Can't LEGO keep up with demand?

[JopieK]

LEGO can't keep up with demand that's the only thing I'm sure of. I might have overlooked, butI did not notice any relevant Black Friday promotion, last year I got the Disney train at about 100€ or so.

I ordered some sets as during the VIP weekend a weeks ago and got the nice little Dickens book, yesterday I ordered some more sets for my wife, but apparently one can only receive a single Dickens book due to "popular demand", so I cancelled the order as Amazon.de was much cheaper with the technic sets for her

Normally I would go to a store, but I don't like busy shopping area's, if I catch COVID without noticing I might jeopardize quite some students (even though wearing face masks in school, helping them with their assignments means I can often not keep 1,5m distance).

But even in Dutch stores stock is apparently dwindling, so many sets show 'out of stock', it is really horrible. Some sets have such limited quantity one can't get it through LEGO unless one immediately gets it: I got the Christmas 40436 through bricklink, it was sold-out here in no time. Well my wife likes it, that was the main point.

I'm wondering if the factories are slow because of COVID or demand is sky-high (or maybe both?).

[JintaiZ]

I'll talk about it from my personal experience: I ordered two battery boxes from LEGO.com, but then I received an email saying my order was cancelled because limit was exceeded, I had no idea why because the limit was said to be 5 per person. I ordered again but the same issue happened.  I ended up getting them on bricklink, but for a higher price...

As for the issue, I think Covid has a large impact on it. Well... there's not much to do at home, other than lego, right!?

Edited November 30, 2020 by JintaiZ

[Mylenium]

39 minutes ago, JopieK said:

I'm wondering if the factories are slow because of COVID or demand is sky-high (or maybe both?).

Both and on top LEGO did the stupid thing of releasing a ton of big sets this year that tie up lots of production capacity.

Mylenium

[Vindicare]

I’d say it’s both, leaning more towards the factory side of things. In late April, my first outing back in the wilds of Target they were low on everything LEGO. I did manage to find a good amount of CMF20, but then didn’t find any again for months. Then we saw boxes showing up with stickers that had the added US box needs, piece count &...something else, which means the Mexico factory was shut down for a time. So both stores(Walmart & Target) & S@H were low on items. 

Edited November 30, 2020 by Vindicare

[deraven]

I feel the same pinch on availability that a lot of others are feeling.  I understand some of the supply chain and production challenges are truly not within TLG's ability to control, but I didn't get to take advantage of the Black Friday promotions since literally every larger set I've been waiting to order is "temporarily out of stock" with no backorders accepted.  If they're struggling with demand it seems like it would be logical to accept backorders (maybe with a big lead-time window to set expectations properly) so they at least know what they should be producing in the factory queue.  I mean, obviously they should have data on that regardless since they know what they're doing with analytics, but it makes me think that their current bottleneck in production is worse than it has been previously if backorders aren't accepted and there's no ETA listed for when those things will be available again.  

[MAB]

Finding things I wanted to get the recent promos was difficult due to out of stock current sets. I ended up going with items I think I can sell on rather than items I actually want.

Edited November 30, 2020 by MAB

[AFOLguy1970]

15 hours ago, deraven said:

I feel the same pinch on availability that a lot of others are feeling.  I understand some of the supply chain and production challenges are truly not within TLG's ability to control, but I didn't get to take advantage of the Black Friday promotions since literally every larger set I've been waiting to order is "temporarily out of stock" with no backorders accepted.  If they're struggling with demand it seems like it would be logical to accept backorders (maybe with a big lead-time window to set expectations properly) so they at least know what they should be producing in the factory queue.  I mean, obviously they should have data on that regardless since they know what they're doing with analytics, but it makes me think that their current bottleneck in production is worse than it has been previously if backorders aren't accepted and there's no ETA listed for when those things will be available again.  

This.  I totally get they cannot keep production up with the demand.  However, it really makes no sense to offer a high threshold GWP and have literally nothing available in that price range.  I wonder if they should have even produced the GWP sets as that now takes away from producing the sets we would want to buy in order to even qualify for them!  The fact that I can not preorder a new release or backorder something is literally leaving money on the table for Lego.  I had saved up for Mos Eisley Cantina, something not seen for months now.  It was only available for a few days at most.  I got the Batwing instead before it predictably disappeared as well.  Thankfully, I also got the Elf Clubhouse when it first came out and did not make the huge mistake of waiting for Black Friday to pick it up.  It is also a tough time for Star Wars fans right now.  I agree that they must really be behind at the factory if they cannot even offer backorder options.  

15 hours ago, MAB said:

Finding things I wanted to get the recent promos was difficult due to out of stock current sets. I ended up going with items I think I can sell on rather than items I actually want.

A lot of people are doing this, and not just with Lego.  My guess is a multitude of PS5 buyers lucky enough to snag one at retail price are turning right back around and selling it for a big profit.  I was tempted to try to pick up a few Razor Crest sets as I knew the moment would come when they too would be unavailable and someone would be willing to pay a nice price for one in order to get it by Christmas.  I may have to do this next year with the advent calendars.  If you can buy several in September and October and then wait until Thanksgiving week, you can probably make bank in no time.  

[howitzer]

26 minutes ago, AFOLguy1970 said:

This.  I totally get they cannot keep production up with the demand.  However, it really makes no sense to offer a high threshold GWP and have literally nothing available in that price range.  I wonder if they should have even produced the GWP sets as that now takes away from producing the sets we would want to buy in order to even qualify for them!  The fact that I can not preorder a new release or backorder something is literally leaving money on the table for Lego.  I had saved up for Mos Eisley Cantina, something not seen for months now.  It was only available for a few days at most.  I got the Batwing instead before it predictably disappeared as well.  Thankfully, I also got the Elf Clubhouse when it first came out and did not make the huge mistake of waiting for Black Friday to pick it up.  It is also a tough time for Star Wars fans right now.  I agree that they must really be behind at the factory if they cannot even offer backorder options.  

A lot of people are doing this, and not just with Lego.  My guess is a multitude of PS5 buyers lucky enough to snag one at retail price are turning right back around and selling it for a big profit.  I was tempted to try to pick up a few Razor Crest sets as I knew the moment would come when they too would be unavailable and someone would be willing to pay a nice price for one in order to get it by Christmas.  I may have to do this next year with the advent calendars.  If you can buy several in September and October and then wait until Thanksgiving week, you can probably make bank in no time.  

Only a guess, but I believe the decisions on what kinds of sets to produce (and GWPs along with them) have been decided already last year or even the year before that, and in the meantime sets have been finalized and factories adjusted for the new products. Then COVID happened and threw a huge wrench in their production machine, making it a lot harder to meet the demand.

Similar things have happened in other industries too, for example I shopped recently for a new bike for my kid, and while one shop happened to have a suitable one in stock (which I bought), they were mostly out of bikes to sell and spare parts and accessories were running low too. Another shop which is usually very well stocked had total of eight bikes available for sale and none of them kid's bikes. No promises on when they'd be getting new stock either, maybe in January, maybe in late spring. Apparently there's also significant problems with the production of new computer hardware, namely the newest graphics adapters and such. So it would be surprising if TLG were somehow able to run production at full capacity.

[MAB]

They are now finding stocks of sought after sets that were previously unavailable during the Black Friday/Cyber Monday promotions. Yesterday the Tantive IV 75244 was not available, even on backorder. Today, it is in stock, available for shipping. Same with a few other larger sets.

 Either they were holding stuff back, or they have little to no planning in their stock system.

[Grover]

18 hours ago, deraven said:

I didn't get to take advantage of the Black Friday promotions since literally every larger set I've been waiting to order is "temporarily out of stock" with no backorders accepted.

This.  I've had several sets I've wanted since August that have never come back in stock.  The most annoying thing to me is to receive advertisements in my e-mail promoting one of the sets that they haven't had in stock in months.  Don't advertise something you can't sell!

[koalayummies]

3 hours ago, AFOLguy1970 said:

A lot of people are doing this, and not just with Lego.  My guess is a multitude of PS5 buyers lucky enough to snag one at retail price are turning right back around and selling it for a big profit.  I was tempted to try to pick up a few Razor Crest sets as I knew the moment would come when they too would be unavailable and someone would be willing to pay a nice price for one in order to get it by Christmas.  I may have to do this next year with the advent calendars.  If you can buy several in September and October and then wait until Thanksgiving week, you can probably make bank in no time.  

That's the holiday spirit.

[Toastie]

6 hours ago, MAB said:

they have little to no planning in their stock system

As a toy company that is regarded as top-notch? As in #1 in the world? (https://www.toytico.com/top-15-toy-brands-on-the-planet/)

Well. I must say: Either their erroneous and no-planning stock system is by chance just working out as the company stumbles through time (with odds I do not want to know) or - they leg (very) godt.

Best
Thorsten

[Toastie]

On 11/30/2020 at 8:36 PM, JopieK said:

I'm wondering if the factories are slow because of COVID or demand is sky-high (or maybe both?).

In direct answer to your question:

Maybe this is a plan? And it just plays out well? Folks freaking out? Getting out the "out of stock" "on back order" "sold out" message? Then "all of a sudden" sets are back in?

On a totally different issue but along this "plan": Banks here in Germany (and I would bet around the rich men's world) like to print out - not even bothering with putting a separate sticker on the original ad - "sold" on a house/flat/whatever ad - just to create some sort of ... "damned, missed that and need to find other ways to get it or something similar AND fast or these will be gone as well" feeling ...

I don't know. To me this seems like a no Covid, no sky high demand issue - but rather a very good plan.

The moment something is sold out, it tells the "red-hot" story. There are two approaches (just argued business-wise!): Make only a few to minimize risk, better for small businesses - or just make a (huge) number of sets that a very smart department has figured out using 50++ years of market analysis data as the most probable target. And then claim: Sold out. And then: In stock again. And then ... well: Play it well. They know demand, can adjust messages, production runs, storage capacity.

We as customers may be a little upset - but as members of the ever believing crowd, we ... cope with it. I believe they know that also very well. Otherwise, the whole plan would not work out.

Being the #1 world toy market leader tells a story. And with a lot of competition in the tank full of sharks even more than just only one.

Just my 2 cents.

Best
Thorsten

[JintaiZ]

1 hour ago, Toastie said:

As a toy company that is regarded as top-notch? As in #1 in the world? (https://www.toytico.com/top-15-toy-brands-on-the-planet/)

Well. I must say: Either their erroneous and no-planning stock system is by chance just working out as the company stumbles through time (with odds I do not want to know) or - they leg (very) godt.

Best
Thorsten

I think the stock system worked fine before Covid-19. But now LEGO simply can't keep up with the huge demand...

[Mylenium]

9 hours ago, JintaiZ said:

I think the stock system worked fine before Covid-19. But now LEGO simply can't keep up with the huge demand...

Well, then their stock system and logistics don't work well at all. That's ultimately the point. Really no way to put it differently. If car manufacturers or other companies had such fragile supply chains, they'd long have collapsed.

Mylenium

9 hours ago, Toastie said:

The moment something is sold out, it tells the "red-hot" story.

LEGO has no plan in that regard. I far too often find myself thinking that utter morons must run their market analyses. It's really that old "ivory tower" syndrome where some of their decisions appear so far removed from reality, it's really incomprehensible. This has happened time and again, not just with expensive Creator and Ideas sets. I wrote a whole article about the failure of Hidden Side (https://myleniumsbrickcorner.wordpress.com/2020/11/17/the-predictable-failure-of-hidden-side-a-post-mortem-analysis/) and similar things could be said for other series or some individual products.

Mylenium

[Lyichir]

18 hours ago, Toastie said:

In direct answer to your question:

Maybe this is a plan? And it just plays out well? Folks freaking out? Getting out the "out of stock" "on back order" "sold out" message? Then "all of a sudden" sets are back in?

On a totally different issue but along this "plan": Banks here in Germany (and I would bet around the rich men's world) like to print out - not even bothering with putting a separate sticker on the original ad - "sold" on a house/flat/whatever ad - just to create some sort of ... "damned, missed that and need to find other ways to get it or something similar AND fast or these will be gone as well" feeling ...

I don't know. To me this seems like a no Covid, no sky high demand issue - but rather a very good plan.

The moment something is sold out, it tells the "red-hot" story. There are two approaches (just argued business-wise!): Make only a few to minimize risk, better for small businesses - or just make a (huge) number of sets that a very smart department has figured out using 50++ years of market analysis data as the most probable target. And then claim: Sold out. And then: In stock again. And then ... well: Play it well. They know demand, can adjust messages, production runs, storage capacity.

We as customers may be a little upset - but as members of the ever believing crowd, we ... cope with it. I believe they know that also very well. Otherwise, the whole plan would not work out.

Being the #1 world toy market leader tells a story. And with a lot of competition in the tank full of sharks even more than just only one.

Just my 2 cents.

Best
Thorsten

I feel like this kind of conspiracy theory isn't necessary to explain shortages, nor does it even make sense for that matter. I would think that FAKING a set being "out of stock" (and thus ensuring that people who look for it during that period would leave disappointed) would do much, much more harm than the chance of increased demand when sets became available again would merit. I just was looking on Lego.com yesterday to give gift suggestions for a friend of my Mom's, for example, and 90% of the Lego Friends sets were out of stock! With the holiday getting closer and closer, it's less likely for buyers to wait around for sets to be restocked (especially with no real assurance of when that would happen) and more likely that they'd buy something else (even a non-Lego gift) in its place. So why gamble on the possibility of future demand if the demand is already there and can be fulfilled immediately?

The more obvious explanation for "out of stock" sets suddenly becoming available again is that more sets were delivered from the factories, or inventory was reshuffled to account for what avenues were getting the most demand. Earlier this summer, for example, COVID-driven shortages on Lego.com led some orders on the site to be fulfilled and shipped from closed retail stores. It's not unbelievable that something similar might be happening here.

[MAB]

13 minutes ago, Lyichir said:

The more obvious explanation for "out of stock" sets suddenly becoming available again is that more sets were delivered from the factories, or inventory was reshuffled to account for what avenues were getting the most demand.

Given that LEGO both manufacture and sell these sets, it is surprising that some OOS sets that are not available for either immediate delivery or on backorder but suddenly appear the day after a promotion has ended. LEGO should know what stock they have produced and where it is. If they can offer backorders for other sets that are not in stock with backorder dates in some cases months into the future, then why cannot they do the same for sets that are suddenly in stock the day after the promotion ends? They know what has been manufactured and what is in the supply chain. I cannot believe that stock just shows up that they have absolutely no knowledge of. Even more coincidence that it appears the day after a promotion ends.

LEGO also showed how stingy they were with the VIP voucher offers this year. They had a Cyber Monday offer of a virtual (lego.com) £20 voucher for £10 of VIP points (and maybe the same offer in different currencies elsewhere). Yet this went out of stock early in the morning of Cyber Monday. So they were advertising a Cyber Monday deal that was unattainable as they were out of stock of a completely virtual product. What it appears happened is that they only wanted the promotion to cost them a certain amount, so they stopped the offer when that amount had sold, even though they kept advertising it to people that missed the offer. As they do that, I have no problem believing they hold back stock during a promotion so they don't have to give away too many free sets. It looks like they are holding back the stock that they know will sell as soon as it is put back into circulation to avoid too many people taking advantage of the BF promotion.

[Toastie]

5 hours ago, Lyichir said:

It's not unbelievable that something similar might be happening here.

I totally agree! And the contrary to that is not what I was trying to say.

First of all, my blurb, written about midnight in Germany above, is as far away from any theory (conspiracy or not) - than everything else most of us are speculating here - and if I may, as you do as well. Unless - you have close ties to TLGs decision-making folks or the like. I have not. Zero. Nothing. I am just about 55 years playing with bricks. With an about 10 years blackout. That is all there is. 

More importantly though is: It is >my< (nothing more) view on this. Posting something here on EB is not automatically a conspiracy theory - it is a very personal opinion. There is simply too much crap out there being called a conspiracy theory as I would like to take your judgement easy. I don't. But it is what it is.

My take was simply that: TLG is a multi-million $ enterprise. It is #1 in the toy market. They have (let us for simplicity take 1960 as kick-off) 60 years of experience. Let us move on to the internet age: They have more than 20+ years of data mining. And I believe they have hired folks who know stuff. On numerous levels. And I simply believe they know what they are doing. And their parts/box delivery system is fully automated. Sure not the end user or retail delivery system. I personally don't believe they go with the flow, and they are surprised, year after year that Xmas is approaching fast.

Of course Covid has caused serious trouble; heck, I am mostly in my home office and trying to run my joint as smoothly as possible. Not the point. I am just trying to grasp why such a huge, ultimately successful company operating world-wide cannot figure out what the impact of their next product in any time of the year, country-categorized, will be.

And all that does not matter: They will do it their way regardless of what we type here.

Typing here - for me - is just fun to do - hearing other opinions and rationals, discuss, sometimes a little more energetic - and then ... move on.

I love LEGO. I love the concept, the approach, what TLG comes up with, their diversity, and never ending awe they induce in my head. And then there are things that I don't like. I am hooked for the rest of my life, for sure. But for now, I will not stop voicing my opinion on this and that - as I feel a bit of criticism has never done any damage to such an entity. Heck, I can't do any damage at all.

I just don't like the term conspiracy theory - as Wikipedia says: "A conspiracy theory is an explanation for an event or situation that invokes a conspiracy by sinister and powerful groups, often political in motivation, when other explanations are more probable. The term has a negative connotation, implying that the appeal to a conspiracy is based on prejudice or insufficient evidence." (citations removed).

I just made my comments. If that is not appropriate here without calling it a conspiracy theory: I am out. With no bad feelings at all!

All the best
Thorsten

 

 

[KRS-3284]

Is it possible that this is just an unprecedented time in human history and it is affecting LEGO the way it is affecting all other industries, given that this worldwide pandemic has created ripple effects across the world economy? I mean, frankly, I'm surprised that LEGO has been able to continue releasing new products to begin with. LEGO has been smart to diversify and have production facilities all over the world, which has helped them keep up with demand to a certain extent. But it doesn't surprise me at all that we are seeing issues with demand. 

I think we should just be patient. In retrospect, a lacklustre Black Friday sale is a "first world problem". I too was excited for this year's Black Friday, given that last year's deals were phenomenal (at least here in Canada). But, a certain level of humility, gratitude, and patience are needed here. I highly doubt any these issues represent a lack of effort or organization on LEGO's part to deal with issues with demand.

We should remind ourselves that the pandemic has created unforeseen problems that nine months ago no one in their right mind would have expected. Also, it seems that with more people having to stay home and looking for something to do with their time, interest has gone up tremendously in products like LEGO. So I would think that plays into this as well. 

[Vindicare]

5 hours ago, KRS-3284 said:

Is it possible that this is just an unprecedented time in human history and it is affecting LEGO the way it is affecting all other industries, given that this worldwide pandemic has created ripple effects across the world economy? I mean, frankly, I'm surprised that LEGO has been able to continue releasing new products to begin with. LEGO has been smart to diversify and have production facilities all over the world, which has helped them keep up with demand to a certain extent. But it doesn't surprise me at all that we are seeing issues with demand. 

I think we should just be patient. In retrospect, a lacklustre Black Friday sale is a "first world problem". I too was excited for this year's Black Friday, given that last year's deals were phenomenal (at least here in Canada). But, a certain level of humility, gratitude, and patience are needed here. I highly doubt any these issues represent a lack of effort or organization on LEGO's part to deal with issues with demand.

We should remind ourselves that the pandemic has created unforeseen problems that nine months ago no one in their right mind would have expected. Also, it seems that with more people having to stay home and looking for something to do with their time, interest has gone up tremendously in products like LEGO. So I would think that plays into this as well. 

Yes, yes, & yes. 

As to your last point, it’ll be interesting to see the reports of this year & their sales. 

[MAB]

10 hours ago, KRS-3284 said:

I think we should just be patient. In retrospect, a lacklustre Black Friday sale is a "first world problem". I too was excited for this year's Black Friday, given that last year's deals were phenomenal (at least here in Canada). But, a certain level of humility, gratitude, and patience are needed here. I highly doubt any these issues represent a lack of effort or organization on LEGO's part to deal with issues with demand.

This is not really about demand. It is about manipulating offers. LEGO is a huge corporation with a lot of customer purchasing data. They know what they are doing bringing sets into and taking them out of stock or not allowing back orders on some sets at specific times.

If they have a certain popular SW set available a month before Christmas that is easy to flip when there is also a popular promotion on, then their stocks of that popular set will disappear and they will need to give out many promotional offers. They then have little stocks of the popular set and have given out many promotional sets, and a significant proportion of those will have gone to people selling them on. Whereas if they hold back the popular set, then they do not give out many promotional sets to people that will sell them on, and also they keep hold of the popular set in the run up to Christmas, so they do not have complaints from consumers saying the only way to get the set is to buy for a huge mark up on ebay. LEGO has learnt to control this. Some people may remember back to the days of "Green Lloyd / Lloyd ZX". That set was in heavy demand and LEGO also had a promotion on, so the easy to flip set went out of stock to people buying multiple orders each of a few of the sets with the promotion. They lost a lot of promotional sets and significant amount of stock of a popular product that they could not get back in stock in the run up to Christmas. They had a lot of complaints from parents about the prices of that in-demand item that was only available on ebay/amazon for 3x the price and not direct from LEGO. That was one of the sets that started the reseller crack-down back then. They have learnt from it. They now limit the sets that are available at a discount during promotions. They now limit the sets that are in stock during promotions. They now even limit the number of VIP vouchers at a discount they will give out (not personal limits, but overall limits).

Of course, this year it is also combined with higher demand. Some may call it conspiracy theory, others may see it as good business practice, others may deny it happens at all.

[Mylenium]

23 hours ago, Lyichir said:

The more obvious explanation for "out of stock" sets suddenly becoming available again is that more sets were delivered from the factories, or inventory was reshuffled to account for what avenues were getting the most demand. Earlier this summer, for example, COVID-driven shortages on Lego.com led some orders on the site to be fulfilled and shipped from closed retail stores. It's not unbelievable that something similar might be happening here.

Still, you have to question the dumbness of not producing sufficient quantities of e.g. the Crocodile locomotive in the first place when the dumbest of morons could see that here in Europe with the LEGO train segment literally starving and people willing to pay almost any price would buy it en masse. And that remains a fact even if you leave the current pandemic out of the equation. You could even go back to previous years. There have been many such shortages for no (to the customer) apparent reasons, and while they have been resolved quicker under better conditions, they still sucked, which at least for me is the point. Anyone care to remember how last year the large Batmobile was sold out everywhere for almost two months? A company as big as LEGO with multiple facilities across the globe should not struggle so much with fulfilling demand, especially when some things are so predictable in the "My grandma, who knows nothing about LEGO, could have told you!" sense. I would maintain that LEGO still have their work cut out and there's lots of room to improve that.

Mylenium

Edited December 3, 2020 by Mylenium
Fixed a typo

[KotZ]

I think I've posted this elsewhere on the site, but LEGO takes some time to make. They don't just have an automatic printer for each piece. They have to manually change out pieces/colors with the molds. I don't know how Denmark is dealing with COVID-19, but I would guess they are limiting people in non-essential businesses. That means limiting people in toy factories to change out molds for LEGO bricks.

[Mylenium]

14 hours ago, KotZ said:

I think I've posted this elsewhere on the site, but LEGO takes some time to make. They don't just have an automatic printer for each piece. They have to manually change out pieces/colors with the molds. I don't know how Denmark is dealing with COVID-19, but I would guess they are limiting people in non-essential businesses. That means limiting people in toy factories to change out molds for LEGO bricks.

IMO a non-argument, to be honest. There's only a handful of people maintaining the machines even during regular times and pieces are produced in long production runs, not requiring to change any molds for days or weeks even. The plastic pellets are fed via an automated tube system, anyway, so changing a color merely requires to flush out the leftovers of the previous production run. And all that aside, let's be serious: If some Chinese knock-off manufacturers can copy entire sets within days, then set-up time to produce specific parts and printing a copy of the instructions and box is even less of a consideration. If at all, tying everything together is the hold-up, but then again nobody forced LEGO to not have on-site packaging facilities in Billund for instance and having to ship out everything in bulk to Poland and Slovakia to be put in boxes. So one could argue that their lack of flexibility is their own doing, not necessarily dictated by external influences or excessive requirements of the production process.

Mylenium

[MAB]

Yeah if you watch some of the production videos, the factory staff are very socially distanced before covid struck. It is amazing how few staff are in the production areas.