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Thread: Transformers retail prices in 2012 unchanged despite exchange rate

  1. #21
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    do we have the prices for each size class from now back through to Armada to compare the last 10 years?

  2. #22
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    Demonac found this topic on another Australian fan-forum, showing that it isn't just Hasbro or Transformers - this is an epidemic of the toy industry by the major toy companies profiteering off the exchange rate. But it seems there is no way to force a correction, as toys aren't seen as important enough for people to know or care about their value.

  3. #23
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    Quote Originally Posted by griffin View Post
    But it seems there is no way to force a correction, as toys aren't seen as important enough for people to know or care about their value.
    But evidently, not unimportant enough to bolster up prices to supposedly cover store rent and employee wages... I'm sorry but I simply don't buy that excuse; if retailers are using 'low priority' items to cover such supposed costs then no wonder they're finding it hard to do business these days.

  4. #24
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    Quote Originally Posted by Accel View Post
    do we have the prices for each size class from now back through to Armada to compare the last 10 years?
    Yes, Griffin's archive includes prices. Over the last 10 years the price for the deluxe price point has stayed around the same.

  5. #25
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    YES!!!!
    THIS HELPS ME SO MUCH HEHEHE.



    Quote Originally Posted by Sky Shadow View Post
    I'm currently in the UK, where Transformers are also imported. I checked out some prices of what I could buy today. None of these are 'sale' prices:

    Prime Powerizers (Voyager Prime and Megatron) are £22.99 - about $34.50AU.

    Prime Deluxes are £12.99 - about $19.50AU.

    Prime Cyberverse Commanders are £8.99 - about $13.50AU.

    Prime Cyberverse Legions are £4.99 - about $7.50AU.

    So if UK retailers can import these toys and sell them at a profit at the above prices, Aussies are being rorted. As we have known for many years.
    "I was expecting a giant car."





    [COLOR="STUFF FOR SALE [/B][/COLOR]

    Non-TF SALE

    TRANSFORMERS SALE!

  6. #26
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    I modified the image in the first post to make it less targeting of Hasbro, and more general of the American owned toy companies in this country... in case it ends up being posted elsewhere.
    It also clears up a few vague elements.



    Now that Toyfair is over, I might risk probing some of our major retailers if they ever question this widening gap, as they know about the improving exchange rate with all their other departments in-store offering cheaper imported items. And if they are aware, I'd be interested in seeing why they don't parallel import toys (including Transformers) because if us collectors are able to import Toys from foreign sources at their retail with express post, and still be cheaper than domestic prices here, then imagine how cheap a big chain store could sell them for here if importing from a wholesaler or even from Hasbro America through their own American Buyers.
    Just looking at the Deluxes in the chart above, they'd be buying them for half as much as they are here, and even if they sent them over cheap by boat, I'd wait the extra month to pay what Americans are paying, at our retailers. (and we often wait more than that here anyway)

    I noticed from this recent article, that aside from books, the only real restriction on parallel importing (as in, obtaining stock from a cheaper FOREIGN source than the official DOMESTIC distributor), is items that are trademark items that are produced in that other country exclusively for that other country. In other words, since the cheaper American Transformers have Australia, NZ, Canada AND USA listed on the packaging, we are one of the "exclusive" countries those products are allowed to be imported & sold in. (making it difficult for Hasbro to block parallel importing of the exact same product that they import themselves)

  7. #27
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    Quote Originally Posted by griffin View Post



    This really annoys me.



    "I was expecting a giant car."





    [COLOR="STUFF FOR SALE [/B][/COLOR]

    Non-TF SALE

    TRANSFORMERS SALE!

  8. #28
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    Just a couple of notes I thought I'd add to the discussion.


    1.
    Let's assume 3% inflation each year (the Reserve Bank's stated target). Using compound interest, we can calculate what TF prices would be if Hasbro simply raised prices in line with inflation.

    For those not familiar, the compound interest formula is

    F = I x (1 + r)^n where

    F = Final price
    I = Initial price
    r = rate of interest
    n = number of periods (in this case years)

    I'm using Armada prices as a starting point (as the classes haven't changed significantly since), which means using 10 years of interest, means

    F = I x 1.344

    Price ranges (using inflation):
    Size Price (2002) Price (2012)
    Scout/Minicon $13.50-$17.99 $18.14-$24.17
    Deluxe $21.50-$29.99 $28.89-$40.30
    Mega $40.00-$49.99 $53.76-$67.18
    Ultra $54.76-$60.00 $73.59-$80.63
    Super $89.84-$115.00 $120.73-$154.55
    Supreme $113.00-$160.00 $151.86-$215.03

    Using these figures we can see that that Transformer prices have gone done at least in terms of real money - ie: I spend a lower proportion of my income to buy a Transformer figure than I would have had to 10 years ago. This is despite American prices rising (more or less) in line with inflation as seen at the bottom of this page.

    2.
    The second point to make is that it is not normal for our dollar to hold parity with the US dollar (see here and here). The historic position of our dollar has been between 60-80c US, and is only high at the moment because of our currently booming mining sector, and the protection measures that were put in place during the first GFC that meant that the Reserve Bank didn't have to drop interest rates to 0% as other countries had to do. This has put us in an enviable position for the last 4 years, which will not necessarily continue into the long term.

    Australian toy wholesalers are then in the hard position of setting their prices with current parity in mind, or do they think long term and set prices more in line with expected future exchange rates in order to avoid a large price shock when our exchange rate drops from parity and returns to it's historic value range.


    Summary for those who don't want to read all that:

    1. Transformers have actually fallen in price in Australia in terms of real money, while the real money price in US has remained the same.
    2. Aussie Dollar parity is not the norm and to set prices in line with short term parity potentially hurts retailers/wholesalers/distributors in the long term.


    Which is not to say that more couldn't be done, I'm saying that it's not as simple as Hasbro/retailers/wholesalers are getting more money for the same work and that a short term benefit could lead to mid to long term hurt.

  9. #29
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    Don't get me wrong, I agree with both points, as they've been taken into account over the years.

    However...
    1 - The American retail price hasn't moved either, despite inflation and resources increasing in cost. To offset those costs, Hasbro have been reducing the size of the toys (which we saw during DotM and Prime). So the product itself has been downsized to offset inflation and higher production costs, so that the American retail price didn't need to be raised. If Hasbro have made sure that the product remained the same cost to produce and sell to American retailers, then it would apply to us as well. (Essentially, they have frozen the wholesale price in recent years, so inflation & production cost increases are not a factor in this - until their US wholesale/retail price increases)

    2 - Hasbro raised prices easily when the exchange rate was dropping, but not as easily when it was improving. Hasbro aren't stuck with set prices beyond the 6 months after Toyfair (they give retailers pre-order prices, and probably guarantee prices when they make additional orders when restocking). Prices can be adjusted with any shipment from China really, as Australian distributors have to pay for the stock from their American "owners". After all, that's what every other Australian importer does - price their shipments according to what each imported shipment cost them.
    The "hedging their bets" excuse is indeed one given by Australian toy distributors (saying that they need to be able to cover themselves if the exchange rate suddenly moves), but they've always had a "safety margin" - it's just been blowing out to a massive margin in the last few years. And how much should they be hedging their bets by before they do start adjusting prices... 20%, 30%, 40%? Because they have been making a lot of extra profit in the last 5-10 years with their US$0.50 exchange rate pricing, with no intention of letting go of the "cash cow" that is our strong Aussie Dollar. A dollar is expected to stay above or close to parity for at least a few years.

  10. #30
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    Quote Originally Posted by Seraphim Prime View Post
    Australian toy wholesalers are then in the hard position of setting their prices with current parity in mind, or do they think long term and set prices more in line with expected future exchange rates in order to avoid a large price shock when our exchange rate drops from parity and returns to it's historic value range.
    I can say that working in commercial contracts & having a discussion with a prospective client doing a 3+1+1 contract (3 year deal with 2 x 1 year options) the subject of fixed term pricing came up.

    This is not uncommon & believe it or not the retailers in this situation actually have a lot more power than Hasbro. Hasbro needs them they do not need Hasbro.

    When this subject of fixed term pricing comes up & I deal in what is known as volitile products which are product relying on the AU vs US$ or on global oil prices etc you have two options available.

    The first is to provide low pricing based on the current health of the $ & establish a clause allowing you to increase pricing based on formal letters of increase from manufacturers & also factor in a CPI based annual increase.

    The second is to fix the pricing for the length of the contract. To do so you need to calculate the possibility of cost increases & set your pricing accordingly. Real world you would need to factor in at least 4% & usually 5% to offset the increases. This excludes transportation costs which cover enormous distances in Australia per item compared to Europe & America.

    Large retailers like Kmart/TRU/Big W etc would push for fixed term pricing. That way they hedge their bets & can guarentee what their buy price & sell price is for a certain fixed period. This also can work against you if the AU $ goes beyond expectations. Hasbro if they are in a fixed price agreement is under no obligation to pass on any savings obtained by them to the retailer.

    Say an agreement was signed in June 2009 when the $ was at $0.80 US & that was for 3 years with options then it is possible that any savings could never be passed on until 2012 at best & maybe 2014. Thsi is a huge factor as to why retail priced have been stable.

    Imagine if the dollar dropped to $0.60 US I bet we would all be grateful for the fixed pricing terms then. Swings & roundabouts I am afraid & retailers need to have fixed pricing wherever possible to report to their stakeholders with clarity on their performance expectations.

    Just my $0.02 of course but there is a lot more than just what we perceive as corporate greed.

    I may also be wrong & if retailers have gone for variable pricing them then need to exercise their muscle to force cost reductions. I do deal with several major retailers in my job & fixed pricing periods have killed my profitability when I cannot pass on price increases.

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