So what happened to MB Klein?

I am one of the many MBK Alumni in the area, and I end up fielding the question “What happened to Klein’s?” a lot, so I’m going to explain my understanding of what brought about their demise.

I worked at MB Klein back in the early-mid 2000s. I think it was 2003-2005. I was in the N Scale department, working for Shane, and built their first eCommerce website. I left in 2005 to focus on web development but the place always kept a warm place in my heart.

I got a chance to check the place out one last time when they were moving in 2007.

The view from across Gay Street. Note the parking lot on the left which they did NOT own.

Looking east from across Saratoga street. Notice the history evident in this photo: The area code-less phone number, the “no parking” sign that’s moved up from where it used to be. The bricked in basement window.

Still looking across Saratoga St. This is the MBK “loading dock” where trucks would have to pull up outside, and have everything tossed through the small gray door.

Note the old garage door. I don’t know what’s the story with that. There’s nothing corresponding to it inside.

Looking north from the south corner in the back of the store. This is the N scale section that I called home for a long time. The cases contain IM, Athearn and Kato cars. Note the protruding furnace on the left.

The wall of track. This is the north wall of the N scale area. You could find almost all the Unitrack, Atlas, Kato & Peco stuff you could find.

The wall of Micro-Trains and Atlas freight cars along the south wall of the store.

Looking over the checkout counter at the bank of credit card machines.

Look at all that empty pegboard! This is the north aisle looking toward the front of the store. The pegboard on the right used to hold many N scale detail parts and structures. The drawer looking things hold the stash of Microscale decals. There ARE a lot of them there.

Looking up the central aisle from the back of the store.

Standing in front of the checkout counter looking toward the front door.

Looking down the central aisle with some last minute shoppers. Notice the lack of “passing lanes”.

Looking toward the front of the store was off to the left between the vertical pegboard and the EZ Track rack.

Looking down the “South” aisle toward the checkout counter in the distance.

Looking south from the north corner of the store.

Bob of the large scale department helps with some packing. Yes, they were packing stuff the whole time I was there.

One of the interesting things about the Gay St location was that it had more security cameras than a Las Vegas casino floor. There are a number of reasons for which, none of which I’ll get into here.

Looking into the large scale room full of empty shelves.

he test track layout inside the large scale room. G on the bottom, 3 rail O on the next, two loops of HO and then one of N at the top.

Another shot of the test track layout, from the back.

And a closeup of the layout. Pardon the flash.

An overview of the general shipping area.

Here’s a closeup of the now vacant shipping area. The hopper looking thing was a great help in packing orders. It holds about two large bags of packing peanuts and gravity feeds them into boxes held below. If you ordered stuff from MBK before, and it arrived safely, this is why!

This used to be my desk. Notice the curtain in the background. That was the result from my pleading for a way to stop the cold air from coming in from the back un-heated room.

Another shot of my old desk area. The curtain helped with the drafts, but nothing helped being this close to the bathroom (on the back left).

This was another very strange site. This used to be the N Scale Manger’s desk

The front stairs leading up to the warehouse. Out of frame to the left is a sign that says “please use other stairs”.

The view from the top of the front stairs into the warehouse. It’s VERY strange seeing it this empty. This whole area used to be packed from ceiling to floor with stuff. N Scale on the left, HO on the right.

Note the steps to the left. This is another view of the warehouse looking back from the front of the building.

The warehouse again, looking toward the front of the building from the back. Noticed the blacked out windows at the front.

The entryway to the office on the second floor.

This is the other half of the upstairs warehouse. This used to house large scale merchandise. It also was always full from floor to ceiling.

I believe these are the arms that I removed from a chair YEARS ago when its previous user left it “gull winged”.

The MBK warehouse had a surprising bit of marker graffiti in it from ages of employees. It’s my understanding that at one point there was a guy who worked there who was a real pervert. There were a bunch of things about him written and drawn, but no names were ever mentioned.

I love how this was written and dated, and then shelved over. That’s the story of MBK.

Work work work. Get back to work. If you know, you know.

I’d hate to think what will happen if this warning is not headed.

I wonder how someone got up high enough to write THAT on the wall there.

It was shocking seeing this scene just a few months after they closed up shop.

I’m surprised that the lot wasn’t completely flattened.

I was excited when they moved to Cockeysville from Baltimore because I lived nearby and now they were convenient to pick stuff up from. I still remember the time (well, some of it) that we visited the store after the Beer Bourbon and BBQ festival. I don’t remember what I bought, but it was a good time. I was also excited for them because Shane and my dream, back in the day, was to turn the company into the Amazon of model trains. The move to Cockeysville was a big step on that journey and for a while it looked like they were succeeding at it.

I found some photos of the new spot, and while I wasn’t able to get photos of the warehouse, here’s what the store looked like. Quite a difference from the old location.

All sorts of things happened in the intervening years, but I’m going to focus on what has happened in the past few months that brought about their end. I haven’t wanted to conjecture and feed the rumor mill, but now that the dust seems to have settled I wanted to share a bit of what I’ve learned. I don’t have any real insider information, but I’ve gathered some bits and pieces and have put it together here.

First, MBK/ModelTrainStuff.com was a sole proprietorship owned by Ted Klein. Ted passed away in 2020, leaving the business to his long-term (very long term, they were already together for ages when I worked there) girlfriend Elaine. Elaine owned it until she passed a little while later and the business’s ownership passed to her daughters.

The daughters wanted out of the business and so were looking to sell it for the maximum value while also extracting what they could from it in the interim. I don’t blame them, you can make money in the model train industry, but you really have to have your head in the game and have some hustle. It’s not the type of thing you’d really consider “passive income”.

In England, Hattons had been looking to get into the US market to help offset the instability and challenges they were seeing in post-Brexit Britain. They made an attempt in 2022 but that does not seem to have taken off. To try again I think they lined up a partnership with Heartland Hobby (who they might’ve already had a relationship with due to their previous US efforts, but this is pure speculation) to handle fulfillment and to use the MB Klein relationships, customer base and other business infrastructure.

In Colorado, Intermountain also saw a chance to do some vertical integration following the Broadway / Factory Direct Trains model. Intermountain was already a distributor, but they could now become a retailer as well.

There might’ve been other plans in other quarters as well but I haven’t heard anything about them.

The Intermountain and Hattons plans were being formulated against a backdrop of rising interest rates and, I’m guessing, declining cash reserves at MBK. This might’ve been because of the way the MB Klein finances were set up (they were very intertwined with Ted’s personal finances). Those two things would’ve made other options, like an employee buy out (which would’ve been awesome) difficult.

Intermountain came to the table and MBK was ready to sell. Apparently Hattons showed up with a bigger check at the 11th hour and won the brief bidding war.

In the meantime, economic conditions continued to change: interest rates continued to climb and Hattons domestic position was continuing to decline. Elaine’s daughters, however, were happily out of the model train business.

From what I understand, the Hattons team did their best to arrest the decline of the remains of MB Klein, and tried to transition to the new model, but it did not work out. I believe there were issues with order processing and the ability of Heartland to handle the capacity needs of retail fulfillment (as opposed to wholesale). This made the whole plan untenable. I have also heard that there were issues with out of state sales tax payments that likely also sapped the company of its cash reserves.

Somewhere along in here MBK closed the majority of its Maryland operation because the stock remaining there did not justify the costs of the operation in a high cost location.

Eventually, the whole thing came apart. Hattons UK’s US rescue plan fell apart and they knew it was time to pull the plug. I’m guessing the final bricks were falling in the US too, and we finally saw the last one tumble.

I had a chance to swing by the old US location on January 29th, 2024 and audibly gasped when I drove into the parking lot. All of the signage is gone and there’s no indication that the company was here.

I’m incredibly sad to see the end of MB Klein. Keeping a company like that alive for over 110 years was an amazing feat, but it’s tough to escape the trap of being a “family business”. The entire team who was able to keep it going for so long, especially at the end in the face of such challenges deserves commendation. I feel terrible for them, especially the long-time employees, now having to find something new to do. I feel bad for the local model railroad community that has lost a strong support pillar. I know, personally, the ability to place an order in the morning and pick it up on the way to the grocery store that afternoon will really be missed.

My best wishes for the entire MBK team. I hope you all move on to new greater things.

Conrail 1285

The model railroading website of Ed Kapuscinski.

So what happened to MB Klein?