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It Is Hasbro's Fault! It Is Retail's Fault! The Price Hike Plot Thickens

Posted by Paul | January 27, 2015 at 05:39 PM ET

We feel that there is a still a big ball of confusion out there surrounding The Black Series 3.75" price hike. Weeks ago, Yakface.com broke the exclusive news (although it appears some people think this "old" news just broke a few days ago) that this was happening and then lengthy discussions with readers at both JTA and Yakface.com added their own opinions to the matter (300+ comments in our article alone). It seems however that there are things not being relayed by [important people] that you should know. Click through for an article sure to create controversy.

I doubt that I am in the minority here, but as a high school student and college student, I got my feet wet in the workforce at the retail level. Even when just starting out as a cashier, I quickly learned the differences between wholesale and retail prices. One retail establishment I worked for was a niche health food/vitamin/gift/music shop. Depending upon the merchandise and depending upon how many units of product were order for each category, distributors discounted the merchandise a few extra points from our costs so we had more wiggle room to promote it with special introductory prices and/or or just mark it down if it didn’t becomes as successful and sell through as planned. Sometimes best selling merchandise would sell out immediately and if we had to reorder it, we wouldn’t get that original discounted deal (by buying in bulk) and have to pay more for the same merchandise. Sometimes the manufacture would influence our retail price because they couldn’t get materials at the same lower price to make the goods. But one thing is for sure. It was ALL dictated by the vendor, not us. (Has no one ever heard of supply and demand?)

The same goes for Hasbro. We don’t deny that retail may set the prices, but it’s all based on an MSRP which means MANUFACTURER’S SUGGESTED RETAIL PRICE. Guess where that advised price comes from? You got it. Hasbro. Our friends at Yakface.com broke the news story that TARGET was selling 3.75” The Black Series figures for up to around $5 more than the suggested MSRP. (Average reports confirmed that $12.99 was much more common.) Questions began being raised. Whose fault is this? Hasbro’s? TARGET’s? The tooth fairy’s? Obviously the latter is a joke, but no one wants to take blame for the higher prices. It was discussed at length weeks ago. The answer is not so simple. But let us look to the basics again because that is where the truth begins. If the wholesale price goes up, then this means the retail price goes up. Does anyone really have trouble or problems with this logic? It should be relatively a no-brainer. Hasbro has said for YEARS that it is retail that sets the prices and that they cannot comment what a retail shop sells their products for because they have no control over it. That is true, but what determines retail’s prices?

If you look at it this way, what Hasbro claims isn’t entirely true. It’s not a lie either. But there is more involved here. What happens if the wholesale price increases so dramatically that it almost equals what the normal MSRP has been for the last couple of years? (We’re talking about that high $9.99 price point by the way that has egregiously been accepted by all as an acceptable price for a 3.75” action figure.) Hey, we don’t like paying these prices either. (On a side note, we will to support the line no matter the price. But we don’t want to go off topic here and ask “how high will you go” because that really isn’t relevant here.) Decisions have been made and it is what it is now. We will explain. For 2015, Hasbro raised the wholesale price of The Black Series 3.75” figures. One distributor has raised them from $7.25 to $9.40. That is nearly a 30% increase. Is a retail store or an online shop supposed to make $.59 each on these figures and then just “suck it up”? This “profit” doesn’t even cover the shipping of the case to their stores. It makes TOTAL sense why TARGET would mark these figures $12.99, $13.99 or $15.29 each. How else are they supposed to make any profit. (We’re not discounting that they may get a slightly better discount for the quantity they order, but hopefully you get the point.)

So, we ask again, who is to blame here? We KNOW production costs in China (whatever that includes: ensuring fair labor standards and working conditions, cost of materials, actual labor to manufacture the goods etc.) have risen. We’re really not even blaming Hasbro exactly that the wholesale for 3.75” The Black Series figures has risen nearly 30% in one year. We know there are multiple obstacles in their way preventing them from producing an affordable 3.75” line. But maybe if the reasons of what’s blocking this could be bettered explained to the fans and collectors, maybe we wouldn’t be whining about it every 5 seconds (me included). Cases that wholesaled for $7.25 per figure have jumped up to $9.40 per figure if they were ordered right now. Similar situations apply to TARGET and Walmart and Amazon.com. And we’re going to blame them solely for the up-charge? We think there is a lot of spin out there and wrong finger pointing. We just want to present that the issue isn’t just one direction. There are multiple factors, one of which is the increase in wholesale costs. Besides, we think distribution and quality issues are bigger problems Hasbro needs to resolve before addressing higher wholesale prices. But that’s just us. Please let us know your thoughts in our comments.

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