00:00 President
Stacey is good to see you and have you in the series. Maybe just start Stacey quickly for viewers who look here at home. Can you tell us a bit about your business? I know you had a long period Stacey. So, a little about history and what, what are you all offering the fan of model trains?
00:23 Stacey
Yeah. Thank you very much for inviting me, Josh. Uh, happy to share. We are a 93 -year -old family business. UM, owned and exploited, founded by my great-grandfather which is above my shoulder here. Founded the company in depression. Uh, and it is therefore a real entrepreneurial story. Started his business UM taking something he loved and transformed a business. And then four generations later, we are there. We therefore produce and distribute model railway equipment, essentially helping people make miniature worlds. We are therefore a producer of products in our own range of WALTHERS brand products, UM in just about all categories that help a railway model to do so. And we also distribute 175 lines of the product of others. This therefore includes Lionel and Atlas and a lot of other UM, UM products, and we sell in leisure stores all over the world, but we also sell directly to the consumer. So we are, we are really in this thing and we support this hobby which is a railway model and also hobbies in general.
02:03 President
Stacey, leave, let's go to a big problem which, I know, is at the center for you and many owners of small businesses, who are the Trump prices. Browse us what they mean for your business, training effects. Where, where are your trains made, Stacey?
02:24 Stacey
There are therefore various categories of things that we produce a bit like the big world. You know, it depends on the type of specialized skills you need to do. So, with regard to UH locomotives, as who have digital control and sound and a lot of components, uh and they are very technical, they have a lot of details, like those you put on the screen there for your audience. UM, these are all produced in China. UM, and therefore if we are a producer of this product and that has an impact, it also has an impact on all these other companies that I have just described, which also represent the same UH product. So we have some that are made in other parts of Asia, but if you look at UM certain categories of products, uh, we are never manufactured in the United States. UM is something that was, all the skills was developed, you know, in Japan, it has advanced a little in China, UM, and really the whole railway industry changed its supply chain about 30 years ago. So, uh, with 145%prices, it really questions if we can always bring this product, if we can do it in the long term. Uh, this is a discretionary element. We are in a hobby company, so the price you should increase to absorb this price is fairly expensive for someone who could choose a hobby. UM, and our main customers being uh, you know, baby boomers, people who could have fixed income. And then families at the other end, the new customer we want to get, Uh, these are their budgets are pinched elsewhere by increasing prices. So uh, we, we were struck in some places here.
04:50 President
So, what is the B Stacey plan trying to think about this? If your costs are increasing, is the plan correct, you eat these Stacey costs? Do you send it to the customer, the model train fan? Could it be a mixture of the two? How, how do you try to think about the different scenarios here?
05:13 Stacey
Yes, so we have a lot of scenarios, like many companies, right? Uh, and so it's a bit of both. Obviously, you know, as we want, we must protect our business in the short term and long -term, but our customers are, you know, the way our invoices are paid here. So we have to protect them too. Uh, but at 145, there is absolutely no way you can absorb this. There is no way you can do it. You must therefore transmit an increase in prices. UM, should they come down to a more reasonable level? Hmm, I think we have the appetite to absorb much more and that the impact on our customers is much less. Uh, but uh it's a decision, even at the moment, uh to know if we are continuing the production or not on certain products that we had planned for the rear part of the year. Hmm, so there is a lot to discern. So, in some cases, our customers will be affected because they simply will not be able to obtain the product that we, you know, that we would have originally supplied.
