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Vol 30 - No 06 - September 2004 Strategic Outsourcing in the Toy & Hobby Industry: The Hornby Case Study Hornby’s business is the development and supply of hobby and toy products. The company’s two principal brands, Hornby and Scalextric, are distributed through a network of specialist and multiple retailers throughout the UK and overseas The Hornby decision to outsource its manufacturing to China was taken against a background of difficult trading conditions and low profitability. Prior to 1996, the company had diversified its product range to insulate it against the effects of the competition from computer related game products but this resulted in a lack of focus on the two core brands. A new chief executive renewed this focus by dropping non-core brands and the decision was taken to outsource manufacturing of Hornby and Scalextric products. The primary objective at the time was to achieve cost savings but the real benefit has been to leverage these cost savings to create real value through an improved product and increased sales. Page number: 14 Word count: 3000 Related Topics: Outsourcing Strategic
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