Subject:
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Re: [FA] - eBay - Lego CUSTOM: - Unique 4 axle custom Hopper
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Newsgroups:
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lugnet.market.theory
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Date:
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Sun, 12 Dec 1999 23:51:32 GMT
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Viewed:
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2583 times
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In lugnet.market.theory, Richard Marchetti writes:
> > I'll be very interested to see how this goes. It's something I have been
> > contemplating doing too. I wonder how TLC will react to this - after
> > all, it's competition for them, in a small way. I also wonder about the
> > possibility of forming a group or consortium of people who do or want to
> > do this kind of thing - a group sales website, for example, would pull
> > in more traffic than multiple individual websites.
>
> Actually, it looks like a big reason to NOT cooperate with AFOL on any
> specialty item or bulk ordering, if all they REALLY want to do is compete for
> marketshare against LEGO with their own, possibly better (I don't doubt)
> designs!
Hmm. I really don't think it's likely.
Point 1:I think it's safe to assume that LEGO will sell parts at a profit, yes?
So no matter what else happens, LEGO makes money indirectly every time a
custom model gets sold.
Point 2:It's a fairly well-established market fact that a 'cottage industry'
simply can NOT produce the same kind of product volume that a multinational
industry can.Larry might be able to provide 10 hoppers every few months, but he
can not produce enough to put 10 on the shelf of every toy store in the 1st
world.
Point 3:If someone out there develops models on a scale to compete with LEGO,
they will not be able to beat LEGO's prices. To produce at that volume, they
will incur industry costs similar to LEGO's, which, when combined with the fact
that their material cost is higher, will mean they are more expensive.
Point 4:If someone out there does develop custom modeling to the extent that
they are competing with LEGO, all LEGO has to do is stop selling to them. End
of competition.
> Larry even wants to claim copyright of the design, and as a design only,
> perhaps the claim is valid. But if he intends to claim any rights to the
> whole set, bricks included, I would guess no way! This isn't like molding
> from clay or carving from wood -- its all LEGO bricks, each one says
> bloody 'LEGO' right on it! Larry also wants control of the distribution of
> the design, but don't we have ready access to an extensive LEGO instructions
> scan database? So isn't Larry's position actually hypocritical? "O, its okay
> to have LEGO's instruction scans on the internet, just not mine..." Do I have
> this right, Larry? Will your exclusive control of this design lapse at some
> future point so that we can view it on Kevin Loch's server, or what?
Brickshelf does not give us access to instructions for any currently produced
sets. It's an archive, not a "current info" site. Ask Larry if he's willing
to have his instructions posted on the internet two years after he's stopped
producing his hoppers, and it will be a more accurate question.
> While LEGO had no intention of cooperating with us, I could see Larry's
> auction taking place and not worried about it one bit -- a flash in the pan,
> and we all would have known it. Suddenly LEGO DOES contact us, and its
> suddenly as if we are on our ABSOLUTELY WORST collective behavior. Some of
> you are too intelligent for your own, or our -- AFOL, good! I truly believe
> that we are coming off as total yahoos, without any sensitivity to LEGO's own
> interests. They will not deal with us from a position of taking a loss, only
> from one in which they will clearly profit -- then they, and only they, will
> make the profits, and we will be able to get the bricks to realize our
Nonsense. (in the nicest possible way, of course) :) Anything they sell to us
will be at a profit. Ergo, they can't deal with us 'from a position of taking
a loss'
> If LEGO Direct is going to do what I would do if I were in their position,
> then it means a radical break from how us AFOL have been doing business and
> acquiring the parts we want. There is no reason for it not to be profitable
> on some basis. Some of you are apparently making your living from reselling
> parted out set pieces. I think LEGO knows this and have figured out what that
> means to them.
I'm not sure what you mean here... What do you think Lego has figured out? I
think they've figured out that there's money out here, and they can get it.
> In trying to make contact with LEGO, all I wanted was access to the parts.
> Now I can see that other ideas have been floating around. And if they can
> work alongside LEGO's own plans, no problem. But to the extent that we are
> talking about competing with them, BIG PROBLEM!
Again, IMHO, the amount of competition a cottage industry can give a
multinational industry is negligable.
> If I could have gotten what I needed from LEGO Direct, then I wouldn't have
> been dealing with Kevin Wilson for the sets he is sending me (may the gods
> love him), nor would I have needed Larry Pieniazek (may the gods love him) as
> a factor in a deal I made with a Brit some months ago. Thanks guys, and I
> mean it, but right now I am thinking of putting you out of the LEGO 'cottage
> industry' in favor of working with 'LEGO Direct'-ly, as it were. And right
> along with you I won't be needing the likes of Baylit, the Vault, MA#XX,
> Auczilla, or anyone else's set or parts auctions or sales sites. Not if in
> the future I can deal with LEGO Direct and get what I am looking for!
Yup, me too, and I suspect 98% of everyone else here. If Lego gives us what we
want, we wont' go anywhere else. But even with LEGO Direct, I don't think they
can provide for the needs of everyone, and make a profit. So the cottage
industry will still exist, providing services that aren't needed enough for
LEGO to do them profitably.
> > BTW, we should be very careful next Summer and very clear in our discussions
> > with LEGO Direct that we desire any bulk purchase arrangements to be free
> > and clear of any strings attached which might prevent someone from reselling
> > the parts they purchase. Personally, I would boycott any bulk purchasing
> > arrangement in which the purchase agreement disallowed resale.
>
> Well, that's bloody great! You boycott it -- I just want to build. Thanks
> for nothing! I suspect that they will at least stipulate that we are not
> allowed to sell the bricks as sets. Isn't that what they do? Isn't that their
> historically primary business?
And what if LEGO Direct doesn't sell in quantities less that, say, 1000? What
if you need 1? Will you spend 1000 times what you need to, or will you buy
from someone in the cottage industry?
If LEGO Direct doesn't allow reselling, you'll HAVE to spend 1000 times more
than you need to.
> James Powell wrote:
>
> > I would think that they -might- put a stipulation on that you cannot resell
> > directly (Ie auction on E-bay for 3x the money).
>
> Uh huh. Thats what I think too. Sell to a builder, yes -- sell to a
> reseller, no! Why would they cut anyone else into a profit they themselves
> could realize? I just can't see it.
Because they can make a profit if they sell 1000 to one person (lower costs in
a bulk puchase) but not if they sell 1 to 1000 people.
> P.S. Maybe I am taking it too seriously, I dunno...Larry asked me to post this
> thing. I have nothing but respect for anyone I have mentioned by name or by
> the name of their auction site. I am not against any of you as such -- VERY
> MUCH the opposite is true. I am also VERY MUCH in favor of LEGO Direct
> perceiving us a community they would want to specifically market to AND in a
> sensible way -- and not just through sets as has been the case for too long a
> time. Perhaps this will all work out some way.
You raise valid points, but yes, I think you're taking it too seriously. :)
Bottom line is that cottage industry can do things that large-scale industry
can't, and vice-versa. This means, IMHO, that the cottage industry simply
CAN'T compete with LEGO in any significant sense.
James
http://www.shades-of-night.com/lego/
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