Reducing costs while preserving safety - can it be done?

It may cost 8K BUT no-one has yet noted the contribution from the charters organised by individuals who have a list of supporting photographers. I presently support
one organiser who charges £50-75 per charter and who can rely on around 30 - 40 photographers to join his charters. Depending on the locomotive and the charges this one organiser can provide a charter contribution varying between £3000:00 [40 @ £75:00] and £1500:00 [30 @ £50:00] which provides a generous reduction in the number of "bums on seats" needed; if a locomotive can generate 4 or 5 charters then these may actually cover all the movement costs and the "bums on seats" will be mainly profit - less the cost of running / hire charges negotiated between the owner and the operator.

A more recent example came last October when a narrow window became available to have at least 3 - and possibly 4 - consecutively numbered A4 Pacifics on display at Shildon; within 48 hours of the appeal being issued sufficient photographers committed to the £60:00 fee and those who turned up gained an unrepeatable collection of night scenes that more than justified the cost and time.

Tangential perhaps but charter income is another element of income that is often dismissed as "photographers who don't / won't contribute" but who help fund a wider range of locomotive moves that few either realise or appreciate.

 

There have been cases where a loco has only visited if the movement costs have been covered by funds raised from charters.

 

I can only speak as I find and I stand by what I said. There will be exceptions of course.

 

Given the number of "Mr & Mrs Smiths" I've seen at railways where Tornado attends, at least one loco attracts more than just "fickle" enthusiasts. Discount enthusiasts at your peril as they are the very people who support major fund raising drives around the heritage railways.

 

It's not quite as clear cut as that though. A big engine (since that is what we are talking about) will use a ton of coal just to light up, and another ton even if it does not much more than potter up and down on a few run pasts. Add in a steaming fee (which these days will likely be the wrong side of £500 even if the owner is recklessly generous) and the charter could cost well upwards of £1000 to put on, even without factoring on the wear and tear on rolling stock etc. OK, the gross income may still exceed that figure, but not necessarily by much. The real benefit to the railway, to defray against the £8k transport bill, may be as little as £500 per charter, rather than the £1500 to £3000 you imply.

Tom

 

I must admit these days I'm less keen on galas than normal days, at least from a footplate point of view. Quite often, because the day is long, it gets split and you end up with two unsatisfactorily short turns, often with a lot of hanging about, rather than one good turn. I get more satisfaction from running the regular service well - to time, with a minimum of fuss.

That said, I quite enjoy some galas to visit, though increasingly it isn't the engines that are the attraction - rather, it is the opportunity to see "behind the scenes".

The other point about galas, at least the traditional "mega gala" (as practised so effectively by lines like the SVR and the WSR) is that to a large extent, they are preaching to the converted, by attracting railway fans who would probably visit the railway at some time anyway. Whereas there ought to be lots of opportunities to attract people who might not otherwise visit. To some extent wartime weekends do that, often drawing in a clientele of re-enactors and people interested in things other than railways, for whom the railway just makes a nice backdrop. I'd like to see railways try to broaden their base, but within a setting that makes logical sense on the railway. How about 1920s weekends for example, or combining with a local vintage transport group? That way, you don't necessarily incur the mega-cost of hiring in locos, but still provide something a bit out of the ordinary, and likely attract a clientele who may not otherwise be part of your core market.

(A non-railway example: The Weald and Downland Museum at Singleton is primarily concerned with preserving old buildings, and no doubt their core market is people interested in such. But once a year they hold a steam rally that attracts an entirely different demographic, but who are then able to see what the "core" Singleton product has to offer and thereby may be induced to come back at a quieter time for a good look round).

Tom

 

I know the premise of the thread is about reducing costs, but increasing income must also be part of the equation, and within that is charitable donation.

Much earlier in the thread, someone (Sidmouth I believe) expressed something of a distaste for such fund raising. However, my own feeling is that it is an essential part of the armoury. Indeed, I can't think of a single museum or heritage attraction with which I am familiar that doesn't use charitable giving to help support its activities. It's naive to believe that, just because we often charge a "fare" rather than an "entry charge", that somehow fare income alone, or some combination of fares and food and filming will keep the railway afloat. It won't, at least not if the real costs are factored in, rather than using up whatever residual value was in the assets we inherited from British Rail.

So fundraising is here to say (and that does mean, despite my comments above, that there is a place for special events and similar that keep enthusiasts motivated). What surprises me is that, with a few exceptions, we as a movement are actually a bit apologetic about fundraising. A very typical scenario is lots of unattended collecting boxes, collecting for everything from an engine to that exquisite, but derelict, Much Muddling and Little Snoring Railway fruit van, along with a few boxes of second hand books and videos, an honesty box and a faded note about the "station canopy appeal". Such a strategy has two effects. Firstly, it provides almost no insight into the donor: who are they, and what motivates them? And secondly, it gives an impression that everything about the railway is equally important - in other words, there are no priorities. Whereas as has been shown (I could mention the obvious, but for a change, how about the GCR bridge appeal, or the IoWSR carriage underframe appeal?), when a railway settles on a really key priority and motivates everyone behind it, remarkable amounts can be raised quite quickly.

Others on this thread have said that it is vitally important to know our customer, and why they choose to visit. But equally - know thy donor. How many railways really understand who their altruistic donors are, and why those people choose to donate?

Tom

 

Many good comments in this thread. Two items particularly stand out for me though and resonate with my own experiences.
1. Cash flow is the key. It doesn't matter what the profit is (when you can claim grants and get labour for free this is fairly meaningless other than a way to keep score with last year), the cash has to be there, and has to managed most carefully. Financially everything else is secondary, and all possible available (legal) sources must be tapped.
2. Leadership is critical in getting and keeping volunteers. I'd add that few (very few) railways will be able to achieve the balance of cost and revenue necessary to dispense with or even substantially reduce volunteer labour.

I notice though that few have addressed the original question, which was about preserving safety. I'll put it this way. Safety is in itself a cost saver. Unless you are running a completely cavalier operation with no regard for safety whatever, (and ultimately this will always catch you out eventually), a safe operation is also cost efficient. Safety is not negotiable and the heritage railway performance in regard of safety has been causing the ORR (HMRI exists no longer) considerable concern. So yes costs will have to be controlled hand in hand with safety.

The biggest challenge to most railways is to shift ways of thinking. To learn from the modern business world and adapt the concepts to the heritage railway. The age of preserved railways is causing a "hardening of the arteries" and a certain reluctance to try new ways of doing things. It's maybe a brave pill to think about employing a project manager, and allowing them to actually do their job to plan things better, rather than hire another two people for the shop, however the project management approach might save enough money through better coordination of resources to pay for the shop staff too. By the same token importing management methods and attitudes from the modern network railway into the heritage sector is not likely to work at all well outside of the training and competence regime where I think we can learn from them (emphasis though on learn from, not on adopt without modification. Our railways are not the same.

 

I think 21B's post is spot on - our business is to preserve the past, but that doesn't mean we can't apply the best of more modern ways of doing it. (We are all enthusiasts for historic railways I presume, yet we discuss our enthusiasm on an internet forum, so this concept should be familiar enough!

To go back a few posts, 61624 has mis-understood my comment about "doing less is not the answer". Clearly, I am not suggesting running 364 days per year - operation has to have a good chance of covering the direct costs involved to be able to make a contribution to those fixed costs (and that depends on the extent and cost of operating). However, the less you run, the bigger share of fixed costs each operating day has to bear. Clearly, the summer school holidays should be able to bear a greater proportion per day than a non-holiday week in April, but contribution is still contribution.

But another key part of my argument is that infrastructure costs especially, but also elements of locomotive and rolling stock costs are not driven by usage but by age and the passage of time. A boiler will need stripping for full internal examination every 10 years (or so) whether used much or not. A metal bridge will rust and need replacement and using it 100 days per year instead of 150 may at best buy you a few months (for the cost of replacement to rise further!)

The argument of "tell them when you are running and they will come anyway" has a logic to it, unlike the British weather which is its main enemy! Take last week - Friday better than Thursday on the NYMR due to the weather being better (or perhaps more accurately, being forecast to be better). Likewise, bothy passengers and volunteers may be free on certain days and not other. The number affected may not be enough to materially affect the decision but they may be.

And not running individual days has its own costs - how much can engineers get done in a single day (especially that they can't do with a sparse service running around their activities)? Will locos need keeping in light steam to be available for the next time they are running? If so, who is going to look after them? True, none of these apply if you don't run all week, although engineers tell you preparing for weekend operations looses at least part of the Friday and putting away at least part of the Monday. Don't run at all for a week, and passengers can't transfer by a day or two.

I believe answer is to have a clear picture as to when contribution can be made, have tailored services to minimise costs of operation at marginal periods (the adequacy of service needs to be judged against no service, not the peak most regular service provision!) and run as efficiently as the market can be served at all times but don't think that a world in which the engineers can get on engineering without those nasty train services interrupting for the bulk of the year will be a financial panacea!

Steven

 

Just a further thought on costs vs knowing your customer vs (loosely) safety.

If we assume that employing CWR would reduce the maintenance bill (and the lose connection is that safety is not diminished, in fact maybe improved by using the money saved on track inspections/maintenace elsewhere in the safety regime) how does this fit with customer expection of old/steam railways having a 'clickety-clack' sound. Is 'clickety-clack' important to the general customer, do they notice it, does its abscence spoil thier day, will it be a factor in them coming back or recommending the line to thier friends. You can measure the costs saved but can you measure the impact on the customer.

I dont think railways really know what is important to thier different customer groups and how that affects spend and future visits, what the contribution of doing or not doing something is - be that special events, big loco hire, or CWR. If, and its a big if, such factors could be quanatified then you have a reasonable basis on which to tailor the scope of operation and therefore costs.

 

I'm not sure you are correct in assuming the second will raise more revenue, certainly not more revenue than it costs to provide.

If you are going for historical accuracy then you would have to strip away all the museums, gift shops cafes etc etc....oh and most of the train services and with them goes most of your revenue.

As you say Joe public on the whole doesn't care that Sir Keith Park never ventured up the SVR in BR days its just a big steam engine to most people.

The Kingswear line is an example of the first scenario doing quite nicely.

 

On the whole I agree with you Simon, but what I would (in an ideal world) envisage at the historical accuracy end of the spectrum is perhaps a limited number of days when real accuracy can be provided and to charge a premium price for this, and I mean a real premium price not £25, the vision I woudl have would be something akin to stepping onto a movie set. I dont think it will happen but I used the point to illustrate that railways are closer to the day out end of the spectrum than the historical accuracy end, which is probably in complete contrast to many other hertiage attractions, so are railways selling hertitage or a day out, and what do the customers want.

Relating to the fact the public dont really know/care that SKP never ran on the SVR, you are Im sure absolutely correct, to most a steam train is a steam train. This is also extended into the world of TV & Film (which is a bugbear of mine - just ask my wife) where seeminghly any steam train can be filmed in a period drama regardless of the fact that it was built x-years after the period of the drama, and worked hundreds of miles away from the area where the drama is set. Taking Downton on Sunday, I almost ruined my wifes evening as I pointed out that we had an SR loco, built (Im guessing here - forgive my lack of knowledge of things south of the Thames) in the 30s (maybe late 20s) pertaining to be on a Yorkshire - KX service in 1922. Now if you had thrown a 1930s bus or car into the scene then there would have been outcry that it wasnt accurate, but seemingly a steam train is a steam train is a steam train - and this would appear to me to be view of the public as a whole.

So to bring us vaguely back on topic are railways spending more money than they should striving for historical accuracy when they need to provide is a steam train ride. If we are just providing a ride then costs can be managed accordingly and then there coudl be a place for a very high end very accurate depiction on a limited number of days.

 

The problem here is that there is a discrepancy between provider and consumer in that the provider [in many cases] simply wants to run trains with minimum effort given that it requires an uncertain mix of permanent staff and volunteers to provide the facility whereas the consumer / customer is looking for an "experience" which is why I would say that theme days such as War Days; 1960s Galas; Halloween Horrors; Santa Trains etc are successful as the "experience" can be a focal point to both provider and consumer.

In the more mundane day-to-day operation, when only a train service is provided, it is difficult for the heritage line to gauge WHY their customers are there and WHAT precisely they expect from their visit. In essence this sees some lines advertising themselves as a means to an end [ e.g. the SVR to either travel between Kidderminster and Bridgnorth OR take the train to a local station then walk back on a local footpath; the ELR to explore the Irwell valley by taking the train to a station for access to local footpaths] whilst others project themselves as part of an experience in itself [ e.g. the Bluebell which promotes the "Victorian" ethos of train running].

Given this divergence it is difficult for any heritage line to provide the appropriate level of service in which the maintenance aspect is an inherent part of the operation. In this context it is reassuring to note that the Churnet Valley Railway, despite its current lack of weekday services, has a regular prominent way team which maintains and improves track lengths as reported on this forum. This is not to say that other lines do no not operate similar teams but it may be worth railways alerting customers to the activities other than running trains which they undertake as part of the railway operation. There may even be a market for people to come and watch coachwork being undertaken; engineering skills such as locomotive repairs being made and signal box operation so that customers can not only only travel on the train but see what is involved in keeping the train moving.

In other words why not extend the experience of a train ride to an experience of railway travel - and all that involves in terms of teamwork.

 

The same can apply to medium or small engines. 10 years ago we did our second and, probably, last "hire-in" gala. The loco was historically and geographically appropriate for our site, complemented our buildings and rolling-stock perfectly, was unique and had never before, in preservation, operated away from it's home railway. In addition, we negotiated a favourable hire fee and got a very good deal from a cooperative haulier who was willing to bend the rules to the extent of carrying the loco and tender as one load! Yet even with all those advantages we barely broke even and would have made a substantial loss had it not been for photo charters. Why? First, in spite of substantial local publicity (another cost) the local "normal" population remained unimpressed and I doubt that we attracted any more of them than we would have done using our resident industrial tanks. We got plenty of enthusiasts- I was concerned that I seemed to know most of them!- but, as has often been said on this forum and elsewhere, there just ain't enough of 'em! What's more, as far as steam is concerned, they are a dying breed (put on tin hat!) Second, we had failed to realise the higher operating costs of an ex BR loco, even a relatively small one. These consisted of three times the expected amount of coal and so much oil that it became a highly noticeable cost and we had to send out for emergency supplies on the third day of the event.

Earlier in this thread, someone mentioned their experience of running, then abandoning, "Thomas" events. We had a similar experience. When we started running them, in 1993, they were the nearest thing that I had ever seen to a licence to print money. You just put painted faces onto your own engines, got someone to dress up as the Fat Controller, then dumped the resulting bags of cash into the night safe each evening, having paid Ms. Allcroft less than 5% of ticket receipts. Of course, it was too good to last. First came the obligation to hire-in a licenced "Thomas", at three times the cost of an equivalent "normal" loco. Then, as the copyright was sold on to a succession of private equity companies, the royalty fees escalated, more railways were allowed into the scheme, thereby diluting the market, and the copyright holders became more more determined to interfere with the running of our railway. Eventually, by 2004, we were wondering the game was worth the candle. Then a succession of events made our minds up; the gentleman from whom we hired the "Thomas" loco decided to jack it in, because he was losing money on the deal, our Fat Controller sadly departed to the great marshalling yard and our caterers decided to cut back on their commitments. Someone was sending us a message and we received it and got out of "Thomas" in 2005.
The results were interesting and relevant to this discussion. "Footfall" and turnover were drastically reduced, by about 50%, but profits were hardly affected. Our safety record improved, the number of nuisance incidents declined to almost nothing and we were able to concentrate on our core business. Most important, we and our volunteers were, for the first time in a decade, happy and stress-free. So is turnover and footfall everything? Certainly not!
Interestingly, several railways are still involved with Thomas. Do they know something I don't? Are they really au fait with their accounts? Or are they just desperate?

Because I run a railway I don't get out much, at least not to other railways! When I do, it surprises me that most lines allow people onto their premises without charge. This is a major income flow going to waste. Why?

In answer to the original question, keep it simple, don't employ and remember, it ain't gonna get any easier!

 

Because it's part of the visitors "experience" and IF the entry charge is too much then it could discourage other income streams. I buy books to support heritage lines and one line local to me has a good range of both new in the line's shop and second hand in the supporters shop. On my infrequent visits I can spend £20:00 + on books alone BUT the line concerned charges £5:00 admission fee to the platform hence my reluctance to visit too often.

Sorry but that charge is too much so I buy elsewhere. I might be prepared to pay £1:00 for admission but given that I spend on both books and refreshments when I visit the particular line then I find the admission charge at its present level to be a real put-off. To put this into context I spent £50:00 last weekend at the SVR Gala including the commercial stall at Kidderminster and the SVR support stall at Hampton Loade. As a photographer I didn't travel or buy a ticket to travel but felt that my purchases had been an adequate support to the SVR for the time spent in the area where I spent a further £300:00+ in the local community on goods and services - a point which was raised earlier in the relationship between the heritage line(s) and the local community.

 

Surely the answer to an admission charge is make it refundable against other purchases

 

Yes, some railways do think that an ex-Big Railway manager can run a a heritage railway. The answer to that is that some can, a lot can't, but to dismiss an ex-Big Railway manager for the job out of hand is as foolish as assuming that they are bound to have all the skills needed to run a heritage railway.

As for my own background, in chronological order:

Founded one preserved railway - one that seems to be highly praised on here
Was an every-weekend/holiday volunteer for two or three years in the early days of another
A senior business manager (non-railway)
A management consultant
A senior Big Railway manager
I sadly had to decline the GMship of one heritage railway because I couldn't afford the terms

That probably makes me a bit different to the average Big Railway Manager.

 

Very true and pretty good credentials. Thank you for responding. I asked the question because my experience of ex Big Railway managers (or more precisely those with no volunteer credentials) running heritage railways is that paid staff are the easy option but, as we all know - and what this topic is all about - for many railways cash in < cash out.

 

Back in the 90s the NVR used to charge an admission fee at Wansford. Initially it was non refundable and did get some criticism from some visitors. Then it became refundable against a travel ticket but even that drew criticism from some people who weren't travelling. On the whole the system worked pretty well. Not sure what the current situation is.

 

People are responding so quickly that it is difficult to reply in sensible order but......

A lot depends on the railway concerned, to give one example there are lines that are possibly using the brake blocks their Mk 1s came with when they were bought in the 1980s, others my see a coach get through 2 or three sets in a season. These are costs that are difficult to attribute to particular parts of the season. Other examples include wheel flats that need costly rectification and are more likely to occur in off peak periods when rail conditions are likely to be worse. Loco springs aren't more likely to break in the shoulder season, but are more likely to do so the more miles are run. As for boiler costs, it will be interesting to see how the Tyseley model of light usage over a 10 year period reflects on overhaul costs, but I'd have thought that costs are roughly proportional to usage. I'd aslo have thought that the actual cost of stripping and inspection pales into insignificance compared to the cost of repairs!

The problem we face is that most lines probably do run a reasonably effective service and big savings are going to be hard to find. If that's the case the only solution is to try to squeeze as much as possible by smaller economies that have a chance of building collectively into bigger ones.