Is the block party over? Lego's impressive run comes to an end

  • News
  • March 8, 2018
Is the block party over? Lego's impressive run comes to an end

Danish company, Lego, has announced its first profit and sales drop for more than a decade. The company saw a dip of eight percent in sales due to an increase demand for more modern toys.

In a tough year for Lego, the family-run brand has said sales dropped eight percent following a “challenging year”, that also saw the retailer cut 1,400 jobs.

While sales declined, profit also fell by 17 percent. Its first decline since 2004.

Lego's net annual profit sits just under $1.5 billion USD. Stilling coming far above its competitors Mattel and Hasbro. According to the official financial report, net profit for the period ending December 31 was down $1.6 million when compared to the same period in 2016. 

From left: Revenue and Profit before tax

Revenue was down $2.9 million on a year to year basis. 

Niels Christiansen, who took over as Lego’s chief executive five months ago, said there would be “no quick fix” and it would take years for the company to return to growth.

“2017 was a challenging year and overall we are not satisfied with the financial results,” Christiansen said. “We started 2018 in better shape and during the coming year we will stabilise the business by continuing to invest in great products, effective global marketing and improved execution. There is no quick fix and it will take some time to achieve longer-term growth.”

Lego said part of the collapse in profits was due to the company producing too many of its colourful bricks, which it was forced to sell off cheaply to make room in its warehouses. Blame was also placed on overlapping layers to its inner structure, which was in part way responsible for the cut jobs.

Announcing more changes to its models, Lego has also made the effort to become more sustainable. Producing Lego pieces made from plant-based plastic sourced from sugar cane, rather than plastic.

Lego has joined forces with WWF to support and build demand for sustainably sourced plastic, and has joined the Bioplastic Feedstock Alliance (BFA) to ensure fully sustainable sourcing of raw material for the bioplastics industry.

The news of Lego struggles adds to the speculation that a brand who stays complacent in its models will face challenges. Such as Toys “R” Us going into administration earlier this week.

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Are you a digital litterbug?

  • Opinion
  • March 22, 2018
  • Michael Goldthorpe
Are you a digital litterbug?

f a tree falls in a forest and there’s no one there to hear it, did it really make a sound? Pretty much everyone has an opinion on that. It’s the pub chat version of Schrodinger’s cat. But since no one was in the forest, nobody knows the answer. And ultimately, it doesn’t matter. At least not until you ask the same question of digital marketing.

Read more

In the belly of the beast: Dr Rosie Bosworth on the pain, pleasure and promise on display at the world’s largest natural foods trade show

  • News
  • March 22, 2018
  • Rosie Bosworth
In the belly of the beast: Dr Rosie Bosworth on the pain, pleasure and promise on display at the world’s largest natural foods trade show

Dr Rosie Bosworth recently attended the world’s largest natural food and products tradeshow in California. What she found was a mixed bag: ‘Natural’ companies peddling healthy snake oil products, as well as promising plant-based protein start-ups that gave her hope for the future. Here, she reports back on the highs and lows of the show.

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A loveable rogue by any name: Rogue Society rebrands to to Scapegrace

  • News
  • March 22, 2018
  • Sarah Pollok
A loveable rogue by any name: Rogue Society rebrands to to Scapegrace

A new campaign by Rogue Society Gin declares they have ‘made a name for themselves’ and the New Zealand company doesn’t just mean figuratively. After an international scuffle with an American brewing company that had a beer called 'Rogue', the company has rebranded to be Scapegrace Dry Gin to better promote its product overseas.

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