Commentary from a Hobby Shop Owner
An interesting mass email from Frank Ruby, owner of Blue Ridge Hobbies, that provides some interesting color on the state of the modelrailroad industry and hobby.
THIS YEAR AT BLUE RIDGE HOBBIES
I hope everyone has a great Christmas and Hanukkah.
First, let me say that the world's model railroading hobbyist, especially those that have supported Blue Ridge Hobbies, have been very very patient over the last two years as the state of our hobbies product availability continued to get worse.
The simple phrase to explain 2012 for Blue RIdge Hobbies comes from the Grinch That Stole Christmas -- "Stink, Stank, Stunk".
I feel the manufacturers of our hobby have not tried to help keep any seller of their products in business.
As I have discussed in previous emails, the situation on the manufacturing side of the hobby is supposed to get better according to them. But, so far, has not. Yes, the "economy" has played somewhat into what is
happening, but it is not the entire picture.
For example, the staples of the hobby, are not available.
Blue Ridge Hobbies has been awaiting Atlas Code 83 Flex track for over 10 months now. Last year it was Atlas rail joiners. We could get the track but you could not put it together. The are out of stock again this year!
Early in 2012 there was a cork shortage at Midwest.
It is not just Atlas! We have been awaiting Lionel Smoke Fluid for the last three years. It is not just these two manufacturers it is all of them.
All we here about is the closure of factories in China that are causing the problem. at least Lionel has
started to make some items here in the USA!
How do the manufacturers expect a hobby store to stay in business if they
can not get the products our customers want!
When I attend conventions and train shows, I try to talk to all of you. Both manufacturers and model railroaders. There is concern for the over all health of our hobby. For some of us, it is how we make a living.our living.
Many of you have expressed that they think the hobby is dying. Certainly, the product situation does play into this, but the hobby is a live a well.
Yes we all have a bias towards model railroading, but recently the hobby has seen large crowds that include not only the older end of the age spectrum, but a large number of youngster, children and teens
that are still interested in the hobby.
Here in Greenville, SC there seems to a huge interest on the Transportation Museum of the World featuring the Miniature World of Trains project. As Chairman and President I receive a lot of calls wanting to know when the museum will be opening. Also, the museum's 2012 Christmas Model Train Display was a huge hit. Many, many young families with their children and older guests attended the display during its 4 week run on selected dates from Thanksgiving to December 16th.
Recently, I attendend Trainfest in Milwaukee, WI. They set an attendance record of over 25,000 this year in just two days!
So, the hobby is not dead nor is it on life support.
Just about everyone loves trains it seems.
But on the retail side of the business, especially for a model train only store like Blue Ridge Hobbies, this year has been the worst year since 2007. Sales where off as of this email about $150,000.00 for 2011 vs 2012.
I attribute this to the lack of product. I do not have the staples of model railroading to sell. Other hobby stores report the same situation as we see here at BRH.
It has gotten so bad for customers that they are cancelling advance reservations. They are just tired of the waits for product. Manufacturers announce product and continually delay the arrival and do not notify the customers and dealers. Just the wholesalers.
Since our customers can not count on the manufacturers to actually produce something to sell, they are not buying anything. Thus our low sales volume.
While our online business continues to do well, it could be doing better.
The retail store looks empty compared to what we had in track and rolling stock inventory even at the beginning of 2012.
Yes, I can fill the store switch with product. But will it be product that will sell.
The answer is no!
The recent move to our current temporary location was done for a reason. Ride out the rest of the year and see where the product availability is, get through the elections and at this point, the "financial cliff" situation.
We all need to know how much the government will be taking from us going forward. To that end, a lot of you are repositioning your money and holding on to it. Not spending it on the hobby. But there is really nothing to buy.
What does this all mean for Blue Ridge Hobbies?
BRH will be downsizing its retail store front by about 1/3. Until manufacturing
levels increase, we need to do this.
This will in no way effect what we do on the internet side of the business which is about 80% of what we do for the model railroading hobby.
We need to keep costs down to get you the lowest prices we can without giving the place away!
Also, we are awaiting some location decisions for the Transportation Museum project. This project is having some cash funding issues. but we are still receiving great support from the model railroad industry. The project can not seem to get that big lump sum of money needed to get a
larger location and move out of the BETA location.
This decision will be made the first quarter of 2013 so that a downsized version of the overall large project can be started. Details to come about that as soon as they are available.
So, the bottom line....
Blue Ridge Hobbies starts shrinking the retail store footprint starting today.
ALL MERCHANDISE IN THE RETAIL STORE
WILL BE SOLD AT COST.
THIS INCLUDES ALL TRAIN SETS, LOCOMOTIVES,
ROLLING STOCK, BUILDINGS, SCENERY
The only exception is the magazines!
Prices will be adjusted at the register.
I want it all gone by the end of the year so we can start fresh in 2013
with our new concept.
This new concept will most likely be the future of most local hobby stores that can still get product.
The website will not change for now, but a new long awaited shopping
cart is being developed as of this email.
We will still have a the largest database of discounted model railroad products available at our still deep discount prices.
The bottom line is BRH is under transition and is not going out of business!
Have a great Christmas ---
Frank Ruby