Hot Toys Probed by Antitrust Regulator, Changes Pricing Policy

[Jameson Rook]

Whoever wins, we lose.

https://en.yna.co.kr/view/AEN20190509005200320

https://www.theinvestor.co.kr/view.php?ud=20190509000562

 

[Stryker2011]

Not necessarily. The retailers aren’t stupid, and if they start hiking up prices ABOVE HTs already over-blown MSRP, they’re going to lose business — this COULD mean more competitive pricing, as they try to compete with each other for business (as long as they are still able to make a profit — regardless of how small. For all we know these things could have a $100 markup. Aside from when Sideshow gives figures away, when they offer them at “deep” discounts, they’re probably still making a profit, even if it’s just 1-3% above cost. The manufacturer CAN set pricing reduction/increase limits — but as the article states they weren’t allowing Korean retailers to do so, whereas other retailers (like Timewalker, for example) have been offering them at a bit of a discount. My wife is an corporate accountant for a retailer, and it’s a huge mess how all that works, as some companies (and HT could be one) won’t allow discounts on MSRP at all; but retailers can get around that with coupons, reward points, buy one get one types of things. Each manufacturer is different — but I can see why the Korean retailers would be upset, if HT has been blocking them, but offering them themselves — just to get more of the money directly.

 

[Big Mo]

I used to work for a high end swiss watch company many years ago, they had a similar policy. If we caught retailers discounting the watches, they would get a warning, and if caught again would lose the distribution rights.
Notice how a lot of high end company's are opening under there own banner, Tag, Swarovski etc.
Its supposed to help these brands keep the value of there products. Not sure if its completely legal though, as Hot Toys have just found out.

 

[Underworld54]

If a brand doesn't want their brands value tarnished isn't their right to not want their items to go on sale?

 

[Stryker2011]

If a brand doesn't want their brands value tarnished isn't their right to not want their items to go on sale?

Yes. Manufacturers can say that their product can only be set at MSRP because they don’t want to devalue their product — the problem comes into play when they allow some retailers to allow discounts, and others cannot. Clearly there was an underlying issue that the article didn’t address in its very brief and vague description — maybe they aren’t allowed to say what the exact issue was, or they have really lazy journalists. My wife’s company sells Under Armour and Columbia clothing, both of which set their prices to exact MSRP so as not to diminish the Brand

 

[potato]

I used to work for a high end swiss watch company many years ago, they had a similar policy. If we caught retailers discounting the watches, they would get a warning, and if caught again would lose the distribution rights.
Notice how a lot of high end company's are opening under there own banner, Tag, Swarovski etc.
Its supposed to help these brands keep the value of there products. Not sure if its completely legal though, as Hot Toys have just found out.

the shops might be under their own banner but i'm sure some of them are owned & ran by private companies under the brands name but under strict supervision of brand company, in some cases the brand company would open a flagship store or so because the cost would be too high and they want total control over how their flagship shop runs.

in the end no matter how big the brands are they will still need to rely on bulk purchasers to move their stock. selling the stocks themselves would reduce the middleman and increase their profit however it'd be difficult to run shops in so many countries while maintaining the high standards and they would have slower income selling to individual customers compared to main distributors/shops. unless they start selling luxury watches over the internet like Ali Express or Amazon.

 

[potato]

Yes. Manufacturers can say that their product can only be set at MSRP because they don’t want to devalue their product — the problem comes into play when they allow some retailers to allow discounts, and others cannot. Clearly there was an underlying issue that the article didn’t address in its very brief and vague description — maybe they aren’t allowed to say what the exact issue was, or they have really lazy journalists. My wife’s company sells Under Armour and Columbia clothing, both of which set their prices to exact MSRP so as not to diminish the Brand

most of the time for branded goods there will be a clause to prevent sellers from dumping price in order to prevent the deterioration of such goods 'potential value and brand image. This is especially true when it comes to Premium stuffs. Of course there are exemptions for example dead stock.

however remember even at MSRP, there are ways to lower their import cost (tax evasion), or play around with their account books, by selling their stocks to other vendors at lower than MSRP price but declare them as sold close to MSRP by transferring some profit numbers from other non-restricted stuffs to cover the tracks. in the end their payable tax remains the same but it looks like they made less profit off those non-restricted stuffs (most of the time cheap china stuffs they sell in big numbers). or they can just sell them off to other vendors (maybe under related owners) that doesn't buy from Hot Toys (thus not restricted) and sell them cheap. Unless the items are serial numbered, it'd be difficult to figure out who bought from HT & dumped the stocks at lower price unless there's a company sticker.

for IT/Gadget stuffs (non-serial numbered), this is happening very often as sellers undercut each other to make more sales. in shops it's difficult to pull such stunts as they can be easily traced or inspected, but what these shops does is set up an official Online shop selling close to MSRP, and another unofficial Online shop(s) selling at discount.

it also depends on company sales rep, whether they have loyalty towards their company to protect their brand value or just focus on sales and ignore vendors dumping price.

also, it depends how much bargain power the vendors has, if it was Footlocker, one of the biggest bulk purchaser, or Toysrus/Target/Walmart, they would most likely have more control over how they want to price the products because they are big customers.

 

[P.]

since Disney, Star Wars has really tanked.

"since Disney"?

 

[**16k**]

Hope other investigations are opened against them for overpricing miserable plastic toys.

 

[Wor-Gar]

Great, money spent on defending themselves.

Expect a lot more re-issues because of this.

 

[potato]

someone should file complaints on Rolex too.

 

[jespernicolaj]

I think this is good. Hot Toys makes buckets of cash, the retailers seem happy. If this strengthened the competition, we all win. Even Hot Toys. If these figures get cheaper, lots of collectors will buy more.

 

[TurdFurgusonsHat]

Who is in for a 90's style class action lawsuit against the music industry? I'll be expecting my check for 58 cents to come in the mail in 2024.

 

[K1LLJOY]

Mezco does the same thing with their One:12 line. A retailer breaking the minimum advertised price policy risks not being able to purchase from mezco. Unless your amazon who just laughs and does it anyway.

 

[TurdFurgusonsHat]

Unless your amazon who just laughs and does it anyway.

Amazon holds the infinity gauntlet and all the stones. Must be nice being so powerful that they can strongarm everyone they do business with, product companies and shippers alike.

 

[dukefett]

Mezco does the same thing with their One:12 line. A retailer breaking the minimum advertised price policy risks not being able to purchase from mezco. Unless your amazon who just laughs and does it anyway.

I'm part of that problem; I skip preordering any regular release because I know I'll at least be able to save 10% or more off retail at Amazon. I typically buy from a 3rd party seller at least so they get the business (and I save on sales tax). For instance the Dawn of the Dead 2 pack was $130 retail and is at $87 now. $43 savings is a ton.

I wish Amazon would start carrying Hot Toys!

 

[asgardianboy]

"since Disney"?

Star Wars.
Tanking since 1999.
m.

 

[asgardianboy]

Who is in for a 90's style class action lawsuit against the music industry? I'll be expecting my check for 58 cents to come in the mail in 2024.

I'd say the most important, even historical outcome of such a lawsuit wouldn't be those hundreds of millions of 58c checks.
m.