$31.00 per figure.................. (1 Viewer)

[Combat]

As explained in an earlier post, K&C and other companies that produce toy soldiers in China and price their sets in U.S. dollars have lost 10% just from the depreciation of the U.S. Dollar vs. the Chinese Yuan over the last ten months and close to 20% over the last 2 years. As a result, 10% of the price increase from last year just allows K&C to make the same amount of profit it did last year without even looking at any increases in labor costs, materials and shipping.

Let's see if prices decrease when the exchange rate improves. My guess is no - prices only go one way. Keep in mind also that a few years ago there was less competition - John Jenkins, First Legion, Honour Bound, Collectors Showcase, Figarti have emerged only recently. Arguably prices should be affected by competition - keeping them down - when in fact they all continue to go up. Also, it is little discussed, but apparently KC prohibits dealers from selling below retail. So collectors will never get a break on price even with unpopular items that can't be sold. I think KC is still a good buy, but it's clear that the manufacturers grasp at any excuse to raise prices. When gas prices drop again (as they will) and the economy improves (as it will) I doubt we hear a peep out of them about reducing the prices.

 

[fmethorst]

Let's see if prices decrease when the exchange rate improves.

...assuming OPEC doesn't switch to the Euro.

 

[nmrocks]

Dear H,

When you transfer to China, you should ask for your pay in RMB.

Steve,
Your explanations for costs were very good, however I take exception in the Figarti case. The fact they own there own facilities and have a full time staff should actually increase there costs as K&C can contract out there manufacturing and not have the high overhead associated with facilities management and full time employment of the manufacturing staff.
Actually, I've often wondered how Figarti does it? With such low volume and so much equipment and facilities to pay for as well as a full time manufacturing staff?
Ray

 

[Njja]

I worry about my grandaughter, I knew the cost of living would be higher for my daughter. My 1st home cost me 30K, her 1st home over 20 times that. She has a wonderful education and career (attorney) what to do for the little one?

If we don't put a curb on our current situation how much is her 1st home going to be? New Jersey has a 1% tax (Mansion Tax) on homes selling for more then 1 Million. Who are they kidding.....at the rate we are going thats
going to be a starter home in 20 years

Whats a box of toy soldiers going to be 1K?

What happened to my .10 fountain cherry coke? for that matter wheres
the Soda Fountain.......and the old candy store?

 

[HAWKEYE]

The Good Thing About Paying Higher Prices Is That You Will Buy Less Thus Alleviating The Space Problem Most Of Us Have With Displaying Our Collections

 

[kilted vampire]

The Good Thing About Paying Higher Prices Is That You Will Buy Less Thus Alleviating The Space Problem Most Of Us Have With Displaying Our Collections

Egads! SNUFFY Pot that chap over there! He said something blasphemous!

Space problem indeed! Harrumph! Good thing.....

 

[King & Country]

Hi Guys,

Our good friend Steven Chong did an excellent job of clarifying and explaining in detail why costs and prices are rising… thank you Steven, much appreciated.

Some people however, Combat for one, refuse to see the overall big picture… I quote…

“Manufacturers GRASP at any excuse to raise prices”… oh really!

Combat seems to think that everything is due to the rise in gas prices (petroleum for the rest of the world) and the dismal performance of the US economy. He imagines that everything will be just ‘hunky-dory’ when gas prices fall and the U.S. economy recovers. Well, I for one certainly share his wish that both of those things happen BUT… what about the rising labour costs? What about the huge increase in the cost of raw materials?

In short, Combat sees only a small part of a very large and complex picture that involves the whole world… not just his little part of it.

On a related topic he brought up ‘discounting’.

Discounting starts price wars between dealers… the smaller dealer goes to the wall and only the bigger ones survive… fewer dealers mean less coverage of any given country (the U.S. would be the best example)… discounting further leads to smaller profits for the remaining dealers… this leads them to buying less K&C… K&C becomes less profitable… K&C reduces investment in new products… fewer products leads to fewer collectors and fewer new customers… K&C begins to wither on the vine… K&C goes out of business… Andy goes and lies on a beach in Thailand and ponders the meaning of life and… ‘discounting’.

And now Combat, if you still don’t believe me go and ask Shannon of Treefrog or George at Minutemen what they think of ‘discounting’.

Best wishes and… happy collecting!

Andy C.

 

[nysoldiers]

Key word "competition"........................
My company manufactures and distributes electronic components. Most are made in Asia (Japan, Taiwan and China).
Exchange rates have cost us over 10%
Labor costs up 10 to 20%
Raw material costs up 5 to 15%
Shipping costs up as much as 50% (for air)

Yet we have only raised prices by about 5 to 10% this year.
Why???
The competition is trying to buy market share and we can't let them!

So lower profits, look for more specialized or proprietary items to sell.
Increase productivity and look for lower cost labor markets.
When competitors meet or exceed K&C quality they will find a way to remain competitive. Or if demand just drops they will adjust.

 

[damian]

Why don't we nationalize all toy soldier companies and have a central five year plan for production. That is thw way to go.


Just kidding
Regards
Damian

 

[Njja]

Nice that Andy reads the Forum, and takes the time to address our

concerns.

I certainly appreciate reading notes from the "wee Scot", Ken, Anna, and

all the other manufacters that drop in!

 

[Steven Chong]

Steve,
Your explanations for costs were very good, however I take exception in the Figarti case. The fact they own there own facilities and have a full time staff should actually increase there costs as K&C can contract out there manufacturing and not have the high overhead associated with facilities management and full time employment of the manufacturing staff.
Actually, I've often wondered how Figarti does it? With such low volume and so much equipment and facilities to pay for as well as a full time manufacturing staff?
Ray

Dear Ray,
While K&C contracts out its manufacturing, it has an office in Hong Kong, which on average has some of the highest office rents in the world, and a Hong Kong staff living in one of the most expensive cities in the world. I am pretty sure that K&C's HK office and staff expense is much higher than Figarti's expense for its factory space and larger staff in China, so any cost advantage from contracting out the manufacturing is probably exceeded by the higher HK office overhead.

Now, the above does not explain how Figarti can charge less for figures. Let's assume we are comparing WWII figures since both Figarti and K&C make these. I think the cost difference actually arises from having your own employees. Figarti pays its workers the same basic hourly wage irregardless of whether they are producing a simple WWII figure or a complicated one. In contrast, one of K&C's factories will charge more to produce a more complicated WWII figure since there is more labor or painting involved and then add its profit margin on top.

 

[Combat]

Contrary to Andy's post, I don't believe the price increases are due to gas prices or poor US economy. Those were reasons given by others which Andy indicates were good explanations, but he also apparently refutes. I think those are excuses to raise prices. My point being when gas prices fall and the exchange rate improves (reasons given by others for the KC price increase) that no reduction in price will occur. Andy has now confirmed that with another excuse - high labor costs! In China no less where all the manufacturing jobs were moved by businesses like KC to begin with. So many jobs have been exported we have apparently created a labor shortage. So prices must rise, rise, rise. Imagine that. The whole point in creating unemployment throughout Europe and the US was to provide cheaper goods. On top of that, collectors should be thankful to pay a premium to help the dealers maintain high prices - and avoid price wars? Also known as price fixing. Yikes. That one speaks for itself. I guess Michigan Toy Solider Co. should be informed it's not a desirable practice for dealers to discount some items.

I won't bog down things since I know some view these discussions as unrelated to toy soldiers and they are largely pointless. No one will change their mind. And why bother? Just let them keep raising prices and making the same Germans every month and let's see what happens. I'll get my duster out for the local shops.

 

[kilted vampire]

One thing about Figarti is that they are doing it as a sort of hobby business. It is a small part of a larger concerne. Rick has stated they got into it because his father wanted to do it. They need to make a profit to keep going but it is not necessary to make a big profit. They want it to be small. They like what they do. They keep it small so it remains fun. Incidentally, I like their vehicles a lot.

 

[sammy719]

Well in the grand scheme of things, I will stand by my K&C collection for what ever the prices maybe, I personally have given up alot of other hobbies to collect my K&C sets, I will probabley have to cut back here and there, but if I take the p&j sandwich and bottled water to work then I think I'll be o.k. haa!!!! I run a meat department and I see first hand how the economy is affecting people and I hear thier worries everyday, but as I tell my customers, the economy will strengthen sooner or later, gas prices have already dropped near 27 dollars a barrel since the 4th of july!! so hang in there guys hopefully our soldier prices are gonna hold for awhile, and we all will live happily everafter....Sammy

 

[theBaron]

Good point, Sammy! The best thing to do is to turn off CNN and other media for a while, and enjoy the silence. A recession is defined as two consecutive quarters of negative growth, and we still haven't hit that. Sure, we've had slower growth than we've been used to, but I think of my grandparents and what they did in the 30's. They didn't p**s and moan about how bad things were, they had a beer or a glass of wine, broke out the harmonica or a guitar, and enjoyed themselves for a while. They worked hard, but they sure seemed to enjoy themselves a lot more than many folks do today.

Prost!
Brad

 

[daruss]

I won't bog down things since I know some view these discussions as unrelated to toy soldiers and they are largely pointless. No one will change their mind. And why bother? Just let them keep raising prices and making the same Germans every month and let's see what happens. I'll get my duster out for the local shops.

Good point,, they will probably keep on making the same poses of german figures just with different color uniforms

 

[daruss]

Is it possible that if K&C converted to a smaller 1/32 scale, that it would reduce prices a little?

 

[Canadian Samurai]

Like Figarti, I believe the cost difference arises from Beau Geste producing its own figures in its own workshop -- a relatively small number of workers producing a relatively small number of sets. If Beau Geste had to produce the volumes of figures and sets like K&C, it would have to hire many more workers and have a much larger workshop, with the resultant manufacturing costs being much higher.

Sorry, this doesn't make sense according to economics. Basic economies of scale mean that the more of anything you produce, the cheaper they will be on a per unit basis, so mass produced figures by K&C should in theory be cheaper than those offered by smaller companies, especially out of the cottage market in the UK. Mass production and economies of scale was the fundamental founding principle of the industrial revolution and that's why today most things are produced by large corporations (in China) instead of one person artisans in western countries. Perhaps, and this is just speculative, if K&C did not spend so much on glossy self-congratulatory magazines they could pass on their economies of scale to the customer?

Anyway, I for one don't particularly begrudge K&C for rising figure prices by a few dollars every year, it's probably in syc with rising real world costs. Vehicles, on the other hand, I wonder about sometimes, especially the SL ones.

Nevertheless, I would hardly hold Figarti or Beau Geste up as manufacturers offering "cheap" figures. Look at the new Figarti $230 V2 halftrack for evidence of a staggeringly expensive (overpriced?) set. Likewise, I just purchase a $250 Beau Geste maxim dog and machine gun team which put a similar sized dent in the old pocketbook. Some of the glossy manufacturers including Beau Geste also benefit from their own economies of scale in that certain glossy sets, while just as complicated to paint as matte ones, often have repeat figures (e.g. 6 marching guys) which allows painters to become more proficient at doing a given figure, reducing total labour time and costs to make them.

P.S. Some of the ignorant political views expressed in this thread just make me shake my head about the future of the human race and planet earth. Please stop, you're making my brain hurt.

 

[aujj65]

Some of the glossy manufacturers including Beau Geste also benefit from their own economies of scale in that certain glossy sets, while just as complicated to paint as matte ones, often have repeat figures (e.g. 6 marching guys) which allows painters to become more proficient at doing a given figure, reducing total labour time and costs to make them.

I would like to suggest that painting 6 figures all in the same pose as opposed to a set of six in various postions, isn't going to be any faster due to the fact that there will be the same surface coverage, detail and equipment to paint.

This is just my humble opinion based on a few years experience with a paint brush.

Jeff

 

[Canadian Samurai]

I bow to your superior first-hand experience Jeff. However, I must ask, have you ever painted 50 sets of the same figures before? It seems logical to me anyway, that if you have to paint 50 sets of figures, and in one case those 50 sets are made up entirely of the same glossy marching figure, and in another case there are 4 differently posed and painted matte figures in the set, then it will take a contracted painter (who may not have extensive previous experience painting toy soldiers) a little longer to paint the matte figures simply because they must memorize and master 4 different poses and paint schemes versus just one type of marching guy. Hence leading to lower productivity and higher total labour costs for matte sets (likewise for any glossy company that uses multiple poses/uniforms in a single set). It might not be a significant difference but it must have some effect. Perhaps once you get good at painting them, the time difference is identical, but it seems to me the greater the number of poses and variety of uniforms (e.g. SS camo), the higher the initial learning curve.

Now maybe where it gets tricky, is in a case like Beau Geste with a large variety of sets available, where a single painter gets to repeat a marching pose 6 times, but only does a small run of that set before being forced to move on to a completely different set, and having to learn its intricacies, and so on. Once again, I say there must be a far greater economy of scale benefit to K&C getting to do 1000 copies of a particular set.