Model Railway Hobby Costs

[DesertHound]

Sorry for bombarding this thread with posts guys, I'm just thinking out aloud and as soon as I post, something else comes to mind.

It just occurred to me that in my rather longish post just now we really are talking about two different hobbies. Perhaps even three. One is building a model railway. One is operating a model railway, and another is collecting stock. All three are different and appeal to different subsets of railway modelling.

Some people like building layouts, but get bored operating them. Others like to buy a ready made layout just to operate their trains. Others still like displaying all their prized possessions in display cases and don't even have a controller and piece if track to operate them on.

Of course there are people who cross all three sections (probably most of us) but I think the three are distinctively different when it comes to the discussion of costs.

Again, just my thoughts.

Dan

[Ben A]

Hello all,

Dan - I'm not a regular sports fan but occasionally go to watch horse-racing (my Dad is keen) and my brother-in-law is a season ticket holder for an English premiership club. I know he just shrugs every time the new ticket price is announced.  You're right, they do control demand with price.  A similar tactic to that used on the real railways to encourage those of us who can be flexible to travel off peak, and fill their empty trains.

Nemo - Yes, I see your point about the Waitrose bottles of wine and yes, a £9.99 will sell ahead of a £10.99 bottle.  But to make it more analagous to model railways, if the £9.99 wine was from, say, Chile and the £10.99 was from Italy then I would probably buy the Italian because I happen to like Italian wine.  Similarly, if a loco I don't need is at £90, while that new Class XYZ that I want is at £110, I'll buy the loco I want.  I won't *not* buy it because there is another, cheaper loco on the market, or that somehow I have decided £100 as an uncrossable threshold.

Also, crowd-fundung schemes tend to deflate, not inflate prices.  One of the advantages of those I have been involved with is that those who support them are effectively obtaining a factory price, since the retailer margin is cut out.  That is the benefit they earn by pledging cash upfront.  So our TEA wagons are £26 (£27 for EWS version due to licencing fees) while a similarly detailed Farish bogie model nowadays is pushing £35-40 even at box-shifter prices.  This probably is harsh on retailers, and makes it hard for manufacturers, but is a new reality of the market.  The question for crowd-funding is not really one of price IMO but of model choice and confidence: ie are they offering what I want and can I trust them with my money and to delivery a good model?

Desert Hound - really good point about the hobby having different facets, and different spending thresholds in each.   After all, for CJM customers the £500 loco is the norm.  I think the collector market has considerably more financial clout than we may realise.

cheers

Ben A.

[railsquid]

Wait, £26 or £35-40 for a single wagon?  That sound you hear is my wallet giving thanks that I have no interest in British freight.

[Ben A]

Hi Railsquid,

Be even more grateful you have no interest in continental freight then!

Though seriously I think this cuts to the heart of the discussion.

The TEA tankers we are doing look, on the face of it, all the same.  They're in red, blue, grey VTG colours, EWS grey and blue and green Greenergy liveries. 

But closer research revealed numerous differences between batches.  These include the positioning of the filler caps, the discharge nozzles, the brake gear and the bogie dampers.

The main components - tank, catwalks, bogies are all the same.  But for the detail parts we had to pay to tool up alternate items to satisfy all these variations.

So this is where the cost rises.

If we had limited ourselves to just one livery we probably would not have seen adequate interest to make the model happen; if we had decided to compromise and offer all the liveries but in most cases not-quite-correct we would rightly have faced criticsm for producing inaccurate models.

So as far as we can each livery has the correct combination of hatches, brake gear, nozzles etc and OK £26 may feel like a premium price (though really it isn't nowadays) but this is a very thoroughly researched premium item.

Apologies if this is sounding too much like sales blurb but I am attempting to illustrate the context of all the decision making that we have taken to get to where we are - and designers at Farish and Dapol, or Atlas and Kato, are making similar decisions all the time.

The advantage of course that Kato or Atlas have is that their sales are likely to be measured in tens of thousands, so those tooling costs can be spread across far more models, and on a big production run the factory is likely to offer a lower unit cost too.

cheers

Ben A.

[steve836]

I appreciate that a lot of work goes into producing a new wagon, and it may be that around £20 for a 4-wheel wagon like the mermaid is appropriate in those terms, but for someone who wants to run a realistic length train of around 40 wagons it comes to £800 which is a lot of money, then when you add a brake van and loco you are looking at nearly £1000 for one train.

[Webbo]

I appreciate that a lot of work goes into producing a new wagon, and it may be that around £20 for a 4-wheel wagon like the mermaid is appropriate in those terms, but for someone who wants to run a realistic length train of around 40 wagons it comes to £800 which is a lot of money, then when you add a brake van and loco you are looking at nearly £1000 for one train.

Just like the surety of death and taxes, one day £1000 for a train will be cheap.

Webbo

[Ditape]

I personally think of my railway as a way of staying "sane" and if I want something I am prepared to pay for it if Locos cost in excess of £100 and larger bogie stock £25+ so be it, for me it is well worth it. If I was to add up all I have spent on my Hobby it would probably be in excess of £10,000 but when you look at what I used to spend on cigarettes and booze I am way ahead of the game and I have something to show for it.

[Irish Padre]

Yes, Di, everyone spends money on something! And whenever I've changed scale etc I've always been able to cash in my old items for a reasonable value. I think it's also worth remembering what has already been hinted at on this forum: the relative cost of model railways has if anything gone down. A 1957 Hornby Dublo Duchess set would cost £270 in 2015 prices (some £12 in 1957). The equivalent Farish Duchess set can be obtained for £131. Expensive as it may seem to us, I suspect that most of us have stock boxes that a 1960s modeller would simply gape at.

[railsquid]

Hi Railsquid,

Be even more grateful you have no interest in continental freight then!

Yup, I appreciate the economics of the situation, just somehow my brain still expresses surprise that a wagon can cost more than a coach.

If I were into freight, sure I'd bite the bullet, but at those prices I couldn't justify them as casual acquisitions; I'd rather put the money towards a 21/29 

[D1042 Western Princess]

Expensive as it may seem to us, I suspect that most of us have stock boxes that a 1960s modeller would simply gape at.

No question about that, and the quality of today's r-t-r equipment is well above what the best scratchbuilders were obtaining back then.
But, as I've said before, it's not about how much a thing costs, as such, as much as about how big a percentage of your disposable income it eats up in order to obtain it.
When I was working £150 for a model loco was an easy buy and could probably get two a week with a bit of 'pocket money' left over (if that's what I wanted) but my pension, while good by many standards, means a model of that price is now a major outlay and I might, perhaps, only be able get one a month were I so inclined. This is one reason why I have a self imposed 'cut off' of £100 max. I just find it hard to justify spending more on a hobby.
As I said, it's not 'costs' but 'percentages of disposable income' which limits purchases in the hobby.

[Irish Padre]

Understood, but even so I suspect that in relation to our modelling forebears many of us can probably allocate a greater proportion of our income to modelling. Go back fifty years and you probably wouldn't find many people able to buy even one loco a month.....

What fascinates me about this debate is the wider issue of social and economic change, particularly in the UK. I do think, however, that this is a good era in which to be a modeller. Whatever budget you're on, it's possible to model something with reasonable fidelity. For me, the budget is maximised by using Japanese stock and careful secondhand/sale purchases. Others have a rigid chronological or regional acquisition policy. But whatever you choose, I think the current model railway economy offers more entry points and possibilities than ever before.

[Webbo]

Who said my 40 locos were British outline? I have 4 British locos and all the rest are Kato, Atlas, Intermountain, Concor, and Fox Valley. Over the last 15 years the MSRP of these locos would average a bit above the $100 US mark but with the typical web discount (20-30%) or deals offered by US online retailers the price would be a bit less than $100. Of course the Australian $ has gone up and down compared to USD and it is not so good at the moment. Nevertheless Nemo's statement that British locos being up around £100 seems to be about right. British outline is expensive.

Yes, that was my point. I checked your layout before replying, and it's a very impressive US outline. I wish I had that space! US stuff is a lot cheaper than UK stuff though, presumably because the market is so much bigger.

Cheers, NeMo

The difference in market size may be part of the price difference between US and UK stuff, but I suspect there is more to the story than just this. Even though the US has a population that is roughly 6 times bigger than that of the UK, there are many more N scale manufacturers selling into the US market including Kato, Atlas, ConCor, Intermountain, Fox Valley Models, LifeLike, ModelPower, Athearn, Rapido, and yes Bachmann. I suspect that the UK has a relatively greater popularity of N than the US due to many if not most US houses having basements. Even though it's likely that the size of the market is a contributor to price disparity, but I suspect a couple of other reasons are that the UK market seems to operate as a duopoly with competition on prices not what it might be. Also, even online businesses need to employ people and the UK I suspect has higher labour costs due to higher minimum wages and the requirement to pay for overheads such as health, pensions, and welfare through VAT, income tax, and company tax that the US operations are less subject to. In effect, some of the extra price we pay for UK locos and rolling stock is attributable to our living in social democracies.

Webbo

[railsquid]

I've also found that going Japanese has helped my modelling budget stretch further. The locos and stock are generally cheaper than UK outline to begin with, and careful internet shopping can lower the costs even more. For the totemic £100 figure mentioned above, one can quite easily purchase two brand new Kato locos.....

And for those of us in Japan, three brand new locos with change left for a bit of stock to run behind at least one of them  (though if you want plug'n'play DCC you'll be disappointed). FWIW, today for about £100 total I came home with a 6-car Shinkansen and 2 (two) locomotives, all 2nd hand but in as-new condition. Do however note that while the Kato/Tomix range of popular trains are relatively cheap (albeit with limited or no DCC compatibility, which will add direct or indirect expense to anyone wanting to run them on DCC), if you want to run specific models particular to various private lines, it can get a whole lot more expensive.

Anyway, kind of going back to the original topic, I'm basically blowing through a small inheritance on trains; I should be doing the boring thing and investing it, but it's providing a lot more value to me like that than sitting in the bank.

[gc4946]

I'd also go on the "percentage of disposable income" factor, too.

However, due to the rising cost of new locos and stock over the last few years, I've spent more on secondhand purchases and only bought new as a result of trade-ins, for evaluation or if I wanted was likely to sell out quickly.

I try and model realistic short trains - imagine the total cost of a steam era "Windcutter" lengthy mineral freight or a full-length HST, even if built up over time - short trains require fewer stock, and overall less spending.

Another factor often understated is investment in baseboards, track and electrics, which tends to be long-term. Recently I've spent a lot on Kato Unitrack and Dio-Town parts for when I may not have room to have a permanent set-up available.

[Ben A]

Even though it's likely that the size of the market is a contributor to price disparity, but I suspect a couple of other reasons are that the UK market seems to operate as a duopoly with competition on prices not what it might be. Also, even online businesses need to employ people and the UK I suspect has higher labour costs due to higher minimum wages and the requirement to pay for overheads such as health, pensions, and welfare through VAT, income tax, and company tax that the US operations are less subject to. In effect, some of the extra price we pay for UK locos and rolling stock is attributable to our living in social democracies.

Webbo

Hi Webbo,

You're right about labour costs - it was to keep prices low that everyone moved their production to China in the 1990s.  Now the Chinese workers are demanding the same kind of employment conditions and living standards we enjoy their labour costs are increasing drastically, which is why model costs are suddenly rising.

Their big problem is retention of labour - why would someone work in a model train factory for a low wage when they could go down the road and work making iPads or Android phones in a cleaner, more modern factory for twice the money?

And the even bigger problem is holding onto specialist staff - the ones you've spent money training in CAD design, or toolmaking, or product and project management.  I am told it's not unusual for a skilled engineer to receive a text message offering a much higher salary, go out on his lunchbreak and not return.

For many years the Chinese factories were producing models at a price that was, really, too cheap.  That's why arguably the best one - Sanda Kan - went bust.

cheers

Ben A.