Manufacturing Costs?

[Vector Prime]

I read somewhere that it cost Nike less than $5 to manufacture the average sneaker, so I was interested in knowing people's opinions of what they think it cost to manufacture a Transformer figure, say in a Deluxe size?

My guess is less than $0.50

[UltraMarginal]

There is always an economics of scale factor with any manufacture, but realistically, a deluxe has on average about 30 parts. they are glued and pinned together. many parts are also painted.

surely some of it can be automated, but there would also be a lot that is assembled by hand, while it is no doubt done in places where the minimum wage would be something that you and I would Balk at, it would surely take a considerable amuont of time to assemble and paint a deluxe.
I would be very surprised if the profit margin for hasbro is anything like it is for nike...

not to mention the cost of design, developement, packing and shipping.

[Lint]

Assuming that:
-A deluxe weighs about 125g
-Hasbro have a very competitive contract for the supply of their ABS plastic
-The labour and energy costs per unit are near negligible due to throughput
-We're not factoring in any R&D or capital cost recovery in the production run

I think you're about right Vector Prime.

If Hasbro have a crappy supply deal the cost would definitely be over 50c.

[Vector Prime]

not to mention the cost of design, developement, packing and shipping.

That being said too, I don't think the Nike example takes into account that sort of cost either, especially the marketing costs associated with a high profile athlete promoting their product ($50+ million endorsement contracts for example)

[Seraphim Prime]

If we're talking in American dollars (not that it makes much difference atm) I'm guessing on the lower side of $1-5, on the higher if we count R&D, engineering, advertising, graphic design, etc.

Walmart sells for approximately $11. Assuming they take a similar margin as what Australian retailers do, Hasbro's charging them about $6. Hasbro also wants to make a profit, so probably around $4-5 including shipping, manufacture, design, etc.

[GoktimusPrime]

That being said too, I don't think the Nike example takes into account that sort of cost either, especially the marketing costs associated with a high profile athlete promoting their product ($50+ million endorsement contracts for example)

Then that's not a really fair way to determine the true "cost" of a product. Things to consider into the final cost of a Transformer toy:

+ Conceptual design staff at Hasbro and TakaraTOMY -- constant interactions back and forth between creative staff in Tokyo and Rhode Island. And there's a lot of people involved in the design process... the person who designs the weapons for a toy may be a different person from the person who designed the main figure itself. Then the person who decides on the paint apps might be a different person too. I knew someone who used to work for Takara on their Microman design team - he designed accessories and worked on packaging designs as well.

+ All the various other staff members who work at Hasbro and TakaraTOMY; product managers, marketing staff, artists, designers, receptionists (TakaraTOMY has call centres -- it's how I was able to get a replacement part that was missing in my Masterpiece Convoy), cleaners etc. HasTak employees have families to feed too.

+ Professional development costs - like sending Eric Siebenaler to work in Hasbro Australia's office for a year. And whenever a Hasbro employee visits TakaraTOMY in Japan and vice versa -- all those travel and accomodation business costs are probably company paid.

+ General business running cost - computers, paper, stationery, furniture, rent, water, gas, electricity etc. Hasbro Australia recently moved from Eastwood to Epping... presumably because conditions there were more favourable (e.g. cheaper rent or bigger building?)

+ Legal costs - e.g. patenting designs, trademarking likenesses and names, issuing licences for official TF merchandise etc. Although whoever came up with the name "Grappel" should take a pay cut. :p

+ Manufacturing costs. Even every drop of paint is budgeted for.

+ Distribution and placement costs.

+ Costs of marketing, advertising, promoting etc. Like ya know, making a cartoon series. :) Speaking of which there would be people at HasTak whose job is to approve things like comic books (issue by issue), cartoons (ep by ep), movies etc. When Simon Furman was writing the G1 comics in the 1980s, he realised that Hasbro kept on approving all of his scripts which had to be submitted for approval over and over again. So he began wondering if they were even bothering to read his scripts at all, so he wrote this rubbish story intentionally looking for it to be disapproved... and sure enough, it was knocked back by Hasbro and so he submitted the _real_ script he'd actually written for that issue!

...and this is probably just the tip of the iceberg.

Having said all that, I do think that Deluxe Transformers are overpriced in Australia. IMO $15-20 would be a far fairer price compared to the $30RRP. Fortunately it's not uncommon to find Deluxes at around $25 which is a more acceptable price. Although if I want a Deluxe badly enough, I'll pay full RRP for it rather than waste time and fuel (and thus more money) driving around looking for it cheaper elsewhere. But if I don't want it that badly then I'll wait till I find it cheaper.

[LordCyrusOmega]

In resturants the price you pay for a meal is 70% above the cost of raw product, wages etc needed to supply this meal.
If the same concept is applied to the manufacture of a deluxe toy that on average costs $30 then the cost of making said toy would be...?
I don't know. My math isn't what it was..damn kitchen work.

[SkyWarp91]

In resturants the price you pay for a meal is 70% above the cost of raw product, wages etc needed to supply this meal.
If the same concept is applied to the manufacture of a deluxe toy that on average costs $30 then the cost of making said toy would be...?
I don't know. My math isn't what it was..damn kitchen work.

0.7 x 30 = 21?

[christalcase]

0.7 x 30 = 21?

should be 30 / 1.7 = $17.41

[Demonac]

Remember that a deluxe retails for between $11 & $14 in the USA.
I don't think they'd be selling at a loss over there. :P

[christalcase]

Forgot about pricing in US, in that case, cost'll be $6 then

[SkyWarp91]

should be 30 / 1.7 = $17.41

I see, at first I was confused but now i get you Christalcase, you smart fella!

Price of toy is $30, so if I buy I pay 70% more than cost (C) of toy.

Thus,

Cost of Toy (C) + 70% Cost of Toy (C) = $30
C + 0.7C = 30
1.7C = 30
C = 17.41

But in US costs, it'd be $6.

So we pay about 5x the amount then for a Deluxe figure?...


FUUUUUUUUUUUUUUUUUUUUUUUUUUUU

[liegeprime]

So if every drop of paint is accounted for in hasbro financing a toy... would we then say that you get more "bang for your buck" if you bought a toy to discover blotches of paint where they shouldnt:D(:p e.g a spot on the face, a drop of wrong paint on the hood)

[gdmetro]

Wow... if these manufacturing cost to profit ratios are true... how much more than the manufacturing cost are we paying when buying TRU Ghost Starscream? :eek:

[Tetsuwan Convoy]

Wow... if these manufacturing cost to profit ratios are true... how much more than the manufacturing cost are we paying when buying TRU Ghost Starscream? :eek:

Hopefully none, as I hope that no one has bought them at that price!:D

Considering how you could now easily import one for probably half the price with EMS postage to get it in 4/5 days.

[UltraMarginal]

Hopefully none, as I hope that no one has bought them at that price!:D

Considering how you could now easily import one for probably half the price with EMS postage to get it in 4/5 days.

precisely (http://cgi.ebay.com.au/TRANSFORMERS-MASTERPIECE-MP-03-G-CLEAR-GHOST-STARSCREAM-/370402174401?pt=AU_Action_Figures&hash=item563db0a5c1)half