[SKUNKY]

Originally Posted by Gambit

Like they say in New York....forget about it...

No, no Gambit, dat's "fahgaddabowdit"

Gehdit?

Gawdit?

Good.

[Celtic]

Originally Posted by Canucklehead

I'm not. I'd say there are many problems. Corgi is still thinking in the terms it was when they started the AA. Production is still too large for most items, since most items in their catalogue are close to or already obsolete. Continually making 2000 of a Mustang or Spitfire that only one or two hundred collectors would want (at most) doesn't help. The factories in China aren't even happy with that. If they're making something they want to do 20,000, not 2,000. If Corgi had their own factory, they could obviously dictate how things are done, but that obviously isn't happening. So production is given the run-around and delivery dates are missed. What the customer wants (run size wise) doesn't really enter into the problem. It's way waaaaay up the line from us.

...and the fact that Corgi doesn't own their production facilities appears to be the root of their cash flow and production delay problems. Apparently, the low-cost producers DO run their own factories. (By the way, in the 1/400 model world, the same own/don't-own problems have been discussed on other forums.)

[planenuts]

Sounds to me like Corgi needs to buy a factory....or merge with somebody that owns a factory....or have a factory buy them out....or....

[JC Woodman]

The production numbers thing is a question I have had for a while. Anybody have a clue as to the numbers run for say Dragon or Hobbymaster subjects? For example Dragons Wildcat "Mah Baby", how many do ya think they made compared to the latest 109 G-6 that just came out?

[JETFAN]

I waded through it all; the one thing that struck me in the comprehensive list of excuses for the losses was the lack of any mention of QUALITY, a key issue in any competitive environment.

Regarding production run numbers, it makes one wonder how the newcomer, HobbyMaster can manage limited editions right from the start at very competitive prices.

I'm amazed that they see a possible way out via further acquisitions. Usually firms in this situation try to sell off loss-making divisions.

Having said this, I sincerely hope that Corgi finds a solution to its problems; they have produced some excellent models of aircraft that other companies wouldn't even consider manufacturing.

[HotTrap429]

The bottom line is Corgi is becoming less a dog, and more a dinosaur. If it doesn't adapt, it will become extinct. When that might happen is anyone's guess, but something like this is not unusual in the business world. For too long, Corgi was the only game in town and now the competition is catching up or even blowing pass them. Corgi still has enough life to put up a great fight, but their pricing is no longer competitive, their quality has slipped, and those low production runs have not meant more buyers. I would hate to see them go, but right now, I can't afford their product no matter how good or unique it is.

[Gort]

Originally Posted by HotTrap429

The bottom line is Corgi is becoming less a dog, and more a dinosaur. If it doesn't adapt, it will become extinct. When that might happen is anyone's guess, but something like this is not unusual in the business world. For too long, Corgi was the only game in town and now the competition is catching up or even blowing pass them. Corgi still has enough life to put up a great fight, but their pricing is no longer competitive, their quality has slipped, and those low production runs have not meant more buyers. I would hate to see them go, but right now, I can't afford their product no matter how good or unique it is.

Gotta agree, HotTrap. Corgi was top dog, but the kennel’s growing by leaps and hounds.

[kabelace]

Don't know if any of you read any of that report that Canuklehead posted the link for but there is a couple of interesting lines in it.

One of our major vendors has determined not to produce products for Corgi beyond September 2006. An alternate vendor has been identified and only nominal delays are anticipated as a result of the move to the new vendor. Nevertheless, production delays can and may occur during the effort to transfer to the new vendor. In addition, other production delays have occurred during late fiscal year 2006 and during fiscal year 2007 that have served to delay sales of products to our customers. Such delays are not anticipated to continue beyond fiscal year 2007, but we can not assure that such delays will not continue.

Also

We have limited negotiating power with our customers, and if our costs increase, our financial results may be adversely affected.

We have little price negotiating power with regard to our mass-market toys, as several companies are competing to sell similar products to the same major retailers. Many substitutes to our toy products are available in the market. Moreover, the large mass retailers have low margins and are price sensitive. The toy industry is mature and retailers have access to and are able to evaluate market information. As a result, we are unlikely to offset cost increases by increasing the prices we charge our customers.

I think that last paraghraph means no price hike , maybe

[Captain Eddie]

Thanks for that, Kabelace, but I do have one question/problem with this. Why does Corgi refer to their line-up as TOYS?

[chiefs70]

Originally Posted by Captain Eddie

Thanks for that, Kabelace, but I do have one question/problem with this. Why does Corgi refer to their line-up as TOYS?

Probably because they are most closely aligned with the toy industry since there isn't a "collectible" industry. The bean counters need to have peers to compare themselves to and toys are the closest they can come to with their product.

Besides, they really are toys, albeit expensive and fragile ones, no?