A local article in my paper from today: By Paul Wyche in the Journal Gazette. Per the Hobby Manufacturers Association the industry had 1.4 billion in sales in 2010 vs 1.3 billion in 2009 and 1.2 billion in 2007 when the recession hit. The Association expects 2011 results to keep pace as hobby shops have seen growth in model trains and r/c vehicles. A local Fort Wayne, IN shop is adding a 3rd location in its 37 years of business. It seems that parents like these hobbies because it gets kids active and uses their hands and minds! Good news if you ask me!
These hobbies are cheaper too. In my opinion fewer people can go out and buy all the big toys like a jet ski, boat, or other off road toys and these hobbies help fill that gap.
It's not dying at all. The hobby is evolving, just like everything else- Nothing in life is ever static. Methods of retailing have changed. Buying habits have been altered due to economics. Etc, etc. I have noted multiple times, previously, every day we sign up new members here. (Take a look in our new members forum, where some of these folks introduce themselves.) And every day we see notations in those profiles of "new to hobby", "just getting started", "starting my first layout", "returning (numerous reasons) to the hobby".
A spritz of cold water on this report: Volume of dollars rising doesn't equate to quantity of items sold also going up. I would expect an eight percent increase in sales volume (which is roughly what 1.3B to 1.4B is) based on how fast prices have gone up. My guess is that it had better go from 1.4B in 2010 to at least 1.7B in 2012 to keep up with those price increases. The HMA's objective (from their own website) "is to promote the general interests of all persons engaged in the buying, distributing, manufacturing, or selling of model hobby merchandise. This includes, but is not limited to, model railroads, plastic/die cast models, and radio control hobbies." There's a lot more there than choo-choos. I'd like to think that this is very good news. However the anecdotal evidence from my neck of the woods is that people are buying fewer items because of higher prices. On the other hand, I think it's absolutely true that there's a downshift effect from more expensive leisure pursuits, say, vacations. Some dealers have told me that they do quite well in less good economic times for that reason.
Buying less for more is certainly true. Today my son and I went to our LHS at the Union Station in Ogden, Utah and got two magazines, three bottles of Polyscale paint, and one bag of Noch static grass....over 40 bucks!! Last time I bought paint it was about $2.85 a bottle...it's now right at $5 bucks a bottle. Noch static grass was almost twelve bucks...guess it's more expensive since it's made in Germany and the dollar keeps falling against the Euro. Glad to see my two Athearn Big Boys and the one 3700 class Challenger which I pre-ordered have not increased in price the same percentage as Floquil Polyscale paint! Cheers! Bob Gilmore
Another dash of cold water. Used to have at least 14 hobby shops that had a fair to large selection of N scale, and other scales, in a relative short travel distance of not over 45 minutes, and at least 60% of those were full service shops. Now down to two shops in that distance, with only one that has any sizable selection of N scale, and the full service shop left is a joke to try and get anything in any scale that is railroad related. To find a large selection of N scale now must drive over an hour to up outside Baltimore. So the dynamics have changed considerably. The few big chain full service shops in this area are a joke for the serious model RR hobby devotee, with mostly starter stuff of generally one manufacturer, and usually are seriously over priced on what they do have. Heaven help trying to find a bottle of RR paint. There is an increased number of internet dealers out there which have taken up the slack from the loss of the brick and mortar stores which can, and does to some extent account for the sales revenues along with some substancial price increases. The brick and mortar stores which survive today had the wisdom to biuld a good solid internet and mail order business to go along with the walk-in customer business and back both with good solid customer service practices, and staff who know the product being sold.
I'm with Ken, this is just a cycle. As an example, when I was younger living in NH, there were more hobby shops, less train shows. By the early 1990's the shift was less hobby shops, more train shows. When I moved in 1998, there were once again, more shops and more train shows. I have seen it here in Illinois as well. Galesburg RR Days for example. When I first went in 1998, I had not see a train show this big except for the Amherst show in Springfield MA. Lots of dealers, lots of displays, lots of people spending money. By the next year, the number of dealers was down a lot and people were not spending as much. From 2000 - 2002 the show saw real growth in all categories and from 2003 - 2004 it went down again. The show has been getting smaller since 2007, but this past year the place was full and the dealers I spoke to were happy with sales made on both days. People were spending and finding deals. Despite the economy, Railfaning is cheap, even if you have an SUV like me. It cost me $45.00 to fill up the Jeep, and $7.00 for lunch. No more film or processing fee. Model Railroading is cheap, so is model airplanes. Jeeps, not so much. My Jeep hobby is the most expensive hobby I have. My Girlfriends son is into English Football (soccer) and wants to play this summer. $500.00 to sign up, plus money for his kit, $130.00 foot wear, etc. Your always gonna have the negative Nancy's (not saying anyone who has commented here is) who long for the days of the local hobby shop that carried blue box Athearn, strip wood and Champ decals all for $20.00, but honestly I would rather pay $65.00 for a Kato SD40-2 that looks great and runs great, mail order my BLMA parts and further detail it than go back to the old days of N. Like someone said earlier, some shops were smart and adapted to the change of the 2000's. Business, be it hobby or cars or food, needs to adapt to market trends or die. Now regarding the cost of Floquil paint? I agree, there is something wrong there and the price Testors is asking for is stupid. If you ask them why, they will tell you it is because of the cost of petrolium based products. true to a point, but when you do the math, the cost of $5.00 per 1 oz bottle does not equate.
Glad you saw that article. I followed that HIAA report for a few years, but couldn't find it recently. Seems like in 2005 or so, I saw it was $1.4B back then, too. So, you can take a lot out of those stats. Basically, stagnant for the last few six years, down a bit in the recession, and trending up as the economy improves. That is part of the economic cycle. As to long term trends, however, with inflation, growth is pretty stagnant, not robust. Basically level doesn't suggest a growing hobby, but the good news is, it isn't falling off the map as much as many here suggest. My take is that the hobby will never be a robuts growth area again, but its not falling off the map either. It seems to me that there will always be a small percentage of boys and men (some women!) that are attracted to trains, just as there always was. It might drop as more options become available, more immigrants with less a train background in their families, etc. Smaller houses might affect interest, although, at the peak in 1950-70, houses were smaller than they are now, and even if houses tend to get smaller, the dedicated might find room for layouts.
But to make up for it, it dries out in the bottle a lot faster! I have model paint that came with me when I moved into the house in 1996 that is still good... while bottles I bought just last year have already congealed. And all these bottles are stored upside down in the same cool, dry place, a metal drawer in a Steelmaster cabinet.
I have had that happen recently too. I also found that the Model Master Acryl Flat clear they suggest over the Polly Scale flat they discontinued is anything but flat. More like a semi gloss. I may start mixing my own colors from Tamiya if it keeps up.
Checking in on this one again and have a few thoughts, based on following up on this number back in 2005 with HIAA when I saw this report. Remember that the $1.4B is the wholesale cost. If 40% of MSRP, but assuming most of us usually buy at a 20% discount (some more on big ticket items, other items less) than it would be 2.5X this, less discounts about double. Total retail sales should be about $2.8B. They get this data by surveying a large majority of their members as to their sales volume for the last year. (I think they said that 80% or so respond to the survey) They do some analysis to come up with their final estimate, but believe their methodolgy is pretty firm and good. If I recall, they might have to estimate general trends in the smaller mfgs who may not have great accounting (and who may be variable - if two of there report increased sales from those who respond, they figure the ones who don't might be 66% likely to have an increase, etc.) Anyway, an increase in sales is always good. We get accustomed to seeing negative news on business pages. If revenues are up, it is usually reported as "less an increase than analysts predicted, and dissapointing." If it is profitable, it might be reported as "20% reduction in profits on a year to year basis" but it is still profitable, despite the negative spin! As I said earlier, at the low point, many other industry/businesses were down 30-35% and haven't recovered yet. To go down less than 10% (1.2B vs high of 1.4B in 2005 before recession) and then recover to 2005 revenues so quickly beats the average, IMHO. Especially impressive for a niche and non essential spending category! The hobby certainly has committed existing modelers. It may be growing with new members, since many old timers with nearly completed layouts probably aren't buying as much, and all of us are more conservative, so that steady/slightly increasing sales number has to be partly driven by newbs, no? The point of these more global stats is to get a true picture of hobby spending. Anecdoteal evidence from our experience isn't very useful, compared to this industry survey. IMHO, they say the hobby is doing quite well. I doubt it will ever be a game industry hit again, but steady for a 75 year old hobby ain't too bad!
RE Paint congealing: I just received a brand new bottle of pollyscale CNW yellow that was about 80% congealed. This was a brand new bottle. To their credit, woo woo woo immediately sent me a new bottle. I advised them to check their stock. I thought maybe if a big retailer like them contacts floquil, something will be done about it.
You couldn't tell me hobbies in general aren't taking a nosedive.I live in a pretty large metropolitan are,two major cities,Wilkes Barre-Scranton,Pa,dozens of towns & boroughs in the same area.Ten years ago,I had probably 15 shops withing a half hour ride,at least three were monster shops,twice the size of almost any other shop you'd go to..Now?..One hardware store that has a hobby department in Wilkes Barre,and he sells WAY more RC cars,planes, and helicopters than trains,and one little hole in the wall in Scranton that sells more or less RC and Williams O stuff. I'm actually down to having to order everything I need,right down to paint,glue, and plastic,neither stocks anything..I'm so disgusted,I pretty much switched over to helis myself,way less frustrating..I can buy a full function,4 channel heli ready to fly for only a few dollars more than a pair of Atlas Geeps..Glad I have way more locomotives than I'd ever possibly need..
Actually yeah I could. And since you live near Scranton, feel free to read the following in the voice Dwight Schrutt :cute: True you or I don't have 4 to 5 local hobby shops near us anymore, heck I live within 20 minutes of the two largest hobby dist. in the world and since you fly Helis, you can probably guess who they are. Again, when I lived in New Hampshire, I had within walking distance a model train only hobby shop. Shops like those were not uncommon in the past, at least in New England. What many are forgetting here, is a few factors that essentially made the local hobby shop fade away. One: Dist. like Walthers and Horizon changed their dealer requirements. A dealer had to have a store front and and a listing in the yellow pages. Doesn't sound like much at first but, if you have a store front like in a strip mall or downtown, your overhead is alot more than what it would be in your garage or basement. (two dealers I went to in the 1990's operated like this, one in a converted garage, the other in his basement.) Ok, so the rent in a strip mall is too high, the garage can be turned into a store front. Not so according to many local zoning boards. Running your hobby shop in the garage at the end of Mulberry Street in the sub division, won't pass the local zoning board or home association. So by the mid 1990's, a lot of shops we went to closed because they either did not meet the new dealer requirements or could not afford the overhead of rent. Two: The internet changed the way people buy things. Take a look sometime of the comparison of "Black Friday" versus "Cyber Monday". Sales on-line continue to go up. If your like me and in the rural mid west were the closest big box store is 34 miles away and gas is what it is, your more inclined to shop online. I can say 98% of all my Jeep parts come from three different shops online, 75% of my train stuff comes from online and almost 100% of my RC stuff comes from online. The dealers who saw the internet as a fade are largely gone. Those who took advantage of the internet by establishing an online presence are still around for the most part. Three: Hobby shop owners are retiring and have no one to pick up the shop. Most of the dealers I know now are getting up in age. Getting up everyday at the crack of dawn, doing the paper work, orders, inventory then running the shop from open to close and packing and setting up for shows on the weekend is not appealing to the dealers kids. One of my favorite shops in NH went through this. Four: The hobby shops of the past were different. In 1985, I could walk in and purchase a blue box Athearn box car, a pair of Kadee couplers, some Sig balsa, maybe a Guillows or Comet Cessna or Piper kit and some T-pins. Hobby's in the past were more building. That 4 channel helicopter you speak of? Open the box, put batteries in it and fly. My Corsair I got? Same thing. Atlas loco? Open box, set on tracks and go. Our hobby's are more turn key now, more so in the RC world then trains. When was the last time you saw a guy come to your field with a kit built airplane that wasn't an ARF? Chances are you wouldn't see many scratch built either. I can't say for sure but do you even go to an AMA field, or have a AMA card? Yes RC like trains has changed A LOT but that is a different discussion. Point being made here also is a shop will no longer survive on low ticket items that were the bill payers in the past. It is more profitable for a shop to sell big ticket items and get a bigger margin on an Atlas Geep than they do on a set of couplers. The smaller stuff barely justifies space in the shop. On-line, the overhead is a lot less and can be sold at a better price. Five: Evolution of big box stores. While I can't say there is a Wal-Mart or Best Buy of the hobby industry, it can be debated that the Hobbytown USA chain/franchise is the Radio Shack of the industry. When the four or five hobby shops in Manchester NH went away, a Hobbytown USA took over. And while you can get the latest Axial Ax-10 Crawler, Hobbyzone Spitfire, or Athearn Ready to Roll box car, good luck finding a 1/10 Warn Winch, retracts or 33" metal wheels for your freight car. The same goes for Radio Shack, you can find a scanner, a TV or a stereo tuner, the parts like diodes and resistors are getting harder and harder to find. So most serious electronics hobbyist just go to DigiKey for what they need, much like most serious R/C guys go to Tower or Horizon on-line. Just as there are specialty online shops for my 1/10 Warn Winch, retracts for my Spitfire, there are specialty shops for my decals, trucks, couplers and detail parts. Now realize this a pretty broad brush I have applied here, not every region is going to be exactly like this. The report speaks of sales volume. It doesn't say how that revenue came in. Factors such as on-line, mail order and even shows play a role. However, that being said, what I have listed above certainly has had an affect on the stores you once visited. The hobby is not dying nor is it where it was in the "Golden Age" it sees its ups and downs like any market. The report is saying that despite what the economy is doing, Hobby Sales in general saw a slight rise.
We lost one of our model RR outlets here. But had absolutely nothing to do with the hobby dying. (Which simply is not happening.) It had nothing to do with economics or retirement, etc. It was an owner who was simply stupid and drove off the customers. That business quickly shifted to the other outlet. And, there are actually more model RRers around my vicinity now than in previous years.
If there's one thing i've learned from reading and posting in these LHS threads over the years it's that the health of the LHS scene is very VERY dependent on where you live. As I've said many times before, I've lived in Chicago Suburbs, Portland Or. Suburbs, North County San Diego and Roseville (sacramento) area. All 4 have thriving LHS scenes. I don't think I've ever lived more than 10 miles from a Hobby shop that carried model railroad equipment. I would not be surprised though if it doesn't have more to do with economics, the health of the towns and cities we're discussing generally and the general move to big box stores in particular in small and medium size towns. Hobby shops don't exist in a vacuum, they depend on a town's infrastructure and other shopping interests to help support them. These are things that have been shifting for a long time now. LHS are a part of that.
I don't know when you lived in North County San Diego, but there is nothing left here. There is one arts and crafts store with a model train department, but it is not well stocked. San Diego proper is not much better. For a good full service shop, one needs to go to Orange County or LA.
Fewer LHS don't suggest lesser sales, just a changing sales enviroment. Anecdotal evidence isn't reliable. I believe those HIAA stats are basically reliable, although we would have to figure they would have some tendency to fluff up stats for the public, even though they are serving the mfg who would be best served by knowing the real truth (which might be provided to them in more detail) If you believe that, then the hobby is very slowly growing, stagnant, or very slowly slowing in sales, depending on how much you figure for inflation. However, its simply not in free fall. If you want to use your own experience, then, I would suggest this. If your buying has slowed, mostly because you have most of what you want, who is buying to make up the slack in a nearly constant yearly sales environment? Doesn't it have to be either newbs, or those further back in the MRR curve (i.e., graduating from 4 x 8 to bigger layouts?)
LOL!! Getting even more absurd..HUGE hobby shop just opened 20 miles from me,tons of RC cars,helis,planes,models,jammed from wall to wall with stuff..NO TRAINS...
