Subject:
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Re: Next year
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Newsgroups:
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lugnet.market.theory
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Date:
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Thu, 21 Sep 2000 17:02:03 GMT
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Viewed:
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913 times
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Kev z --- your store employee or Lego Rep is wrong.
Think, for a minute, about the number of transactions involved...even given
computers, and we all know that the big chain computers are not always right,
how could a retailer POSSIBLY track all the Lego sold in order to send a bill
to Lego for the margin hits? What happens when the same set is sold for
different prices because of regional sales? What about "instant markdowns"
because the store staff mis-labels a set so it scans higher than a price
sticker price? Do you really think Lego would pay for the store's mistakes??
No.
Retailers pay a standard price for each set, based on a contract with the
manufacturer, which gives a standard discount based on volume.
This discount ranges anywhere from 10% to 50%, depending on the size of the
retailer and the total volume purchased.
The retailer absorbs all margin hits on standard price reduction sales, whether
they are BOGO, % off, or set price reduction (to a clearance price). The ONLY
time that Lego, or another Mfr. would pay for a discount, is in the case of
Mfr. coupons, such as the UCS $10 coupon. Store coupons, such as TRU uses, are
not paid for by the Mfr.
In short, TLC has no involvememnt in standard sales at retailers.
Paul Sinasohn, ex-Financial Analyst
MBA (Finance) 1985 Golden Gate University
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Message is in Reply To:
 | | Re: Next year
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| In lugnet.market.theory, Kevin Wilson writes: <Snip my own message> (...) I'm also in Canada (Montreal) so I doubt that it is a factor. The rep told me that, at most, the retailer took a 10% hit on his margin during sales. The rest of the discount (...) (24 years ago, 21-Sep-00, to lugnet.market.theory)
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