

QUOTE Certainly the cost of producing tooling out in China seems to be dramatically lower, making shorter runs cost effective

That is a major point that should not be overlooked.

Prior to the move to China the Hornby model range comprised of 25 to 30 locos each of which had a large production run to make it viable.

The current catalogue features over 130 different locomotives each with shorter production runs.

The market has changed out of all recognition to what it was even 10 years ago.

Happy modelling
Gary

 

[Gary]

I personally am not a great fan of the "if its built in Europe its superior" mentality.

And I am slightly puzzled by the criticism of the "send it back and we will replace it" customer service. Who really wants to mess about with spare parts?

Think of the ViTrains airhorns scenario. Is it really such great service to simply be sent replacement airhorns when it was a design fault (poor packaging or weak plastic airhorns) that caused the issue in the first place?

Happy modelling
Gary

 

[Gary]

Why use email and not the secure order processing mechanisms when purchasing online?

You should pass on any online store that does not have real time order processing, secure order processing, and real time stock updates as it suggests the outfit does not wish to treat online customers seriously.

Now the issue of course is that many cottage industry types are not capable of offering any of these criteria and cannot afford to employ website designers to enable these criteria given that there is a home made website of sorts in place.

We seem to have moved from discussion around poor Hornby quality to poor customer service and is it this that is the real issue and that poor customer service by third parties reflects unfairly on Hornby?

Happy modelling
Gary