Just for grins and chuckles. Those who cannot access it. For the purpose of comment and review:
Primary Source vs. Reliable Sources
The rumor mill is running at full production and working overtime.
Unfortunately there’s no quality control to the information it is producing. The “Reliable Sources” brand of information showing up on some websites and yahoogroups e-mail lists is based on hearsay, and is simply incorrect.
After being bombarded with e-mails and phone calls about Aristo-Craft closing its doors “in a few days”, it was time to sit with the Primary Source of information about Aristo-Craft, namely Lewis & Maryann Polk and Scott Polk. TATE spent two hours this afternoon in Irvington with them talking about the business, the future of Crest Electronics, the 27,000 sq ft warehouse, and the rumor campaign to kick dirt onto the business and declare it dead.
By now, just about all of you know that “TATE” is a living, breathing individual. He is neither Scott, nor Lewis. He is a fourteen year employee of Polk’s Model Craft Hobbies who has had the responsibility of being a digital presence to serve and represent the needs of you the Customer. He’s paid for his work. He’s always been straight with the Customer, and that won’t change now.
As you read this, I’d ask that you quiet your “hobbyist” brain and rely on your “business” brain.
The 2013 Landscape:
• The Large Scale manufacturing landscape has changed dramatically in the past five years.
• The Large Scale retail landscape has been rocked by economic conditions and a major shift in consumer buying habits.
• Large Scale is a niche market.
Primary Source Facts:
• Polks Model Craft Hobbies owns a number of businesses, all of which have operated under one roof in Irvington, NJ (and Jersey City, NJ prior to that).
• Polks Model Craft Hobbies is a privately owned, for-profit corporation.
• The Polk family owns and operates the corporation and annually makes decisions in the best interests of business continuity and profitability, always with an eye toward serving its Customer base.
Here’s the word from the Polk’s … THE Primary Source …
Aristo-Craft is NOT closing its doors “in a few days” … And no one, no “West Coast reliable source”, or “reliable source at a Greenberg Show”, or any other “in the know” technical pundant has the inside scoop about a closing. While the Polks do not have a crystal ball which will tell the future, the closing of Aristo-Craft is not imminent. Aristo-Craft has a container of product arriving Mon/Tues next week. There is also a container arriving in early Nov. The containers will bring a variety of product into the warehouse, not just the upgraded 0-4-0s. As Mark Twain said, “The reports of my death are greatly exaggerated.”
The Crest Electronics business has not been sold, traded, given or otherwise transferred to an Aristo employee, group of employees or any other new owner. The Crest Electronics business has been the Polks’ radio control business for decades (trains, planes and automobiles). It has brought to market a number of innovative products and has done quite well despite larger, hobby related economic issues. The current Revolution system has been very successful and that success drives its expansion. Revolution system components for G will be restocked approx mid-Sept. JK is going overseas early in Sept to the manufacturing site for QC and for development work on a line extension. “Reliable sources” may post that expanding beyond G is a recipe for disaster, a business analysis indicates otherwise … and separating the Crest product line from the Aristo-Craft product lineup broadens the Crest nameplate and allows other gauges to more readily be Customer accepted. ( example - HO enthusiasts wouldn’t look at a G Gauge product lineup for a product directed at them.) For those with short memories, Aristo-Craft is no stranger to the HO marketplace.
RMT / Arist0 was NOT a drain on the company. In fact, it has been quite the opposite. As the G Gauge marketplace continues its anemic buying patterns, the O Gauge market has been steady and fruitful.
A post was made about how the pulling up of the people saw it except as a background in product photography. Gone in a realignment of resources.
The same post mentioned how empty the warehouse seemed on the same visit. It’s a 27,000 square foot warehouse. When business was at its peak it held a few million dollars of inventory and then it wasn’t at more than 75% capacity. In today’s environment that much inventory would drown the business. Today, it’s much more overhead than the company needs. The warehouse is for sale as of Sept 1, as a right-sized facility is sought. The business requires a warehouse that fits its needs and resources, not one that drains it in a business with smaller inventory needs.
So here’s a great example of how “reliable source” information gets it wrong. A post on a yahoogroup reported that Aristo’s buildings would no longer be produced and implied the molds were for sale. Fact = Aristo building for sale. Rumor = building line dropped, molds for sale. Fact = the building line will not see another production run in 2013. Rumor = Aristo out of the building product line.
Today it was “rumored” that a $1M investment had been made in the Company and that would bring with it new ownership. JP Morgan China was mentioned as investing. Not correct. JP Morgan China
bought Sanda Kan from the original US owners. They ran it into the ground and were about to go under. Kader (not Bachmann) bought it from them. JP Morgan China did “touch” Aristo in that that way. They are not a “$1M” investor in any part of Polks Model Craft Hobbies. Lewis, Maryann and Scott confirm that there is not a new owner.
An internet post pointed at Scott Polk as the cause of the demise of the retail hobby shop by taking the Aristo business to consumer-direct. Scott, Lewis and Maryann put a rather startling fact on the table … in the fiscal year prior to the move to consumer direct, sales to retailers declined by 85% . With a warehouse filled with product, and 85% of your primary sales channel gone, the writing was on the wall. Develop a new sales channel or shut down. Going direct kept Aristo-Craft selling. The closing of hobby retailers across the country was driven by issues much larger than the Aristo-Craft sales channel change. In fact, the previous years’ massive retail channel decline mirrored the changing buying habits of consumers in a wide variety of businesses.
The grain of truth behind the rumors is that it’s a very challenging financial situation. Adapt, improvise and succeed. Status quo and go quietly. There are changes, visible and behind the scenes.
There are fewer people working at the warehouse. Never an easy decision.
JJProductions (a Polks company) will have an announcement about not producing a 2014 ECLSTS (fear not! … more news to follow on that)
A keen eye and a sharp pencil will be needed in the coming months to manage P&L.
The company may well have a new address in 2014.outdoor layout in Irvington was an indication of the failed financials of the company and the departure of Aristo-Craft from the marketplace. The layout is gone for one simple reason … it contributed nothing to the business and took time and money to maintain. The property is in an urban industrial area, and hidden behind another building. It didn’t grace a retail establishment but a warehouse and an office. Very, very few
The changes that you will see are designed for the health and longevity of Polks Model Craft Hobbies and its family of companies.
There are the facts from the Primary Source.
The 2013 Landscape:
• The Large Scale manufacturing landscape has changed dramatically in the past five years.
• The Large Scale retail landscape has been rocked by economic conditions and a major shift in consumer buying habits.
• Large Scale is a niche market.
Primary Source Facts:
• Polks Model Craft Hobbies owns a number of businesses, all of which have operated under one roof in Irvington, NJ (and Jersey City, NJ prior to that).
• Polks Model Craft Hobbies is a privately owned, for-profit corporation.
• The Polk family owns and operates the corporation and annually makes decisions in the best interests of business continuity and profitability, always with an eye toward serving its Customer base.
Here’s the word from the Polk’s … THE Primary Source …
Aristo-Craft is NOT closing its doors “in a few days” … And no one, no “West Coast reliable source”, or “reliable source at a Greenberg Show”, or any other “in the know” technical pundant has the inside scoop about a closing. While the Polks do not have a crystal ball which will tell the future, the closing of Aristo-Craft is not imminent. Aristo-Craft has a container of product arriving Mon/Tues next week. There is also a container arriving in early Nov. The containers will bring a variety of product into the warehouse, not just the upgraded 0-4-0s. As Mark Twain said, “The reports of my death are greatly exaggerated.”
The Crest Electronics business has not been sold, traded, given or otherwise transferred to an Aristo employee, group of employees or any other new owner. The Crest Electronics business has been the Polks’ radio control business for decades (trains, planes and automobiles). It has brought to market a number of innovative products and has done quite well despite larger, hobby related economic issues. The current Revolution system has been very successful and that success drives its expansion. Revolution system components for G will be restocked approx mid-Sept. JK is going overseas early in Sept to the manufacturing site for QC and for development work on a line extension. “Reliable sources” may post that expanding beyond G is a recipe for disaster, a business analysis indicates otherwise … and separating the Crest product line from the Aristo-Craft product lineup broadens the Crest nameplate and allows other gauges to more readily be Customer accepted. ( example - HO enthusiasts wouldn’t look at a G Gauge product lineup for a product directed at them.) For those with short memories, Aristo-Craft is no stranger to the HO marketplace.
RMT / Arist0 was NOT a drain on the company. In fact, it has been quite the opposite. As the G Gauge marketplace continues its anemic buying patterns, the O Gauge market has been steady and fruitful.
A post was made about how the pulling up of the people saw it except as a background in product photography. Gone in a realignment of resources.
The same post mentioned how empty the warehouse seemed on the same visit. It’s a 27,000 square foot warehouse. When business was at its peak it held a few million dollars of inventory
and then it wasn’t at more than 75% capacity. In today’s environment that much inventory would drown the business. Today, it’s much more overhead than the company needs. The warehouse is for sale as of Sept 1, as a right-sized facility is sought. The business requires a warehouse that fits its needs and resources, not one that drains it in a business with smaller inventory needs.
So here’s a great example of how “reliable source” information gets it wrong. A post on a yahoogroup reported that Aristo’s buildings would no longer be produced and implied the molds were for sale. Fact = Aristo building for sale. Rumor = building line dropped, molds for sale. Fact = the building line will not see another production run in 2013. Rumor = Aristo out of the building product line.
Today it was “rumored” that a $1M investment had been made in the Company and that would bring with it new ownership. JP Morgan China was mentioned as investing. Not correct. JP Morgan China
bought Sanda Kan from the original US owners. They ran it into the ground and were about to go under. Kader (not Bachmann) bought it from them. JP Morgan China did “touch” Aristo in that that way. They are not a “$1M” investor in any part of Polks Model Craft Hobbies. Lewis, Maryann and Scott confirm that there is not a new owner.
An internet post pointed at Scott Polk as the cause of the demise of the retail hobby shop by taking the Aristo business to consumer-direct. Scott, Lewis and Maryann put a rather startling fact on the table … in the fiscal year prior to the move to consumer direct, sales to retailers declined by 85% . With a warehouse filled with product, and 85% of your primary sales channel gone, the writing was on the wall. Develop a new sales channel or shut down. Going direct kept Aristo-Craft selling. The closing of hobby retailers across the country was driven by issues much larger than the Aristo-Craft sales channel change. In fact, the previous years’ massive retail channel decline mirrored the changing buying habits of consumers in a wide variety of businesses.
The grain of truth behind the rumors is that it’s a very challenging financial situation. Adapt, improvise and succeed. Status quo and go quietly. There are changes, visible and behind the scenes.
There are fewer people working at the warehouse. Never an easy decision.
JJProductions (a Polks company) will have an announcement about not producing a 2014 ECLSTS (fear not! … more news to follow on that)
A keen eye and a sharp pencil will be needed in the coming months to manage P&L.
The company may well have a new address in 2014.outdoor layout in Irvington was an indication of the failed financials of the company and the departure of Aristo-Craft from the marketplace. The layout is gone for one simple reason … it contributed nothing to the business and took time and money to maintain. The property is in an urban industrial area, and hidden behind another building. It didn’t grace a retail establishment but a warehouse and an office. Very, very few
people saw it except as a background in product photography. Gone in a realignment of resources.
The same post mentioned how empty the warehouse seemed on the same visit. It’s a 27,000 square foot warehouse. When business was at its peak it held a few million dollars of inventory and then it wasn’t at more than 75% capacity. In today’s environment that much inventory would drown the business. Today, it’s much more overhead than the company needs. The warehouse is for sale as of Sept 1, as a right-sized facility is sought. The business requires a warehouse that fits its needs and resources, not one that drains it in a business with smaller inventory needs.
So here’s a great example of how “reliable source” information gets it wrong. A post on a yahoogroup reported that Aristo’s buildings would no longer be produced and implied the molds were for sale. Fact = Aristo building for sale. Rumor = building line dropped, molds for sale. Fact = the building line will not see another production run in 2013. Rumor = Aristo out of the building product line.
Today it was “rumored” that a $1M investment had been made in the Company and that would bring with it new ownership. JP Morgan China was mentioned as investing. Not correct. JP Morgan China
bought Sanda Kan from the original US owners. They ran it into the ground and were about to go under. Kader (not Bachmann) bought it from them. JP Morgan China did “touch” Aristo in that that way. They are not a “$1M” investor in any part of Polks Model Craft Hobbies. Lewis, Maryann and Scott confirm that there is not a new owner.
An internet post pointed at Scott Polk as the cause of the demise of the retail hobby shop by taking the Aristo business to consumer-direct. Scott, Lewis and Maryann put a rather startling fact on the table … in the fiscal year prior to the move to consumer direct, sales to retailers declined by 85% . With a warehouse filled with product, and 85% of your primary sales channel gone, the writing was on the wall. Develop a new sales channel or shut down. Going direct kept Aristo-Craft selling. The closing of hobby retailers across the country was driven by issues much larger than the Aristo-Craft sales channel change. In fact, the previous years’ massive retail channel decline mirrored the changing buying habits of consumers in a wide variety of businesses.
The grain of truth behind the rumors is that it’s a very challenging financial situation. Adapt, improvise and succeed. Status quo and go quietly. There are changes, visible and behind the scenes.
There are fewer people working at the warehouse. Never an easy decision.
JJProductions (a Polks company) will have an announcement about not producing a 2014 ECLSTS (fear not! … more news to follow on that)
A keen eye and a sharp pencil will be needed in the coming months to manage P&L.
The company may well have a new address in 2014.
The changes that you will see are designed for the health and longevity of Polks Model Craft Hobbies and its family of companies.
There are the facts from the Primary Source.
Enjoy Your Trains!
TATE
The Aristo Train Engineer
