Author Topic: The Hasbro/Retail/Case Pack Situation  (Read 737 times)

Offline Dave

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #15 on: March 18, 2014, 10:28 PM »
Several of the K-Mart stores where Justin and I live are in the hood.  They're not just messy and filled with feral children, they're actually located where you wonder if your car is still going to be in the parking lot after you leave the store.

Offline Diddly

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #16 on: March 19, 2014, 12:51 AM »
Target having only 1800 stores also surprises me because there are like 10 Targets within a 10 mile radius of me. Pretty much anywhere there's a Wal-Mart, you'll find a Target either right across the street or close by. Our only K-Mart closed around 2000, and I think there might be two left Texas, one in Lubbock (6 hours away) and another near Ft. Hood in Killeen (about 2 hours). 3 TRUs in town too, and that's pretty much it for toy shopping.

Back on topic, I spotted a case of wave 3 at Target today, oddly enough missing only the Mara Jade. In what might be a dumb decision, I passed. I still want to order a case online to get all of the Wave 1/2 leftovers I keep passing on.

Offline Jesse James

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #17 on: March 19, 2014, 01:18 AM »
Kmart distribution is easier to manage now that they're down to 37 stores. You're lucky to still have one around.  I definitely think retail plays a role in lack of availability,  but I think you're ignoring some really terrible assortment choices from Hasbro that aren't helping matters.  Look at the 6" line.  The first wave sold fairly evenly with 4 different figs.  W2 doubles up on Han and no one can find Fett. W3 doubles up on Kenobi when everyone wants at least one Stormtrooper.  Complain about retail all you want - if it was your store and you were sitting around with extra Ben and Han figures, you'd be gun shy about ordering the next wave of figures too.  There are some obvious misses in these selections (double up on Fett, use a repainted Sandtrooper for your 4th "extra" figure, double up on Stormtrooper, etc) that would help retail sell through faster and regain their confidence in the line.  On the 4" side I will never understand why they don't release all new figure cases (2x of 6 for example), then manage in a greatest hits case one a year with the figures that were most popular.

I have 2 within 20 minutes, both pretty clean nice stores...  I have 4 within 45-50 minutes...  maybe a few more actually, not sure, but they're all in different directions ultimately.

The two fairly close to me though I hit regularly since both are on my commute, plus between my gf's house and mine.

Anyway, quite the contrary on ignoring case assortments...  You point out 6" Wave 2, which I just mentioned recently on this very topic.  It's EVERYWHERE here, for sure, but Han isn't among it.  Maybe your area's suffering because of it being Target's HQ?  In our area, Greedo and Leia are out in scads, including Target, TRU, and K-Mart.  But Han's a tough find.  Last one I saw was overpriced at the book store, but it's gone now too as of last weekend.

WM doesn't carry 6" figures at any of the ones I haunt.  Target has steadily got Wave 2 in, but that steady flow has led to tons of Leia and Greedo.  There were 8 of each at my nearby Target just last weekend.  Again, I say over-ordering caused that, but Han is gone. 

My KM got a case of 2 in, they sold out, they got another case in, sold out, and on the 3rd case Leia and Greedo haven't sold.  The other K-Mart I hit frequently has Leia, no Greedo.  An X-Wing Luke as well.

I don't disagree on Fett, Stormtrooper...  They're no-brainers to come back at some point. But again, in my area where a store ordered Wave 2, it's more Leia/Greedo than Han...  Even if it were Han, the finger I'd be pointing is how many cases the store ordered though.  Target having 8 of each of the other 2 figures is pretty sad.

I don't think K-Mart's that much "easier" to manage in that regard...  I don't work there though, or Target, but they have almost the same number of stores by your numbers, so I guess I don't consider that a factor.

On the 4" end of things, Hasbro's said a wave is costed out by itself...  6 new figures doubled-up in a case isn't likely to happen, short of a line launch or movie line...  Even then, unlikely they haven't factored in repacks for subsequent waves.  Repacks/repaints are something Hasbro's basically said are a necessity to get that obscure new character or whatever...  I don't know why they do things that way.

If it takes a repacked Scout or something like that, to get you Plagueis or Vizam, I tend to accept it.  Much like if cheap low-risk junk like Angry Birds toys nets me a figure I want while Hasbro grasps at the kid dollar, I'm ok with that.

Like I said...  If you short any figure, you'll have griping.  If you overload any figure, griping.  Since the line's like steering a tanker, rather than a speedboat, in terms of turn-around time with adjustments, I think Hasbro's GENERALLY (again, I think that 6" Obi-Wan is a misstep, and some of the Clone repacks they've gone with) done well for a time when the line hasn't had much of any media support at all.

I think we've also seen that retailers who don't contain their ordering, or who go the polar opposite direction and basically ignore the Star Wars section all together, are miserable to deal with for the most part.  Hasbro's certainly not perfect, but they shoulder 99% of the blame in the collector community.  I think that's anger that should be sent more to the retailers not supporting the line at all, or not being conservative enough to manage the flow of product at all.

A bit of an aside here.  Most of our "Glock K-Mart" stores are gone...  One is more along the lines of a 30-06 store than a Glock, but it's in a poorer rural area.  At this one, your car will be there, but dependent upon how "Purdy" your mouth may be, you may wish you had remote start.  It's a pretty rough store, shittiest of employees, and camo's a bit of a uniform there.  I got my first Ewok sets there on store pick up.  What a fiasco.

My area's rural but it zoned against big box stores actually, so K-Mart's about the only thing here aside from small places like Family Dollar, a Big Lots, or Dollar General.  It's kind of nice in a way, but kind of not when you want variety.

On the other hand, I have literally $90 in free money to spend at K-Mart because I use the Reward Zone thing a lot, and if you pay attention to it and all the coupons you can make an assload of cash to use on anything, plus $.30 fuel perk coupons at BP.
« Last Edit: March 19, 2014, 02:15 AM by Jesse James »
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Offline Rob

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #18 on: March 19, 2014, 10:34 AM »
Target having only 1800 stores also surprises me because there are like 10 Targets within a 10 mile radius of me. Pretty much anywhere there's a Wal-Mart, you'll find a Target either right across the street or close by.

That applies to urban areas and suburbs, but it doesn't apply to rural areas where there's generally a Wal-Mart in any reasonably sized small town that people within a certain radius all drive to.

Offline JediJman

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #19 on: March 19, 2014, 02:51 PM »
Anyway, quite the contrary on ignoring case assortments...  You point out 6" Wave 2, which I just mentioned recently on this very topic.  It's EVERYWHERE here, for sure, but Han isn't among it.  Maybe your area's suffering because of it being Target's HQ?  In our area, Greedo and Leia are out in scads, including Target, TRU, and K-Mart.  But Han's a tough find.  Last one I saw was overpriced at the book store, but it's gone now too as of last weekend.

I don't think anyone's arguing that Leia or Greedo would have been a better choice than Han.  The example I gave was Fett versus Han.  I have seen Han on pegs, but I've never seen Fett.  And given that Amazon had Fett at $40 and Han at $12, I'm making the assumption that Fett is more in demand.  All else equal, it would have made more sense to double up on Fett and/or include him as the "repack" in wave 3.  I am sure we will see Han warming pegs more once wave 3 gets out to most stores, but unless you think Fett would have sold less than Han its still an example of poor assortment choice.

I don't think K-Mart's that much "easier" to manage in that regard...  I don't work there though, or Target, but they have almost the same number of stores by your numbers, so I guess I don't consider that a factor.

That was just a joke based on the 37 store count.  If they truly just had 37 stores versus Target's 1800, I would think inventory management might be easier for them.   ;)  Like I explained earlier, that was just me being grumpy about not having any KMarts nearby.

On the 4" end of things, Hasbro's said a wave is costed out by itself...  6 new figures doubled-up in a case isn't likely to happen, short of a line launch or movie line... 

I think that's a cop out on Hasbro's part.  If they would normally sell 1,000 cases at an expense of $20 per case or sell 1,500 cases at an expense of $30 per case, they should be break even at worst, and you can't tell me the reissued stuff sells as fast as the new stuff would.  There are holistic benefits to what I proposed as well - greater market share, volume influence at retail, expanding/defending shelf space, etc.  If you issue 6 new figures x2 then I can gobble up two of each as one buyer, I can split the assortment with a friend, or I can sell off a complete set on the secondary market.  I have all kinds of reasons to buy them up.  But 4-6 new figures with 6-8 repacks means the repacks sit on shelf waiting for kids or sale prices, and that means slower reorder times and eventually less overall volume sales.  I get there's a cost element to what they're doing - I just believe that the added volume sales and increased sales velocity more than makes up for it. 

Even then, unlikely they haven't factored in repacks for subsequent waves...If you short any figure, you'll have griping.  If you overload any figure, griping.  Since the line's like steering a tanker, rather than a speedboat, in terms of turn-around time with adjustments, I think Hasbro's GENERALLY (again, I think that 6" Obi-Wan is a misstep, and some of the Clone repacks they've gone with) done well for a time when the line hasn't had much of any media support at all.

Which is why I suggested a Greatest Hits wave each year.  You want cheaper cases and need repacks for profit?  Evaluate which figures from the last 1-2 years are in greatest demand by end of May, then release a Greatest Hits wave for the holidays every year.  There's no new tooling time involved and they can make 1x of each figure to minimize peg warming.  And its the holidays, so they can capitalize on added gift volume.  Nevermind the fact that you're getting HTF figures out to people who missed them and at least giving the appearance that you care about something other than your profit per case metric.

I think we've also seen that retailers who don't contain their ordering, or who go the polar opposite direction and basically ignore the Star Wars section all together, are miserable to deal with for the most part.  Hasbro's certainly not perfect, but they shoulder 99% of the blame in the collector community.  I think that's anger that should be sent more to the retailers not supporting the line at all, or not being conservative enough to manage the flow of product at all.

Sophisticated retailers don't have some guy with a clipboard deciding when to reorder each line of SW figures.  These are automated systems that for the most part do a pretty good job of determining volume needs vs. inventory on hand.  In my opinion, the crappy assortment offerings (I'm looking at you TPM wave, Malgus wave, earlier waves etc.) drove slower turns and backed up retailer inventory.  An obvious direct result of that is slower reorders and reduced shelf space.  I'm not sure what you're asking retailers to do when you say they're not "supporting the line" or "being conservative to manage the flow of product,"  so maybe I'm missing why you're so willing to shift the blame to them. 

If a guy smacks you in face every time you walk down his street, I don't blame you for walking down the other side of the street.  Hasbro's not 100% of the issue, but they're definitely the biggest contributor by far in my mind.

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Offline Jesse James

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #20 on: March 19, 2014, 05:09 PM »
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I don't think anyone's arguing that Leia or Greedo would have been a better choice than Han.  The example I gave was Fett versus Han.  I have seen Han on pegs, but I've never seen Fett.

Nor am I, I'm simply making the point that seeing Han doesn't mean he was necessarily a bad choice...  I'm also pretty sure Hasbro said Fett's coming back, no?  I thought that was the case, but maybe I'm wrong.  I bet he does though.  Perhaps Han is doubled up because of all the extra stuff?  They need to get their money's worth out of the mold? 

Regardless, he's selling well enough here I think he's a fair choice...  The best?  I never said that, nor do I believe it, but he's not a bad one either by my estimation to see again.

The total numbers of Greedo and Leia at my area Target stores indicates to me though, that being a tad more conservative with their orders would've benefited them.  Like other stores were.  Or run a sale to manage the overstock they now have of Wave 2, to help Wave 3 come in, like TRU does.

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I think that's a cop out on Hasbro's part.  If they would normally sell 1,000 cases at an expense of $20 per case or sell 1,500 cases at an expense of $30 per case, they should be break even at worst, and you can't tell me the reissued stuff sells as fast as the new stuff would.
 

It's something Hasbro's consistently said throughout the Q&A...  If you think it's a cop-out that's your prerogative, but I disagree.  Accounting on a wave-by-wave basis is done because Hasbro has to be conservative...  Rather pay for a wave now, than hopefully pay for it later...  Which would be much later because, as I said, decisions in toy manufacturing are like steering a tanker, not a speedboat. 

You'll plan out this "Greatest Hits" wave, but by the time it's ready for release who knows what's going on, right?  The line's popularity at retail or what they're willing to order, etc.  By costing it out by wave, Hasbro forces the retailer to pay for it now, rather than decide to cover manufacturing costs later on by buying what essentially is an all repack/repaint wave.

What if that wave sees no support?  They're not fans of high risk choices I've noticed...  Especially where the 4" line's concerned.

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If you issue 6 new figures x2 then I can gobble up two of each as one buyer, I can split the assortment with a friend, or I can sell off a complete set on the secondary market.
 

I don't disagree with that as a COLLECTOR, but Hasbro's hardly one to place its bets on the collector market either.  To them, toys are still for kids.  Not the guy willing to buy the whole case.  They say we're the minority.  Feel free to not believe that either, I just know that's their stance, and that they want the mom/dad or kid $, and the casual consumer $.

I'm not even disagreeing that it's ideal for us because my buddy and I would split cases all day long, ordering online...  Then again, Hasbro wants bigger retailer support first, so maybe that plays some part in case assortment decisions too?  I'd love 2x 6 new figures in each case though, but I'm simply saying what Hasbro's position is...  Costing out a wave is done so on a wave-by-wave basis so a wave pays for itself, rather than paying for it down the line.

TPM3D was "paying for it" down the line (a wave of almost entirely new being paid for by repacking what you can for the next 3-4 waves).  It didn't work well because TPM3D didn't work well.  We saw this coming (me too, I was bemoaning TPM3D merchandising all the way).  Hasbro didn't.  Perhaps they couldn't.  Perhaps they were being told to support it LFL's way.

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I get there's a cost element to what they're doing - I just believe that the added volume sales and increased sales velocity more than makes up for it.


Again I say it's a risk, and time issue...  Pay for it now than later, taking a risk you won't make up the costs in all these new toolings by putting out repack waves further down the road, which would have to be much further because of the boat steering analogy.  You won't know what's "good" till wave 1's out a while...  Maybe even wave 2 or 3...  when does that Greatest Hits wave even get compiled, produced, and shipped?  You can guess, but the first wrong guess and you've got collectors once again up your ass online saying you're the devil because you guessed wrong, plus you've got the same issues you always had.

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Which is why I suggested a Greatest Hits wave each year.  You want cheaper cases and need repacks for profit?  Evaluate which figures from the last 1-2 years are in greatest demand by end of May, then release a Greatest Hits wave for the holidays every year.  There's no new tooling time involved and they can make 1x of each figure to minimize peg warming.  And its the holidays, so they can capitalize on added gift volume.  Nevermind the fact that you're getting HTF figures out to people who missed them and at least giving the appearance that you care about something other than your profit per case metric.

I've noticed that, like I said, in today's market even the slightest bit of saturation means the figure pegwarms...  I think your view is idealistic, and I don't think it's a bad idea, I just don't think it'll work.  I like idealistic, and wish it would work, but I don't think it would work NOW is maybe the way to put it. 

Not factoring in Hasbro's insistence that a wave be costed out on its own...  Forgetting that, it's not 2007 where "Greatest Hits" was a glorious group of things people hadn't found before.  And it seemed to sell well.  2007 was a great year.  Greatest Hits financed the main line, for the most part, it seemed, and fans were clamoring for both.

Does that model work NOW though, in 2014?  The line's limped along for some years.  It's far more costly now than 2007 as well.  That worked 2 years removed from a movie and with a big cartoon blitz on the horizon, in a 30th anniversary year of the original film.  THAT was a great year to collect.  The greatest year, hands down, to me.  It was fantastic, and it kind of worked in a fashion like you're talking about Justin, but I just don't see that working now.  Collectors are at an all time low, and if we are, then you know kids really are out of it.

I think you might see something like that come back in the future, with new movies and new material, but not right now.  If those Greatest Hits DON'T sell that holiday season, and they may not, then Hasbro's in trouble on what it sunk a lot of $ into with all the new tooling they put out leading up to the holidays.

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Sophisticated retailers don't have some guy with a clipboard deciding when to reorder each line of SW figures.  These are automated systems that for the most part do a pretty good job of determining volume needs vs. inventory on hand.  In my opinion, the crappy assortment offerings (I'm looking at you TPM wave, Malgus wave, earlier waves etc.) drove slower turns and backed up retailer inventory.
 

I had the benefit of learning both systems when I graduated in 1998, working management for J.C. Penney first, then Service Merchandise.  Both had on-hand store merchandisers, but also automated systems for reordering product.  I'm pretty well versed in both, which most people here are.

My point is that K-Mart also doesn't have a man with a clipboard...  But they're able to keep a conservative order rate going, and sell through.  They have a comparable number of stores, yet are considered the most incompetent retailer in America.  But they're ahead of Target on this.  Because Target's re-ordering has been a disaster of late.  With 4" TBS it was their DPCI debacle, but as soon as the flood gates of that were opened, TBS wave 1 poured into my local Target stores even though they're already behind the curve on it.

KM on the other hand, conservative ordering meant smooth shipments of new product steadily over the holidays.  4" TBS Wave 1, 2, and 3.  Same with 6" TBS Wave 1 and 2.  Target's capable of that, no?  That's all my point is on the matter.

Likewise, Wal-Mart is, but they are the opposite of Target...  They're basically abandoning much of the Star Wars line right now, probably biding their time till new movies...  They could conservatively order and have steady streams of new figures as they're released without the logjam of getting in 3+ cases at a time of any given wave. 

Perhaps Target and WM don't want to be like that because they feel the sales volume doesn't meet the floor space it would eat up, and Target would rather sit on 8 of each 6" Greedo/Slave Leia, and scads of Wave 1 4" TBS figures, but K-Mart manages it well and so I think it's safe to say two superior stores should be able to do the same.

TRU manages it through sales...  Larger volumes wind up sitting and they do a BOGO50% sale, which tends to move larger volumes of toys.  Their method is different, but it too works. 

Wal-Mart doesn't support the line for the most part, right now.  I think we all see that pretty consistently.  Target is overzealous in what's coming in when they are ordering, things back up, then they stall out...  Case assortments can be blamed for part of that, but when other stores aren't running into the same problem Target is, and are having sell-through, it makes you think maybe case assortments aren't ALL the problem, and perhaps during these lean times Target should start taking a more conservative ordering approach, ala K-Mart, and keep product flowing through its stores on its own...  since, obviously it's an attainable goal for a retailer...  even without a guy with a clipboard in each store micromanaging the situation.

I'd agree with you on this 6" OWK...  Hasbro loves him, says kids love him, but while I'm sure that's probably the case, I think $20 figures are a clear Collector item, very little else aside from casual adult buyers, and a kid isn't looking there.  I am guessing they feel 6" Ani will push 6" OWK sales?  But I agree with you, I think doubling up on OWK is a dumb move.  I think Clone repaints were a dumb move too for repacks, but then again the Scout didn't exactly blow out the door either in the 4" TBS line.

I'm far from saying Hasbro's blameless...  But I just feel at this point retailers should shoulder the majority of it because I see retailers selling Hasbro's cases well, through sales or conservative ordering.  I see other retailers either not supporting the line (WM) or overordering the line and then sitting on their thumbs (Target), and you can't blame Hasbro for that when others are coping.

Maybe things will change during a movie year?  2007 feels like a lifetime ago though, and I just don't think that tactic works till there's more interest in Star Wars globally than there has been in the last 5 or so years.
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Offline Dave

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #21 on: March 20, 2014, 09:34 AM »
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I think that's a cop out on Hasbro's part.
 

I think this is a cop out as well. 

I've managed enough product lines and whole portfolios to know that some products within your portfolio have better margins than others and you need to be looking at the whole portfolio, not individual items or waves.  You need to balance gross margins with turns.  There is no point getting great gross margins if your turns are terrible (e.g. backed up pegs with TPM).

I don't know that they should go to a 2x each new figure in each case as there are going to be figures that kids likely won't care much about (Toryn Farr), but I do think Hasbro could do a lot better job managing their case assortments.  Particularly when you look across the lines Legends, Mission Series, TBS, CW/Rebels.  I think its tough when you've got four different repacked Jedi Anakin figures on the shelf across all the lines and they all back up, especially when stores are only allocating a few pegs and re-order when the counts get down to near zero.

Offline JediJman

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #22 on: March 20, 2014, 02:59 PM »
It's something Hasbro's consistently said throughout the Q&A...  If you think it's a cop-out that's your prerogative, but I disagree.  Accounting on a wave-by-wave basis is done because Hasbro has to be conservative...  Rather pay for a wave now, than hopefully pay for it later...  Which would be much later because, as I said, decisions in toy manufacturing are like steering a tanker, not a speedboat.

They can say it all they want, its a cop out, or at the least very bad portfolio management.  Like Dave, I work for a manufacturer of a variety of products and those come with a variety of different margins.  Beyond basic portfolio management, it's just simple math that If you put out product that turns faster and sells more volume, you can afford higher input costs.  Putting out mostly repacks that take a long time to sell probably does drive them to minimize their cost per case, but that's failure of their own design.

You'll plan out this "Greatest Hits" wave, but by the time it's ready for release who knows what's going on, right?  The line's popularity at retail or what they're willing to order, etc. 

That could be said of any case.  Do you think a single greatest hits wave with the 12 most sought for figures from the last year or two will sell LESS volume than a constant flow of cheaper-to-produce, less popular remakes that were just made available in previous waves?  That Malgus wave is a prime example of what happens when you only offer a few new figures per case.  As a retailer, crap like that would surely scare me away from reorders, and that's why I'm not willing to fault them much for not having what I want to buy.

What if that wave sees no support?  They're not fans of high risk choices I've noticed...  Especially where the 4" line's concerned.

How is a greatest hits wave more risky than releasing less desired reissues throughout the year?  A 12x1 wave based on input from fans, call centers, etc. couldn't do any worse than the repacks they're currently putting into new cases.  I also suggested a holiday timing, when any figure is more likely to sell for kids and gifts.  I would think retailers would eat this up, especially if Hasbro was willing to discount the case price a little.  If you want retailer support, do something to earn it. 

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If you issue 6 new figures x2 then I can gobble up two of each as one buyer, I can split the assortment with a friend, or I can sell off a complete set on the secondary market.
 

I don't disagree with that as a COLLECTOR, but Hasbro's hardly one to place its bets on the collector market either.  To them, toys are still for kids.  Not the guy willing to buy the whole case.  They say we're the minority.  Feel free to not believe that either, I just know that's their stance, and that they want the mom/dad or kid $, and the casual consumer $.

I don't have the data to prove or disprove this, but my belief here is that Hasbro is fooling themselves.  They don't really use the free research from sites like this, so I don't really trust their research elsewhere.  Regardless, I think kids also prefer new figures to repacks, so this doesn't explain why repack assortments would fare any better than all new assortments.

You can guess, but the first wrong guess and you've got collectors once again up your ass online saying you're the devil because you guessed wrong, plus you've got the same issues you always had.

I thought Hasbro didn't care what collectors think?  If that's true, then they're no worse off.  Frankly, I think collector's would welcome any kind of plan other than packs of 12 with 4 new and 8 old figures.  People are a lot more accepting when they see that you're trying to make things better versus staying the course on something that isn't working.  I'd also argue that you don't have the same issues you always had because as soon as that next case comes in, its all new.  Their problem is having pegwarmers, then a follow-up case that resupplies the figures already not selling.

Does that model work NOW though, in 2014?  The line's limped along for some years.  It's far more costly now than 2007 as well.  That worked 2 years removed from a movie and with a big cartoon blitz on the horizon, in a 30th anniversary year of the original film.  THAT was a great year to collect.  The greatest year, hands down, to me.  It was fantastic, and it kind of worked in a fashion like you're talking about Justin, but I just don't see that working now.  Collectors are at an all time low, and if we are, then you know kids really are out of it.

Not seeing any rationale here why all new figures cases wouldn't work.  Yes, they could muck up production levels and have too much supply, but they have that same risk with what they produce today, right?  With the system I suggested, you could keep production levels near the lower end, then resupply with the most wanted figures in the GH case.  That should help them control production vs. demand better than what they're using today.  Am I missing something?  I just don't see how it could be any worse off...  ???

My point is that K-Mart also doesn't have a man with a clipboard...  But they're able to keep a conservative order rate going, and sell through.  They have a comparable number of stores, yet are considered the most incompetent retailer in America.  But they're ahead of Target on this.  Because Target's re-ordering has been a disaster of late. 

I am curious to know what you think KMart is doing differently from Target and Walmart in terms of reorder.  The way you portray it, KMart either closely monitors distribution levels or has programmed in set limits on the number of cases they receive to avoid massive pegwarming.  In truth, I bet their reorder systems are actually very similar in principle.  The difference is that Target and Walmart sell much more volume than KMart.  If you sell 12 figures per week, the system is going to tell you to order a case per week, so higher volume retailers stand a better chance of getting "backed up" when product isn't selling.  If you sell 2 figures per week and  only reorder a case every 6 weeks, its far easier to manage that inventory and prevent stockpiles.  Kmart may appear more efficient, but it's not clear to me that they're more effective.  Target might be better off selling 36 figures per month and having 12 leftover versus Kmart selling 11 of 12.

I will say that I think Target's DPCI system throws an added wrench into their inventory.  When cases started flowing into TJMaxx/Marshalls, I saw lots of these being returned at Target, often with the other store's price tag still on the package.   ::)  I find that system incredibly useful for managing my own returns, but it definitely contributes to their distribution problems as well.
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Offline Jesse James

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #23 on: March 20, 2014, 04:46 PM »
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They can say it all they want, its a cop out, or at the least very bad portfolio management.  Like Dave, I work for a manufacturer of a variety of products and those come with a variety of different margins.  Beyond basic portfolio management, it's just simple math that If you put out product that turns faster and sells more volume, you can afford higher input costs.  Putting out mostly repacks that take a long time to sell probably does drive them to minimize their cost per case, but that's failure of their own design.

I don't know what industries you or Dave work in, but I'd guess managing a toy line for a major movie series differs slightly unless you're in a similar field. 

For instance the TPM3D line...  First wave, pretty good stuff from the standpoint of it being new, quality figures...  The film it's surrounded by, not so much, and it failed.  We personally all probably agreed this looked ugly when we saw repacks of TPM3D figures, but Hasbro was banking on popularity, possibly at the behest of LFL.

I'm simply saying many factors would go into why they did what they did.  We may disagree, and we'd have been right to, but why they did what they did has many levels to it I'm sure.

Your idea I think revolves, a lot, around the idea the line will turn anything around quickly.  I think the line's not suited for that right now.  I think it's at a point where anything doubled up will sit if a retailer gets just that one too many cases.  Like Dave said, double up on Torryn Far and you may not like what you see.

Then again short her, and a retailer only gets one case in, and others aren't supporting the line maybe like we are seeing right now, and you'll have people clamoring for her...  Then she's being demanded in that greatest hits assortment you're hypothesizing and she gets out in droves at the holidays...  Then she's a pegwarmer.  See the pattern?

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That could be said of any case.  Do you think a single greatest hits wave with the 12 most sought for figures from the last year or two will sell LESS volume than a constant flow of cheaper-to-produce, less popular remakes that were just made available in previous waves?  That Malgus wave is a prime example of what happens when you only offer a few new figures per case.  As a retailer, crap like that would surely scare me away from reorders, and that's why I'm not willing to fault them much for not having what I want to buy.

I think Hasbro's looking not at just cost savings, but what they think will move...  You say less popular, but the Clone repacks in theory should still do well at retail.  This is basing it on Hasbro's idea that the line has to appeal to someone other than you and I.

Again, is a case of 12 HTF figures great for us?  Yes.  Is it great at retail if it's the case available?  I'd argue the idea would be possibly catastrophic.  You put out something collectors say they couldn't find too much, and it'll clog pegs.  Collector figures don't necessarily drive the line would be my point there.  Again, according to Hasbro (feel free to assume they're lying to you), obscurity is paid for by the things we hate, like a Clone repaint/repack.  Put Vizam or Torryn Far out again because you had a hard time finding them the first time, they're possibly pegwarmer bombs just waiting to happen.

I'm sure some figure names you're throwing out will do well, but hypothetically others won't.  You're in the same boat, but with their system (whether you believe or not) they're accounting for the wave now, rather than waiting to account for it later via your system...  Which they may not accomplish.  That's maybe poor portfolio management to you, but I'd say it's strong conservative accounting to them, in a year far removed from ANY media support for this toy line.

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How is a greatest hits wave more risky than releasing less desired reissues throughout the year?  A 12x1 wave based on input from fans, call centers, etc. couldn't do any worse than the repacks they're currently putting into new cases.  I also suggested a holiday timing, when any figure is more likely to sell for kids and gifts.  I would think retailers would eat this up, especially if Hasbro was willing to discount the case price a little.  If you want retailer support, do something to earn it.
 

See above...  Costing a wave by itself is obviously a more conservative move.  Costing a wave by banking its costs are covered by a wave you're planning on releasing only through the 4th quarter of the year?  You think that's not "risky"?  Holiday timing is nice in theory too, but I don't know if you noticed but things getting here on time doesn't always happen with the Star Wars line. :)

Now you're wanting discounted prices on the cases designed to make up the cost of the figures you put out all year too.  I just don't see how that's anything but "risky" when things aren't paid for yet, but you're going to put all your eggs into a basket for the end of the year.

Not to mention you'll still take the chance that something in THAT assortment doesn't move, especially if it's all hypothetically collector-targeted stuff that collectors couldn't find and are demanding.

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I don't have the data to prove or disprove this, but my belief here is that Hasbro is fooling themselves.  They don't really use the free research from sites like this, so I don't really trust their research elsewhere.  Regardless, I think kids also prefer new figures to repacks, so this doesn't explain why repack assortments would fare any better than all new assortments.

Again, you're free to believe what you want.  I can't argue against that.  I think that kids do appreciate some new stuff, but I also think kids like main characters, Clones, and other stuff like that...  When the line is actually popular.  Which, at this point, I don't think it is with the mass market.

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I thought Hasbro didn't care what collectors think?  If that's true, then they're no worse off.  Frankly, I think collector's would welcome any kind of plan other than packs of 12 with 4 new and 8 old figures.  People are a lot more accepting when they see that you're trying to make things better versus staying the course on something that isn't working.  I'd also argue that you don't have the same issues you always had because as soon as that next case comes in, its all new.  Their problem is having pegwarmers, then a follow-up case that resupplies the figures already not selling.

Don't recall ever making that statement since there is plenty of evidence to the contrary.  I never said Hasbro didn't CARE about what collectors think, I just simply stated they have to gear the line to other segments because collectors aren't the majority.  If you feel differently despite being told otherwise, again that's your prerogative, but I doubt the line would've lasted half as long if it were a collector-targeted thing.  Collectors as a whole like to talk big, and rarely back it up financially I've noticed.

Torryn Farr and the invite to Toy Fair every year is enough to realize they care about collector happiness to some degree though.

I think collector's general "acceptance" of Hasbro sways with the wind though too...  Make the figure they want, regardless of pegwarming suicide, and they'll praise you.  Try to make the figures and decisions necessary to make that instant pegwarmer though?  They burn Hasbro at the stake.  Hasbro tends to be in a no-win situation a lot of the time, when it comes to the adult collector segment.

Again, you don't agree with those being necessary decisions though, so that's fine.  But outside of major movie blitzes or residual line popularity like 2007, I can't recall when the line didn't seem to need that kind of decision making to keep it going in the lean years.

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Not seeing any rationale here why all new figures cases wouldn't work.  Yes, they could muck up production levels and have too much supply, but they have that same risk with what they produce today, right?  With the system I suggested, you could keep production levels near the lower end, then resupply with the most wanted figures in the GH case.  That should help them control production vs. demand better than what they're using today.  Am I missing something?  I just don't see how it could be any worse off...  ???

I've given you my rationale and I think you're choosing not to see it, personally...  Not agreeing with it, I understand, but it's not like I avoided making points.  I see your point of view...  It's a more liberal one, IMO, by the details I laid out to you, and according to Hasbro's own point of view on how they run the line.  I just don't see it working right now, nor jiving with the times.

I think in 2007 it may work well because a variation of it, of sorts, did work well...  It wasn't quite as liberal, but it was still a risk by today's standards to have Legends be so collector-focused for a whole year.  In 2014 it wouldn't work though, I don't believe.  I think there are variables in figure choices in that Greatest Hits wave that would come into play, and could cause issues.  There are timing/release issues I can see cropping up.  Prices are way higher now, and people are far choosier in what they purchase.  Not to mention the collector segment, which in theory that Legends stuff would be geared at, isn't what it once was.  The buying power isn't there like it used to be, and that was long before 2013.

That's all aside from the fact Hasbro simply seems to run a more conservative model, for reasons we could only guess at...  As bad as its portfolio management may be to you.  Without knowing why, or all the variables they have in making such decisions, or simply without believing them in the first place, it's a tough thing to even argue at this point.

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I am curious to know what you think KMart is doing differently from Target and Walmart in terms of reorder.  The way you portray it, KMart either closely monitors distribution levels or has programmed in set limits on the number of cases they receive to avoid massive pegwarming.  In truth, I bet their reorder systems are actually very similar in principle.  The difference is that Target and Walmart sell much more volume than KMart.

I would assume the systems are virtually identical, but in my neck of the woods they're steadily selling figures, and steadily getting new product in to replace it.  Target's getting in a lot of stuff, seemingly at once, and it's sitting after a short time...  Let's say 6" as an example since they f'd themselves with the DPCI issue on 4" and it's slightly different.

In terms of 6" they got in a TON of Wave 1 to kick off the line...  $20 action figures, they went all in.  They had lots of pegwarmers.  They got in tons of Wave 2 as well though, but it's sat pretty stagnant aside from Han/Fett.

K-Mart got in at best 2 cases at a time of any wave, launch or now.  And that was at the holidays.  A case was replaced after a time...  A single figure or 2 may have hung on the pegs, but then another would come in eventually after some time for some reason.  Then those would gradually sell even though they were "pegwarmers" by most people's standards...  There were still some Wave 1 hanging, one or two maybe, then Wave 2 started shipping...

The same pattern continued.  Wave 2 would sell down.  One or two cases came in, went...  One or two, etc.

Now Wave 3's surfacing.  I expect the same thing.

Nobody's monitoring it any closer, it's just set to some different standard than Target's cases.  Target is sitting on scads of Greedo and Leia.  K-Mart isn't.  I'm not expecting my Target to get many Wave 3 in right now, but who knows.  Perhaps, with things being as they are, maybe volume selling on a line that clearly isn't a volume seller right now is bad business?

I haven't seen anything past Wave 1 4" TBS at Target or WM...  Again the DPCI thing maybe screwed Target up there though.  K-Mart and TRU have seen all 3 waves, just through different means.  Perhaps Target should adopt TRU's methods since volume is their issue then?  Doesn't explain WM basically ignoring the Star Wars section all together of course, but either sales or a more conservative re-order schedule might be in order for them?  K-Mart may not have done Target's volume, but they're able to keep new product flowing right now when cases are supposedly destroying the line overall. 

I've seen 6" Boba Fett between my two K-Mart stores no less than 8 times!  And that's assuming I was the first one there, and more have been at these two stores.  That's not bad numbers on Wave 2 of the 6" figures.  It maybe took longer at K-Mart for that much to come through, but the stores aren't bogged with Leia and Greedo either like Target is.  Perhaps spreading it out a little bit would help.  Assuming they can adjust their system like most stores are able to.  I know Penney's stores could, and that was 1998, so I'd assume Target could as well.  Perhaps not though, and they're just stuck.

Don't get me wrong though, I see your point and don't disagree with it entirely even...  I do think Hasbro can do better on case assortments.  I don't agree that they're just lying to us, and I don't agree that they're better off with your overall plan, but I do think they can do better on case assortments.  I think figure choices could improve though. 

TPM3D came up a lot, but that's a weird situation which because of the 3D cancellations we won't be seeing again hopefully.  Will a new movie line be much different though?  I dunno.
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Offline Rob

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #24 on: March 20, 2014, 04:56 PM »
So.  Many.   Words.

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #25 on: March 20, 2014, 05:46 PM »
Here's what I took away from the novels Justin and Jesse wrote:

it's just simple math that If you put out product that turns faster and sells more volume, you can afford higher input costs.

Your idea I think revolves, a lot, around the idea the line will turn anything around quickly.  I think the line's not suited for that right now.

I think Justin has a valid point.  If you look back at the history of the line, there have been plenty of times (aka times when sales were good) where Hasbro has shown willingness to put more $ into a case knowing the sales would be there to recoup the costs.  That is how we were able to get stuff like Hermi Odle, a Kybuck, Ewok 2-packs, Ephant Mon, etc.   Or sometimes they lowered the prices knowing increased volume would make up for it ($4.50 ROTS figures in 2005)

But, I think that Jesse is right in that Justin's proposal only works if you get the increased sales to offset the higher input cost.  And right now, with the low sales we're seeing (and you can take your pick for the reason - price, availability, figure selection, case pack, etc), Hasbro's not interested in taking the risk of putting more $ cost into a case and potentially not seeing a sales increase to recoup it because Star Wars is in the tank right now.

Somewhere amidst all the turmoil of the past two years (TPM flop, cancelled 3D releases, Disney/LFL changes), Hasbro made a decision to just ride out 2013/2014 with as little cost as possible.  Just put the line on life support and wait for the LFL/Disney stuff to settle and Episode 7 to get here.  So, here comes 3.75" collector cases with cheaper manufacturing raw material costs (smaller cardbacks, crappy plastic bubbles), less accessories, less paint masks, etc.  And that's not even mentioning the $6 Legends or $10 Mission Series cost cutting moves. 

I have no idea if that choice was right or wrong, because I have zero ideas of all the other factors involved in the decision.  Did the Hasbro money guys cut their budget?  Did Disney have some say in the direction they chose?  Or did the 6" line cannibalized the 3.75" budget to some degree?
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Offline Darth_Anton

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #26 on: March 20, 2014, 06:36 PM »
So.  Many.   Words.

And how.
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Offline JediJman

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #27 on: March 20, 2014, 06:39 PM »
Well summarized, Jeff.  I can't disagree with any of that.  The point that sticks out to me is this...

And right now, with the low sales we're seeing (and you can take your pick for the reason - price, availability, figure selection, case pack, etc), Hasbro's not interested in taking the risk of putting more $ cost into a case and potentially not seeing a sales increase to recoup it because Star Wars is in the tank right now.

Somewhere amidst all the turmoil of the past two years (TPM flop, cancelled 3D releases, Disney/LFL changes), Hasbro made a decision to just ride out 2013/2014 with as little cost as possible.  Just put the line on life support and wait for the LFL/Disney stuff to settle and Episode 7 to get here. 

The origin of this discussion was in whether to place more blame on retailers or on Hasbro.  My long winded rants were in support of the belief that availability issues fall more in Hasbro's camp than retail's.  I firmly believe that case assortment has been and continues to be a core driver behind the decline in Star Wars space, sales, support, so am admittedly overly defensive when I hear someone say the assortment doesn't matter.

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Offline Jesse James

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #28 on: March 20, 2014, 07:01 PM »
Of course, I never said case assortments don't matter, but feel free to just go with whatever you want at this point. ;)
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Offline Nicklab

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Re: The Hasbro/Retail/Case Pack Situation
« Reply #29 on: March 20, 2014, 08:31 PM »
This whole sub-section of the thread should probably be a topic unto itself.  Clearly, distribution is an issue at this time.  And there are significant issues that are contributing to the problems we're encountering.

RETAILERS - Clearly, some of them are being far more conservative with their buying.  Sales in the action figure segment are down across the board because of a shift with kids toward video games.  WalMart seems to have pulled back in light of the TPM 3D debacle and the stock from that time that is STILL in stores.  Target seems to be managing their inventory even more aggressively than they have in the past with fewer orders.  And TRU is having issues maintaining their own business model.  The expansion into Disney stores certainly helps Hasbro, but we'll have to see how that pans out.  Disney stores aren't quite as plentiful as other chain stores and may have some difficulties managing their inventory down the line.

PRODUCTION - The lead time from producing a figure until the time it gets to store shelves is considerable.  A production run may take weeks.  Then there's overseas shipping, customs and distribution to retailers.  And this isn't accounting for production schedules at the factories, which are also turning out other Hasbro properties on a schedule.  The Hasbro Star Wars team can't simply call the factory and say "Hey, Darth Plagueis is really selling well!  Churn out another 3,000 and get them to me next week!"  And that kind of slow roll is likely why it's taken Hasbro 2 years to get Bastila reissued, too.  They simply aren't capable of turning on a dime like a smaller company.


Product is likely to be more readily available as the marketing for REBELS starts to ramp up.
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