Inside the Toy Biz

Videoviper

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We often hear about arm chair quarterbacking of how the toy business works. Often what's posted is grossly wrong so I found a few behind the scenes videos to share knowledge of how things work.

 

nacho

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That first video is a good primer for basic production of goods. However it pains me to think that the concepts of sunk/fixed/variable costs are not common knowledge, especially in the mostly-adult-male universe of toy collecting.

There should not be a person in this country that gets out of high school without taking a basic business class. Not that all of them will start a business or anything, but just for their own edification so they know how the world works on some basic level. I can't imagine walking around this earth with no concept of how an item gets to my store or why it's priced the way it is. It seems inconceivable to think there are people living in that fog of ignorance.
 
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Videoviper

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OH back in the HT days & still on other sites, I see people try to figure out how many of X were made. The number is always absurdly low (10,000-12,000 minus what time destroyed) for something that had a minimum of 100,000 units.

I figured it would be good to document some of the questions people often ask.

It does surprise me that many people just don't know/care what goes into these things & thay the "toy" issues are not limited at all o collectables/toys/or ever a particular store.
 

ThunderDan19

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That was very informative. It is more than a little annoying that Hasbro didn't use the extra profits from not having the royalties to provide more stock on the shelves. That is the worst thing about the Classified line: no product on the shelves because what little was produced (particularly the Tarjay exclusives) was snatched up at store opening of drop day and immediately listed for double the price to infinity on evilBay. I think it is ironic though, that, had they produced more product (even just double the product), the scalping would be less profitable and Hasblo would have significantly increased their own profit without the extra royalties to pay. Putting out more army builders (particularly instead of multiple versions of Roadblock, Destro and Cobra Commander :wtf: ) at this scale would have been like printing money for them.

Also, I really would have loved to have gotten the 6" line he was working on that got cancelled. The modernized Joes of POC were undoubtedly the best produced at 3-3/4" IMO. However, I am not sure I'm in the majority on that one. A lot of Joe collectors love the nostalgia and want the look of the originals. I like his ideas in the Valaverse stuff, and may well pick up a couple (including the Sarge), but I'm not sold on some of the more flamboyant ones, particularly at the price point. I think he should have stuck more tightly with the modern military aspects, favoring some of the more realistic Joe/COD/Battlefield flavors (without getting so close that he'd get copyright hits). Not a terrible first offering, but we'll see if it can jump off to something truly collector-worthy. I wonder how he got the license for Steel Brigade and Sergeant Slaughter. (Maybe Hasbro's time ran out?)
 
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nacho

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It's my understanding that he bought them from hasbro for little-to-nothing, as they had no plans for items with those names. Other people have speculated that Hasbro let the trademarks lapse and he snatched them up, but I don't think that's correct. Being a former hasbro guy that still seems to be on reasonably good terms with them, I don't think he was trying to screw them over.

The watering down of the brand to keep Marvel and SW looking respectable is irritating. Did sales of those lines tank when PoC was giving us superior value at the 4" scale? No, they did not.

It reminds me of car development. My '01 SS Camaro was the first year to get the LS1 V8, previously developed for the corvette. Reading stuff from the former developers, they said that track lap times in the camaro were so good that they rivaled the contemporary corvette, and GM would not stand for that, as the Corvette had to be substantially better as the flagship sports car. So GM made the Camaro developers put a silverado truck camshaft in the camaro to lessen the performance. And even then, they actually fudged the camaro HP values downward to further appease the corporate overlords. All to keep the perceived value of the corvette high, as it cost twice as much.

So it's a shame we're not getting the full beans. Joe deserves better. One could argue that without ARAH, Hasbro might very well have been gobbled up by another company like mattel or kenner (rather than the other way around). They are the largest toy company because Joe kept them afloat more than once in the brand's history, yet they treat it like a red-headed step-child.

I like the Vala stuff. I'll be buying most of the first offerings just to check it out. The Steel Brigade figure looks like a sufficiently updated/modernized version of the '86 toy, so that's cool. And I can't wait to see what else he comes up with that can be used to fill in the gaps in the Classified line. It's clear Hasbro is only interested in half-assing the official stuff. On a positive note, Habsro is doing a running change to the w1 figures that gives them a more muted deco without the red and gold bits. I already customized ARAH-ish versions of them, but I'll probably pick up a muted duke just because.
 

ThunderDan19

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It's my understanding that he bought them from hasbro for little-to-nothing, as they had no plans for items with those names. Other people have speculated that Hasbro let the trademarks lapse and he snatched them up, but I don't think that's correct. Being a former hasbro guy that still seems to be on reasonably good terms with them, I don't think he was trying to screw them over.

The watering down of the brand to keep Marvel and SW looking respectable is irritating. Did sales of those lines tank when PoC was giving us superior value at the 4" scale? No, they did not.

It reminds me of car development. My '01 SS Camaro was the first year to get the LS1 V8, previously developed for the corvette. Reading stuff from the former developers, they said that track lap times in the camaro were so good that they rivaled the contemporary corvette, and GM would not stand for that, as the Corvette had to be substantially better as the flagship sports car. So GM made the Camaro developers put a silverado truck camshaft in the camaro to lessen the performance. And even then, they actually fudged the camaro HP values downward to further appease the corporate overlords. All to keep the perceived value of the corvette high, as it cost twice as much.

So it's a shame we're not getting the full beans. Joe deserves better. One could argue that without ARAH, Hasbro might very well have been gobbled up by another company like mattel or kenner (rather than the other way around). They are the largest toy company because Joe kept them afloat more than once in the brand's history, yet they treat it like a red-headed step-child.

I like the Vala stuff. I'll be buying most of the first offerings just to check it out. The Steel Brigade figure looks like a sufficiently updated/modernized version of the '86 toy, so that's cool. And I can't wait to see what else he comes up with that can be used to fill in the gaps in the Classified line. It's clear Hasbro is only interested in half-assing the official stuff. On a positive note, Habsro is doing a running change to the w1 figures that gives them a more muted deco without the red and gold bits. I already customized ARAH-ish versions of them, but I'll probably pick up a muted duke just because.

I agree that Joe (and the original Xfrmers) are what built Hasbro and got them enough capital to weather the lean times. I wonder, though, if H'bro just underestimated the demand for GJC. If they are already issuing muted versions of the early waves, I wonder if maybe, just maybe, they'll see the potential for their own profit and up the quantities and re-releases. Even if some peg warm, they still have the profit cushion from not having to pay royalties. They ought to jump on it. I took a look at the re-deco'ed Duke on EE. He's better than the original. I might end up with one at some point.

BTW, my daughter is all about the 6" figs right now (mostly Marvel Legends). I picked her up a SW Black Series Leia. She looks tiny next to pretty much any Marvel fig. Is there any explanation why the SW figs are pretty much 15% smaller? Is it just a GI Joe 3-3/4" to SW 3" thing, where all the SW stuff is just smaller in general, despite the "similar" scale? It's almost comical that she's so tiny next to them.
 

Videoviper

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I said this years ago that to the company it’s all product. As much as I would like to see GI Joe come back, SW was the war toys that were “ok” & selling. so GI joe had to go because they were competing with themselves.

Now joe would come back with a high presence if they lost SW, but that didn’t happen. Now SW competes with itself now, so there will never be that toy presence in the isle again without a major change.

Now a lot of supply issues we complain about are no where near unique to toys or just one company but if I could figure that out I would be a millionaire.
 

nacho

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I agree that Joe (and the original Xfrmers) are what built Hasbro and got them enough capital to weather the lean times. I wonder, though, if H'bro just underestimated the demand for GJC. If they are already issuing muted versions of the early waves, I wonder if maybe, just maybe, they'll see the potential for their own profit and up the quantities and re-releases. Even if some peg warm, they still have the profit cushion from not having to pay royalties. They ought to jump on it. I took a look at the re-deco'ed Duke on EE. He's better than the original. I might end up with one at some point.

BTW, my daughter is all about the 6" figs right now (mostly Marvel Legends). I picked her up a SW Black Series Leia. She looks tiny next to pretty much any Marvel fig. Is there any explanation why the SW figs are pretty much 15% smaller? Is it just a GI Joe 3-3/4" to SW 3" thing, where all the SW stuff is just smaller in general, despite the "similar" scale? It's almost comical that she's so tiny next to them.
No doubt that covid delaying the SE movie screwed up their plans for the line, so they're scrambling for product, hence the slight repaints. But it still vexes me that they once again underestimated the demand for Joe, and the more ARAH they make it, the more fans like it. We need to engrave this in stone above the HQ entry doors, lest each new design team has to learn the hard way every time.

I don't think I've ever heard a reason for SWB being so much smaller than Legends, but they clearly are. SW feels like a 5.5" line, while Marvel Legends have been growing for years, with standard male heroes now pushing 6.5". Classified seems to split the difference, while Vala appears to be just a smidge taller than Joe, no doubt b/c his original plan was to fit with everyone's ML collection.

You should try to find a SWB Slave Leia... she's like 4.5" tall. When I opened her, my first reaction was that she was a 4" figure, but then I remembered that Vintage Collection Slave Leia is like 3" tall. It's a mystery why they think she's so damn short and ugly. For a character/deco that was the subject of many a schoolboy fantasy, they work hard to make her slave figures look like f@#$ing Gollum.
 
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ThunderDan19

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Yeah, the one my daughter has is the ESB cloud city version. She's not ugly, just tiny. I told my daughter, "Well, Carrie Fisher was pretty small in real life, so maybe that's why..." :p

It's always hit or miss with female action figures. Like you said, they turn out fugly way more often than they should these days, considering it ain't the 1980's any more (looking at you, manly 1982 Scarlett...). I will say, as a whole, the 6" ones my daughter has: Black Widow, Hela, Sif, Valkyrie, Wasp, Gamora and even Leia are generally pretty well done.

Although, just this past weekend we discovered there is a price to be paid for attractive/proportional female figures, at least if you want to be able to play with them. My daughter's Hela's (who she just got for her birthday) arm snapped at the elbow joint without her abusing it at all. There just isn't very much space for plastic there in those skinny arms for a joint pin. Thankfully, there is eBay for something besides scalping GJC figs. I got another ordered for her pronto and saved the day/weekend. Yay, Dad!
 
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Videoviper

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Leia is short because they wanted to save plastic & kept the change going forward.

As far as the different sizes, at one point the thinking was each toy line needs to be unique that’s why they never use each other’s parts/assesories. This may or may not have been a contract issue.
Dispite them obviously trying to sell them as the same scale.
 

nacho

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She's a pygmy...

1611709477970.png

And how does the (supposed) 4" figure look substantially better than the (supposed) 6" figure?! The 1:18 figure has a little muscle tone, a b-cup, and nice facial details. The 1:12 is derpy, flat, and crosseyed. WTF mattel!

1611709366267.png
 

ThunderDan19

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Lol, it is funny that the teenage nerds’ dream looks so frumpy yet still disinterested... :laugh:
 

ThunderDan19

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Well, sort of, but we have this thing now called technology. I can go to the kiosk right there in the toy section and it will tell me at least which aisle the GJC figures are supposed to be located. From there it's simply walking down the aisle and looking between the other 6" figures to find the correct pegs. If a toy stocking person can't manage that, they have no business being there.

And I disagree with his premise that this is why it is hard to find GJC figs in the stores. It's not because the stock person can't figure out where to put them. It's because on day one the scalpers got there and snatched them all, before the actual collectors could find their way there to pick one or two of them up.

Edit: The second video eludes to that moreso in relation to the big box stores and how their limited stock combined with the scalping leads to empty pegs. Oh TRU and KB, how we miss thee...
 
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I really don't get why they don't go majority DTC at this point.

You know you'll get nerds to army build, just sell sell sell them direct. Bypass store deals and scalpers.

I really cannot believe a dumb line like GI Joe Classified sold a ton of figures to non-collectors. Is little Tommy going to walk into Target and say "Gee I want one of those!" Occasionally, maybe, but since scalpers are clearing the pegs as fast as they can stock them.. what's the point.

If the nerds could satisfy themselves via online ordering, you'd leave figures on the pegs for kids to organically discover..
 

nacho

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I understand the logistics of why the manufacturers and stores behave the way they do. But what I don't understand is why they don't even try to do better. As ThunderDan19 says, there is this thing called technology. Stores stock and restock toys in the same manner they do cans of soup, and they aren't the same. In the old days, I can see why they would make no distinction, but with the kind of innovation and tech capability that is commonplace these days, there is no excuse for not being able to pinpoint some kind of optimal distribution/stocking scheme. And no one can convince me that empty pegs is "optimal".

If Target can tell you you're pregnant before you even know it based on purchase patterns, certainly they can tell who is buying what, how many more they need to order, what items have hit saturation and what SKUs need more attention. And it can all be automated so that it doesn't depend on a pimple-faced teenager or burned-out middle manager who doesn't give a shit. I just don't buy the notion that without a planogram of minimum size X, they just don't know what to do with these toys? Huh?

WM/Target have perfected the concept of JIT (just-in-time) distribution and stocking, so it's hard to fathom that they have empty pegs for weeks on end and have no idea how to fill them back up. It's a stupid assertion. They should know that x-number will be scalped the second they hit the pegs (or before in the case of Cobra Island Exclusives going out the back door), and they need to order z-more so that the pegs aren't empty. How f#$%ing hard is it?

Collectors can't collect what isn't there, and certainly kids can't discover a toy line that might as well be a myth.

While I find these videos to be interesting windows into the toy biz, I also have a hard time taking Scott seriously. This is the guy that tried to convince us for years that Digital River was doing a great job with MOTUC. Fuck that guy. He's a snake oil salesman.
 
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nacho

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I agree that it does explain their decisions to a degree, but it doesn't excuse their unwillingness to adapt their business model to the 21st century and the way these products would be optimally bought and sold.
 

nacho

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That's pretty sweet.

I really want to get into some 3d printing for the same reason I wanted to get into casting... custom parts! But casting is a mixed bag, as it's messy, I'm not much of a sculptor, and I don't have a pressure pot, so it's tough to do much with fine detail. Maybe I'll talk myself into a 3d printer with the next gubment check.
 

ThunderDan19

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A pretty good (though concise) comparison of Hasbro and Mattel as businesses from a channel I enjoy watching. The only thing I disagree with is his assertion that GI Joe has not been significant for "like 50 years now." If he said 30 years, maybe. But I would say the fact that they made two (while not actually successful enough for a true revival of the brand) movies and have had a run of maybe 10 waves of product in the interim would invalidate his statement to some degree. Hasbro just doesn't hang its hat on GI joe like they did 35 or 50 years ago. Dang kid probably wasn't alive in the '80's... :p
 
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nacho

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I think your assessment of his age is correct. He clearly was not alive in the 80s and would not know that they were the hottest selling toy of the decade, likely by a large margin. TF, He-Man, SW, and TMNT were all big, but none of them were on Joe's level at the time.

Although it's odd that he seems to have missed the '07-'11 revival as well, and you'd be hard pressed to find anything not named Transformers that topped Joe in that window.
 
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