Production numbers v popularity (1 Viewer)

[OzDigger]

I guess it's difficult for figure manufacturers to accurately forecast how many sets of a variant they will be able to sell, and therefore what production run they should do for each new piece or set. Of course the lower the run the more likely they will all sell, this also encourages buyer competion as some people buy multiples for resale to finance their habit (not that there's anything wrong with that ). However low numbers can reduce the return on the manufacturing investment in the new piece(s). They usually get around this shortfall by selling the limited editions (or should that be strictly limited editions) at a higher price.

Of course the number produced is only one factor, another being popularity, which is more important imo, consider the following examples. Rommel was a popular General (with both sides) and his 'Greif' halftrack has always been a popular model kit. We all knew the AK 29 set would sell well and the quick sell out came as no surprise to most collectors. So why didn't K & C produce more to maximise their return, I feel 1,500 or even 2,000 would have sold. The high resale prices of this set will not add to K & C's bottom line. To me it would make more business sense to produce less popular pieces such as WWII Russians in 'Strictly Limited' runs, and keep the popular items in extended production such as with the LAH range. Perhaps a smarter move would be to issue several 'Strictly Limited' variants of the popular items. So we may yet see more Rommel (and Wittman) sets (with slight variations) marching our way in the not to distant future. That would keep the manufacturer and the collectors happy, of course the investor types won't be too impressed, but who cares about them

 

[sceic2]

Manufacturers do financial projections and base the number of units sold to a return on their investment. That and a balance between market issues like "branding", name recognition, etc. also play a factor. If a company can make a reasonable profit on one unit's limited sales and create a market demand for their entire line, that action of limiting production runs has the ability to raise all sales.

I am in the economic development profession. We examine financial statements on an almost daily basis from a variety of business models. We do this to ensure that our local investment dollars (from government and private investors) is not invested in a business model we would classify as "a dog." We want "cash cows." Businesses that generate cash with little investment and do so for the long-term. GM used to be a "cash cow" they just stopped investing in the market demands of the consumer where the foreign companies have, i.e. most production lines produce car models that look almost like twins, not much change between model years, etc.

Certain ratios have a great impact on a company's viability. Debt to equity, quick and current, Altman's Z-Score (measures propensity for failure), and about 20 other ratios are examined by a company anytime a new financial statement is generated. These statements are based on assumptions that must be realistic and achievable.

Don't think for one minute that strategic market planning is not a factor in the number of units sold. Perhaps they have other issues to consider like production costs that can become greater as more units are produced, the limited life of molds, the ability to find affordable skilled labor, the time restraints on the market... there are a multitude of factors associated with limited production runs and I would not want to second guess a successful company be it whatever it's name. I hesitate to name companies in this discussion for fear of offending someone, they all are making such dramatic and fantastic upgrades in their quality, and I would hate to leave some company off a list due to my own ignorance. Michael

 

[jazzeum]

Andy, I believe, is interested in keeping interest high and prices high. If he productes approximately 2,000 of a so called Strictly Limited item, that's hardly a limited item when his normal runs aren't usually that high. Also, he wants to keep Strictly Limited to a few. If you start having many SLs, how are they then Strictly Limited. It adds indirectly to his bottom line by keeping resale prices high. Higher resale prices lead to higher interest and that leads to more sales on the regular non-SL items. Oh, he knows what he's doing.

 

[OzDigger]

Hi Michael, I spent almost 20 years in finance and one of the first things I learnt was that business models, statistics and ratios etc have less to do with business success or failure than the owners skills, personality and attitude. Therefore imo an assessment of the company owners is as important as the financial statements. For example, if the owners are suspect then perhaps the figures are.

Meanwhile back to the thread.

Hi Brad, I hope Andy isn't really interested in keeping prices high as that would tend to reduce his sales and discourage new buyers imo. In fact I think prices for new items have come down (relatively speaking) yet the detail is still improving. I have every confidence in Andy's business accumen and I fully appreciate your comments and agree with them. However I still feel it would have been better for collectors if K & C had done a larger run of the AK 29 set. I'm sure most dealers would have appreciated more sets to put in stock as they now have to deal with disappointed collectors that missed out for a variety of reasons. No doubt many of these collectors will soon need to buy their set from eBay thus lining the pockets of speculators etc. Imo all this after market eBay trading is not doing any favours for K & C or its distributors.

 

[panda1gen]

Fascinating thread. The problem for people like me is about timing. Coming recently into the hobby means a difficult balance between collecting gems from the past and affording the new stuff which is getting better and better. There is more of it too with competition entering the market and pushing up quality. This may mean choices however for individual collectors. Not sure I've cracked that yet I suppose at some point the depth of pocket becomes the crunch issue, or the ability to trade in future with a spare set. For example I have still resisted Naploenics.......but it is hard.

 

[Flammenpanzer]

The halftrack master can also be utilized to make other versions of the halftrack or repainted for the Western or Eastern fronts. The limited part to the halftrack could just be in the figures, markings, and paint scheme like the previously limited vehicles. Another halftrack released in Normandy camo with new figures would not reduce the value of the African version, and I believe would sell very well.

 

[sceic2]

Two comments:
"Hi Michael, I spent almost 20 years in finance and one of the first things I learnt was that business models, statistics and ratios etc have less to do with business success or failure than the owners skills, personality and attitude. Therefore imo an assessment of the company owners is as important as the financial statements. For example, if the owners are suspect then perhaps the figures are. OzDigger"

OzDigger, you are absolutely correct. I just did not address the subject sufficiently enough so as to cover all the issues involved. Financing revolves around the three "C's" - Credit, Cash Flow, and Charactor. Credit is obvious, Cash Flow is the actual or projected cash through a business in its normal activity and Character is the profile of the owner or management team (just as you wrote - could not have said it better). Of the three, Character more often than not has more weight in the very subjective world of financing.

Fascinating thread. The problem for people like me is about timing. Coming recently into the hobby means a difficult balance between collecting gems from the past and affording the new stuff which is getting better and better. There is more of it too with competition entering the market and pushing up quality. This may mean choices however for individual collectors. Not sure I've cracked that yet I suppose at some point the depth of pocket becomes the crunch issue, or the ability to trade in future with a spare set. For example I have still resisted Naploenics.......but it is hard.

This is what I am talking about, I will use Panda1gen's comments as an example of how the marketing strategy of K&C (limited runs, quick retirements, suprise releases, and increased product quality among other factors) has produced a market desire to get more products. The consumer is only limited by their ability to spend. This hobby of ours is rapidly changing from an "I gota' have every single issue" type of collecting into selective collecting and using a discerning eye towards particular releases to ensure the value of the individual collection increases or the quanity of the collection increases.

It's all a game, and remember, in this game nobody gets out alive (life is fatal). Michael

 

[jazzeum]

I think the marketing strategy is to keep the focus on K & C and one way you do that is by talking about them. The more people are talking about your product, the more likely they -- and others who are listening to them -- are to purchase the product. One way to do that is through Strictly Limited items. The prices those fetch on ebay elicit conversation so that is why runs are kept small and the frequency of the SLs are also kept low. It is not inconceivable that the small run of the Greif was made in anticipation of Honour Bound and NMA making their splash. Since there is now competition (including Figarti), Andy needs to keep people talking about K & C and keep the focus (and the dollars) on K & C.

 

[vandilay]

Hi
I think strictly ltd numbers have to be kept low enough to sell out,otherwise what realy is the point of producing a limited piece.
I collected britains in the past, and I feel one of the mistakes they made was releasing ltd editions in such huge quantitys I.m not sure why they even bothered to call them limited editions.
Limited editions create a buzz about a product,If they are released in too large a number they just become part of a normal product run,defeating the purpose of being limited.
I also feel if you re hash the same piece with a new paint job and re release it this also detracts from what are supposed to be a special piece in your collection.
Maybe this was the problem with the limited stug ?
just my 2 cents worth

 

[OzDigger]

I totally agree with the utilization of the new halftrack mold for other variants which is normal business practice. My main concern is with the specific AK 29 (Rommel-Greif) Set and the way it was initially released as a Strictly Limited edition of only 750 pieces. Yes, this kind of tactic does generate talk about K & C, but if you talk to those that missed out on this popular set you'll find that 'the talk' isn't very positive I can assure you.

Similar problems have occured in the past requiring K & C to do other run(s) with 'slight changes' to satisfy collector demand. And as Vandilay has said this usually upsets the initial buyers that believe their 'collectable set' has been devalued in some way (which rarely occures as original issues always retain their value despite subsequent improved/rehashed issues).

I'm sure we would all agree with vandilay's comments about the overly large numbers in 'Limited Editions' produced by Britains. However most of Britains Limited Editions were not especially attractive as the subjects weren't overly popular - unlike Rommel and his Command Vehicle. And this is the crux of my arguement. If you (strictly) limit the production of an item that you know, or strongly suspect will be popular, you are likely to cause unneccesary dramas that may back-fire.

Which to me is not a good tactic considering the number of new manufacturers entering this field. I can see nothing to stop other companies producing a similar set as I doubt there are any legal or trade restrictions on Rommel or 'his' vehicles. I fully agree with Michael's observation that figure collectors are becoming more selective and not buying every issue, completism is now a thing of the past. This is an indication of the increasing maturity and experience of the collectors that were attracted to this hobby by K & C.

During many years of collecting diecast vehicles and figures I've seen several companies (Matchbox, Corgi etc) attempt to maximise their profits by taking advantage of 'collector passion' and they have always come unstuck in the end - I'd hate to see K & C go that way.

 

[nmrocks]

I haven't seen any indication that King and country Hong kong is out of the Grief set? The dealers maybe, but I know Andy doesn't distibute his entire stock to the dealers and usually has some available.
As for Limited Editions as a concept, I prefer to think of them as a Gift to the loyal, hard core fans of Andy's products.
As it stands now, this is an ongoing, ever changing process as we have seen from the changes in this edition from previous limited editions. I have ultimate confidence in Andy's constant improving of both product and marketing.
Frankly for me, anything in editions of under a 1000 units in the collectables world is a no brainer. This group, K&C fans and collectors and interest in this hobby is exploding right now. Not a day goes by anymore when a new or previously unknown bidder shows up on e-bay driving the secondary market to maintain the lofty prices or pushing them higher.
As has been said, you can't have it all, the most pleasure I've had as a collector is picking up a piece that fills a long empty hole in my collection.
Ray

 

[jazzeum]

Oz,

A couple of clarifications on your post. The other collectors aren't happy because they missed out. In this game as in any other, the early bird.... So you know the next one of these SLs are announced, they'll be very quick. And even if they're not happy, K & C is at the forefront of their collecting thoughts.

The allusion to the recent situation with the new new KTs and Chars aren't comparable. Those weren't Strictly Limiteds but models with limited runs. After Andy had explained it all, the furor died down. You will not changing production numbers on the SLs once they're announced.

 

[Chuck Harris]

I think the marketing strategy is to keep the focus on K & C and one way you do that is by talking about them. The more people are talking about your product, the more likely they -- and others who are listening to them -- are to purchase the product. One way to do that is through Strictly Limited items. The prices those fetch on ebay elicit conversation so that is why runs are kept small and the frequency of the SLs are also kept low. It is not inconceivable that the small run of the Greif was made in anticipation of Honour Bound and NMA making their splash. Since there is now competition (including Figarti), Andy needs to keep people talking about K & C and keep the focus (and the dollars) on K & C.

Brad
I agree with you. I don't look at my collecting K&C Toy Soldiers the way I do at buying stocks or bonds.
Toy Soldiers can be and investment but I don't think a bank would take them for collateral on a loan.

 

[OzDigger]

Oz,

A couple of clarifications on your post. The other collectors aren't happy because they missed out. In this game as in any other, the early bird.... So you know the next one of these SLs are announced, they'll be very quick. And even if they're not happy, K & C is at the forefront of their collecting thoughts.

The allusion to the recent situation with the new new KTs and Chars aren't comparable. Those weren't Strictly Limiteds but models with limited runs. After Andy had explained it all, the furor died down. You will not changing production numbers on the SLs once they're announced.

Brad, yes I know of several collectors that missed out and I don't subscribe to the idea that "there is no such thing as bad publicity", and you can check with ex President Clinton if you want to 'clarify' that as well

I wasn't refering to the KT or the Char, so such an allusion must have been an illusion. And speaking of illusions, there is no real difference between Limited and Strictly Limited as both are limited by the number produced. The later is merely a marketing ploy to encourage people to buy item(s) quickly so they 'don't miss out'.

This is usually an acceptable technique as the item is quickly delivered via the dealer to the collectors. Usually the dealers are happy because they get a fast turn-over and the collector is happy because he gets his 'rare?' model. However when used on a new a set that is sure to be very popular I feel a 'to low limit' is bad marketing practice as it results in many annoyed customers and harassed dealers.

 

[jazzeum]

Oz,

It's actually limited not Limited. Strictly Limited is a set that has a fixed amount whereas limited is really a set where you're not going to make that many.

Your concern or question seems to be that King and Country made to few of these when they could have made more. Andy said this weekend that they did not anticipate the demand. They were originally going to make 500 but decided to up it 750. They really did not know that it would do this well. As far as making 2,000, that's something he would not want to do in a SL set as then frankly it can hardly be called SL.

 

[OzDigger]

Oz,

It's actually limited not Limited. Strictly Limited is a set that has a fixed amount whereas limited is really a set where you're not going to make that many.

Your concern or question seems to be that King and Country made to few of these when they could have made more. Andy said this weekend that they did not anticipate the demand. They were originally going to make 500 but decided to up it 750. They really did not know that it would do this well. As far as making 2,000, that's something he would not want to do in a SL set as then frankly it can hardly be called SL.

Brad, you said: "It's actually limited not Limited. Strictly Limited is a set that has a fixed amount whereas limited is really a set where you're not going to make that many".

My initial interpretation of your above statement is that 'Limited' sets will be made in less numbers than 'Strictly Limited' issues. Which I feel is not what you really meant as it is the opposite of the K & C 'spin-doctored' meaning where 'Strictly Limited' sets will be made in fewer number than 'Limited' sets.

However, as I hinted at before, the word 'Strictly' in 'Strictly Limited' is redundant, it's like the word 'backwards' in the term 'reverse backwards'. If a collectable item is in 'Limited' production only a fixed number will be made, therefore you don't need 'Strictly' mentioned at all because it will just confuse people - as it clearly has.

Imo the old standby term 'Collectors Edition' should be used for the low production runs of say 500 - 1,000 pieces rather than 'Strictly Limited'. However, considering recent developments on eBay etc maybe 'Investors Edition', or 'Dealer Keep & Sell at Inflated Price Edition' may be more appropriate as it appears the collector has been shafted once again.

Btw, I'm sure no one would be upset if K & C produced another 250 of the 'Greif' set to make it an even 1,000

 

[jazzeum]

Look, Strictly Limited has a fixed number, 999 in the case of the Winter Tiger, 750 in the case of the Greif. That will not be changed. This "limited" thing came up in the case of the WS 71 where the term was perhaps used a bit inartfully but there was not attempt to necessarily fix a specific amount. I don't really want to get into an extended debate about this but to say the collector is getting screwed here is just a lot of crap. Who's getting screwed here? You're getting a great vehicle or figure(s). Just like anything in life, it pays to get your interest in early. "The early bird..."

 

[ucla1967]

Strictly limited implies that it is, without exception, limited to an exact number of sets, but a small number to be sure. Limited implies a softer standard without an exact number to be produced, but fewer than a regular production run. I have noticed with some other companies that they have limited edition sets "X of 1,000," but I have never seen anything above number 100 even years after they came out with the sets.

 

[Steven Chong]

... Btw, I'm sure no one would be upset if K & C produced another 250 of the 'Greif' set to make it an even 1,000

I have to disagree ... check out the thread "Question about new King Tiger and Char B1 bis" to see all the distress expressed when K&C decided to increase production of the 2nd edition King Tigers from 500 to 750 because of dealer demand -- and that was not even a "Strictly Limited" set. In that thread, the posts regarding the definition or meaning of "Strictly Limited" and "Limited" are very similar to the posts in this thread.

 

[Louis Badolato]

The difficulty in accurately predicting demand for a particular item was a topic of conversation raised by Mike Neville of K&C, UK during Andy's Q&A session. Mike said he wished they could have a crystal ball to predict demand. I commented that Steven Chong's suggestion of pre-orders with deposits might serve as such a crystal ball. Andy rejected the idea, but admitted he made a mistake in issuing thr Grief as limited to 750. He commented that, as is sold out in less than 24 hours, he could have made it a limited run of 1500. While this pleased the dealers present, we collectors insisted that "strictly limited" sets must be 1000 or less.