Lego Executive Summary

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As LEGO industry is continuously developing more innovated ideas to expand their product lines for their global buyers, it is my job to analyze their position in determining how to maintain market dominance in the building toy market as well in their financial success within the industry. By using Michael Porter’s Five Forces model, I was able to present the competitive set for LEGO building blocks and its recent product advancements. Looking at LEGO in the competitive set as a whole, we note that LEGO is a globally operated product line for toys. Global toy sales represented over US $83.3 billion in 2010. One of the fastest growing toys was building creations which increased 13 per cent in 2010. LEGO products are provided to those buyers globally through retail stores, online third party vendors (i.e. Amazon.com, Ebay, etc.), as well as LEGO.com. It is important to look at the global coverage and quality of product that LEGO is providing its buyers when evaluating the competitive set. In order to maintain market dominance and financial success they must insure they are providing the highest quality product to our buyers directly within sustainable financial costs. Inside the competitive set there is rivalry between LEGO and additional toy creators, more recently Hasbro. The market is growing rapidly in innovations for more children’s entertainment globally. LEGO competes in a large market of deriving technology and virtual online creations. LEGO not only operates in a large market but is the fourth largest toy manufacturer in the world. Disney, Hasbro, and Mattel hold significant placement above LEGO industry in toy production. After looking directly at their global market on toy creation it is obvious they are gaining revenue which has doubled since 2007; 8,027 to 16,014, as well as increasing work force size which also doubled since 2007; 4,199 to 8,365. They are maintaining proper financial income and expenses in order to sustain and expand the buyer’s...
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