 | | | | | |
| |
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
| | | | | | | | | | | | | | | |
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
| | | | | | | | | | | | | | | | | | | | | |
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).
| | | | | | | | | | | | | | | | | | | | | | | | | | |
In lugnet.lego, David Laswell wrote:
| |
| |
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
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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.
| |
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)
|
<snip>
| |
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?
|
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.
| | | | | | | | | | | | | | | | | | | | | | | |
In lugnet.lego, David Eaton wrote:
SNIP
| |
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
|
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
| | | | | | | | | | | | | | | | | | | | | | |
In lugnet.lego, Jeff Szklennik wrote:
| |
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.
|
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.
| | | | | | | | | | | | | | | | | |
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
| | | | | | |
