This sale appears to be worldwide, or at least affecting the UK as well. Woo!

A Good Example would be Hasbro.. Lets pick a line.. say Transformers Alternators.. They sell for what at most Toys r us..$19.99 right? Toys R us buys these from hasbro (whole sale) for a whopping $5 each!!!  :tdown

I'm not disputing the fact that you may have worked for Toys R Us.

 

But please, your stated cost from Hasbro on these items is completely off base.

 

First off, no simple floor staff/Cashier/Stocking Boy would know the cost of the goods as Corporately, TRU doesn't allow that. Translation, it would not be in a computer you could access.

 

Second, if you happened to be old enough and mature enough to ascend to the position of Store Manager/Replenishment Buyer, then you would know that 150% is not the profit Margin on an item that sells for $19.99 and costs a business $5.00. The profit margin would be 74.9% The "Mark Up" would be 150%. There is a big difference.

 

Lastly,...competition in the Toy category simply doesn't allow for a profit margin of 74.9%. The first thing Wally World would do is to cut that to a maximum 30% profit margin($7.15 retail) to drive business into their stores.

 

That isn't to say that there aren't high margin items out there. That isn't to say that I know exactly what they are paying for alternators. But I know enough.

Hey man, lay off. Clearly he was referring to markup when he used the word profit, and it's entirely possible that if he worked there one of his managers could've told him that. It might very well be common knowledge. Also, no one is going to believe you over him if you insist on acting like a jerk about it.

Good news. Haven't been to TRU in two months now. I hope Sertile is right on those reissues too. I saw the ad this sunday in my paper and it only said Energon figures.

Two questions:

 

1. Does this apply to all TRUs, nationally?

 

2. Does this mean I could buy, say, two basics or two deluxes and make off with an Ultra scott free?

Of course not.

 

The one with the lowest price is always the free one.

Wow, nice trolling up there. :roll Anyway, the sales around here appear to be applicable to the Energon toy line. Also, when making your two figure purchase, you only get a free toy of equal or less value to/than the cheapest figure you bought. So, if you buy a $20 figure with a $10 figure, you're only going to get a $10 figure for free. That's the way it works.

Not my intention to be a jerk nor to troll.(Removed the more personal comment from the first post) I simply wanted to call a spade a spade. Sure, his Manager could have told him the cost of an item. It's possible. What isn't possible is the wholesale cost of Alternators at $5.00.

 

Let me tell you why. I worked 10 years as a Retail buyer. Now I work beyond that and do manufacturering.

 

Shipping costs for Hasbro.

 

Just to get a container across the water from China is running approximately $3500. That is just to get it from the port in China to Long Beach. By measuring the Alternators box, I can figure that it takes about 14,500 units/alternators to fill a 40' container. That is filling the entire container of 58 cubic feet chuck full of alternators. They usually always have a little bit of empty volume space, but I'm giving the benefit of the doubt here. That means, that just to bring it from China to Long beach runs Hasbro .241 cents per unit.

 

5.00

- .24 = 4.76

 

Now that figure has no costs built in for break out, or shipment to Hasbro's Warehouse - where ever that may be. Cost of Railing(train) a container to most places in the US is $400. If Hasbro happened to have a warehouse somewhere in Long Beach that they ship from(doubtful) it would at least that for the cost of a truck.

 

4.76

- .027 = 4.73 (Rounded)

 

Duty which is figured on the cost of goods from China I couldn't pinpoint an exact figure because I don't import toys. But what I was able to find in my searches were that Toys and Dolls/Durables from China ran anywhere in the neighborhood of 2.7%-7% depending on the contents. These are prominently plastic and so I'm going to figure low and say 3%.

 

4.59 x 1.03 = 4.73 (Rounded)

 

So now we are down to $4.59 for the cost FOB China. I am really simplifying things here and leaving some things out. But I don't have all day.

 

$4.59

 

Next we have to take Hasbro's mark up out of the equation. The general rule of thumb for any profitable business is at least a 40% profit margin to maintain health. That is the bare minimum. This is including all your operating/manufacturing/marketing costs etc. Now if you make more than one product you can cost average this. For example, We can make a widget at a profit margin of 30% if we make a wagget at 50%. Lets give Hasbro the benefit of the doubt and say that they have things really dialed in and are an exceptional business and can do it at 35%.

 

4.59 - 2.98 / 4.59 = .35

 

So, Hasbro is making our Alternators for $2.98 in China? Now this leaves out warehousing costs, packing costs. For a simple four color box(without plastic, without packaging, without printing) I pay approximately .50 for a size box similiar to the alternators box. That means that the alternator itself is down to $2.48.

 

The other thing I've left out is the $5.00 original cost is assuming that TRU received that Alternator with no shipping costs from Hasbros warehouse to them...which isn't the case. So there are shipping costs there that haven't been figured in.

 

Why do I go through all this? One reason. To point out the lie.

Well I didn't actually try to buy any reissues, so I could be mistaken, but that's what popped up on the scanner. I would have, but all my TRU has left are Grapples and Infernos, neither of which I'm particularly interested in.

:cop Attention: Troll alert

 

The only way to deal with trolls is to limit your reaction to reminding others not to respond to trolls.

 

Why do I go through all this?  One reason.  To point out the lie.

 

:eek This isnt my sister trying to prove me wrong again is it? Im not a liar. This what I know and that's what I put down.

 

But this is America and you have the right to say what you want. :usa

 

I bow before your superior mastery of economics..

Have a nice day!!! :thumb

well, I just went to toysrus yesterday and I was able to get the buy 2 get the 3rd fre, I saw that g1 grapple was only $6 and hoist and smokescreen were only $8! I couldn't avoid buying them.