[Benn Roe]

Quote:

Originally Posted by usernamedustin

I wish Hasbro would stop offering store exclusives and just sell them through Pulse. It doesn't make sense. I assume Target pays $5 wholesale for an action figure that sells for $20. If Hasbro is selling them directly, at full retail price, they make a lot more money and don't have to sell as many figures.

Yeah, so unfortunately this isn't the case at all. If Target was getting a margin that good, they'd do a better job stocking the line. I can't tell you what they're paying, because their wholesale rate is probably a bit better than what I pay, but it's a lot closer to $15 than $5. Hasbro needs stores like Target to sell the line for exposure, but Target doesn't make any money selling it. The compromise is exclusives. Target can use exclusives to force Legends collectors to shop there, but it doesn't actually want them buying Legends, so it stocks the line lightly to keep them coming in over and over again, rarely finding what they want, with the hope that repeated trips will yield sales of high margin goods they might otherwise've bought elsewhere, like batteries and toilet paper. Target wouldn't stock the line without exclusives, and Hasbro needs big-box stores to stock the line, thus the eternal song and dance. Preorders selling out quickly online is by design, as it stokes fear of scarcity, which powers the whole machine.

Exclusives aren't the problem: the toy industry's wholesale rates are. If Hasbro even charged $10, let alone $5, a $20 MSRP would be sustainable, and exclusives wouldn't be necessary, because Target would actually want to sell figures. Stores would stock a hell of a lot more too, which would--in turn--decrease customer frustration and increase sales. If exclusives did exist, and they probably still would, they'd be easy to get. Alternatively, stores could start selling figures for $30, but I think the former scenario would make customers happier, and ultimately probably make more money for everyone. Garbage wholesale rates have a long history in the toy industry, though, and I imagine it would be a tough habit for Hasbro to break, even if it might ultimately make them more money.

Honestly, flippers are the only people making any money off toys, and--even there--the math is frighteningly unfavourable. For instance, a reseller buys for $20 and sells for $40. They double their money, right? Actually, they barely break even. $20 toy + average of 8% sales tax ($1.60) + $8 to ship the toy to the buyer + 10% eBay fee ($4) + Paypal fee ($1.46) = $35.06 spent, to make $4.94 in profit. This is why figures are increasingly being flipped for $50-$100 each, rather than $30 or $40. $70 is a sustainable flipper price on a $20 figure. The industry's numbers are just tailor-made for feel-bads.