Subject:
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Re: A change in attitude: was Big Brother is Watching (and reading, too!)
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Newsgroups:
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lugnet.general
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Date:
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Fri, 22 Oct 1999 23:20:17 GMT
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Viewed:
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1320 times
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In lugnet.general, Nick Goetz writes:
>
> Mike Stanley wrote in message ...
> > Nick Goetz <ngoetz@iquest.net> wrote: • If you tick
> > > off the wrong person all forward motion stops.
> >
> > You're entitled to your opinion.
> >
> > Here's mine:
> >
> > The people at TLG who continue to ignore the overwhelmingly huge
> > amount of interest the AFOL has in certain things (bulk order,
> > better service packs, etc) are fools. Period. If they're concerned
> > about what they SHOULD be concerned about, ie making TLG as much
> > money as possible, they'd be all over us.
> <cut rest of message>
>
>
> Are you saying that if you need 20 2x2 orange tiles that come in the pod
> racing set for $90 a set, that TLG will not make more money selling 10 of
> those sets for $900 then individual pieces for .06 x20 for $1.20? I don't
> think so. If money is the sole reason for their operation, and maybe it is,
> they would be foolish to EVER allow bulk orders.
That is a very true example. Here is another one. I want 2,000 of the 1x4x6
black town jr. windows. Does this mean that they will make more money by
selling me 2000 of the McDonalds sets? Yes they will, if I felt inclined to
buy $22,000 worth of one set, which I don't. Instead, I bought none. (I got
2 free with other orders, but that is all).
Sometimes, when you put pencil to paper and figure the cost, it is worth it,
like $44 for the Black Thunder chopper. You buy it. Sometimes, it is not
worth it ($22,000 for a minifig skyscraper). You don't buy it. Now if they
brought the price down by selling you just what you needed, you would possibly
cough up the $1,000 it would take. They make more in some instances, but not
in others. For small quantities, bulk cuts sales of sets with specialized
bricks. For large quantities, it just doesn't work. How else would I
possibly come up with the 36,000 2x8 gray bricks in my bulk order? 36,000
gray brick packs for $198,000? Instead, they sold none. My order came to
about $10,000, which is more than I will spend on sets in stores in the next 4
years. (Most of my set purchases are of older used sets that have better
pieces)
>
> Furthermore, think about the flow of the product. By cutting out the
> retail channel, Lego looses big business. If Toys R Us sold 65% of my
> product, I wouldn't do a single thing to tick them off. They can survuive
> without Lego, but can Lego survive without them? Profits are already down.
> It is not a change I would want to take.
>
> -Nick
But they do not cut out the retail channel any more than they already have
with shop at home. How about Toys R Us? Can they survive without Lego?
Maybe, but not as easily as one would think.
Being in a business that deals with supermarket chains, I can tell you some
things. When you go shopping at Kroger and find Cheerios, you don't realize
that Kellogs or Post or whoever makes those darn things had to pay the
supermarket JUST FOR THE SHELF SPACE. That is right, supermarkets charge
companies for shelf space for their product. Everyone has to pay it. Except
Coca-cola. What is a supermarket going to do? Stop selling Coke? It will
lose too many people who will go to Albertsons or A&P to buy the Coke and get
their other products. Coke is not the only exception, but it shows a point.
Stores NEED the major brands to draw in business. Would people shop at Toys R
Us if they didn't carry Nintendo, Pokemon or Barbie? Maybe, unless there is a
KayBee near by that has them. Not wanting to lose business to a competitor,
Toys R Us would end up carrying them. Even if they didn't want to. It is
just to prevent a competitor from getting an upper hand and stealing their
customer base.
I actually get people who went into a store and bought our nuts send me mail
asking if they could buy direct. Do you really think that A&P cares if I sell
Joe Blow a 25 pound box of walnuts direct when they sell thousands of cases?
It is negligable.
This would be a different story if I sold a distributor product and then went
direct to their customers. Like Toy Suppliers Inc. (fictional) who sells to
Mom and Pop stores. If they had a store that bought a pallet of goods once a
week and then their supplier went in and took the account, they would not be
too happy. This happens and it is just considered tough luck.
The final example is broker circumvention. My broker gets paid 2% on sales.
If I called the customer (i.e. his customer) and said, buy direct from me and
I will give you a 1% discount, this would be both bad and wrong. Although it
is tough to get legal recourse, (tough, not impossible) it is generally
considered unacceptable behavior.
Of all these examples, the first one is how you would have to consider bulk
sales to large end consumers. How could Toys R Us get mad over that? The
local supermarket doesn't expect Mrs. Fields to buy all her flour from Aisle
8? Why should Toys R Us expect the same?
Mike Poindexter
Oh, and I didn't say TLG's sets were crappy, but I can and will now. Mainly,
their Freestyle sets need some work. They are great for cheap parts, but
there is really a need for a better mix of elements that are more conducive to
use in large AFOL MOC models.
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