Bainreese from Allspark wrote:Why You Can't Find Movie Toys
I've seen a lot of people expressing dismay over not being able to find Movie toys. There have been several threads and several reports of empty shelves everywhere. Some have pondered the meaning of this. Some have blamed Target or Walmart as a company. Some have blamed their local stockers, etc.
I am here to tell you not only the problem, but what is causing the delay in restocking.
Supply is not keeping up with Demand.
Sounds like a simple answer right? Well, not so much. The major retailers had sales on Transformers figures prior to the movie. So the buyers of those stores estimated what their demand would be. They obviously estimated wrong. We have the recently reported Walmart figures to prove that. They forcasted the brand would net 2mil in sales and it netted 5mil within the given time period. So they bought a certain amount and it sold through.
The problem with that is, Hasbro doesn't have this gigantic warehouse in the U.S. with stockpiles of Movie TFs just waiting for Walmart and Target to reorder. When it comes to supplying the major retailers it's pretty much a 'build to order' type scenario. Those shipments go from the factory, to the boat, and straight into the stores Distribution channel. Which means that when the first week of July hit and this stuff disappeared off the shelves, Hasbro didn't have product just waiting to deliver to the stores.
The most common scenario, and probably true in this case, is that Hasbro had manufacturing booked according to the major retailer's forecasts. Forecasts are predicted purchases over a given period, seasonal, yearly, or otherwise. Walmart hands Hasbro a Purchase order that says I want 10,000 cases for June delivery, 10,000 for August, and 20,000 for October. Albeit simplistic, that's kinda what a forecast is. When the sales numbers came in and the majors reacted....all they could do, if they did, was to place a new order for immediate delivery. The problem with that is....immediate delivery when the goods aren't forecasted or made means the following.
Factory receives order. Factory orders raw materials and waits for raw materials to be delivered. Minimum 1 week unless they have raw materials on site.(depends on the factory and what raw materials we are taling about.) Ordering the printing on the packaging. Molding needs to take place. Painting needs to take place. Assembly needs to happen. Packaging needs to happen. Its hard to say how long this takes. It depends on a lot of variables including factory size, number of workers, complexity and number of parts on the item being assembled, etc. Lets say best case scenario this process from ordering raw materials to completion of production takes 1 month. Remember, in a wave they are doing 4-6 different figures and each one of those means that unless different assembly lines are going, the line has to change per figure.
1 Month.
Then shipping. Shipping means putting them into a container, getting them to the port, getting it across the water, clearing customs, and inland freight to where ever the major retailers distribution network is. You can sometimes pick expedited vessels, but it costs you more. You can sometimes airfreight the shipment, but that is grossly expensive. Suffice to say, these are coming by boat.
If everything runs smoothly this is perhaps a 20-28 day minimum from factory door to stores distribution door, give or take a couple of days on the long side. That is if nothing goes wrong. No delays at port, no hold up at customs, no hold up on processing shipping documents, etc.
1 Month
The problem is, the end of June, first of July, there was a major hold up at the Chinese ports. The Chinese Government repealed or greatly reduced their rebates to factories for manufacturing. This was helping keep the RMB artificially low and keeping China competitive with cheaper manufacturing in other countries. Because of that repeal or rollback, factories were pumping out product to beat the deadline. This caused a MAJOR backlog at the ports. Let me show you.
So even if all other things were going smoothly, the backlog at the port in China would have held shipments up for days.
At the end of the day, its going to take near 90 days for the stores to be able to get new merchandise in outside of what they already forecasted. The good news is, I think they probably had inbound shipments forecasted. The bad news is, if demand remains high going into September, we may still see a shortage of the figures we want to find.
Nobody has a crystal ball with this stuff and when demand goes crazy, everyone is pulling thier hair out wanting more. You, me, the stores, and Hasbro. The stores and Hasbro because they could be making money hand over fist. So you can bet they are pushing the factories, pushing the freight lines, pushing the document people for cleared papers, etc.
It isn't anyone's fault persay. We are just victims to unexpected popularity and the way the system works.
I hope that helps answer some questions.
Personally I feel that for the most part he is right. What do you think?
