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What is LEGO's Strategy on Regional Pricing? Availability?
I have notice that the prices change quite a lot when I change my location at S@H website.
For example the Minifigure Wrapping Paper 853240. In Spain I would have to pay 1,95€, in Italy 1,99€, in Ireland 2,49€, and in Germany 2,99€.
In this case I don´t think that one euro is really important but in some other sets there is a difference of 10 or 15 euros.
Sometimes Ireland is cheaper than the rest of countries, sometimes Spain is at the same level as Germany.
First I thought it was directly connected with the economical level in each country but now I don´t know what to think as there is not a constant for the variations.
What do you think?
For example the Minifigure Wrapping Paper 853240. In Spain I would have to pay 1,95€, in Italy 1,99€, in Ireland 2,49€, and in Germany 2,99€.
In this case I don´t think that one euro is really important but in some other sets there is a difference of 10 or 15 euros.
Sometimes Ireland is cheaper than the rest of countries, sometimes Spain is at the same level as Germany.
First I thought it was directly connected with the economical level in each country but now I don´t know what to think as there is not a constant for the variations.
What do you think?
Comments
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0 • Like •I have been looking up the national taxes in each country in europe and it is not so different in these countries (from 18 to 21,5%)
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0 • Like •ireland = 12.5%
germany = 28% + (this amount * (5.5%+14%)) the extras are solidarity tax and town trade tax
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0 • Like •France: http://search2.lego.com/exec/?q=10199&pt=&lang=2057&cc=FR => €72.90
Belgium: http://search2.lego.com/exec/?q=10199&pt=&lang=2057&cc=BE => €59.99
Germany: http://search2.lego.com/exec/?q=10199&pt=&lang=2057&cc=DE => €59.99
Does anyone have an explanation for these differences? A few euros I could understand, but €12.91 more expensive than BE or DE is a lot of money. Is shipping something to France that more expensive for LEGO?
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0 • Like •http://search2.lego.com/exec/?q=7189&pt=&lang=2057&cc=FR => €69.90
http://search2.lego.com/exec/?q=7189&pt=&lang=2057&cc=BE => €74.99
I'm now thinking about writing something that compares S@H prices for a bunch of items... Damn, this "catch a bargain" thing is hard.
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0 • Like •Over here it's usually a better idea to buy larger sets on Ebay and have them shipped to Sweden, even if the shipping cost is €50 or more.
So I'm officially challenging the aussies about who has the most expensive Lego... :-)
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0 • Like •I need to understand the strategy behind Lego and its release of sets/themes with respect to different countries. Lego has no direct presence in my country so we used to have to rely on importers and problem with that is the Importers do not focus more on Lego as they have other brands to work with as well.
Now that I am beginning to understand Lego as a small business idea on the side, I see that the sets are released in different regions and are not made available everywhere else at once. For someone like me, I had to go through the hassle to buy Super Heroes, new City sets, new Ninjago Spinners from the US. And recently made a friend who helped me get new Star Wars and new Friends sets from the UK. At the same time, I bought some POC sets, and some big Technic sets from another friend in Denmark.Even in the US, TRU gets sets which are not released on Lego.com, eventually TRU will charge markup. So it all adds to the hassle to get the sets.
Point is, why is this strategy being used by Lego? Is it because Lego wants people who can really invest heavily to buy the sets from different locations and then resell them for bigger returns? Or is it to create a certain cat and mouse race between Lego fans? As Lego being the company behind the most amazing toy EVER, is doing a service yet making money from it obviously. Why is there such a difference?
Sorry to rant but I am new to the Lego business and need to understand it better.
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0 • Like •Remember that the phenomena that we know instantly when someting gets released in any country is very new. Thanks to the Internet! But merchandise has been always released at different times at different markets, we just didn't know about it before.
I don't know if you ever had the chance to work with any major company that sells merchandise internationally or even in a larger region. The amount of detail that need to be pulled together for an item to appear on a shelf is staggering and things don't always go smoothly.
Due to LEGO fan sites we are way ahead of the curve and know way too much way too early...(c;
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0 • Like •My full time job is in Pharmaceuticals, so I know sales dynamics and how a product is made available to the public.
I just wish there was a better, easier, more humble channel to get this amazing product.
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0 • Like •Every time LEGO sells something internationally, they have to deal with customs and taxes-- both in the country of origin and the country of destination. And on top of that, they have to deal with distributors who can get the products where they're supposed to go.
That's quite a lot of hassle for LEGO, so they don't set up deliveries for a given country UNLESS they think that there's going to be sufficient sales there. If LEGO doesn't sell directly to your country, that's probably why.
Australia (for instance) had a lot of difficulties setting up a direct service, thanks to some strange legal issues (as well as "other factors", we were told). So even though LEGO *wanted* to sell directly in Australia, it took them a while to get something established.
Anyway, it's not cut-and-dry. There's only so much that LEGO can handle at a given time, and setting up shop in every country in the world just isn't worth it for LEGO.
DaveE
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0 • Like •But the part about distributors is also true. Everyone is in to make money so the price goes up. Availability can be sorted out but then price hikes up. And then is becomes too expensive to manage. But in my region, these two are the only hurdles, pricing which is very high and availability. Some of the importers buy old sets in bulk from places and then dump these here for a high price. And mainly that has discouraged a lot of potential buyers.
But that is another issue. I feel that if the price was right and items were made available to people over here, sales would go up.
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0 • Like •I think it also has to do with demand which I mentioned earlier. Japan, for instance, isn't a major market, meaning that it doesn't have much of a population of Lego fans or consumers and hence the not-so-high sales volume. That's why we only get the basic sets via Lego Japan. Other sets ( ie; SW or exclusives ) must be imported by other distributors.
I think many of us are in the same boat when it comes to wanting a wider selection of Lego sets. But there are a lot of issues to clear if we are going to have things settled more fairly.
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0 • Like •But I personally feel, more people should jump in and help spread the Lego love all over the world, especially places where people are ready to buy but where Lego cannot reach.
It is sad that I personally have emailed a few members here for the help, some have replied positively but declined nicely, keeping in mind no one likes to work for free, but then some did not even reply seeing where I am from. But that is a topic of another thread I guess.
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0 • Like •http://news.lugnet.com/events/brickfest/?n=371
At the time, the Australian LEGO fans were very upset that they didn't have a S@H service, and were constantly asking LEGO why it wasn't set up.
DaveE
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0 • Like •Asking me to help you does no good, I have no special sources, no access to Lego cheaper than anyone else. If you really want to bring Lego into your country, you need to stop talking to us and start talking to TLG.
Offer to be the in-country distributor. TLG needs someone domestic who knows the local culture and can be the contact and point-man who handles the receiving end, who sets up deals with retailers in country, etc.
Of course you probably need money to do this, but if there is demand for something, you can find someone local with money to help set it up in return for a share of the business.
From a money point of view, it makes no sense to add another middle-man, which is what any of us would be. Go direct to the source, buy container loads of Lego and import them into your country and setup distribution.
I would wish you nothing but success! :)
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0 • Like •Rather then sitting and waiting for importers to dump 2 year old products in the market every 6-8 months, I took off and started to use the indirect approach (offering markup on retail prices, buying from Bricklink in bulk, and other options), so its working, slow and steady.
The joy to spread Lego and to hand over something like the Black Pearl or the Unimog or a SW Battle pack to people here is really worth the hassle.
But sadly, our region will never become a collectors region like in the US, UK or Canada. There is big money in collecting and reselling stuff at higher prices which only very very few people know about.
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0 • Like •I guess it's just another headache that TLG has with the Customs of various countries (comes with the territory of being a toy exporter). Look at all the problems they're having with Poland right now with S&H orders being held up in Poland for other countries.
And then of course there Customs Canada... slooooooow...
Interestingly enough... TLG has had Custom (and laws) related problems going back to the 1950s. The first export country (Norway) had a toy import restriction ban for many years, which is why LEGO had to set up production (via Norwegian plastic maker Svein Stromberg & Co.) in Norway for nearly a decade. And later, in 1970, came the headaches with Italy when the Italian Parliament set up a construction toy import ban for several years (and that gave us Minitalia).
So TLG has had to deal with customs related issues nearly its' entire exporting existence.
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0 • Like •Is there a way to identify official Lego Distributors, Exporters and Agents in a region?
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0 • Like •@Coolsplash The job description in this comment shows that TLG is interested in "the potential for opening franchise/partner stores" and in developing "a framework for opening franchise/partner stores that can be successfully applied to locations worldwide." Looks like they don't have a system for dealing with franchises but maybe they will develop one in the UK that will then be used worldwide. If that happens, you might be able to open you own LEGO store! Really, it might be worthwhile to inquire about it with TLG directly.
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0 • Like •http://www.bricksetforum.com/discussion/186/when-do-you-think-prices-will-come-down
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0 • Like •Funny thing is, I ordered Town Hall from Shop@Home during the free shipping event last month, and I got it for the regular 150 USD price. So if LEGO doesn't charge Hawaii resident any extra money to ship to Hawaii, then why does the LEGO store charge higher prices in Hawaii? Too bad, because this is the first time that I have lived near a LEGO store.
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0 • Like •The rent at Ala Moana Mall is probably higher than the typical mainland mall, and therefore items carry a slight markup to offset this, similar to a location like Rockefeller Center. I actually visited the store in February, and although I'm not sure where it ranks in sales, it did seem on the lower end. Tourists, which I imagine comprise a good portion of mall traffic, simply won't be able to transport the large boxes home.
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0 • Like •In some places, product A will go for X dollars, in another place, it will go for Y dollars.
Product B will go for a different set of dollars and a different spread, given regional tastes.
Lego is in business to make money, it is what I'd do if I were them. So very few of their customers are ever going to actually notice anyway...
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0 • Like •There is a *reason* why everything costs more over there, it costs more to do business over there. To open a business here costs almost nothing and generally takes very little from the government to do so, taxes (for all we complain about them) are pretty low, a lot can be "written off" to reduce them, etc.
To put it bluntly, all those wonderful social services you enjoy, cost money, and part of the price of that is paid in the price of goods. Everything from a higher minimum wage to universal health care all costs *something*, you're seeing part of that *something* in the price of Lego in Europe compared to the USA.
The above comment is not meant to be pro/con, I see both sides and benefits to what Europe has, I'm simply pointing out that one of the prices to be paid are higher prices on goods purchased. This is not a "good" or "bad' thing, it just is what it is.
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0 • Like •Well as my fellow brethren here has seen me rant and stuff about LEGO products not being easily available in my country, I would like to share some news with my friends here. We recently got a official LEGO presence in my country, right in my city! At first it was hard to believe but then I found out the facts about this group. They have created a Webstore where they sell LEGO from and I think a physical store is underway but will take time. So LEGO is available but most bizarre part is as follows:
- Not everything is available i.e. in Super Heroes the Catwoman set is not available nor is the Dynamic Duo (obviously as its Out of stock everywhere it seems)
- The 2012 sets in Star Wars, City are not available
- The prices are so high that ordering from Bricklink or asking some friend from Brickset is much cheaper :P
So my point being, even this venture is being managed by a big Importer who has limited access, no idea about the market and has higher prices. Oh oh, I'm ranting again :P
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0 • Like •In the U.S., a Porsche Cayenne cost less than what a Chrysler 200 convertible (Lancia Flavia) cost in Europe!
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0 • Like •From the 2005 Lego Annual Report, the breakdown of revenue is -
> North America & Pacific - 27%
> Europe, Asia & Emerging - 59%
> Direct to Consumer - 10%
> Other - 4%
From the 2007 Annual Report, the last time they published revenue figures by region, the breakdown was different -
> Central and Southern Europe - 27.1%
> Scandinavia, Benelux, Eastern Europe, Asia - 26.5%
> North America, Australia, New Zealand, United Kingdom - 30.1%
> Community, Education, Direct - 16.3%
Other figures I've seen, not in the public domain, confirm that Europe, as a whole, is a much larger market than the US for Lego, but that they don't treat Europe as a single market for accountancy purposes. Yes. Exactly that.
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0 • Like •Doing a bit more research, in 2010, North America had 29% of the global toy market, Europe had 28%, and Asia had 28%. The US alone commanded 26.3%. UK was 5.4%, France was 4.9%, Germany 4%. Australia was just 2.8%, and Canada just 2.5%.
So if their 2007 numbers are still somewhat accurate today, they seem to match up with these overall worldwide numbers.
It would be nice to know the breakdown of the Community/Education/Direct numbers by region.
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