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Operating a Model Railroad
Operating a layout executive summary

Operating a model train layout does not mean the same thing to everyone. In general model railroad operation refers to going beyond the running of trains for fun and a move to the simulation of railroad activities. For some operation is the duplication of a railroad as a business while for others it is the duplication of a section of a prototype railroad on a given date and there are many other variations. Do not expect a canned solution to match your desires.

To operate a model railroad you need several things regardless of how you personally define the term operation. Two trains can not be on the same track at the same time so you need a way to control the rights of a train to be on a section of track. You also need something to do, trains to run and normally cars to pickup and deliver.

There are three primary means of controlling the rights of trains for railroads of American prototypes:
Time Table and Train Order : Requires trained crews and very little hardware
Automatic Block Signals (ABS) : Requires a lot of hardware and you need to do a lot of wiring.
Centralized Traffic Control (CTC) : Requires a lot of hardware and you need to do a lot of wiring.

To simulate the paperwork that directs the movement of cars on the railroad there are two primary methods used:
Car Cards : Manual system with cards for each car that have a way bill pocket that holds a smaller card that gives the car route. Cost is low and the feedback about what is going on is low. A lot of people know how to use the car card system.
Computer Printed Lists : Many different system choices available. Some systems will print reports/lists that are very close to the prototype. Can be hard to learn how to use and setup, plus you will need a computer and printer.
A third less common option for car routing is car tabs where a color coded tab is carried by by each car to provide the car routing information

For anyone just getting started I think car cards are by far the best option.
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How to setup and use Car Cards
How to setup and use Car Cards 

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