The writing has been writ large on every hobby wall for the past five or six years, but never more brightly illuminated than when the recession began four years ago. Some of the larger and more established importers like Horizon and Bachmann are pretty much continuing business as usual, but the smaller importers like Rapido, Exact, Broadway Limited, etc...they are struggling to pay bills while still retaining skilled and motivated staff willing to saddle through the tough times as well as the good. While there is still plenty of discretionary income these days, RC and iPads have taken up a big chunk of that.
Model railroadings is going through a permanent shrink, and this is just one of the shrinking phases. I don't mean it will shrink to nothing...far from it. But the squeeze is real, and the smaller players feel the pressure first. Hobby shops have been fading everywhere as oft-lamented by those who have spent years going to them. My own nearest is not a success train-wise, and the best one closed when the boss retired five years ago already. On-line competition is fierce, particularly when well-established etailers like trainworld and M. B. Klein are effectively running the show. Few can match their prices, and when they do manage it (in advertising), they snip a few extra threads off you in shipping.
As a parting comment, when has the HO hobby been better? Look at the quality of stuff available these days, even if you have to hold your nose and offer to buy early and sight-unseen? Okay, you may not find your 50' dreadnought for the Short & Windy Railway, but that can be had with some decals and a hunt for undecs.
