I feel the increasingly high price of sets is one of LEGO's largest setbacks. It prevents their audience from growing much and severely limits their appeal.
I'm an ex-LEGO employee. I was an AFOL before joining LEGO and remain an AFOL after leaving LEGO. Before joining LEGO, I too felt that many of the sets were overpriced (and this was back in 2016). However after being at LEGO for a while and seeing first hand the entire process of how a set is made (from design to engineering molds, to production, QC etc. etc.) I began to appreciate what makes LEGO simply amazing and why it is more expensive than other products. This is especially apparent when you visit a LEGO factory and just see the amount of care and quality control that goes into everything (I've been to Jiaxing & Kladno). Now as an ex employee (left around 3 years ago) and still AFOL, yes I do feel that some sets are still overpriced (I still collect SW sets), but I don't mind as much now knowing everything that went into making the set.
Just look at other manufacturers of bricks (bluebrixx, keplay, wange, cada, cobi, happy build, decool, ...). Most of them offer sets of similar quality but these sets are less expensive. So Lego sets *are* expensive. It *is* possible to design, produce, deliver, ... sets for less money.
In comparisn to the part count they often cost only half the price of LEGO. And they make a lot more interesting sets and topics people demand but LEGO is denying them. Trains, Castles, Pirates and extendable sets. "Burg Blaustein" from BlueBrixx for example. 4 expansions and I think one more to come. All in all over 20.000 pieces. And the instructions are written for people that have an IQ over 20 ... in contrast to LEGO.
@@svensantesson2020 thats not true, i bought a set from CaDa with 1700 pieces for 60 Bucks and the only thing that differentiates these two brands are their logo stamps
@@svensantesson2020 In addition to Lego, I only own Cobi and they are of identical quality. However, what makes Cobi better is that unlike Lego, they don't use stickers and have a greater variety of bricks.
They're expensive because we keep buying them regardless, and for the example of "costs to make: 20" "retail price: 200" is pretty average, they're charging 10 times the cost to make. To put that in perspective, Gatorade costs about 2 dollars and is only 10 cents to make. That's 20 times more than it costs to make. Everything has to be significantly higher than the cost to make or how else can a business get off the ground.
Dont forget exorbitant spending on marketing. Spending money to hype up a product or a brands image, meaning they spend money to also raise their perceived value and people will buy with less rational thinking(by objective standards, pieces of plastic). Legos are a premium desirable product.
Not everything in legos operations might be first party, they might have their suppliers of the raw materials, owning everything in the supply chain is pretty fckin rare and expensive. Like dude soda cans are made by a seperate company outside of pepsi or coke. Apple doesnt manufacture chips, it only designs, they dont even make their own screens either, they buy from samsung cuz they have patents for the making of smartphone oled displays, or just have better quality standards. Even the assembly lines arent apple,s, they outsource work to foxconn and others. Outsourcing work is sometimes better than inhouse.
I see your point, however no I don't think it is that simple, the machines they use to mold each piece is about the size of a car and would cost hundreds of thousands of dollars each, not to mention the maintenance electricity and constantly updating the molds, the warehouse space it takes which means the land they have to purchase or rent and the logistics to keep it going. Next is the plastics, it is delivered in pellet form which is why it is so cheap for them when opposed to off the shelf 3d filament, because its essentially raw material not yet formed, this material is pumped around using yet more expensive machinery and more logistics. then heated using more electricity to then finally be formed as just a crash course on its journey. Next we have Licensing, the main reason star wars is more expensive than lego city, because the rights that have to be paid, the branding etc. and finally the retail shops and delivery drivers that require their share, at the end of the day a lego set isnt going onto shop shelves out of the kindness of the shopkeepers heart. im sure there are many more things i am missing like the designers that work, the general cleaning of the factory, damaged or missing product, failed product, molds, colour, machinery. working in a factory (not lego) when a machine goes down if not a whole factory, that is stock not making money for that time duration and machines constantly fail, im sure if you were to go to any factory there would be at least one machine under maintenance, money that is dripping out and not being made up, so they make it up with the overheads in sales.
my main reasoning - Lego can basically sell for quite a high price since its the only competitor and people still buy A LOT -The LEGO brick machining has a tolerance of 0.0002cm, which is crazy because of the amount of pressure required to make it that precise, so the machines are most likely crazy expensive to buy and operate (especially for EVERY single mold for every single piece)
Yeah. There's no nice way to say this, but people who think Lego's markup is unreasonable probably don't know anything about manufacturing. I work for a medical injection molding company, and Lego's tolerances are genuinely more comparable to medical devices than most normal consumer products, where a 0.002cm tolerance 10 times more forgiving than Lego's would still be unusually precise. Given the cost of our competitors' injection molding machines, it's a miracle Lego is as cheap as it is for its quality. That said, I'm sure Lego benefits greatly from economies of scale, but that's probably offset somewhat by the difficulty of maintaining their precision at higher product volumes. Honestly I wouldn't be surprised if Lego has the highest precision/cost ratio of any retail product. Everything else with the same level of precision is so specialized that it I doubt it could be as affordable. Now if people think the high quality parts are overkill and the sets would be just as good with cheaper parts, that's something I can understand, but there's no way Lego's gouging you on the price.
„ Lego can basically sell for quite a high price since its the only competitor“ Wrong there are dozens of great alternatives: BlueBrixx CaDa Rebrickable . . . „The LEGO brick machining has a tolerance of 0.0002cm“ I highly doubt that. If that were the case there should be no problem assembling giant sets like the Star Destroyer from Star Wars. But at that scale you notice how the bricks are not that precise and do not fit perfectly as the inconsistencies add up. Also those competitors often outperform LEGO in brick quality while being significantly cheaper. And I highly doubt anything with a tolerance of 0.0002 cm is cheap to produce, to the point of 5 -10 ct per piece. (Which is what you usually pay for when buying a BlueBrixx set)
@@leonmuller8475 BlueBrixx is one of the worst companies out there, they sell so many things where the design is stolen, they even faked a Kre-O starscream and if i'm not mistaken a couple of older lego technic sets. BlueBrixx is so fkn bad. I agree with CaDa and some other brick manufacturers, but no joke, Bluebrixx is just a joke. I once bought a tank there and no joke, the pieces always falled off, i needed to glue it 3 times to hold, and i even missed 8 pieces... but when i moved i threw it in the garbage(recycle of course) that was 1 year ago
@@MeisterSchwabbo Huh, I know people who have build 5000+ brick sets from BlueBrixx and had 0 complaints about the brick fit. And all I can find about the Kre-O starscream is that Lego ripped of Kre-O, nothing else.
If you only count the cost of the plastic, then you're on the wrong way. One high-precision mould (for ONE kind of brick) costs up to a million US$, and needs replacement after a certain time, to keep the bricks' dimensions perfect. And Lego produces hundreds of different bricks. Count that with the (correctly) mentioned HR, R&D, design, plus production costs (machinery, factories and energy needed), packaging, shipping, and last but not least, the reseller margin. Lego products are expensive indeed, but it's totally wrong to say that Lego makes 10x the actual cost of the product. I would be surprised if Lego makes more than 10~15% from the retail price.
@@ChetYeetus Yeah, that is what I believe as well, but the one who wrote the comment says it is because producing bricks is so expensive. So I wanted to know how he explains that.
Fun fact: legos in indonesia is absolutely way more expensive, like sets that are 40 dollars turn into 70 dollars, 80 dollar sets turn into 120 dollar sets, good thing lego stores/stores that has legos in indonesia usually has a lot of discounts
I live in Indonesia and this is SO TRUE! They are SO EXPENSIVE! But I have had a set that had a 70% discount, so it was MUCH cheaper. Most discount’s are usually above 10% idk if this is true, I haven’t been in a lego store since the virus.
A 20 dollar set is 35 dollars here, a 40 dollar set is about 70 dollar here, and the lego Mario starter pack costs 100 dollars in here, which is 60 dollars in other countries, fucking outrageous
The majority of their costs is paying the engineers to design the sets. Engineers are generally paid $60-70hr. My Dad was a senior design technologist and was making $55/hr as he was a pay grade below an Engineer.
No matter how much the designers are paid I promise its a tiny fraction of the cost. The salary of a handful of designers is nothing compared to the vast sales lego get annually. Even if a designer were paid $70/hr for a $70 set, their entire salary would be paid off within a few hundred sales. I promise each lego set gets a lot more sales than that.
@@arrun5125 Lego sets take months, if not years to produce, and are normally worked on by teams of several people. There are hundreds, if not thousands of different types of pieces and designers have to experiment with all of them to find the best fits. If 5 people work on a 70 dollar set for 70 dollars an hour for 8 hours a day for 5 months, Lego has to pay them 420,000 combined, or the money they would earn selling 6000 $70 sets if 100% of the money made from them were profit.
The answer to why LEGO is so expensive is that LEGO pay their designer and employee well, and their customer service cost a lot. I don't get why sometimes they have to ship free replacement pieces directly from Denmark. Won't the international sipping fee already cost higher than many small Lego sets? I have contacted Lego customer services a few times for things like simple inquiries or shipping address change, I must say based on the quality and efficiency of the customer services, the customer service representative must get paid a lot. Mcdonald's also includes licensed toys in their kids meal, but their meal is still so cheap that as an adult I still occasionally buy the kid's meal. Sometime for the toy (especially Pokemon toy), sometime just for the meal.
_their customer service cost a lot_ Meanwhile the customer service inbox mail: - My LEGO plane can't fly. - The passengers of my new LEGO roller coaster cannot get safely out of their seats. - Instructions unclear: I can't find the fuel tank of this LEGO car to drive it. 😂 Sorry, I had to imagine it like this. Idk what exactly does the customer service of LEGO 🤣
Exactly. The reason McDonalds profit over 60% is because it's a minimum wage low-skills job with no reward and very few people actually wanting to be there. It's modern day slavery where you're purposely underpaid so you're too weak financially to be able to stand up for yourself and either fight or flight.
lego is way to expensive. look at the porsche 911 the orange one... you pay 900 now.... cada is having a way more detailed, car, remotecobtrolled, looks good with technic (its almost lie fully closed around) the brick quality is reeealy good, etc... and you pay 190...) like seriously ... only fanboys or ppl who dont know what else is on the marked buy lego... or maybe if its on 50% sale, some sets are on the price they should be
@@hannahwills8970 No, that price is paid to create new molds for new pieces. Once they have one mold they can use it as long as they want. However if they're introducing several new pieces in a set then yes. But they'll still consider future use for that mold, and not create one for just a single set.
@@LegoVlogger and pt did happen, that is was only for one set. But when the new piece gits to other sets, you will notice, they will use it as much as possible
Packaging comes down to how it it can be palletized. Before I started a business I wondered why some video card boxes were way bigger than they needed to be. When I started ordering 50-100 at a time the packaging made alot more sense as it fits precisely in a carton, that carton fits precisely on a pallet. It's true that shelf presence is a thing, but it has a real cost associated with it other than shipping. Many retailers make money selling shelf space to manufacturing not reselling their goods. This is called "rack jobbing." So making a box really big is a well researched and calculated move. Peace!
0:30 People from Germany: You sure about that? Like, there are countless other companies producing compatible bricks for a cheaper price and with a better quality (often including no stickers), like Cobi, a Polish company producing in the EU with only prints, and often complicated ones. And they at least gain in popularity here, because the biggest German Lego channel Held der Steine got 2 different conflicts with Lego, started by them over basically nonsense in the last few years, that he began putting a focus onto them that many others also got aware. Honestly, the US market needs to follow with this trend of showing other stuff than Lego to make Lego lose market share to them. Only when they are severely threatened by similar companies they are going to improve and go down with prices
Not to mention the case of Steingemachtes and QMan, where customs detained freight containers without justification at Lego's request. On top of that, I wouldn't be surprised if Lego were even more aggressive in the US with lawsuits against other manufacturers.
@@PaDDy7389 well, Cobi is already being sold under a different name there (they fused with a British company over a decade ago), so they would have a hard time doing stuff. Because "Why is it a problem now and wasn't with the same stuff before?"
@@Hendricus56 Oh, I didn't knew that but then Cobi should be safe, because Lego doesn't dare to challange large retailers and importers, but if, for example, Qman were to try to enter the American market via a smaller dealer, such as Steingemachtes, they might face the same issues there as in Germany. In any case, I really hope that more manufacturers will move to the US and challenge Lego's predominancy, then they might have to change their pricing policy and that would benefit the rest of the world as well.
@@PaDDy7389 Or someone just manages to talk to the guys at the top of Lego and makes them understand, selling more with a smaller profit margin can grant more money over all
The problem here is that quality of LEGO is sinking, while prices are soaring. I recently saw a video of the large loop coaster set, with the high blue tower - the tower is covered in blue flat 2x2 plates, and it was immediately visible that there were irregular spaces between some of these plates - something unheard of from LEGO before. Not to mention the notorious issues with color accuracy in sets with a large number of supposedly same-color tiles, or the lack of printed tiles (fuck the stickers, seriously). Whatever the reasons, some of their competitors like Cada, Cobi or Bluebrixx have begun to achieve the same or better quality sometimes. Also - Cobi produces exclusively in Europe, unlike LEGO. It becomes increasingly difficult for me to justify spending top money for LEGO at this point.
That's what we did in the early days. My parents bought me a large boxed set and I just used my imagination to create my own buildings. I also hade the motor set that added a bit of animation to play. I'm just amazed at the Creator sets with the level of detail and functionality.
Most of our kids' Lego is second hand. It is really hard with themes like dinosaurs as it's all licensed and as soon as it's retired, becomes collectible and you're competing with collectors and looking at scalpers' prices just so your kid can have a dinosaur that goes with their other Lego. We have bought them new sets, but it's getting harder and harder to afford, and with the recent price increase on the back of the announcement they've been making record profits shooting through the roof, it's pretty much saying to parents like us that Lego isn't for our kids anymore, it's for rich adult collectors now.
There is a key factor being missed here: minifigures and unique parts. Fact is, the more unique minifigures and non-standard molds used, the greater the price of the set. This is likely due to the increased printing and molding costs associated with the unique pieces, but also the way the online market treats these pieces. If few enough sets have rare enough figures, the value of the individual figure skyrockets. One of my favorite sets, the SWTOR Corellian Jedi Cruiser, was worth a pretty penny. The build is good, but it also contained unique figures unattainable in any other set to this day.
The excessive numbers of one-off pieces nearly ran them out of business. When I was playing with them, mostly in the late '80s and early '90s, there were relatively few unique pieces, most of the pieces would be in dozens of other kits in different proportions. But, apparently later they went on a binge making a bunch of unique pieces that made for great looking sets, but were very expensive to manufacture comparatively speaking.
6:50 Shipping costs go generally per kg/pound, not so much the size. So bigger boxes with little to no extra weight doesn't add much, if any, extra shipping costs.
I've always loved Legos throughout my childhood but unfortunately because of how ridiculously pricey they are especially for sets with basically nothing in them costing more than 40 bucks, I miss the feeling of clicking bricks together
It's a danish company, with its own ethic and national proudness, and you're paying that a lot through their prices. I personnaly do enjoy this a lot about them, but yeah, obviously, it has financial consequences for those of us with lesser income than the scandinavians (which means: the near totality of the rest of the world).
Mexican here, a Lego Creator set costs 20,000 Mexican Pesos, which is the equivalent of 1000 dollars, and just for u to imagine, a common employee salary in Mexico is 15,000-20,000. Meaning that if u want a lego creator set you will need to spend all your salary, and I forgot to mention that they also add a tax based on the 16 percent of the final product price 💀
Lego still has not realized, that there is a whole plethora of legal competitors around - with prices well below of what Lego is asking. The bricks are basically no longer protected, only the figures are covered by a 3D trade mark.
Well, but those "competitors": - Are made with low-quality bricks - Don't have good quality control - Badly designed/stealing designs And, they've always been known as "rip-offs". Trust me, I live in a place where these are everywhere.
@@nhantnt Some have the same quality as Lego (for example Gobricks). Some have better designs (especially Cada and Mould King (in their non copied sets). And the quality control of these companies is similar to Lego's.
Lego has become a hobby of the rich. It’s impossible to afford these things now and while I understand some of the points made here, it’s absurd when kids and parents see a small new At-Te star wars set that they are charged 140 dollars plus tax
I mean assuming you don't buy Lego sets every few days like some hardcore people do, maybe you could save up to buy at least 1 Lego sets a month, 12 Lego sets per year is already alot for me,waiting for the price drop is also good idea
Lego is expensive because 3rd party sellers have made it a job. They buy up sets then wait a few years after they retire to sell for huge profit. I usually buy non lego and save a ton. Keep over paying if you want and encourage 3rd party business to continue. In the end its all just plastic people.
I have no premium experience unpacking a LEGO set. I feel cheated. I have bought a Mold King Flying Dutchman, 3500 parts for 150 bucks. It has a colored box, paper instruction, no fail parts, no color problems and its so damn heavy, you can murder people with the ship. LEGO today has color problems, some parts have slightly shape problems, and even in Ninjago Sets you don't get a good price -> part value. You buy LEGO for the figures, thats all.
I just wish everything wasn't licensed, I miss the old Lego themes they came up with themselves, also it probably does drive up the cost of everything.
An ABS lego brick is actually very durable... remember you can step on them on hardwood floors and they suffer no damage. The amount of force it would take to damage the bricks inside a tightly packed box of bricks versus a loosely packed box is about the same, and in both cases it's a ton of force
Maybe a little bit boring but I have summed up some key figures from the Financial statement 2021 in Danish Krones (Dkk)and USD: Total revenue of 2021 is 55.293 billion Dkk (about 7.6 Billion USD). Net profit 2021: 13.285 billion Dkk (about 1.8 billion USD). That is about 24% of the total revenue. So in general 24% is net profit (we round it up to 25%). The rest about 75% are costs in every way. De difference are the expenses (38.3 billion dkk/ about 5.24 billion USD) and the income tax (4,7 billion dkk/650 million USD ). So the total sum is, now in USD: Expenses (5.24 Billion USD) + tax (0,65 Billion USD)+ Net profit (1,8 billion USD) = total revenue (7.6 B USD). So the Expensies are about 70% of total revenue and income tax about 5%. From the expensives (38,3 billion Dkk) are: - Production costs: 16.783 billion Dkk (about 2.3 billion USD). That's 30% of total revenue. - Sales and distribution expenses: 16.446 billion dkk (about 2,25 billion USD). That about 30 % of total revenue. That's almost as much as the production costs. Lego group spends a lot on sales! - Administrative and IT expenses: 4,0 billion Dkk (about 550 million USD): That about 7% of total revenue. - other operating expenses: 1,0 billion USD (about 136 million USD). That's about 2% of total revenue. If you sum it up ypu have the total expenses (38,3 billion Dkk). If you sum it up the expenses are about 70% of total Revenue. The rest is net profit (25% of total revenue) and tax (5%). Interesting fact is the ' raw materials and consumables used' in 2021: 7,567 billion Dkk (about 1,0 Billion USD). Consumables are things to be used in the production proces. So that's 13,7% of the total renevue of Lego Group. That a lot more than you assume in your video. Source: www.lego.com/cdn/cs/aboutus/assets/blt248041929be3b572/Annual_Report_2021_ENG.pdf
Thank you for pointing this out. It's amazing how much speculation is in the video and the comment section, considering that the finances are publicly available.
You forgot the point that lego has the client service costs. What I mean by that is, if some parts are missing in your Lego set, you can reach out to them and they will send you the missing parts per Mail for free. (Which is obviously more costs for Lego)
Legos Price is literally just for the Name. There are so many other Manfucaturers that make better Sets with higher Quality and Prints for half the price
manufacturing for lego, should be fairly cost effective, their is hardly any labor cost, everything is automated. In my opinion designing new sets doesn't justify what research and development usually cost, at most its labor cost, at the same time lego hasn't really done anything that has created more value for their consumer in the last decade that can justify research and development cost.
Let's reiterate, if everyone knew how much their set cost to produce including all overhead cost plus shipping versus how much of a premium they pay above that...... You would not like it very much as a consumer but some would still buy it but way less than now
I remember back in the day that my parents favored Minecraft over Lego sets because it was significantly cheaper to just buy the video game instead of buy several boxes of expensive ass lego sets.
Hate to sound like a geezer, but I remember being able to get decent sized Lego sets for only $6 or $10 as a 1990s kid. I even remember some cheaper then that. I used to be able to go to the store with my parents, and they'd be fine letting me get a cheap Lego set. I kinda feel sorry for modern kids, as there are no more cheap Lego sets. Aside from those tiny little bag sets, where you don't get much. Now $6 will only get you a random minifigure person.
The little sets that take you 10 minutes to put together are 20 dollars. It’s insane. 10 minutes of fun for 20 dollars. The one airplane is 100 bucks takes you probably an hour a half to build if that.
Ever heard of inflation.? $6 in 90s is like $12 nowadays. For around $10 you can by a small set with a minifig and something like 70-100 pieces, like space construction mech 60428 or go-carts 60400.
While Lego is giving us "premium" experience with more and more missing parts, lack of color consistency, non-reusable parts (typical for the licensed sets), decreasing brick quality (visible molding points, bricks not sitting properly), boring sets, removing whole themes (Mindstorm, trains etc.), mind boggling inaccuracies (especially for their licensed sets), decreasing Technic overall quality and increasing prices (to the point you can buy a cheap used car or a premium smartphone instead of a Lego), the competition is pushing the opposite and clients love it. Lego has turned from a premium toy for all ages to a collector's lackluster thing that only adults with low IQ and cash to burn buy.
I think there’s more about the box that it seems. The box has a empty space for the impact that it can happen during the trasportation - like cereals or chips; if the impact doesnt go in the air or in the box itself, it goes on the product, which can damadge it. I know lego brics aren’t as fragile as a chip, but we are talking about hundreds of boxes being packed and transportared all at once.
Real Reasons why they're expensive: - They take a lot of R&D (Research and Development) to create new sets - Manufacturing Costs have increased due to going 100% Carbon Neutral - Most Lego Bricks now are made using either Bio-Plastics (Sugar Cane) or Recycled Plastics
-I believe they cut R&D expenses drastically in the last few years, at least for sets made for children when compared to similar sets from 10-15 years ago. -What exactly does it mean when Lego claims to be 100% carbon neutral? -are their Chinese suppliers or their packaging partners producing carbon neutral or is the Lego company investing huge amounts of their excessive profits tax-free in renewable energy companies for even greater long-term profits and greenwashing as a bonus? - Since bricks for different customers are produced more or less by the same manufacturers, I doubt there is much difference in the material used. Apple products for example are not more expensive compared to other brands because they are produced in a magical green wonderland full of happy people...
The Lego City Pizza Truck isn't made of pure ABS plastic, and I'm not talking about the air between the bricks. The tires are made of rubber, or a rubber like substitute, and the transparent pieces are made of acrylic plastic.
He didn't mention the cost to color the bricks as well. Dye isn't free. Also the cost to "produce" isn't the same as the cost to "make". Minifigs cost more to produce than bricks with the multi sided printing (more ink). Then producing stickers, rare parts cost more to produce. It's no where near as simple as it's explained.
To be completely honest, it is completely a waste of money to not buy Chinese companies. Instead 9f paying $700 for the Titanic, you can buy the Jiestar copy for $200. Instead of buying the Lego UCS Imperial Star Destroyer for $800, you could buy the Mould King MOC called the ISD Monarch for $200 which has almost 12,000 pieces! So you could save $600 dollars, get a better looking set, and have 2.5x the price count? Why WOULDN'T you buy the Mould King set.
The MSRP also has to figure in the retail markup, i.e. retailers need to turn a profit which means they pay lego less than MSRP for each set. Even if you buy straight from lego, the pricing still has to reflect retailer markup if lego wants retailers to stock their products.
@@upotheke that is an insanely high markup. I’ve seen the business prices for Lego on occasion and they are sub 20% normally. Small retailers cannot stock their products other than mini sets because retailer margin compared to demand isn’t there. Perhaps big retailers get a lot better pricing but I don’t know.
@@flyingrat492 It's not, shelf space is expensive, and it's in line with what I've seen from the products in the store I work at. I can't be too specific, but I'd wager that it's similar in other stores and other chains.
Some Lego sets like the trains also completely throw price calculations out the window. The electronics are a thing but also the larger pieces like track and wagon plates probably may be more expensive to manufacturer.
Why are Lego so expensive? Because people will pay for them at those prices. If people stop buying them, they'll lower the prices. You'll see a drop in the number of licenses, though, if that happens.
Legos did not cost this much 30 years ago.. its just bs... Prada doesnt use that much different than other brands what makes prada expensive is the name only same with legos.. just name only and that is unacceptable... Legis are for kids not collectors which os what their aiming for and thus the excuse to raise price.
Actually Lego's current prices are comparable to previous decades. I have sets from the 80s with price stickers that show about $30 for a set with 300 pieces. There are sets right now on Amazon with 350 pieces for $30. Also stores didn't use to ever put Lego on sale back then. Some of you need a little perspective to realize how good you've got it.
@@studebricker2845 Im pretty sure stuff like the 2000s millennium falcons were like 100 dollars and now the newer ones went for 160-180. It's slowly going up and they're trying to be sneaky with it. Sure some themes stay the same with price but it's definitely going up over time.
@@TheBrickBuildingEnthusiast Okay, let's look at the Falcon. Yes, I'm pretty sure you are right. The 2000 Falcon was $100. I just checked and the newest Falcon is $127 on Amazon right now. That's pretty amazing! Only $27 more 20 years later, for a much improved design and more pieces? And again, if you wait a month or so, most Star Wars Lego is 20% to 30% off. So overall I see Lego's pricing is pretty reasonable.
@cool bear It's because the bricks have a higher chance of smashing into one another. His comment would only be true if the air gaps were replaced by crumple zones.
$20 may reflect cost of raw materials becoming actual bricks for sets, but that denies the cost of designing sets, engineering molds, marketing to audiences, providing customer care, etc. $20 falls far too short to cover all these expenses. Also, you forgot to round up for the cost of the set @4:00; cost is 87 cents, not 86.
If I think something is too expensive I just won't buy it. Sometimes we're forced into things because of necessity (fuel). But things that aren't a necessity we always have the option not to buy.
Lego plastic is expensive although high-quality because of it’s durability and obviously costs more to manufacture. Licenses can be a bitch of a cost and they obviously need a profit. They also had to hire technicians, engineers & professionals in the sets related field to make it. Proper designers have to model all of the sets, the machines that produce things from instructions to the proper parts are very expensive and have to be maintained. They have factories which require many employees to keep up and running. They obviously have taxes they need to pay, they even need to go out and scout locations if a set is based of that location
Tbh I am done with legos, after seeing how the Millenium falcon cost was 120 last year so when this year it became 160 it made me realize that Lego is becoming less and less worth it, is extremely overpriced for what they use in their production, so considering all the prices of production plastic etc. I believe Lego is definitely not worth it anymore. A fucking Ewok battle set is 37 dollars in target so yeah 💀
30% is definitely not quite small. Look at the Lego annual report for official numbers. Here are a few interesting ones: They have a total income of 55 billion Danish Krones, and a profit of 17 billion. They spend about 7.5 billion on materials and consumables like electricity. 10 billion on employee costs. Their total production costs are less than 17 billion. The rest goes to IT, development, purchases of assets, licensing (about 4 billion). delivery, shop maintenance and so on.hey make about 30% profit. That's a lot. They have a total income of 55 billion Danish Krones, and a profit of 17 billion. They spend about 7.5 billion on materials and consumables like electricity. 10 billion on employee costs. Their total production costs are less than 17 billion. The rest goes to IT, development, purchases of assets, licensing (about 4 billion). delivery, shop maintenance and so on.
All questions related to why xxx is so expensive while the "cost" is so low is simply because people only take materials and production costs into account. They usually don't take one important thing into account - employee wages. And yes, that of course includes the executives and stock holders in some cases. Wages is, most of the time, the biggest expense by far in many companies. If lego stop producing sets and instead, only produce parts, then of course the price should be far cheaper. Technically you could design your own sets and just buy the parts.
@@gnammyhamster9554 It would be great if they sold more individual parts but LEGO is popular because of the sets, lose that and you lose a lot of the brand.
@@gnammyhamster9554 If you go to a LEGO store they have a wall you can buy individual pieces from, but admittedly not every single piece/color combination possible
Found out it's actually cheaper to buy the parts and follow the instructions to make the set than the set itself. (Mainly due to custom parts and sticker prints)
I began to realize. Youre not paying for the quality of lego anymore. Youre laying for the *brand* of lego. Lego has plenty of smaller competitors (such as Cobi) and theyre qualify is superb whilst being cheaper.
the cost calculation is not that simple. Take star wars for example, lego has to pay for the license fee. Then , the lego brick manufacturing machine also cost money. Each lego store has pay for rent, since the company do not own any land . Each employee including designers and shop worker also need salary per month. What about transportation fee, lego sets are not gonna move themselves. Above all, lego is still making huge profit.
Each new mold design cost shit ton of money & they are high quality/very precise. IMO Lego makes at least 1 new mold design for every license/theme and every years. Some mold are used in a set or 2, no more during their lifespand. The Demogorgon's legs from the Stranger Things set got used by the demogorgon & Lupin's werewolf in 2022.
After you factor in the design costs, manufacturing overheads, marketing, etc. etc. it all adds up and LEGO isn't that expensive compared to many adjacent products. It's certainly not cheap either, but it's not as ridiculous as say Games Workshop model kits.
Remember when you could get a Bionicle Canister for like 10-15$ and have so much fun with it? I know that a lot of Bionicle sets had less than 100 pieces but a lot of those parts were fairly big and when you combined all of them into your Bionicle it stood kinda tall and big. So yeah.....
These videos are starting to look very professional, honestly impressive. You obviously have a lot of potential, believe in yourself and don’t let hate or unjustified criticism get to you! ❤️
Used to love Lego as a kid, mom would get me a real nice big lego set for about $30 back in 2005ish. Now days that $30 retails for over $100, so I've started recently buying from like Mega Construx which has way way more complex pieces and figures for only a fraction of the price compared to Lego.
from the lego shop some lego cost more than from amazon or kmart. the assembly square costs $400(Aud) at the lego store but on amazon it costs like 285.
Yea I don’t understand how the manufacturer (Lego) sells a set more than Kmart. Since Lego gives the sets to Kmart they should be able to sell the sets for less given the fact they don’t have to make as much money back
I think that if lego won t stop raising the prices the Lego company will become an exclusive for the rich and not for everyone, or for people who can afford it. Lego aims to have as many buyers as possible, raising prices to the maximum of those allowed to the normale people.
I remember finding and buying off-brand imitation LEGOs to use for a planetarium activity. The bricks (from the imitation brand) were not as high of quality as LEGO. You can also look into buying loose LEGO parts much cheaper than purchasing full kits
Yeah, quality is a big factor. I still have lego lying around that's 30 years old, still perfectly usable. There aren't many plastic toys you can say that of.
Btw you guys in the US have it good, where i live lego is atleast 20% more expensive than in the us, sometimes its better to buy from amazon than in the stores here
the bigger boxes means they take up more shelf space so it makes it harder for any simillar brand hard to get shelf space bigger box= more spacr for their product by taking up more space
Cool. I think bigger boxes can have many advantages now that i think about it, they take more space, so they create a larger area in the store, so people are more likley to spend more time there looking at box art than they would if it was only one shelf. Also taking up more shelf space might mean small and medium stores have to choose between lego and their competetors to a bigger degree. Which probably favors lego, as they’re the top dog. It’s actually really smart! (And not very friendly to free market principles and the enviroment)
I feel the increasingly high price of sets is one of LEGO's largest setbacks. It prevents their audience from growing much and severely limits their appeal.
Keeps their audience at 30 year olds who now have money
Nope, LEGO doesn't need to change a thing, they are doing things right.
@@LunaticTheCatdon’t forget to zip their pants up when ur done
knock offs
@@Depsty proved his point lol
I'm an ex-LEGO employee. I was an AFOL before joining LEGO and remain an AFOL after leaving LEGO.
Before joining LEGO, I too felt that many of the sets were overpriced (and this was back in 2016). However after being at LEGO for a while and seeing first hand the entire process of how a set is made (from design to engineering molds, to production, QC etc. etc.) I began to appreciate what makes LEGO simply amazing and why it is more expensive than other products. This is especially apparent when you visit a LEGO factory and just see the amount of care and quality control that goes into everything (I've been to Jiaxing & Kladno).
Now as an ex employee (left around 3 years ago) and still AFOL, yes I do feel that some sets are still overpriced (I still collect SW sets), but I don't mind as much now knowing everything that went into making the set.
Nice
cool
Awesome
Quality control??? Bro the fiat500 have like 20 different yellow tones. Many prints are not good and so much more...
Literly made this channel the day of commenting ain't cap
Just look at other manufacturers of bricks (bluebrixx, keplay, wange, cada, cobi, happy build, decool, ...). Most of them offer sets of similar quality but these sets are less expensive. So Lego sets *are* expensive. It *is* possible to design, produce, deliver, ... sets for less money.
There Quality is higher and they arent so much more expensive...
In comparisn to the part count they often cost only half the price of LEGO. And they make a lot more interesting sets and topics people demand but LEGO is denying them. Trains, Castles, Pirates and extendable sets. "Burg Blaustein" from BlueBrixx for example. 4 expansions and I think one more to come. All in all over 20.000 pieces. And the instructions are written for people that have an IQ over 20 ... in contrast to LEGO.
@@svensantesson2020 thats not true, i bought a set from CaDa with 1700 pieces for 60 Bucks and the only thing that differentiates these two brands are their logo stamps
@@tw3397 Ok, thats good!
@@svensantesson2020 In addition to Lego, I only own Cobi and they are of identical quality. However, what makes Cobi better is that unlike Lego, they don't use stickers and have a greater variety of bricks.
They're expensive because we keep buying them regardless, and for the example of "costs to make: 20" "retail price: 200" is pretty average, they're charging 10 times the cost to make.
To put that in perspective, Gatorade costs about 2 dollars and is only 10 cents to make. That's 20 times more than it costs to make. Everything has to be significantly higher than the cost to make or how else can a business get off the ground.
Dont forget exorbitant spending on marketing. Spending money to hype up a product or a brands image, meaning they spend money to also raise their perceived value and people will buy with less rational thinking(by objective standards, pieces of plastic). Legos are a premium desirable product.
Not everything in legos operations might be first party, they might have their suppliers of the raw materials, owning everything in the supply chain is pretty fckin rare and expensive. Like dude soda cans are made by a seperate company outside of pepsi or coke. Apple doesnt manufacture chips, it only designs, they dont even make their own screens either, they buy from samsung cuz they have patents for the making of smartphone oled displays, or just have better quality standards. Even the assembly lines arent apple,s, they outsource work to foxconn and others. Outsourcing work is sometimes better than inhouse.
I see your point, however no I don't think it is that simple, the machines they use to mold each piece is about the size of a car and would cost hundreds of thousands of dollars each, not to mention the maintenance electricity and constantly updating the molds, the warehouse space it takes which means the land they have to purchase or rent and the logistics to keep it going.
Next is the plastics, it is delivered in pellet form which is why it is so cheap for them when opposed to off the shelf 3d filament, because its essentially raw material not yet formed, this material is pumped around using yet more expensive machinery and more logistics. then heated using more electricity to then finally be formed as just a crash course on its journey.
Next we have Licensing, the main reason star wars is more expensive than lego city, because the rights that have to be paid, the branding etc.
and finally the retail shops and delivery drivers that require their share, at the end of the day a lego set isnt going onto shop shelves out of the kindness of the shopkeepers heart.
im sure there are many more things i am missing like the designers that work, the general cleaning of the factory, damaged or missing product, failed product, molds, colour, machinery.
working in a factory (not lego) when a machine goes down if not a whole factory, that is stock not making money for that time duration and machines constantly fail, im sure if you were to go to any factory there would be at least one machine under maintenance, money that is dripping out and not being made up, so they make it up with the overheads in sales.
When lego is sold at 30% off its generally sold at a loss it def cost more than 20 bucks to make
They are still ridiculously expensive
10 cents to 2 dolars is not significant as 20 dolars to 200 dolars
my main reasoning
- Lego can basically sell for quite a high price since its the only competitor and people still buy A LOT
-The LEGO brick machining has a tolerance of 0.0002cm, which is crazy because of the amount of pressure required to make it that precise, so the machines are most likely crazy expensive to buy and operate (especially for EVERY single mold for every single piece)
Yeah. There's no nice way to say this, but people who think Lego's markup is unreasonable probably don't know anything about manufacturing. I work for a medical injection molding company, and Lego's tolerances are genuinely more comparable to medical devices than most normal consumer products, where a 0.002cm tolerance 10 times more forgiving than Lego's would still be unusually precise. Given the cost of our competitors' injection molding machines, it's a miracle Lego is as cheap as it is for its quality. That said, I'm sure Lego benefits greatly from economies of scale, but that's probably offset somewhat by the difficulty of maintaining their precision at higher product volumes.
Honestly I wouldn't be surprised if Lego has the highest precision/cost ratio of any retail product. Everything else with the same level of precision is so specialized that it I doubt it could be as affordable.
Now if people think the high quality parts are overkill and the sets would be just as good with cheaper parts, that's something I can understand, but there's no way Lego's gouging you on the price.
„ Lego can basically sell for quite a high price since its the only competitor“
Wrong there are dozens of great alternatives:
BlueBrixx
CaDa
Rebrickable
.
.
.
„The LEGO brick machining has a tolerance of 0.0002cm“
I highly doubt that. If that were the case there should be no problem assembling giant sets like the Star Destroyer from Star Wars. But at that scale you notice how the bricks are not that precise and do not fit perfectly as the inconsistencies add up.
Also those competitors often outperform LEGO in brick quality while being significantly cheaper. And I highly doubt anything with a tolerance of 0.0002 cm is cheap to produce, to the point of 5 -10 ct per piece. (Which is what you usually pay for when buying a BlueBrixx set)
@@leonmuller8475 BlueBrixx is one of the worst companies out there, they sell so many things where the design is stolen, they even faked a Kre-O starscream and if i'm not mistaken a couple of older lego technic sets. BlueBrixx is so fkn bad. I agree with CaDa and some other brick manufacturers, but no joke, Bluebrixx is just a joke. I once bought a tank there and no joke, the pieces always falled off, i needed to glue it 3 times to hold, and i even missed 8 pieces... but when i moved i threw it in the garbage(recycle of course) that was 1 year ago
@@leonmuller8475 bruh… the tolerance part is true. As for the competition part, you don’t see many if not any people buying lego alternatives
@@MeisterSchwabbo Huh, I know people who have build 5000+ brick sets from BlueBrixx and had 0 complaints about the brick fit.
And all I can find about the Kre-O starscream is that Lego ripped of Kre-O, nothing else.
If you only count the cost of the plastic, then you're on the wrong way.
One high-precision mould (for ONE kind of brick) costs up to a million US$, and needs replacement after a certain time, to keep the bricks' dimensions perfect. And Lego produces hundreds of different bricks. Count that with the (correctly) mentioned HR, R&D, design, plus production costs (machinery, factories and energy needed), packaging, shipping, and last but not least, the reseller margin.
Lego products are expensive indeed, but it's totally wrong to say that Lego makes 10x the actual cost of the product.
I would be surprised if Lego makes more than 10~15% from the retail price.
Underrated well thought out comment.
And licensing fees for the branded themes (Disney, Marvel, Star Wars, Ghostbusters, etc)
Then how do competitors like bluebrixx manage to produce higher quality bricks, more bricks per $/€/£ and lower prices all at the same time?
Lego is expensive bc it's "name brand" they charge so much bc people buy sets no matter what.
@@ChetYeetus Yeah, that is what I believe as well, but the one who wrote the comment says it is because producing bricks is so expensive.
So I wanted to know how he explains that.
Fun fact: legos in indonesia is absolutely way more expensive, like sets that are 40 dollars turn into 70 dollars, 80 dollar sets turn into 120 dollar sets, good thing lego stores/stores that has legos in indonesia usually has a lot of discounts
Even tiny 10 dollar sets turn into 20/30 dollars
same in australia
I live in Indonesia and this is SO TRUE! They are SO EXPENSIVE! But I have had a set that had a 70% discount, so it was MUCH cheaper. Most discount’s are usually above 10% idk if this is true, I haven’t been in a lego store since the virus.
A 20 dollar set is 35 dollars here, a 40 dollar set is about 70 dollar here, and the lego Mario starter pack costs 100 dollars in here, which is 60 dollars in other countries, fucking outrageous
You are literally correct
The majority of their costs is paying the engineers to design the sets.
Engineers are generally paid $60-70hr. My Dad was a senior design technologist and was making $55/hr as he was a pay grade below an Engineer.
No matter how much the designers are paid I promise its a tiny fraction of the cost. The salary of a handful of designers is nothing compared to the vast sales lego get annually. Even if a designer were paid $70/hr for a $70 set, their entire salary would be paid off within a few hundred sales. I promise each lego set gets a lot more sales than that.
It’s for the intelectual property
@@arrun5125 Lego sets take months, if not years to produce, and are normally worked on by teams of several people. There are hundreds, if not thousands of different types of pieces and designers have to experiment with all of them to find the best fits. If 5 people work on a 70 dollar set for 70 dollars an hour for 8 hours a day for 5 months, Lego has to pay them 420,000 combined, or the money they would earn selling 6000 $70 sets if 100% of the money made from them were profit.
This is such bs it’s not even funny what are you talking about man
Just use an AI to generate sets lol
The answer to why LEGO is so expensive is that LEGO pay their designer and employee well, and their customer service cost a lot. I don't get why sometimes they have to ship free replacement pieces directly from Denmark. Won't the international sipping fee already cost higher than many small Lego sets? I have contacted Lego customer services a few times for things like simple inquiries or shipping address change, I must say based on the quality and efficiency of the customer services, the customer service representative must get paid a lot. Mcdonald's also includes licensed toys in their kids meal, but their meal is still so cheap that as an adult I still occasionally buy the kid's meal. Sometime for the toy (especially Pokemon toy), sometime just for the meal.
_their customer service cost a lot_
Meanwhile the customer service inbox mail:
- My LEGO plane can't fly.
- The passengers of my new LEGO roller coaster cannot get safely out of their seats.
- Instructions unclear: I can't find the fuel tank of this LEGO car to drive it.
😂 Sorry, I had to imagine it like this. Idk what exactly does the customer service of LEGO 🤣
Exactly. The reason McDonalds profit over 60% is because it's a minimum wage low-skills job with no reward and very few people actually wanting to be there. It's modern day slavery where you're purposely underpaid so you're too weak financially to be able to stand up for yourself and either fight or flight.
And another problem is that they are too expensive in different countries than actual price
@@Gloggle1that is more so a then problem
lego is way to expensive. look at the porsche 911 the orange one... you pay 900 now.... cada is having a way more detailed, car, remotecobtrolled, looks good with technic (its almost lie fully closed around) the brick quality is reeealy good, etc... and you pay 190...) like seriously ... only fanboys or ppl who dont know what else is on the marked buy lego... or maybe if its on 50% sale, some sets are on the price they should be
Each mold costs between $150K to $250K to produce. So, they need to substitute the cost of those as well.
So your telling me they spent over 1M dollars making a small lego set
@@hannahwills8970 No, that price is paid to create new molds for new pieces. Once they have one mold they can use it as long as they want. However if they're introducing several new pieces in a set then yes. But they'll still consider future use for that mold, and not create one for just a single set.
@@LegoVlogger ok
@@LegoVlogger and pt did happen, that is was only for one set.
But when the new piece gits to other sets, you will notice, they will use it as much as possible
@@hannahwills8970 Honestly did you even think when you wrote that?
Packaging comes down to how it it can be palletized. Before I started a business I wondered why some video card boxes were way bigger than they needed to be. When I started ordering 50-100 at a time the packaging made alot more sense as it fits precisely in a carton, that carton fits precisely on a pallet. It's true that shelf presence is a thing, but it has a real cost associated with it other than shipping. Many retailers make money selling shelf space to manufacturing not reselling their goods. This is called "rack jobbing." So making a box really big is a well researched and calculated move. Peace!
A
The only people buying these more expensive sets are the a hole adults that are grabbing up everything on the shelves just to resell later.
Considering how low quality the prints are these days I truly feel like they're overcharging
0:30 People from Germany: You sure about that? Like, there are countless other companies producing compatible bricks for a cheaper price and with a better quality (often including no stickers), like Cobi, a Polish company producing in the EU with only prints, and often complicated ones. And they at least gain in popularity here, because the biggest German Lego channel Held der Steine got 2 different conflicts with Lego, started by them over basically nonsense in the last few years, that he began putting a focus onto them that many others also got aware. Honestly, the US market needs to follow with this trend of showing other stuff than Lego to make Lego lose market share to them. Only when they are severely threatened by similar companies they are going to improve and go down with prices
Not to mention the case of Steingemachtes and QMan, where customs detained freight containers without justification at Lego's request. On top of that, I wouldn't be surprised if Lego were even more aggressive in the US with lawsuits against other manufacturers.
@@PaDDy7389 well, Cobi is already being sold under a different name there (they fused with a British company over a decade ago), so they would have a hard time doing stuff. Because "Why is it a problem now and wasn't with the same stuff before?"
@@Hendricus56 Oh, I didn't knew that but then Cobi should be safe, because Lego doesn't dare to challange large retailers and importers, but if, for example, Qman were to try to enter the American market via a smaller dealer, such as Steingemachtes, they might face the same issues there as in Germany.
In any case, I really hope that more manufacturers will move to the US and challenge Lego's predominancy, then they might have to change their pricing policy and that would benefit the rest of the world as well.
@@PaDDy7389 Or someone just manages to talk to the guys at the top of Lego and makes them understand, selling more with a smaller profit margin can grant more money over all
The problem here is that quality of LEGO is sinking, while prices are soaring. I recently saw a video of the large loop coaster set, with the high blue tower - the tower is covered in blue flat 2x2 plates, and it was immediately visible that there were irregular spaces between some of these plates - something unheard of from LEGO before. Not to mention the notorious issues with color accuracy in sets with a large number of supposedly same-color tiles, or the lack of printed tiles (fuck the stickers, seriously). Whatever the reasons, some of their competitors like Cada, Cobi or Bluebrixx have begun to achieve the same or better quality sometimes. Also - Cobi produces exclusively in Europe, unlike LEGO. It becomes increasingly difficult for me to justify spending top money for LEGO at this point.
Ever since Lego began getting so expensive, I had to resort to buying secondhand pieces in bulk from yard sales and building MOCs .
That's what we did in the early days. My parents bought me a large boxed set and I just used my imagination to create my own buildings. I also hade the motor set that added a bit of animation to play. I'm just amazed at the Creator sets with the level of detail and functionality.
Most of our kids' Lego is second hand. It is really hard with themes like dinosaurs as it's all licensed and as soon as it's retired, becomes collectible and you're competing with collectors and looking at scalpers' prices just so your kid can have a dinosaur that goes with their other Lego. We have bought them new sets, but it's getting harder and harder to afford, and with the recent price increase on the back of the announcement they've been making record profits shooting through the roof, it's pretty much saying to parents like us that Lego isn't for our kids anymore, it's for rich adult collectors now.
There is a key factor being missed here: minifigures and unique parts. Fact is, the more unique minifigures and non-standard molds used, the greater the price of the set. This is likely due to the increased printing and molding costs associated with the unique pieces, but also the way the online market treats these pieces. If few enough sets have rare enough figures, the value of the individual figure skyrockets. One of my favorite sets, the SWTOR Corellian Jedi Cruiser, was worth a pretty penny. The build is good, but it also contained unique figures unattainable in any other set to this day.
The excessive numbers of one-off pieces nearly ran them out of business. When I was playing with them, mostly in the late '80s and early '90s, there were relatively few unique pieces, most of the pieces would be in dozens of other kits in different proportions. But, apparently later they went on a binge making a bunch of unique pieces that made for great looking sets, but were very expensive to manufacture comparatively speaking.
6:50 Shipping costs go generally per kg/pound, not so much the size. So bigger boxes with little to no extra weight doesn't add much, if any, extra shipping costs.
If you own a company that produces anywhere over 20% profit return
That’s considered very good !!
Business is not easy
Especially now with COVID
@@aidenwilliams5591 I'm from the future, COVID is not a big deal anymore
@@GreenLeafUponTheSky well not in first world countries
@@GreenLeafUponTheSky Yeah no, it still fucked up manufacturing in general
Plastic is cheap , they make 70% profit or even more
I've always loved Legos throughout my childhood but unfortunately because of how ridiculously pricey they are especially for sets with basically nothing in them costing more than 40 bucks, I miss the feeling of clicking bricks together
It's a danish company, with its own ethic and national proudness, and you're paying that a lot through their prices.
I personnaly do enjoy this a lot about them, but yeah, obviously, it has financial consequences for those of us with lesser income than the scandinavians (which means: the near totality of the rest of the world).
Mexican here, a Lego Creator set costs 20,000 Mexican Pesos, which is the equivalent of 1000 dollars, and just for u to imagine, a common employee salary in Mexico is 15,000-20,000. Meaning that if u want a lego creator set you will need to spend all your salary, and I forgot to mention that they also add a tax based on the 16 percent of the final product price 💀
Mi cara cuando, mi cara cuando me lo compro en Coppel y ahora vale el doble por los intereses ☠️☠️☠️☠️
Lego prices be like:
Small 2x2 baseplate: 1,000$
A small set: 600$
1x1 brick: 700$
Stud: 100$
Lego still has not realized, that there is a whole plethora of legal competitors around - with prices well below of what Lego is asking. The bricks are basically no longer protected, only the figures are covered by a 3D trade mark.
But no one buys fake Lego unless you’re a shit parent
Well, but those "competitors":
- Are made with low-quality bricks
- Don't have good quality control
- Badly designed/stealing designs
And, they've always been known as "rip-offs". Trust me, I live in a place where these are everywhere.
@@nhantnt Some have the same quality as Lego (for example Gobricks).
Some have better designs (especially Cada and Mould King (in their non copied sets). And the quality control of these companies is similar to Lego's.
@@GothamClive It's until you know the fake LEGOs from China...
@@nhantnt knock off Chinese brands are not “competitors”, when we say competitors we mean original things like cobi or mega construx
Lego has become a hobby of the rich. It’s impossible to afford these things now and while I understand some of the points made here, it’s absurd when kids and parents see a small new At-Te star wars set that they are charged 140 dollars plus tax
I mean assuming you don't buy Lego sets every few days like some hardcore people do, maybe you could save up to buy at least 1 Lego sets a month, 12 Lego sets per year is already alot for me,waiting for the price drop is also good idea
It’s not a small set it’s one of the bigger ones and it is slightly overpriced I think 120 or 115 was the sweet spot for that set
But also take into mind we are going into a recession ppl
Lego has always been pricey. They expanded their ceiling but priced to inflation similar sets are probably pretty comparable.
@@JayJapanB
Lego plus big brands like Marvel and especially Star Wars is an automatic plus 20-30plus dollars to the set because of rights and licence
Legos are collectibles so the boxes are extra large so they aren’t deformed by the legos inside, preserving their quality and value
Lego is expensive because 3rd party sellers have made it a job. They buy up sets then wait a few years after they retire to sell for huge profit. I usually buy non lego and save a ton. Keep over paying if you want and encourage 3rd party business to continue. In the end its all just plastic people.
I have no premium experience unpacking a LEGO set. I feel cheated. I have bought a Mold King Flying Dutchman, 3500 parts for 150 bucks. It has a colored box, paper instruction, no fail parts, no color problems and its so damn heavy, you can murder people with the ship. LEGO today has color problems, some parts have slightly shape problems, and even in Ninjago Sets you don't get a good price -> part value. You buy LEGO for the figures, thats all.
I just wish everything wasn't licensed, I miss the old Lego themes they came up with themselves, also it probably does drive up the cost of everything.
LEGO actually doesn’t make bigger boxes to make the sets seem bigger, but rather to prevent damage to the bricks during transport
An ABS lego brick is actually very durable... remember you can step on them on hardwood floors and they suffer no damage. The amount of force it would take to damage the bricks inside a tightly packed box of bricks versus a loosely packed box is about the same, and in both cases it's a ton of force
@@tacoterrorizer1862 theyre hard to break, but they are most certainly not impervious to scratches, especially the transparent pieces
@@adne4336 Wouldn't it scratch the stones more if they slide back and forth in a big box?
@@HerrW0lf no, lower pressure
If that was true, why aren't they using that space to protect their transparent panes from getting scratched?
This is why I prefer rip-offs of Lego. For a quarter of the price of Lego, you get way more than a quarter of the quality of Lego.
Maybe a little bit boring but I have summed up some key figures from the Financial statement 2021 in Danish Krones (Dkk)and USD: Total revenue of 2021 is 55.293 billion Dkk (about 7.6 Billion USD). Net profit 2021: 13.285 billion Dkk (about 1.8 billion USD). That is about 24% of the total revenue. So in general 24% is net profit (we round it up to 25%). The rest about 75% are costs in every way. De difference are the expenses (38.3 billion dkk/ about 5.24 billion USD) and the income tax (4,7 billion dkk/650 million USD ). So the total sum is, now in USD: Expenses (5.24 Billion USD) + tax (0,65 Billion USD)+ Net profit (1,8 billion USD) = total revenue (7.6 B USD). So the Expensies are about 70% of total revenue and income tax about 5%. From the expensives (38,3 billion Dkk) are:
- Production costs: 16.783 billion Dkk (about 2.3 billion USD). That's 30% of total revenue.
- Sales and distribution expenses: 16.446 billion dkk (about 2,25 billion USD). That about 30 % of total revenue. That's almost as much as the production costs. Lego group spends a lot on sales!
- Administrative and IT expenses: 4,0 billion Dkk (about 550 million USD): That about 7% of total revenue.
- other operating expenses: 1,0 billion USD (about 136 million USD). That's about 2% of total revenue.
If you sum it up ypu have the total expenses (38,3 billion Dkk).
If you sum it up the expenses are about 70% of total Revenue. The rest is net profit (25% of total revenue) and tax (5%).
Interesting fact is the ' raw materials and consumables used' in 2021: 7,567 billion Dkk (about 1,0 Billion USD). Consumables are things to be used in the production proces. So that's 13,7% of the total renevue of Lego Group. That a lot more than you assume in your video.
Source:
www.lego.com/cdn/cs/aboutus/assets/blt248041929be3b572/Annual_Report_2021_ENG.pdf
Thank you for pointing this out. It's amazing how much speculation is in the video and the comment section, considering that the finances are publicly available.
You forgot the point that lego has the client service costs.
What I mean by that is, if some parts are missing in your Lego set, you can reach out to them and they will send you the missing parts per Mail for free. (Which is obviously more costs for Lego)
Legos Price is literally just for the Name.
There are so many other Manfucaturers that make better Sets with higher Quality and Prints for half the price
Please mix the volume of your end card down. It is obnoxiously loud!
manufacturing for lego, should be fairly cost effective, their is hardly any labor cost, everything is automated.
In my opinion designing new sets doesn't justify what research and development usually cost, at most its labor cost, at the same time lego hasn't really done anything that has created more value for their consumer in the last decade that can justify research and development cost.
Don't forget about that brick peeler in most sets now
HAHA
That’s because research and development doesn’t look for things that make bétter products, but rather make sets that sell bétter.
If it was like that nobody would be buying legos anymore
Let's reiterate, if everyone knew how much their set cost to produce including all overhead cost plus shipping versus how much of a premium they pay above that...... You would not like it very much as a consumer but some would still buy it but way less than now
I remember back in the day that my parents favored Minecraft over Lego sets because it was significantly cheaper to just buy the video game instead of buy several boxes of expensive ass lego sets.
Hate to sound like a geezer, but I remember being able to get decent sized Lego sets for only $6 or $10 as a 1990s kid. I even remember some cheaper then that. I used to be able to go to the store with my parents, and they'd be fine letting me get a cheap Lego set.
I kinda feel sorry for modern kids, as there are no more cheap Lego sets. Aside from those tiny little bag sets, where you don't get much. Now $6 will only get you a random minifigure person.
The little sets that take you 10 minutes to put together are 20 dollars. It’s insane. 10 minutes of fun for 20 dollars.
The one airplane is 100 bucks takes you probably an hour a half to build if that.
Ever heard of inflation.? $6 in 90s is like $12 nowadays. For around $10 you can by a small set with a minifig and something like 70-100 pieces, like space construction mech 60428 or go-carts 60400.
While Lego is giving us "premium" experience with more and more missing parts, lack of color consistency, non-reusable parts (typical for the licensed sets), decreasing brick quality (visible molding points, bricks not sitting properly), boring sets, removing whole themes (Mindstorm, trains etc.), mind boggling inaccuracies (especially for their licensed sets), decreasing Technic overall quality and increasing prices (to the point you can buy a cheap used car or a premium smartphone instead of a Lego), the competition is pushing the opposite and clients love it.
Lego has turned from a premium toy for all ages to a collector's lackluster thing that only adults with low IQ and cash to burn buy.
I think there’s more about the box that it seems. The box has a empty space for the impact that it can happen during the trasportation - like cereals or chips; if the impact doesnt go in the air or in the box itself, it goes on the product, which can damadge it. I know lego brics aren’t as fragile as a chip, but we are talking about hundreds of boxes being packed and transportared all at once.
Real Reasons why they're expensive:
- They take a lot of R&D (Research and Development) to create new sets
- Manufacturing Costs have increased due to going 100% Carbon Neutral
- Most Lego Bricks now are made using either Bio-Plastics (Sugar Cane) or Recycled Plastics
-I believe they cut R&D expenses drastically in the last few years, at least for sets made for children when compared to similar sets from 10-15 years ago.
-What exactly does it mean when Lego claims to be 100% carbon neutral? -are their Chinese suppliers or their packaging partners producing carbon neutral or is the Lego company investing huge amounts of their excessive profits tax-free in renewable energy companies for even greater long-term profits and greenwashing as a bonus?
- Since bricks for different customers are produced more or less by the same manufacturers, I doubt there is much difference in the material used.
Apple products for example are not more expensive compared to other brands because they are produced in a magical green wonderland full of happy people...
The Lego City Pizza Truck isn't made of pure ABS plastic, and I'm not talking about the air between the bricks. The tires are made of rubber, or a rubber like substitute, and the transparent pieces are made of acrylic plastic.
This. His calculations are wrong.
He didn't mention the cost to color the bricks as well. Dye isn't free. Also the cost to "produce" isn't the same as the cost to "make". Minifigs cost more to produce than bricks with the multi sided printing (more ink). Then producing stickers, rare parts cost more to produce. It's no where near as simple as it's explained.
To be completely honest, it is completely a waste of money to not buy Chinese companies. Instead 9f paying $700 for the Titanic, you can buy the Jiestar copy for $200. Instead of buying the Lego UCS Imperial Star Destroyer for $800, you could buy the Mould King MOC called the ISD Monarch for $200 which has almost 12,000 pieces! So you could save $600 dollars, get a better looking set, and have 2.5x the price count? Why WOULDN'T you buy the Mould King set.
my only question is "WHY is the outro music much louder than the video?!"
Here in Brazil the prices of a lego set are absurd! In addition to converting dollars to reais, they still double the price!
brazilian laws, tariffs, and regulations require that domestic goods are cheaper than international and higher-quality goods
The MSRP also has to figure in the retail markup, i.e. retailers need to turn a profit which means they pay lego less than MSRP for each set. Even if you buy straight from lego, the pricing still has to reflect retailer markup if lego wants retailers to stock their products.
And that MSRP is anywhere from 30-50% for retail consumer goods. It might be a bit lower given that there's not a concern of the product perishing.
@@upotheke that is an insanely high markup. I’ve seen the business prices for Lego on occasion and they are sub 20% normally. Small retailers cannot stock their products other than mini sets because retailer margin compared to demand isn’t there. Perhaps big retailers get a lot better pricing but I don’t know.
@@flyingrat492 It's not, shelf space is expensive, and it's in line with what I've seen from the products in the store I work at. I can't be too specific, but I'd wager that it's similar in other stores and other chains.
@@SmallSpoonBrigade perhaps it’s not then, but as I said, that’s nowhere near the price markup for Lego
This foo just gave us a 5 minute math lecture to prove his math was right.
Some Lego sets like the trains also completely throw price calculations out the window. The electronics are a thing but also the larger pieces like track and wagon plates probably may be more expensive to manufacturer.
Why are Lego so expensive? Because people will pay for them at those prices. If people stop buying them, they'll lower the prices. You'll see a drop in the number of licenses, though, if that happens.
Legos did not cost this much 30 years ago.. its just bs... Prada doesnt use that much different than other brands what makes prada expensive is the name only same with legos.. just name only and that is unacceptable... Legis are for kids not collectors which os what their aiming for and thus the excuse to raise price.
not even 15 years ago...
Actually Lego's current prices are comparable to previous decades. I have sets from the 80s with price stickers that show about $30 for a set with 300 pieces. There are sets right now on Amazon with 350 pieces for $30. Also stores didn't use to ever put Lego on sale back then. Some of you need a little perspective to realize how good you've got it.
@@studebricker2845 Im pretty sure stuff like the 2000s millennium falcons were like 100 dollars and now the newer ones went for 160-180. It's slowly going up and they're trying to be sneaky with it. Sure some themes stay the same with price but it's definitely going up over time.
@@TheBrickBuildingEnthusiast Some of that is also probably because of inflation
@@TheBrickBuildingEnthusiast Okay, let's look at the Falcon. Yes, I'm pretty sure you are right. The 2000 Falcon was $100. I just checked and the newest Falcon is $127 on Amazon right now. That's pretty amazing! Only $27 more 20 years later, for a much improved design and more pieces? And again, if you wait a month or so, most Star Wars Lego is 20% to 30% off. So overall I see Lego's pricing is pretty reasonable.
If lego made their sets cheaper they might make more money from having more sales but they need a lot more sales to make more profit
Headphone user warning at 7:57. I about jumped out of my skin with the outro music!
I'd rather have cheaper lego sets if it means having less collaborations with Star Wars, Harry Potter, etc.
The bigger box has more air giving the peices more room to move preventing letting them being crushed
This is incredibly wrong
@cool bear It's because the bricks have a higher chance of smashing into one another. His comment would only be true if the air gaps were replaced by crumple zones.
In Canada, jasper, Lego is so over priced. A 60 piece set for 70 dollars?
$20 may reflect cost of raw materials becoming actual bricks for sets, but that denies the cost of designing sets, engineering molds, marketing to audiences, providing customer care, etc.
$20 falls far too short to cover all these expenses.
Also, you forgot to round up for the cost of the set @4:00; cost is 87 cents, not 86.
Its soooo funny how he tries to explain the metric system but still calculates the costs with gallons of milk xD
Quick tip, the audio at the end is really loud. Please adjust your audio accordingly throughout the video.
That music at the end blew my speakers out, lmao.
If I think something is too expensive I just won't buy it. Sometimes we're forced into things because of necessity (fuel). But things that aren't a necessity we always have the option not to buy.
New topic:Why does the prize of lego change between countries
Lego plastic is expensive although high-quality because of it’s durability and obviously costs more to manufacture. Licenses can be a bitch of a cost and they obviously need a profit. They also had to hire technicians, engineers & professionals in the sets related field to make it. Proper designers have to model all of the sets, the machines that produce things from instructions to the proper parts are very expensive and have to be maintained. They have factories which require many employees to keep up and running. They obviously have taxes they need to pay, they even need to go out and scout locations if a set is based of that location
Tbh I am done with legos, after seeing how the Millenium falcon cost was 120 last year so when this year it became 160 it made me realize that Lego is becoming less and less worth it, is extremely overpriced for what they use in their production, so considering all the prices of production plastic etc. I believe Lego is definitely not worth it anymore. A fucking Ewok battle set is 37 dollars in target so yeah 💀
Most of legos profit goes into making more sets, the actual amount of money they keep from their yearly profit is quite small
30% is definitely not quite small. Look at the Lego annual report for official numbers. Here are a few interesting ones:
They have a total income of 55 billion Danish Krones, and a profit of 17 billion.
They spend about 7.5 billion on materials and consumables like electricity.
10 billion on employee costs.
Their total production costs are less than 17 billion.
The rest goes to IT, development, purchases of assets, licensing (about 4 billion). delivery, shop maintenance and so on.hey make about 30% profit. That's a lot.
They have a total income of 55 billion Danish Krones, and a profit of 17 billion.
They spend about 7.5 billion on materials and consumables like electricity.
10 billion on employee costs.
Their total production costs are less than 17 billion.
The rest goes to IT, development, purchases of assets, licensing (about 4 billion). delivery, shop maintenance and so on.
It's so expensive because people are happily paying that shit before blinking with an eye.
When i compare a lego set to a wave of hasbro marvel legends they are not “overpriced” but compared to the actual lego yes i agree
Short answer: they don't cheap out. Lego has been a quality brand for over half a century.
All questions related to why xxx is so expensive while the "cost" is so low is simply because people only take materials and production costs into account. They usually don't take one important thing into account - employee wages. And yes, that of course includes the executives and stock holders in some cases. Wages is, most of the time, the biggest expense by far in many companies.
If lego stop producing sets and instead, only produce parts, then of course the price should be far cheaper. Technically you could design your own sets and just buy the parts.
Maybe they should start selling just parts (other than the very limited pick a brick)
@@gnammyhamster9554 It would be great if they sold more individual parts but LEGO is popular because of the sets, lose that and you lose a lot of the brand.
@@bobbirdsong6825 I'm not saying to stop selling sets, just start selling some parts as well.
@@gnammyhamster9554 If you go to a LEGO store they have a wall you can buy individual pieces from, but admittedly not every single piece/color combination possible
2:24 you forgot about the tires man, tiers and stickers
Found out it's actually cheaper to buy the parts and follow the instructions to make the set than the set itself. (Mainly due to custom parts and sticker prints)
Not to mention you can save money if you already have those parts
For me, having to go through all that effort would destroy the experience of why I build lego sets in the first place.
I began to realize.
Youre not paying for the quality of lego anymore. Youre laying for the *brand* of lego. Lego has plenty of smaller competitors (such as Cobi) and theyre qualify is superb whilst being cheaper.
Please turn down the outro loudness. At least your audience that is using headphones will thank you.
They are to expensive, they should be between 50% to 70% of the current price.
A theory I had about the boxes is that the size match (for most of them) a repacking of the set without having to take it a part. Or just partly.
Your outro song scared the shit out of me. Why have it so much louder than the rest of the video?
lego killed all competition with patents and lawsuits. they are monopoly thus overpriced 10 times over
So you didn't even watch the first minute and a half? Their sets are "overpriced" 1.25 times over, not 10 times
@@Chris_winthers no0blet :3
@@uhohwhy what
It's cheaper to get a 3d printer and a sticker printer that can make high quality legos than it is to get a couple lego sets nowadays
the cost calculation is not that simple. Take star wars for example, lego has to pay for the license fee. Then , the lego brick manufacturing machine also cost money. Each lego store has pay for rent, since the company do not own any land . Each employee including designers and shop worker also need salary per month. What about transportation fee, lego sets are not gonna move themselves. Above all, lego is still making huge profit.
Each new mold design cost shit ton of money & they are high quality/very precise. IMO Lego makes at least 1 new mold design for every license/theme and every years. Some mold are used in a set or 2, no more during their lifespand. The Demogorgon's legs from the Stranger Things set got used by the demogorgon & Lupin's werewolf in 2022.
That's like asking Entrepreneurs "Why are you selling this at a high price?"
Profit.
After you factor in the design costs, manufacturing overheads, marketing, etc. etc. it all adds up and LEGO isn't that expensive compared to many adjacent products. It's certainly not cheap either, but it's not as ridiculous as say Games Workshop model kits.
Remember when you could get a Bionicle Canister for like 10-15$ and have so much fun with it? I know that a lot of Bionicle sets had less than 100 pieces but a lot of those parts were fairly big and when you combined all of them into your Bionicle it stood kinda tall and big. So yeah.....
So lesson learned, don’t buy lego for a long time to send a message
Yep, if only people would do that, we would stop footing the bill for Lego's escalating profits.
You literally missing the biggest pricing point: Marketing.
These videos are starting to look very professional, honestly impressive. You obviously have a lot of potential, believe in yourself and don’t let hate or unjustified criticism get to you! ❤️
Ain't nothing remotely professional about that outro. Beyond that I agree with you tho
Rock on, its a real shame more people don't keep this in mind when commenting
You have the price of 1 gram at 3:07 as 0.042 cents, but have the price at 3:52 as 0.0042, so you did do it wrong
wtf why the outro so loud
6:55 shipping is mostly priced by weight and not by volumen.
Especially if you are a big player like Lego.
And mostly a fraction of the total costs.
Thanks for waking up my whole house at the end of the video!!!!!!!!!!!!!!!!!!!
Used to love Lego as a kid, mom would get me a real nice big lego set for about $30 back in 2005ish. Now days that $30 retails for over $100, so I've started recently buying from like Mega Construx which has way way more complex pieces and figures for only a fraction of the price compared to Lego.
from the lego shop some lego cost more than from amazon or kmart. the assembly square costs $400(Aud) at the lego store but on amazon it costs like 285.
Yea I don’t understand how the manufacturer (Lego) sells a set more than Kmart. Since Lego gives the sets to Kmart they should be able to sell the sets for less given the fact they don’t have to make as much money back
the thing is lego can probably get abs much cheaper as they're a large a reputable company, plus there's no doubt they buy in as bulk as possible
I think that if lego won t stop raising the prices the Lego company will become an exclusive for the rich and not for everyone, or for people who can afford it.
Lego aims to have as many buyers as possible, raising prices to the maximum of those allowed to the normale people.
It's called Capitalism.
Simply it's so the LEGO company doesn't go bankrupt like it almost did 10 or so years ago
I remember finding and buying off-brand imitation LEGOs to use for a planetarium activity. The bricks (from the imitation brand) were not as high of quality as LEGO.
You can also look into buying loose LEGO parts much cheaper than purchasing full kits
Yeah, quality is a big factor. I still have lego lying around that's 30 years old, still perfectly usable. There aren't many plastic toys you can say that of.
Btw you guys in the US have it good, where i live lego is atleast 20% more expensive than in the us, sometimes its better to buy from amazon than in the stores here
I prefer megabloks but they’re always sold out in every store
Megabloks is just cheap knockoff lego
I had to mostly rely on the big buckets of generic bricks as a kid, since it was the most "cost effective" out of the sets.
the bigger boxes means they take up more shelf space so it makes it harder for any simillar brand hard to get shelf space bigger box= more spacr for their product by taking up more space
Cool. I think bigger boxes can have many advantages now that i think about it, they take more space, so they create a larger area in the store, so people are more likley to spend more time there looking at box art than they would if it was only one shelf.
Also taking up more shelf space might mean small and medium stores have to choose between lego and their competetors to a bigger degree. Which probably favors lego, as they’re the top dog. It’s actually really smart! (And not very friendly to free market principles and the enviroment)
*2:22* dude you forgor to take out the rubber tires💀
Bro that's like 1 gram difference chill your beans
Boxing, design team, builders, plastic bags for bricks, instructions shipping: Am I a joke to you?