Lego back in Canadian Wal-marts

[Johnny 5]

http://www.cbc.ca/consumer/story/2008/02/1...go-walmart.html

So who's fault was all this? TLG's or Wal-mart's?

[hoang]

i say both.

[Johnny 5]

Hasn't TLG had trouble with retailers complaining about price differences between countries before?

I'm guessing that Wal-mart was the first to have the muscle to do something about it.

[gylman]

Clearly a TLG issue. I think you are dead on Johnny 5.

[tedbeard]

Johnny, I see from your profile that you are from Texas so perhaps that explains the totally inappropriate editorializing in the thread title. You wrote "Good news for canadians" which is both inaccurate and incorrectly written as Canada is usually spelled with a capital "c". :-/ But that is just being nit-picky.

My real argument is that the return to Canadian Wal-Marts is nothing less than a punch in the head to Canadian consumers and of no benefit whatsoever. There was no shortage of LEGO outlets in Canada with national chain Zellers usually offering better deals on LEGO products through nearly monthly BOGO specials. And now we are further behind in our hopes to have some sort of adjustment in pricing similar to the automobile, books and comic industries which have had to bring prices more in line with American $$ pricing.

LEGO is already seen as an over-priced luxury item by most moms and dads in Canada. With awareness of the dollar's value against the $U.S. more people will drive across the border and shop where prices are 30% less simply because they drove across the border. Adults ask me for for buying advice all the time and I cannot in good conscience recommend buying LEGO in Canada at MSRP.

[natelite]

why would you wanna drive across the border to get a set for 30% cheaper when you can get BOGO at zellers? especially when the BOGO events are frequent.

[gylman]

Well, "frequent" BOGO has not been my experience. It's pretty uncommon actually except on single items like Xpods, miniracers, etc. Once in a while a real BOGO comes along, but I don't remember the last time that happened.

TRU was selling many LEGO items at 20-40% off MSRP during most of the October - December period. The sales varied week to week, and they managed to cover more or less the entire product line over that time period, and I loaded up on many things from Castle to Technic, Town, Creator. However, all the TRU products now are back to MSRP again.

Tedbeard, I don't necessarily agree that return to WalMart of LEGO product is a bad thing. For all we know TLC compromised with Wal-Mart, and there will be a price reduction. Other retailers will have to follow.

Don't get me wrong, I'm no Wal-Mart fan, and on the few times I have shopped there, I have found their selection of LEGO to be crap. Nearly all of my retail LEGO purchase is from TRU, with occasional Zellers/Hudson's Bay when they have a good sale, and from smaller toy stores whenever I can.

[blueandwhite]

Realistically speaking, I very much doubt Canadian prices are going to come down to match the US. If anything, US prices are going to start to crawl up in the next few years owing to a weak US dollar. Sure, it's frustrating being Canadian when you know that only a few hours away your American friends are enjoying better pricing, but the real question is whether our prices in Canada are artificially high, or whether US prices are artificially low. Right now given the steady slide in the US greenback over the past four years, I would suggest that American pricing is an issue.

That being said, I just picked up Gotham Assylum at Toys R Us for $59, so every now and again good bargains do find their way into Canadian stores. I don't like Canadian prices, but then again they aren't really that much different from the pricing paid in other countries.

[natelite]

well, ted did say zellers BOGO were like monthly. to me that's frequent enough. :-P unless you receive your paycheck weekly, in which case i would agree, it's not "frequent" enough. hehehe.

does zeller mark up normal retail price? in that case, BOGO isn't really BOGO either. :-P

i think the compromise with walmart will be in the form of frequent d/c sales, tbh. that way TLC doesn't need to extend the same pricing to other retailers. however that can really backfire especially if the sales became too frequent to the point where consumers equate sale price to "normal" price, and msrp = marked up price. :-D it's all about expectations.

what i don't understand is why everyone is comparing their countries' prices to US prices. lego bricks are manufactured in different regions. lego isn't made in the US. TLC's cost base doesn't decrease when the US$ depreciates. in fact, it probably rises since the raw material price rose (i.e. oil).

and if you have been paying 100 euros (or loonie) in the past for 1000 pieces sets then what has changed that you need to pay less now?

we know that TLC manufactures in denmark, hungary, czech and mexico. 3 of those are in the EU and all 4 nations' currencies have rose against the US$. that means labor cost has risen relatively vs the US$. if TLC were to adjust its MSRP so that every country is based off of US's prices, then revenue decreases, cost increase = loss!!!! (or lower gross margin).

just because they happen to be subsidizing US doesn't mean that every other country needs to be subsidized as well, right?

afterall, their game plan is to capture a bigger pie of the US toy market. if they were to raise price in the US to match their cost base, wouldn't that mean lower sales? hence a need for them to lower prices in the US to stay competitive vs mattel and hasbro. In fact, i am quite surprised that they haven't been sued with "dumping goods" by the US toy industry yet. :-D

[blueandwhite]

afterall, their game plan is to capture a bigger pie of the US toy market. if they were to raise price in the US to match their cost base, wouldn't that mean lower sales? hence a need for them to lower prices in the US to stay competitive vs mattel and hasbro. In fact, i am quite surprised that they haven't been sued with "dumping goods" by the US toy industry yet. :-D

Well, almost every product sold in the US is noticeably cheaper than it's non American counterparts. From cars to books and gas; you guys get everything at a good price. I'm simply done with LEGO when I can get the same thing from Bricklink for far less. It's sad when it actually costs less to go through a middle man. I'll only buy LEGO in a store if it's on sale these days.

Edited February 22, 2008 by blueandwhite

[tedbeard]

For all we know TLC compromised with Wal-Mart, and there will be a price reduction

I guess you did not read the article that was posted at the top of this thread. It clearly states that LEGO made no concessions on price whatsoever.

That being said, I just picked up Gotham Assylum at Toys R Us for $59, so every now and again good bargains do find their way into Canadian stores.

Good price on Arkham Asylum but there is only one problem. It is a two-year old set and I have been watching them sitting on the shelves of my local TRU for over a year waiting for a serious price reduction. It's not really a bargain finding it's way into a store when they are clearing out outdated stock that has been sitting on their shelves for years. *sweet*

why would you wanna drive across the border to get a set for 30% cheaper when you can get BOGO at zellers? especially when the BOGO events are frequent.

No Canadian retailer has more than 20-40% of the complete LEGO line available to retail chains at any given time. "Almost monthly" means they seem to have one every 6 weeks or so for much of the year but they manage the inventory so well that mainly what you could get last year on the BOGO specials was Bionicles, Exo-force and some Creator Sets (if you were lucky). Licensed sets were almost never on the shelves when a BOGO sale happened (I sometimes wonder if they remove them from the shelves for the duration of the sale.)

If you want a specific set for a reasonable price when you want to buy it you have to cross the border. Wal-Mart caving has done nothing to improve that situation.

[gylman]

I guess you did not read the article that was posted at the top of this thread. It clearly states that LEGO made no concessions on price whatsoever.

Sorry, but I still can't see where it says that.... All I see is that it said the dispute was "resolved". It did not say how.

I agree with Natelite above... probably Walmart will have more opportunity for offering sales and specials editions.

My LEGO buying these days is identical to Blueandwhite's: sales only, Bricklink or Ebay for current sets I want. Only recent exception was the Town Plan, which I paid for on S@H, and promptly received a mashed-up box. :-(

[natelite]

My LEGO buying these days is identical to Blueandwhite's: sales only, Bricklink or Ebay for current sets I want. Only recent exception was the Town Plan, which I paid for on S@H, and promptly received a mashed-up box. :-(

call customer service for a replacement. if you are lucky they may not even request you to return the mashed up set. :-D just for the record, i haven't had such luck. i had a few destroyed or opened boxes they tried to offload to me but i called and gotten replacements, and they collected the badly dmged sets.

[blueandwhite]

Good price on Arkham Asylum but there is only one problem. It is a two-year old set and I have been watching them sitting on the shelves of my local TRU for over a year waiting for a serious price reduction. It's not really a bargain finding it's way into a store when they are clearing out outdated stock that has been sitting on their shelves for years. *sweet*

Well given the price, what would you expect :-D . That being said; a bargain is a bargain. LEGO bricks don't really go out of date per se, and it's not like I would pay full price for the set to begin with. I got a good assortment of bricks and bits for far less than 10 cents a piece. For me, that's a pretty good deal right there.

Most bargains come when stores clear stock. If the Viking ships do the same, I would probably pick up a couple of those as well *yoda* .

[tedbeard]

Sorry, but I still can't see where it says that.... All I see is that it said the dispute was "resolved". It did not say how.

My apologies, I thought the CBC story contained what the DOW JONES report said:

14/02/2008 DOW JONES NEWSWIRES TORONTO (Dow Jones)--Wal-Mart Canada Corp. has resolved a pricing spat with LEGO Group (LEG.YY) and fixed a potential conflict of interest that the dispute brought to light. As reported last week, Wal-Mart Canada, a unit of retailing-giant Wal-Mart Stores Inc. (WMT), discontinued its business with the toy-construction icon at the beginning of the year, due to a disagreement over pricing. At the time, Wal-Mart Canada declined to comment on the dispute with LEGO but that, generally, it wouldn''t tolerate "unfair pricing for our Canadian consumers." In a joint statement Thursday, the companies said they have reached a mutual decision to reinstate LEGO products on Wal-Mart Canada''s shelves, but didn''t elaborate. "Specific timelines, assortments, space and category-management responsibilities are being worked out to provide the best value to our mutual customers," the companies said. A spokesman for LEGO said in an e-mail message that details of the resolution are confidential, but confirmed that LEGO didn''t lower its prices in Canada.

Source: cached version of http://www.intesatrade.it/intesa/News/Dett...i&idNot=1041748 - emphasis added by me.

So now we are clear. No change in pricing to reflect the reality of the relative values of the dollar and the growing anger amongst Canadian consumers who are feeling screwed over by opportunistic corporations.

I agree with Natelite above... probably Walmart will have more opportunity for offering sales and specials editions.

So what? There are just as many sales and special editions at American stores and sales there would be discounts on prices that are already 30% cheaper than here in Canada.

To make it more clear: when a BOGO sale happens and you get 25% off each of two sets you are STILL paying more than REGULAR price across the border in the United States and it that would apply to ALL sets, not just a limited number of sets available during the sale!

And I suppose it is nice that you buy off BrickLink but this issue affects the entire LEGO community in Canada including moms and dads who just want to buy little Johnny a set for his birthday but will now buy MB because the price difference is insulting and they don't like feeling screwed.

[gylman]

And I suppose it is nice that you buy off BrickLink but this issue affects the entire LEGO community in Canada including moms and dads who just want to buy little Johnny a set for his birthday but will now buy MB because the price difference is insulting and they don't like feeling screwed.

Fully agree that TLC is missing an opportunity here. I guess they just don't care that much about this market. They figure they can count on their brand name supporting the premium price, and to some extent that's true. But the strength of the Canadian dollar was an opportunity to try to grow the market a bit, and I guess that's not a big enough thing for them to be worth the trouble.

Anyway, the future for TLC is in Asia. I think in North Am the market is mostly saturated. They probably don't have any major growth goals here - just hold their own against their rivals in terms of market share and bring down their costs.

[blueandwhite]

Realistically, LEGO has every right to charge whatever they feel. If they want to charge Canadians half as much, twice as much or five times as much as Americans, Europeans, or pretty much anybody else that's their perogative. It's my perogative to stop supporting their brand on the primary market when prices get too high. When it's cheaper to get the same product through Ebay, Bricklink or pretty much any other middle man out of the US, then there is no reason for me to support the brand directly.

The same is true of the average consumer. If they feel that the price difference between LEGO and Megabloks is no longer justified, then they should by all means switch over to the other brand or stop purchasing bricks alltogether. If LEGO is too expensive for mom and dad, little Johnny will probably be just as content with a video game. I'm actually disappointed Walmart caved in. Either way, it doesn't have much impact on my buying habits as I rely more and more on Bricklink.