In the 2003, the company we have all come to love and admire was nearly dead. From the overwhelming success in the past, the business quickly become strained. LEGO began producing more toy sets then needed because they were trying to capture as many different demographic groups as possible. On top of the many different toy sets LEGO started producing clothing apparel, video games, more theme parks, watches and many other places. In efforts to increase revenue there, other goal was to make LEGO a lifestyle. The company spent too much time and energy trying to obtain new customers that they forgot about the customers they already had forgot about what they stood for (no self-identity). The Kristiansens family was so consumed with trying to be in each industry that they did not realize they were wasting and losing money, big time. With so much going on within the company the different departments hard a hard time keeping up. The marketing department had no clue what the production …show more content…
The times consisted with the holiday season. Many families bought LEGO sets around the holiday season but neglected the brand the rest of the year. In an effort to increase revenue LEGO collaborated with large film franchises to produced LEGO sets for big box office movies - Star Wars movies and the Harry Potter pictures. When these movies were, released LEGO saw a spike in revue and sales but when the movies left the theaters LEGO was left with much lower volumes.
By the end of 2003, LEGO was losing more than a million dollars a day. Sales dropped 35% in the Unites States and 29% worldwide, concluding a year later in the largest loss in the company's history to date. This loss of profit was due to the high manufacturing costs to produce the plastic blocks and the less popular products. It was reported that the company had debt that was equal to its annual sales.
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