Price of LEGO® Increasing
The LEGO® Group (TLG) has announced that the price of LEGO® is increasing. However, this increase will not impact the entire portfolio. Rather, it will likely impact about 25% of sets (out of around 600 sets). In addition, the increase will be most noticeable on more advanced sets. These sets tend to be those marketed to the adult fan base and are typically larger sets. Personally, I find that many of the higher price point sets offer better value (price per brick). Unfortunately, this may not be the case for much longer. Perhaps they are bringing these sets in line with the pricing of the rest of their product offerings. I also wonder if this was meant to coincide with the recently announced rebranding of the adult-oriented sets to the LEGO® Icons theme.
- Price increases will only impact some sets (about 25%).
- The actual price increase will vary across sets but higher priced sets will see a larger increase.
- Pricing increases will come into effect in August and September of 2022.
- Other retailers set their own prices so we might see a greater increase in the price of sets at other retailers.
- No word yet if price increases will impact sets currently on the market or just new sets.
- No word yet if a list of affected sets will be released ahead of time.
- No word yet if price increases will be implemented differently between countries or markets.
- No word if price increases will impact the cost of individual elements that you might purchase on Pick a Brick on LEGO.com.
Official Statement From TLG
The current global economic challenges of increased raw material and operating costs are impacting many businesses.
Putting consumers first is at the heart of what we do as a company, and for some time, we have absorbed these costs to keep pricing stable. However, as these costs have continued to rapidly rise, we have taken the decision to increase the price on some of our sets. This increase will come into effect in August and September.
The increase will differ depending on the set and prices will change on around a quarter of the portfolio. On some sets we will not alter price, on others there will be a single digit increase and on larger, more complex sets the percentage increase will be higher.
We will continue to work to ensure our products offer great value and full recognise how important this is to our fans and everyone who love our products.
We are all aware of the current global circumstances (rising material and fuel costs). However, it is still hard to accept that a company that saw such growth in 2021, has decided to increase prices on some of its portfolio. Here is a summary of their growth highlights for 2021:
- Consumer sales grew 22%
- Revenue grew 27% to DKK 55.3 billion (over 10 billion CAD)
- Operating profit grew 32% to DKK 17 billion (over 3 billion CAD)
- Net profit grew to DKK 13.3 billion (2.2 billion CAD) from DKK 9.9 billion (1.8 billion CAD) in 2020
- Free cash flow was DKK 12.9 billion (2.3 billion CAD)
- Market share grew in large markets
It is important to note that I am not an economist or business analyst. Therefore, I don’t know how TLG does their forecasting or projections. That said, my response is purely from a consumer perspective. While a price increase is never good news, at least the price increase isn’t being applied to all LEGO® sets.
The most detrimental impact of the price of LEGO® increasing is it perpetuates LEGO® as a socioeconomically exclusive brand. LEGO® does have sets in lower price ranges. However, these sets aren’t always the most exciting. Instead, many of the sets that both kids and adults want are becoming less affordable for many people. LEGO® is an expensive hobby and price increases just perpetuate the increasingly elitist nature of the hobby.
There is a significant socioeconomic gradient in Canada. Most folks are aware that there is a significant gap between privileged populations and disadvantaged populations. However, there is also a significant difference between each group on the socioeconomic ladder. Therefore, the price of LEGO® increasing disproportionately impacts each successive group. Consequently, these folks may very well get priced out of the LEGO® hobby. That said, I fully understand that TLG is a company and that they need to watch their financial projections. However, they are also a company of immense growth. Ultimately, I would love to see LEGO® bring people together rather than create a divide between them. What do you think about the upcoming price increases? Will they impact your LEGO® spending habits? Share your thoughts below or tell us what you think on social media.
Play well folks,
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