Hobbico the owners and importers of Revell and Monogram models (2007) has filed for bankruptcy!

So we now wait for the outcome and how it will effect the brands and distribution to the outlets both Internet and brick and mortar distributors and stores alike.

Thu, 01/11/2018 - 7:00am | Ben Zigterman.
The company announced Wednesday that it has filed for bankruptcy.

CHAMPAIGN — One of the largest hobby product distributors in the country filed for Chapter 11 bankruptcy protection Wednesday, which could spell trouble for the 332 employees at its Champaign facility.

Hobbico, formed in 1985 when Clint Atkins combined Don Anderson's Great Planes Model Distributors and Bruce Holecek's Tower Hobbies, said it plans to sell the company and will continue operating throughout the bankruptcy process.

As it has grown, Hobbico said it has added too much debt and hasn't been able to successfully restructure, especially facing "an increasingly competitive industry, market headwinds and a series of one-off events with key suppliers."

In its filing with the U.S. Bankruptcy Court in Delaware, Hobbico said it has an estimated 200 to 999 creditors, $10 million to $50 million in assets, and $100 million to $500 million in liabilities.

"Despite Hobbico's core strengths, our business has faced a number of challenges in the last few years, and we have taken steps to ensure all available options to restore the stability of the company have been exhausted," said Louis Brownstone, Hobbico's president. "However, while these efforts were taken to rebuild revenue and profitability, they did not sufficiently address our challenges, and we decided to pursue a Chapter 11 reorganization and attempt to attract new capital investment."

Also on Wednesday, Hobbico sent a notice that 'mass layoffs' could begin in April, though the company hopes to avoid them.

"Upon the sale of the company, it is possible that there will be a permanent shutdown of all Hobbico operations and locations and the permanent termination of all Hobbico employees, including the permanent layoff of all 332 employees assigned to the company's facility at 2904 Research Road, Champaign," Human Resources Director Howard Salazar wrote in a letter obtained by The News-Gazette.

The Reno, Nevada distribution center will close February 28.


Interesting times ahead.

Yep-- this has been discussed in at least three different posts now on Kitmaker-- I started one of them myself. My experience with Hobbico is contained to what happened back in 2007-8, when the president of Hobbico sat down with the "Big 7" hobby distributors, and carved out what would happen to the Hobby industry in the US, and who would distribute what and to whom. In so doing, they put several competitors out of business that we were dealing with at our LHS (we were also local wholesale distributor for Testor's, Academy and Italeri at the time and had a direct relationship with Monogram, who owns Revell). Although it didn't affect our wholesale business much, it did cause us to find different distributors where we were dealing directly with manufacturers before. I suspect the reverse will happen now-- and perhaps the manufacturers will go back to directly selling to wholesale distributors (if there are any left), which would be good for some of the LHS that are left, as long as prices are controlled. Along with that, we might be able to hope for some small price decrease--maybe, but I doubt it. There's no mention of the manufacturers in the Hobbico statement, which is also a good thing. The 332 jobs at risk seem to be at the Hobbico HQ. If the major plastic manufacturers (Monogram-- who owns Revell; Italeri, and the other "divisions" of Hobbico, etc.) can make it on their own without the "parent" distribution leadership,we shouldn't see much change-- I hope. Now that I'm "fully retired" and "out of the LHS business", it doesn't matter a whole lot to me personally anymore-- unless of course it interferes with the announced "new tool" release of Revell's 1/72 PT 109 in February!
VR, Russ

Revell of Germany is a seperate company and they plan on business as usual for now, as per their press release. Hopefully someone takes the RevellUSA molds off their hands, if they hold any interest . If they are simply a distributor - oh well. Was never a fan of sole distributors - that's who gouge prices. Tamiya did fine after dropping RiKo way back when so we will see!
Personally I think they entered the drone market too aggressively. Multiple brands and really probably didn't understand the market. It ain't RC! Sadly the employees will pay the price. Not only are they probably getting laid off their pensions / 401ks will be almost nil as are their stock options which fell by 85%. There was already a labour standards investigation going due to benefit payments not being paid out since 2016. Very sad!

Julian,
Yes, RoG is a separate company. Folks have been saying that in these posts. Unfortunately there is a connection between RoG and Monogram (who owns Revell USA), as they share many of the same molds. And also unfortunately, Revell, RoG, and Monogram are managed and distributed in the US by Hobbico.
VR, Russ

That sux. Never a big Revell fan except for 1/25 stuff but hopefully they will be reborn!

Round 2 Corp has a close relationship with revell as far as molding and working to help each other. I would expect some if not all of the line to end up with them. They have worked to save other lines and brands in the past.