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In lugnet.lego, Arne Lykke Nielsen wrote:
> Hi,
>
> Just noticed this press release:
>
> http://www.lego.com/eng/info/default.asp?page=pressdetail&contentid=12504&countrycode=2057
>
> Kjeld Kirk Kristiansen retires, and LEGOLAND parks will be a seperate company,
> after new losses this year.
>
> Arne, Copenhagen
Follow-up: In the Danish TV News, in two interviews,
the new CEO said, that most of the production would probably be moved to China
(where Click-its and many parts are already made)
and
KKK said that the trouble for LEGO was that they had focused too much on growth,
and had becomed too dependant on licensed products, as opposed to the basic
brick !!!!
and furthermore it was mentioned, that KKK will give 800 mill DKr (appx 140 mill
US dollars) of his own personal fortune to TLC.
Arne, Copenhagen
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|
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In lugnet.lego, Arne Lykke Nielsen wrote:
Snip
> Follow-up: In the Danish TV News, in two interviews,
> the new CEO said, that most of the production would probably be moved to China
> (where Click-its and many parts are already made)
Snip
> Arne, Copenhagen
well, i weathered the color change, & lego ultra-juniorization/B.U.R.P etc.
garbage, but this might break it for me. Lego, you darn well better absolutely
NOT use slave labor & conditions!!!! (although that's probably what they're
counting on to cut costs by going to china. I don't wanna hear about poor
abused children being forced into making one of the best toys invented FOR
children. way to go Lego, you really tick me off.
Jeff
|
|
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In lugnet.lego, Jeff Szklennik wrote:
> In lugnet.lego, Arne Lykke Nielsen wrote:
>
> Snip
>
> > Follow-up: In the Danish TV News, in two interviews,
> > the new CEO said, that most of the production would probably be moved to China
> > (where Click-its and many parts are already made)
>
> Snip
>
> > Arne, Copenhagen
>
> well, i weathered the color change, & lego ultra-juniorization/B.U.R.P etc.
> garbage, but this might break it for me. Lego, you darn well better absolutely
> NOT use slave labor & conditions!!!! (although that's probably what they're
> counting on to cut costs by going to china. I don't wanna hear about poor
> abused children being forced into making one of the best toys invented FOR
> children. way to go Lego, you really tick me off.
>
> Jeff
Yes all that and now the possibity that MegaBlocks and Lego being made in the
same manufacturing plant. They'll just take the better ones and put them in the
"Lego" bin with the poorer ones going to the other knock offs.
-Patrick
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|
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In lugnet.lego, Patrick S. O'Donnell wrote:
> In lugnet.lego, Jeff Szklennik wrote:
> > In lugnet.lego, Arne Lykke Nielsen wrote:
> >
> > Snip
> >
> > > Follow-up: In the Danish TV News, in two interviews,
> > > the new CEO said, that most of the production would probably be moved to China
> > > (where Click-its and many parts are already made)
> >
> > Snip
> >
> > > Arne, Copenhagen
> >
> > well, i weathered the color change, & lego ultra-juniorization/B.U.R.P etc.
> > garbage, but this might break it for me. Lego, you darn well better absolutely
> > NOT use slave labor & conditions!!!! (although that's probably what they're
> > counting on to cut costs by going to china. I don't wanna hear about poor
> > abused children being forced into making one of the best toys invented FOR
> > children. way to go Lego, you really tick me off.
> >
> > Jeff
>
> Yes all that and now the possibity that MegaBlocks and Lego being made in the
> same manufacturing plant. They'll just take the better ones and put them in the
> "Lego" bin with the poorer ones going to the other knock offs.
>
> -Patrick
I'm just shocked...I can't even begin to say what this means to me....other than
I guess the market for old Lego collections will just continue to go through the
roof. <sigh>
When will it ever end?
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In lugnet.lego, Timothy Wade wrote:
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In lugnet.lego, Patrick S. O’Donnell wrote:
| |
In lugnet.lego, Jeff Szklennik wrote:
| |
In lugnet.lego, Arne Lykke Nielsen wrote:
Snip
| |
Follow-up: In the Danish TV News, in two interviews,
the new CEO said, that most of the production would probably be moved to
China (where Click-its and many parts are already made)
|
Snip
well, i weathered the color change, & lego ultra-juniorization/B.U.R.P etc.
garbage, but this might break it for me. Lego, you darn well better
absolutely NOT use slave labor & conditions!!!! (although that’s probably
what they’re counting on to cut costs by going to china. I don’t wanna hear
about poor abused children being forced into making one of the best toys
invented FOR children. way to go Lego, you really tick me off.
Jeff
|
Yes all that and now the possibity that MegaBlocks and Lego being made in the
same manufacturing plant. They’ll just take the better ones and put them in
the “Lego” bin with the poorer ones going to the other knock offs.
-Patrick
|
I’m just shocked...I can’t even begin to say what this means to me....other
than I guess the market for old Lego collections will just continue to go
through the roof. sigh
When will it ever end?
|
As sad (wrong depending on how ones sees it) as it may sound that TLC is moving
production to China it *IS* the way of this century. Expect to see a lot of
this occuring for the rest of our lifetime! 1st world countries *CAN NOT*
compete against the wages of those countries. That is off coruse the way of
capitalism. I’m not saying it is wrong, that is just the way it is.
Case in point, today on Nationa Public Radio they had a segment of the DRUG
ROUTES. Basically colombia drug lords are now using the central american
corridor to bring drugs up to the USA. Nobody stops them (governments, local
police, the people) becuase if a fisherman who earns $10 per week “help”
transport some drugs from one port to the next he gets a $1,000.00 “reward”.
With that amount of money his family is set for the year!
It is disparelty of wealth that allowed “cheap labor” to grown in certain areas
of the world. So don’t blame TLC for going where everyone else is going. If
they don’t they won’t be competitive and if they can not be competeive then say
good bye to TLC!
You and I and everyone else on this board don’t have the power to change the way
stuff is so don’t bother. Just be happy that TLC is doing things (which you amy
not agree on) to keep itself alive and making the brick.
You know kids todays are not into the brick as we were. Yes it has it’s
following but the brick in the US can’t really compete against the SONY
Playstations... =)
-AHui
A&M LWorks
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as sad (wrong depending on how ones sees it) as it may sound that TLC is
moving production to China it *IS* the way of this century. Expect to see
a lot of this occuring for the rest of our lifetime! 1st world countries
*CAN NOT* compete against the wages of those countries. That is off coruse
the way of capitalism. I’m not saying it is wrong, that is just the way it
is.
|
Actually, I don’t think it will save them much at all. Sea transport will now
be across the atlantic, they have built the factories in Hungary, have the ones
in Bulland (sp), ect. Cost to run the actual factories is relatively low in
terms of personel. IIRC, when Enfield was closed, it used 1 person to run 34
molding machines. They would use more people where the molds are changed more
often, but not many more. Probably not more than 3-4 people on the floor of the
molding shop at a time. Having seen the packing display at LLCA, I would
suspect a similar level of supervision amongst the packing machines. Meaning
that the total on the floor people in a plant is like 8-10 at a time, plus
service people. (Probably another 8-10 people). Given a 1 min mold cycle, and
8 pieces a mold, that gives you:
8x34x60x8 (one shift)
=130560 bricks
To cover the cost of the employees. I’d suspect that the shot time is rather
less than a min for most elements. I’d also think that given inteligent design,
those numbers have come down rather than gone up. The press release talks of
overcapacity, not undercapacity.
Lego is a capital intensive operation, rather than a labour intensive one.
Maximizes advantages of working in 1st world, minimizes advantages of 3rd world.
James Powell
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> Follow-up: In the Danish TV News, in two interviews,
> the new CEO said, that most of the production would probably be moved to China
> (where Click-its and many parts are already made)
That's right, those 12 people in the production facility are what led you to two
consecutive years of heavy losses.
I swear, this world is being ruined by the decisions of MBAs and accountants who
have no natural talent for their occupation, let alone their industry.
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|
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In lugnet.lego, Jeff Szklennik wrote:
> Lego, you darn well better absolutely
> NOT use slave labor & conditions!!!! (although that's probably what they're
> counting on to cut costs by going to china. I don't wanna hear about poor
> abused children being forced into making one of the best toys invented FOR
> children. way to go Lego, you really tick me off.
That is some rather ignorant ranting. Why would you expect those single kids,
spoiled by two parents and four grand parents, would be forced to work? And
what is this "slave labor"? Some cold war garbage?
Yes you really tick me off too.
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|
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In lugnet.lego, Ka-On Lee wrote:
> In lugnet.lego, Jeff Szklennik wrote:
> > Lego, you darn well better absolutely
> > NOT use slave labor & conditions!!!! (although that's probably what they're
> > counting on to cut costs by going to china. I don't wanna hear about poor
> > abused children being forced into making one of the best toys invented FOR
> > children. way to go Lego, you really tick me off.
>
> That is some rather ignorant ranting. Why would you expect those single kids,
> spoiled by two parents and four grand parents, would be forced to work? And
> what is this "slave labor"? Some cold war garbage?
>
> Yes you really tick me off too.
Riiiiiiiiiiiiight, and the majority of China's factory labor force is
upper-middle class, university educated!?!
Bad factory environments exist in much of the Global South, and China in no
exception! Some generalizations are valid, simply because they still apply.
Peace,
--==Richard==--
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|
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In lugnet.lego, Ka-On Lee wrote:
> In lugnet.lego, Jeff Szklennik wrote:
> > Lego, you darn well better absolutely
> > NOT use slave labor & conditions!!!! (although that's probably what they're
> > counting on to cut costs by going to china. I don't wanna hear about poor
> > abused children being forced into making one of the best toys invented FOR
> > children. way to go Lego, you really tick me off.
>
> That is some rather ignorant ranting. Why would you expect those single kids,
> spoiled by two parents and four grand parents, would be forced to work? And
> what is this "slave labor"? Some cold war garbage?
>
> Yes you really tick me off too.
Just to think about how we're (USA) going to support the baby boom generation in
retirement and that there are four times as many humans in China with little in
the way of future generations to support those. Of course their family
structure is different than ours most likely. Still with 1,200,000,000 people
there I would too find it hard to believe slave labor does not exist. Someday I
hope to find out for myself first hand - inspired by this RUSH song.
-Patrick
Tai Shan
High on the sacred mountain
Up the seven thousand stairs
In the golden light of autumn
There was magic in the air
The clouds surrounded the summit
The wind blew strong and cold
Among the silent temples
And the writing carved in gold
Somewhere in my instincts
The primitive took hold.
I stood at the top of the mountain
And China sang to me
In the peaceful haze of harvest time
A song of eternity
If you raise your hands to heaven
You will live a hundred years
I stood there like a mystic
Lost in the atmosphere
The clouds were suddenly parted
For a moment I could see
The patterns of the landscape
Reaching to the eastern sea
I looked upon a presence
Spanning forty centuries.
I stood at the top of the mountain
And China sang to me
In the peaceful haze of harvest time
A song of eternity
I thought of time and distance
The hardships of history
I heard the hope and the hunger
When China sang to me...
When China sang to me.
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> Follow-up: In the Danish TV News, in two interviews,
> the new CEO said, that most of the production would probably be moved to China
> (where Click-its and many parts are already made)
> and
> KKK said that the trouble for LEGO was that they had focused too much on growth,
I've worked with China before. I hate dealing with them. They wanted me to do
all this work, then trying to get paid was like squeezing blood from a stone.
Took me six months to get paid. Chinese people are smart--but I have found a
rather unethical culture exists there. It was pretty intense--it went up the
chain of command pretty quick--I had someone about two-three levels below the
CEO of company demanding payment from the China teams.
Didn't Lego win a lawsuit regarding patent/design infringement some time ago?
From what I've read, it's an ongoing thing that Lego keeps fighting Asian
knockoffs...and yet...they want to move more to Asia? Doesn't this mean more
lawyers need to be employed...and doesn't that make operations more capital
intensive?
It is my personal opinion that Chinese business culture is that they
(manufacturing operation/company) agree to one thing and sign contracts, but are
highly willing to sell that stuff out the back door when nobody is looking.
That's when you see how smart they are--because they are very sneaky about not
getting caught. I need to start documenting every time I see things like that
in the news. I recall reading an article one time where a Hollywood movie
studio had a problem with a Chinese company that made the films to be
distributed to theaters, and were allegedly selling prints in China without
studio permission.
Sorry I have a personal bias against China, but the bias comes as a result of
dealing directly with them--their business culture needs to change to a more
business ethical-based culture before I will change my opinion of doing business
in China.
(The views expressed above do not represent the views of either of my employers)
Scott Lyttle
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> well, i weathered the color change, & lego ultra-juniorization/B.U.R.P etc.
> garbage, but this might break it for me. Lego, you darn well better absolutely
> NOT use slave labor & conditions!!!! (although that's probably what they're
> counting on to cut costs by going to china. I don't wanna hear about poor
> abused children being forced into making one of the best toys invented FOR
> children. way to go Lego, you really tick me off.
I would like to see exactly how much more expensive per anum to make the
stuff in Denmark than it is to make it in China.
And what the extra expense is going towards (taxes? wages? electricity
costs? what?)
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In lugnet.lego, James Powell wrote:
| |
Meaning that the total on the floor people in a plant is
like 8-10 at a time, plus service people. (Probably another 8-10 people).
Given a 1 min mold cycle, and 8 pieces a mold, that gives you:
|
Supposedly, it’s around 7 seconds to cool and eject a new element from the mold
(obviously differs according to piece size, etc). So if you count injection
time, it’s probably around 10 seconds or so? And I believe the number of
elements produced per year is supposedly about 20 billion? Hmm. How many parts
get squeezed off in a single mold? I know I’ve seen 2x4 molds that have 8 parts,
let’s go with that for starters.
That’d be 6,944,444 hours per machine per year meaning roughly 800 molding
machines going non-stop, not including time to switch molds and to switch color
batches. So assuming 2 people per 30 machines (adding 1 to help fudge the
mold/color switching) that’s about 27 people (let’s say 30) at any given time at
the plant. Assuming 4 shifts of full-time people, that’s a total crew of 120,
probably more, plus other staff for the facility itself (executive, security,
janitorial, etc).
So, maybe a ~200 person operation all told? That sound reasonable? No clue what
wages are in Denmark vs. China-- but at a guess we’re probably talking about $5
to $15 million in Denmark, and maybe half that in China? But that’s just a
pulled-out-of-my-ABS kind of guess.
| |
Lego is a capital intensive operation, rather than a labour intensive one.
Maximizes advantages of working in 1st world, minimizes advantages of 3rd
world.
|
From what I’ve heard, Lego sounds sort of top-heavy. Probably part of why
MegaBloks can compete so well-- a top-heavy company has lots of executive chains
and processes to go through to get a final product. And Lego’s attention to
detail and struggle to be “the best” only make it slower. MegaBloks by
comparison probably has a MUCH faster turnaround time for new products, and less
attention to quality, which is (I’d guess) where the REAL savings are.
DaveE
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In lugnet.off-topic.debate, Richard Noeckel wrote:
> Riiiiiiiiiiiiight, and the majority of China's factory labor force is
> upper-middle class, university educated!?!
No, but they've learned a lot over recent years. They've set up huge
manufucturing districts, and the way it usually works is young adults will work
there for a few years, earn enough money in that time to go buy a small farm,
start up a family, and subsist off of whatever they can produce themselves for
the rest of their lives.
> Bad factory environments exist in much of the Global South, and China in no
> exception! Some generalizations are valid, simply because they still apply.
Are there still instances of child labor in China? I'd be shocked and amazed if
there aren't, but I can say the same thing about the US, where there are still
underground slave rings that sell young children for sex. BUT, there are enough
reputable manufacturing companies that TLC should be able to maintain full
legitimacy in their business dealings there. Quality control is a much more
painfully significant issue in this case. I once caught someone telling a
supplier in China that his customer needed them to adhere to strict quality
standards...and that this time they actually meant it. That to me screams
"empty promises" in that regard.
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In lugnet.lego, James Powell wrote:
| |
| |
as sad (wrong depending on how ones sees it) as it may sound that TLC is
moving production to China it *IS* the way of this century. Expect to see
a lot of this occuring for the rest of our lifetime! 1st world countries
*CAN NOT* compete against the wages of those countries. That is off
coruse the way of capitalism. I’m not saying it is wrong, that is just the
way it is.
|
Actually, I don’t think it will save them much at all. Sea transport will
now be across the atlantic, they have built the factories in Hungary, have
the ones in Bulland (sp), ect. Cost to run the actual factories is
relatively low in terms of personel. IIRC, when Enfield was closed, it used
1 person to run 34 molding machines. They would use more people where the
molds are changed more often, but not many more. Probably not more than 3-4
people on the floor of the molding shop at a time. Having seen the packing
display at LLCA, I would suspect a similar level of supervision amongst the
packing machines. Meaning that the total on the floor people in a plant is
like 8-10 at a time, plus service people. (Probably another 8-10 people).
Given a 1 min mold cycle, and 8 pieces a mold, that gives you:
8x34x60x8 (one shift)
=130560 bricks
To cover the cost of the employees. I’d suspect that the shot time is rather
less than a min for most elements. I’d also think that given inteligent
design, those numbers have come down rather than gone up. The press release
talks of overcapacity, not undercapacity.
Lego is a capital intensive operation, rather than a labour intensive one.
Maximizes advantages of working in 1st world, minimizes advantages of 3rd
world.
James Powell
|
I would agree here. Maybe they are looking to take advantage of a newer,
cheaper ABS supply? Is there a tax write-off in Denmark for relocation expenses
like these? Its gotta cost a pretty penny to move the stuff.
Jeff
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In lugnet.lego, David Eaton wrote:
| |
In lugnet.lego, James Powell wrote:
| |
Meaning that the total on the floor people in a plant is
like 8-10 at a time, plus service people. (Probably another 8-10 people).
Given a 1 min mold cycle, and 8 pieces a mold, that gives you:
|
Supposedly, it’s around 7 seconds to cool and eject a new element from the
mold (obviously differs according to piece size, etc). So if you count
injection time, it’s probably around 10 seconds or so? And I believe the
number of elements produced per year is supposedly about 20 billion? Hmm. How
many parts get squeezed off in a single mold? I know I’ve seen 2x4 molds that
have 8 parts, let’s go with that for starters.
|
2x4 bricks are in 8-part molds, yes. I’d venture a guess that 1x1 molds produce
more parts per shot, and that some really large parts might even be single-part
shots. Now that’s all because you want to use the full volume capacity of the
machine on parts where you know you’re going to have to tool up new molds on a
regular basis. For limited production parts, you want to minimize the amount of
wasted tooling work, so you cut down the shot size as much as you can while
still having a reasonable expectation of meeting the minimum required quantity.
The BIONICLE Vahi mask, which isn’t very big, was limited to a 2-part shot
because it was intended to be packed with expensive video games, not included in
fast-selling sets. Most of the other Kanohi were produced in 4-shot molds,
while the smaller Krana and Kraata were produced in 8-shot molds like the 2x4
bricks.
A few parts, like baseplates, are thermoformed instead of injection-molded.
Whether they are vacuum-formed, pressure-formed, or a combination of the two I
couldn’t say, but if you look inside the taller raised baseplates you can see
the distinctive freeze-lines that result when the part has only touched a mold
surface on one side. Since there are no mold numbers showing on the outside of
the part, there’s no way of knowing if they’re running those in single-part
shots or running a full 4’x8’ sheet at a time. Since the flat baseplates could
be cut down into whatever size you wanted, it’s probably a safe bet that those,
at least, used to be run in 2.5’ increments (the minimum size to give you the
option of either 48x48 X-Large or 32x32 Large plates) and then just chopped up
into whatever size they want with a press. I’m not so sure newer baseplates are
produced the same way. If you look at the corners, they have round corners
instead of just having the tips knocked off at 45 degrees, the top edge is
radiused, and they actually have mold info stamped into the bottom
| |
That’d be 6,944,444 hours per machine per year meaning roughly 800 molding
machines going non-stop, not including time to switch molds and to switch
color batches. So assuming 2 people per 30 machines (adding 1 to help fudge
the mold/color switching) that’s about 27 people (let’s say 30) at any given
time at the plant. Assuming 4 shifts of full-time people, that’s a total crew
of 120, probably more, plus other staff for the facility itself (executive,
security, janitorial, etc).
So, maybe a ~200 person operation all told? That sound reasonable? No clue
what wages are in Denmark vs. China-- but at a guess we’re probably talking
about $5 to $15 million in Denmark, and maybe half that in China? But that’s
just a pulled-out-of-my-ABS kind of guess.
|
Since they’ve been cited as having laid off more than double that amount in
production labor at a time, that can’t possibly be right.
| |
From what I’ve heard, Lego sounds sort of top-heavy. Probably part of why
MegaBloks can compete so well-- a top-heavy company has lots of executive
chains and processes to go through to get a final product. And Lego’s
attention to detail and struggle to be “the best” only make it slower.
MegaBloks by comparison probably has a MUCH faster turnaround time for new
products, and less attention to quality, which is (I’d guess) where the REAL
savings are.
|
When you’ve got cheaper design, cheaper raw materials, and cheaper labor, you
can sell less product and still make a lot more profit. TLC has been running
with a comfortable 1-year turnaround on new themes/sets, but they’ve recently
announced that they’re going to be dropping that down to a six-month period
(which, yes, means that no more than half of the year’s product could ever be
shown at Toy Fair, because anything that’s going to see a September release
wouldn’t even have been sketched up the previous February, and would be old news
by the next).
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In lugnet.lego, David Laswell wrote:
| |
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So, maybe a ~200 person operation all told? That sound reasonable? No clue
what wages are in Denmark vs. China-- but at a guess we’re probably talking
about $5 to $15 million in Denmark, and maybe half that in China? But that’s
just a pulled-out-of-my-ABS kind of guess.
|
Since they’ve been cited as having laid off more than double that amount in
production labor at a time, that can’t possibly be right.
|
Yeah, it does admittedly sound low to me-- where are you getting the cite? Of
course, I guess I also didn’t include packaging and shipment, either-- and
that’s not necessarily just the “final” packaging, but shipping to other areas
to be “finally packaged” (assuming that those packaging facilities don’t also
move to China as well).
| |
When you’ve got cheaper design, cheaper raw materials, and cheaper labor, you
can sell less product and still make a lot more profit. TLC has been running
with a comfortable 1-year turnaround on new themes/sets,
|
Huh! Where’d you hear that? From what I’ve heard it’s been anywhere from 6
months to 5 years for sets and themes (depending on how involved they are), and
usually around 3 years (IIRC I remember hearing that various things like Legends
and standalone models like the Wright Flyer or something are quicker to
production)
| |
but they’ve recently
announced that they’re going to be dropping that down to a six-month period
|
That’s awesome! (or, *should* be awesome if they don’t start dropping even more
quality). Did I miss some uber-cool announcement somewhere? But anyway, that’d
allow for less time for MB to steal their designs and whatnot (which I’ve heard
they’ve done in the past) Hm. I wonder how long it takes MB to do a product
design?
DaveE
|
|
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In lugnet.lego, David Eaton wrote:
| |
Yeah, it does admittedly sound low to me-- where are you getting the cite?
|
2-3-03, when 161 waged production workers in Billund were laid off, and 1500
was the number cited as being employed in the affected departments.
2-27-03, when 43 administrators were in Billund were laid off, and 2000 was the
number cited as being employed in the whole Billund organization (meaning they
have about 500 people in administrative or higher positions).
10-27-03, when they announced that one of the Swiss plants would be shut down,
and that there were 130 employees just at that one plant (and it sounds like
that was one of the plants that produced bricks).
Also 10-27-03, where they announced another 257 layoffs in Billund, primarily
in the production ranks.
3-16-04, when they announced about 500 layoffs globally, 1/3 of them from
Denmark.
| |
Of course, I guess I also didn’t include packaging and shipment, either-- and
that’s not necessarily just the “final” packaging, but shipping to other
areas to be “finally packaged” (assuming that those packaging facilities
don’t also move to China as well).
|
Loose bricks would be packed up and shipped to other plants (clearly, since the
Czech plant paints parts, but does not mold them), but if a given plant is
packing the sets, there is no logical reason that I can think of that they
wouldn’t also be packing the cases right afterwards. As it is, while they’ve
been shipping parts to Enfield to be packed locally, early runs of sets are
still shipped fully packed from Denmark to get shelves stocked right away.
After all, it saves having to wait for them to finish packing the loose bricks
that would be coming in on the same shipment, but it’s got to be cheaper to ship
loose bricks from Denmark and pack them here than it is to ship lots of
half-full (or much less, in the case of Spybots). If production moves to China,
labor costs drop quite a bit, so it might be cheaper to have everything packed
there and shut down all of the factories except one in Billund (for
prototyping/design purposes) and Germany (for tooling), leaving places like
Enfield as not much more than warehousing/shipping/marketing outfits.
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Huh! Where’d you hear that? From what I’ve heard it’s been anywhere from 6
months to 5 years for sets and themes (depending on how involved they are),
and usually around 3 years (IIRC I remember hearing that various things like
Legends and standalone models like the Wright Flyer or something are quicker
to production)
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That’s awesome! (or, *should* be awesome if they don’t start dropping even
more quality). Did I miss some uber-cool announcement somewhere? But anyway,
that’d allow for less time for MB to steal their designs and whatnot (which
I’ve heard they’ve done in the past) Hm. I wonder how long it takes MB to do
a product design?
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If you scroll down a bit on
this page, they mention that the development time for product ideas will be cut
by about 50%. The industry standard for major toy companies has been about a
year for quite some time, but I can’t find anything specifically listing
12mo/6mo timeframes. That might be something that I was told during my last Toy
Fair visit, or I might be subconsciously combining the two bits of info (I do
remember that they didn’t have Han Solo ready to display with the new Millennium
Falcon, but they had his dark-blue parka hood). We’ll have a pretty good idea
by the end of next year, once we see exactly how much late-release product was
not shown at NY Toy Fair compared to previous years. Now that they’ve switched
over to a rolling release schedule with new product coming out nearly
year-round, there have always been a couple of sets released way late in the
year that weren’t even mentioned at Toy Fair in February, but they’ve also had
at least a couple sets scheduled for release as late as October. Never anything
from the following November/December/January, though.
I could see, though, that an idea could be bounced around for a few years before
it gets the go-ahead for full-out development, or they might be doing loose
planning well in advance of where they’re actually at (it’s been mentioned on a
few occassions that the BIONICLE story outline was laid out for seven “books”,
the second of which just began with the release of the Metru-themed sets), but
if they’ve been taking 3-6 years to develop each and every set, they very well
deserve to go bankrupt, because there’s no way they can keep up with market
changes with numbers like that. If a line completely flops, you’d have years of
wasted development for sets that wouldn’t then ever be released. And it would
take a few years to pick up the slack in product releases. They’d be
hard-pressed to be able to release Star Wars sets before their associated
movies, since Lucas works on a three-year schedule, with designs being finalized
well into the production process.
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In lugnet.lego, Ka-On Lee wrote:
> In lugnet.lego, Jeff Szklennik wrote:
> > Lego, you darn well better absolutely
> > NOT use slave labor & conditions!!!! (although that's probably what they're
> > counting on to cut costs by going to china. I don't wanna hear about poor
> > abused children being forced into making one of the best toys invented FOR
> > children. way to go Lego, you really tick me off.
>
> That is some rather ignorant ranting. Why would you expect those single kids,
> spoiled by two parents and four grand parents, would be forced to work? And
> what is this "slave labor"? Some cold war garbage?
>
> Yes you really tick me off too.
I apologize, Ka-On Lee, for not making my point clearer. I had no intention of speaking negatively of children. I was lamenting the tendency of large corporations to abuse what they see as less developed economies by using the most vulnerable in a society for VERY cheap labor in poor working conditions. I admit, not all of China's labor force is slave labor, but i've read horror stories of large US toy companies (mattel & hasbro) & retailers (especially Wal*Mart, being the biggest, but not the only pne) being the cause of Chinese children & early teens (many being girls) to become, in effect, slave laborers in order to support their families, just so richer nations can have cheap conveniences. Some US companies are so absolutely in pusuit of profit because consumers want cheap stuff, and don't care who gets abused to make it. I REALLY try avoid the abusive companies/retailers, or if i deal with them, make sure the product is made somewhere else) Basically, my point was that i don't want my favorite toy, a source of joy for me & many other adults & children, to be made BY children in slave labor conditions. Thanks for calling me on my un-clearness b4
Jeff
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In lugnet.off-topic.debate, Jeff Szklennik wrote:
woah! why didn't the text 'wrap' like in the
editing box? can someone fix my post (b4 this one)?
Sorry!
Jeff
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In lugnet.lego, David Eaton wrote:
SNIP
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From what I’ve heard, Lego sounds sort of top-heavy.
Probably part of why > MegaBloks can compete so well
-- a top-heavy company has lots of executive chains
and processes to go through to get a final product.
And Lego’s attention to detail and struggle to be
“the best” only make it slower. MegaBloks by
comparison probably has a MUCH faster turnaround time
for new products, and less attention to quality, which
is (I’d guess) where the REAL savings are.
DaveE
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surprise-overpaid upper mananagement cutting labor to save costs.
we can still have the best product without keeping the perception that
more management is better.
Jeff
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In lugnet.lego, Jeff Szklennik wrote:
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surprise-overpaid upper mananagement cutting labor to save costs.
we can still have the best product without keeping the perception that
more management is better.
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It’s really easy to look at it that way, but the evidence suggests otherwise. I
cited a few press releases elsewhere in
this thread, most of which dealt with layoffs. Within a month of announcing 161
production layoffs last year in Billund, they also announced 43 administrative
layoffs (plus 11 more through attrition). The two releases listed the
production force in Billund as being about 1500 people, and the total workforce
there being about 2000, which means there’s about a 3:1
production/administration ratio. 161 to 54 is still weighted a little against
the production force, but not by much. The other layoff notices don’t say
anything more than that “most” of the layoffs will be in production, but there’s
nothing to suggest that 25% of those layoffs aren’t in administration.
They also culled about a third of the top management positions earlier this
year, dropping down from 14 execs to only 9, and some of those have been
replaced. Kjeld Kirk Kristiansen has also been quoted as saying that he’ll be
pumping a large chunk of his own personal wealth back into the company, which
sounds like it’ll be enough to make it break even.
Mr. Kristiansen, the grandson of the man who founded the company, has also just
stepped down as CEO.
Yeah, it sucks when a company constantly looks to the production staff as an
expendable source of profit reclamation while doing everything they can to
protect and line the pockets of the upper management, but these aren’t the
actions of such a company.
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> Follow-up: In the Danish TV News, in two interviews,
> the new CEO said, that most of the production would probably be moved to
> China (where Click-its and many parts are already made)
Okay...
They will be using the same molds so part quality should remain similar. (This
says nothing for color consistency or actually getting the right parts in each
bag/box)
They probably won't save much money because they've often said that the factory
is so automated that very few people are required to run it.
It will probably cost a lot of money to shut down the old factory and set up
operations in China. It will probably take many years for the small labor
savings to cover these setup costs.
After the setup costs have been covered, yearly savings from the cheaper labor
in China will remain an insignificant part of the big picture.
None of TLC's problems will actually be solved, but they will have shaved a bit
of cost out of their production. After they realize that these cost savings
aren't helping them, they will regret shutting down the factory in Denmark, but
it will be too late to do anything about it.
From my own observations and things in the various news articles recently linked
in this thread, TLC has two big problems:
1. Supply Chain Issues - Moving to China does not solve this. At the worst, it
may make things worse. At the best, it will require TLC to restructure the
entire supply chain. (That may prove to be a very good thing in the long run,
depending on how things go.)
2. Low Sales. The article that started this thread said that sales in 2004 are
expected to be 8b compared to 8.4b in 2003. I'm tempted to suggest that this 5%
decrease is caused by the "insignificant" minority of AFOLS who do not like the
new colors, but I wouldn't want this post to get sent to lugnet.color so let's
forget about that. :)
The bigger problem is not the 5% drop compared to last year, but the fact that
it's part of an ongoing trend. I blame the the lower sales volume on high prices
and less appealing set designs.
LEGO prices have risen at an abnormal rate since the year 2000. I believe that
bad set designs since the mid 90s resulted in TLC eventually charging more in
2000 to make up for lower sales. Come the year 2000, less children were getting
into LEGO because it is expensive and the set designs are not very appealing.
Older children are also getting away from LEGO at a younger age because the set
designs are unappealing. Set designs are slowly starting to improve (with some
exceptions), but it's not helping enough. The rate at which older children are
giving up LEGO is probably higher than the rate at which young children are
getting into it. That would explain why TLC's been focusing so much effort on
younger children lately. Sadly, I think it's backwards. Retaining the older
children should be more important than gathering the young ones. Older children
will pass the hobby to their younger siblings anyway.
The problem with the focus on younger children is that TLC is doing so in a
"trendy" way. Movie licenses, flashy boxes, and gimmicky set designs, etc. They
generate the quick sales without creating any brand loyalty. Children get into
LEGO and then give it up after a year or two, so TLC has to keep trying to woo
the next generation of 4-8 year olds year after year while the 8-12 audience is
nowhere near what it once was or should be.
This move to China will not result in lower set prices for customers. The
savings will be used to help offset some of TLC's losses. Turning the company
around will have to come from an increase in sales volume. What's their plan for
that? I guess we'll have to wait and see the 2005 set designs in a few months.
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I wonder if LEGO has considered how that would affect prices in various
countries. For example in Canada LEGO is duty free since Denmark is considered
a preferred trading partner, but I am not sure on the situation with China, will
see if I can find it's status. Otherwise it might bump the raw cost of the
goods in CAnada at least if there would be a duty applied. OUCH!
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In lugnet.off-topic.debate, Jeff Szklennik wrote:
> In lugnet.off-topic.debate, Jeff Szklennik wrote:
>
> woah! why didn't the text 'wrap' like in the
> editing box? can someone fix my post (b4 this one)?
Not that I am aware of, as fixing spacing or linewrapping is a kind of editing
and LUGNET does not support editing.
You can repost it and request a cancel of the original post if you like, but no
one can change it, not even you, as far as I understand the system.
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Not sure farming things out to China will benefit LEGO that much, the production
system is so automated it doesn't involve that much hand work to my
understanding but it would be interesting to have someone from LEGO comment on
this.
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