Price Increase Faq
Entry posted by GregF
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We have already discussed the price increase on the BIONICLE canister figures in this space, but I am seeing a lot of people for whom it is apparently news. So I thought repeating some of what I said before might be a benefit to at least a few people (even if you guys know this, you can pass it on to people who do not).
Q. Why are BIONICLE canister prices going up?
A. The simple answer is that BIONICLE sets are costing more to buy because they are costing us more to make. Oil prices have doubled in the last two years and show no sign of going back down. That means the cost of producing plastic goes up; the cost of running molding machines goes up; the cost of getting packaging produced goes up; and the cost of transporting the sets to stores goes up.
When our manufacturing costs go up, we have two choices: keep prices where they are and make less profit on each sale (which we did for the last few years), or raise prices. If we don't make a profit on our sales, then there is no point in doing the line and we would just cancel it. Instead, we looked at which BIONICLE sets were most popular, and so the best able to survive a price increase, and bumped the prices up. We kept the prices the same for the more expensive sets.
Q. Why are they going up by so much?
A. Basically. because we held the line for a few years when we should have been raising prices. So now we have to do a bigger increase to get the prices where they should be.
Q. Are the prices of all BIONICLE sets going up?
A. No. Only the canister sets.
Q. Are the prices going to go up again in 2009?
A. There are no plans for price increase in 2009, no.
Q. I live outside of the US. Are my set prices going to go up too?
A. As far as I know, the answer is no. Prices in the US were lower than they should have been for years, which is why we have to do this increase. Customers in, say, Canada were already paying higher prices, so we don't need to increase theirs.
Q. Is this something just LEGO Company is doing?
A. No, it's a fact of economic life in 2008. Gas prices are up; food prices are up; prices of other toys and goods are up or soon will be. The dollar is weak, and so does not buy as much as it used to, and increasing energy costs mean anything that requires energy to produce or transport (in other words, everything) is going to go up.
Q. I think LEGO is just doing this to make a bigger profit!
A. No. LEGO Company is doing it to maintain the level of profit we had per set sale in the past. Keep in mind that LEGO does not get $12.99 for every canister set sold, because some of that money goes to the retailer and some of it goes to manufacturing. As manufacturing costs go up, you either have to ask the retailer to take less profit from the set or you have to take less -- unless you raise the price. That's why you are seeing prices up for everything everywhere.
Q. I am going to boycott BIONICLE sets so the price will go back down!
A. What you choose to spend money on is up to you, of course. But unless you think not buying a BIONICLE set is going to drive oil prices down, your boycott will only achieve two things: you won't have the sets, and if enough people follow your lead, the line will just get cancelled. Simple as that.
Q. This is the worst thing LEGO has ever done!
A. This is the most practical thing LEGO could do for the health and future of the line. Yes, it stings the wallet -- so does $4.30 gas and a $2.50 load of bread and a $3.50 comic book. But the alternative would have been no more BIONICLE at all, and I don't think anyone wants that.
Any other questions, feel free to send them along.
Greg
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