Subject:
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Re: According to TLC...
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Newsgroups:
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lugnet.lego
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Date:
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Wed, 22 Sep 2004 20:36:07 GMT
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Viewed:
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3425 times
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In lugnet.lego, David Eaton wrote:
> Yep-- that was my first point. Most Americans are cheapo. People in the US may
> just be used to paying less, hence, you can't get away with charging a crazy
> markup. You have to judge your price based on what you think people will be
> willing to spend, which means figuring out a lot about your target demographic.
I think this may be the key point - charge what the market will bear. Except
where there is significant competitive pressure which drives makers to seek
cheaper ways of supplying product, there is no need for a product's price to
have much to do with how much it costs to produce. Very few businesses "will
leave money on the table". That is simply the nature of business. Businesses do
not try to sell you something as cheaply as they can, they try to make things as
cheaply as they can and sell them for as much as they can get. That's why
competition is so good for the consumer. And so I think the fact that most
Walmarts here in the US have at least as much shelf devoted to clone brands as
they do to Lego product may be a driving factor for low prices in the US. I did
not note the same situation in UK stores when I was there earlier in the year.
Plus, you're right I think, US purchasers have a well tuned sense of perceived
value. There are some things which ought to be expensive and so they are. And
other things shouldn't be and so they are not, if you want to sell lots of
(Walmart scale mass merchandizing) product. I think toys are in the category of
stuff which shouldn't be very expensive.
JB
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Message is in Reply To:
 | | Re: According to TLC...
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| (...) Generally, S@H prices reflect the markets they're sold in, not the cost to Lego. Let's say a toy store buys a set from Lego at $10 per unit, sells it at $20 per unit as their markup. Lego "sells" the product to S@H for $5 per unit, and can (...) (20 years ago, 22-Sep-04, to lugnet.lego)
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