Subject:
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Re: Bulk Pricing (Interesting comparison?)
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Newsgroups:
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lugnet.lego.direct
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Date:
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Wed, 14 Feb 2001 19:46:31 GMT
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Viewed:
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2787 times
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In lugnet.lego.direct, Frank Filz writes:
> Bones Dragon wrote:
> > Now like I said, I don't expect TLC to offer the bulk packs as
> > cheaply as the blue tubs, since they probably don't make much
> > of a profit off them... but the current pricing scheme for the
> > bulk packs seems silly to me, especially when offering the
> > standard colors. Personally I'll order "bulk" for the rare colors,
> > but still rely on blue tubs for the standard colors. But as I said,
> > they can obviously do better...
>
> I don't think it's "obvious" they can do better. I think the buckets and
> tubs (pretty much only available in the US and Canada I think) are
> almost a loss leader. I don't think they actually are a loss leader, but
> I strongly suspect they are taking a lower profit margin (taking into
> account the low development cost of these sets) than for regular sets. I
> think they need to have the tubs to compete with Mega Bloks, I also
> doubt that they lose many sales of $20 sets to people buying $20 tubs. I
> think it's possible that Larry and the other train summit folks have a
> better idea of how the blue tub fits into things, but I don't expect
> them to share any knowledge they have. I also don't expect TLC to ever
> share that information (though it is possible that they would share that
> the blue tub does indeed have a lower profit margin target). Bulk packs
> are going to have a higher overhead (the advantage the tub has is that
> they need exactly one stock item, well, maybe a few with the various
> buckets, but you get the idea, any kind of bulk system is going to need
> more than ten offerings).
Well as far as the overhead I think the two might be closer than you think.
There is a lot of air in the Tubs so the tubs take up more space/part plus the
lack of packaging on the bulk packs lower their overhead right away. My guess
is that you can get a lot more parts per stock location with the bulk packs.
I agree that the tubs possibly have a lower overall profit margin than sets but
I do think they make a profit on them. The tubs especially because they
require next to 0 R&D. I also agree that they probably don't loose many sales
of $20 sets to the $20 tubs even if that is the case with me.
>
> Having said all that, I do hope we will at some point see 2nd tier bulk
> packs which have 1000 bricks at a cheaper price point. I wouldn't be
> surprised if TLC isn't offering those out of the gate until they get a
> feel for what types of things are in demand, and what the overall demand
> is. The unfortunate thing is any such research will be imperfect because
> they can't have a good idea of how many sales didn't happen at all
> because of the price points. I'd like to see 1000ish piece bulk packs
> with a mix like the tub (or perhaps split it into 1x and 2x packs) for
> the colors people are going to want in quantity: red, blue, yellow,
> green, white, black, light grey, dark grey, and tan at a minimum. Also
> nice would be orange, sand red, sand blue, light blue, sand green, and a
> few other colors. I don't expect pink etc. to be available this way, but
> it would be nice to see the current bulk packs extend to many of the
> unusual colors (excepting the Scala colors, though it would be nice to
> have more elements in those colors).
I would like to see a 2nd tier bulk ordering system as well although I am not
going to hold my breath. I am pretty happy with what they have in terms of
prices on the rarer colors. About the only thing I can think of that would
decrease my bulk purchasing is if they do away with the 3033. I am willing to
spend some extra to build a couple Dark Gray or Tan Buildings but that is just
for variety. Most of my buildings will still be built with primary LEGO colors
and if the 3033 goes away I can definitely see my buildings and bulk ordering
going down.
Eric Kingsley
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Message is in Reply To:
 | | Re: Bulk Pricing (Interesting comparison?)
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| (...) I don't think it's "obvious" they can do better. I think the buckets and tubs (pretty much only available in the US and Canada I think) are almost a loss leader. I don't think they actually are a loss leader, but I strongly suspect they are (...) (26 years ago, 14-Feb-01, to lugnet.lego.direct)
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