Otto and his mother arrive in the cold, grey town of Hodorf, where his mother plans to make and sell coats. Otto is doubtful, and when she leaves the inn where they are staying to run errands, and doesn't come back, doubt is replaced by dread. Hodorf is a place full of young thieves who call themselves the Tattercoats-- raged children who sleep curled up next to the town's chimneys, sometimes freezing to death, and always hungry. Two of these kids target Otto on his first solo expedition to look for his mother. One, Nim, takes his money, and another, Blink, takes his coat.
Nim is kind-hearted, and returns almost all of his money...but it's not nearly enough to keep paying for a room. So when another girl speaks kindly to him, and promises to lead him to a place where he'll be warm and looked after, he goes with her. This "sanctuary," though, is a terrible shoe-polish factory, whose cruel owner enslaves children in classically evil gothic child-worker style.
Nim, though, can't shake a feeling of responsibility toward Otto, and so she and her pet rat manage to get him out. Now he too becomes a Tattercoat, but is no closer to finding his mother...And at this point the story swings toward the truly fantastic, when Nim, Otto, and Blink set out into the woods outside the town, which are full of dangerous magic that's full of echoes of familiar fairy tales. Giants, dragons, witches and enchantments await....
If you like plucky kids on their own, in both mundane and magical peril, being fiercely loyal to each other, and banding together against a cruel world, this is a book for you! Otto is a protagonist without particular agency, but Nim and Nibble, the rat, have enough for the both of them, and Blink is a solid contributor to the party, with an interesting bit of back-story. As I said, I think it would make a lovely read-aloud; though there's danger and unhappiness, the familiar fairy tale echoes and the good-heartedness of many of the characters give it a cozy feel--Otto's mother is found and the greedy bad guys get their just come-uppance! I agree with Kirkus on this one--"Both charming and wise."