Subject:
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Re: Bulk Ordering - Secrets Revealed.
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Newsgroups:
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lugnet.general
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Date:
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Fri, 13 Aug 1999 18:20:40 GMT
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Viewed:
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2281 times
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In lugnet.general, Frank Filz writes:
> Well, one thing that could happen is serious clones of Lego bricks. I
> don't know what the costs are of doing ABS molding but model railroad
> hobbyists are pretty resourcefull. [...]
I worked for a company that had to have a custom mold (actually several molds)
to manufacture plastic parts for the product's enclosure (the plastic "shell"
that most electronic products have).
The mold pieces were made for us by the same mold contractor that made molds
for Revell (the plastic model company) and were made to the same precision. The
cost of making the mold parts depends mainly on how much time it takes the
machinists to create all the surfaces that are part of the mold's active
surface. In other words, the more complex the plastic shape you're creating,
the more it costs to make the mold.
Our molds had about the same complexity as about 12 2x4 LEGO bricks would have
[1], speaking in terms of machinist time to make the mold. The cost for the
mold was about US$100,000 (it has been about 10 years, so that might have
changed due to automation and inflation). [2] If you made a mold to make twice
as many parts, the mold would require twice as much machining and cost almost
twice as much.
Once you have a mold you can use it about 100,000 times before you have to
throw it away. In our case, we elected to "resurface" it, a process that
irreversibly changes many of the dimensions of the resulting plastic pieces and
therefore would not work for LEGO-compatible pieces.
So, based on this it would probably cost our hypothetical model railroaders
about $100,000 to make 1.2 million 2x4 bricks. [3]
> There is a TON of small manufacturers
> in model railroading. If enough people get interested in Lego trains,
> the small manufacturers will figure out a way to capitalize on that. And
> they'll put out quality products. And model railroaders are willing to
> pay for their products (that's one reason Metroliners go for so much).
The only real problem I see in this is that we're talking about *LEGO* model
railroaders. Based on what I've heard, *LEGO* model railroaders won't let any
clone bricks near their layout, regardless of who makes them or how good they
are.
- Robert Munafo
LEGO: TC+++(8480) SW++ #+ S-- LS++ Hsp M+ A@ LM++ YB64m IC13
[1] I am not counting the carving of the tiny letters "LEGO" on the studs. Your
hypothetical model railroaders wouldn't bother with such detail, and it
probably doesn't affect LEGO's cost anyway since they probably have specialized
milling machines dedicated just to this purpose.
[2] If you have your own machine shop and do the work, you probably spend about
half as much -- so LEGO would spend about $50,000.
[3] The cost for the LEGO Group would be about $50,000 for the same 1.2 million
2x4 bricks. If LEGO only sold 2x4 bricks (it's a good thing they don't :-) and
if their retail pricing were US 10 cents per part [4], they would sell these
1.2 million bricks for about $72,000 (40% off from the retail value of
$120,000), and they would have about a 30% margin to cover their operating
expenses and try to make a profit. According to their annual report at:
http://www.lego.com/info/pressspecific.asp?PressReleaseId=68&Year=1999
they didn't manage to make a profit last year.
[4] I know a lot of sets sell for a lot less than 10 cents for part, most
notably the buckets and tubs. But there are also a lot of sets sold that are
more than 10 cents per part so it probably balances out.
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Message has 2 Replies:
 | | Re: Bulk Ordering - Secrets Revealed.
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| Robert Munafo (munafo@gcctechNO.SPAMcom) wrote: : [1] I am not counting the carving of the tiny letters "LEGO" on the studs. Your : hypothetical model railroaders wouldn't bother with such detail, and it : probably doesn't affect LEGO's cost anyway (...) (25 years ago, 14-Aug-99, to lugnet.general)
| | | Re: Bulk Ordering - Secrets Revealed.
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| (...) The (...) and (...) Hope I'm not stealing Steve Chuck's thunder, but I was browsing the Brickshelf Gallery and came upon this picture: (URL) was taken on a LEGO factory tour. It's a picture of a retired mold which makes 8 2x3 bricks. There is (...) (24 years ago, 19-Sep-00, to lugnet.general)
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Message is in Reply To:
| | Re: Bulk Ordering - Secrets Revealed.
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| (...) Well, one thing that could happen is serious clones of Lego bricks. I don't know what the costs are of doing ABS molding, but model railroad hobbyists are pretty resourcefull. There is a TON of small manufacturers in model railroading. If (...) (25 years ago, 13-Aug-99, to lugnet.general)
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