Trying to buy sets from LEGO.com in the run-up to Christmas 2020 wasn’t a fun time, with most of the company’s biggest and best products consistently unavailable to purchase as a result of the pandemic. But while COVID-19 is still having a lasting impact on global supply chains, the LEGO Group is adamant that it can meet demand over the next few months, as it has mostly managed throughout 2021.
“The way that we’re structured and how we develop our global operations footprint means that we’re well-placed to maintain supply, despite external factors such as capacity constraints in the global shipping market,” the company’s CFO Jesper Andersen said in a recent Q&A with Brick Fanatics and other media. “We don’t foresee a significant impact from increased freight cost in the second half [of 2021], and we expect to meet demand in the holiday season.”
Andersen also emphasised the company continues to ‘plan for the long horizon’, allowing it to mitigate the challenges presented by the pandemic – at least this year – and better react to demand for specific sets.
“During the past 10 years, we’ve invested in a global supply chain network, with five manufacturing plants on three continents located close to our markets,” he explained. “This means that we’re able to ship products short distances and respond quickly to shifting consumer demands. Over the past year we’ve expanded capacity at these facilities and extended our warehouse facilities. This has enabled us to keep up with sustained strong demand.”
CEO Niels B. Christiansen added that the LEGO Group doesn’t anticipate any supply issues specific to the UK, amid concerns over Brexit and increased freight costs – and it also isn’t planning to boost prices for British customers, even while normalising RRPs on the continent from 2022.
“We do not plan to do any extraordinary price increases due to freight or raw materials costs,” Christiansen explained. “We are basically operating like we would normally be. We’re comfortable servicing the market up to Christmas, and in that sense we don’t expect any particular issues.
“We are of course dependent on transportation and customs into the UK, but as it looks right now, we don’t have any particular concerns in that area.”
That hopefully means we won’t see a repeat of the 2020 shortages as we approach LEGO VIP Weekend, Black Friday and Cyber Monday – when we’re expecting to see some very good deals from the LEGO Group – and finally through Christmas, when the worst of the stock issues hit last year.