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Lego working with shops to avoid Brexit disruption | Lego working with shops to avoid Brexit disruption |
(about 8 hours later) | |
The boss of Lego has said the toymaker is working with UK retailers to "make sure they have enough stock" this Christmas in case of a no-deal Brexit. | The boss of Lego has said the toymaker is working with UK retailers to "make sure they have enough stock" this Christmas in case of a no-deal Brexit. |
Niels Christiansen said the Danish firm was not expecting problems but that he was "monitoring the situation" nonetheless. | Niels Christiansen said the Danish firm was not expecting problems but that he was "monitoring the situation" nonetheless. |
Prime Minister Boris Johnson has said he wants to take the UK out of the EU on 31 October, with or without a deal. | Prime Minister Boris Johnson has said he wants to take the UK out of the EU on 31 October, with or without a deal. |
But some have warned this could cause chaos for British retailers. | But some have warned this could cause chaos for British retailers. |
Potential risks include delays at ports and higher prices for imported goods caused by further falls in the pound - although others say the claims have been exaggerated. | Potential risks include delays at ports and higher prices for imported goods caused by further falls in the pound - although others say the claims have been exaggerated. |
Lego imports its bricks into the UK from the Czech Republic, Denmark and Hungary, suggesting it could be at risk from new trade barriers. | Lego imports its bricks into the UK from the Czech Republic, Denmark and Hungary, suggesting it could be at risk from new trade barriers. |
It also raised wholesale prices by 5% in the UK in 2016 in response to the pound's devaluation after the Brexit referendum. | |
The firm declined to comment on whether its Christmas pricing might be affected in the case of a no-deal scenario, but Mr Christiansen said the toymaker was unlikely to be "majorly affected" by no deal. | The firm declined to comment on whether its Christmas pricing might be affected in the case of a no-deal scenario, but Mr Christiansen said the toymaker was unlikely to be "majorly affected" by no deal. |
"We have been working with customers to make sure the flow of product won't be disrupted," he said, but declined to specify what those measures might be. | |
Mr Christiansen made the comments after Lego announced a 4% rise in revenue for the first half of the year to 14.8bn Danish Krone (£1.8bn), although profits fell 16% as it reinvested in its business. | Mr Christiansen made the comments after Lego announced a 4% rise in revenue for the first half of the year to 14.8bn Danish Krone (£1.8bn), although profits fell 16% as it reinvested in its business. |
And at a time when rival toymakers are struggling, the family-owned firm said it planned to open 160 new stores this year globally - 16 of them in the UK. | And at a time when rival toymakers are struggling, the family-owned firm said it planned to open 160 new stores this year globally - 16 of them in the UK. |
Eighty of the shops will be in China, with the Danish firm on track to have 140 stores in the country by the end of 2019. | Eighty of the shops will be in China, with the Danish firm on track to have 140 stores in the country by the end of 2019. |
Asked if he was concerned about a recent slowdown in China's economy, driven by Beijing's trade war with Washington, Mr Christiansen said he still saw the country as a growth market. | |
"We have been helped by the fact that we produce our products around the world close to where the demand is, so for China we produce in Asia," he said. | "We have been helped by the fact that we produce our products around the world close to where the demand is, so for China we produce in Asia," he said. |
"There are also many Chinese kids that don't know Lego and whose parents don't know Lego, so we see a real opportunity there." | "There are also many Chinese kids that don't know Lego and whose parents don't know Lego, so we see a real opportunity there." |
Despite this, the firm has come up against a wave of counterfeit Lego products in China which Mr Christiansen admitted had been challenging. | Despite this, the firm has come up against a wave of counterfeit Lego products in China which Mr Christiansen admitted had been challenging. |
Plastic waste | Plastic waste |
Copycat brands have even made their way to the UK, although Mr Christiansen said the Chinese authorities were getting tougher on the practice. | Copycat brands have even made their way to the UK, although Mr Christiansen said the Chinese authorities were getting tougher on the practice. |
"There have been some court rulings in our favour in China, so we do see an element of progress." | "There have been some court rulings in our favour in China, so we do see an element of progress." |
Lego has committed to use only sustainable materials in its core products and packaging by 2030 amid rising concerns about plastic waste. | Lego has committed to use only sustainable materials in its core products and packaging by 2030 amid rising concerns about plastic waste. |
And last year it launched its first ever Lego products made from polyethylene, a type of plastic derived from sugar cane, to replace materials sourced from fossil fuels. | And last year it launched its first ever Lego products made from polyethylene, a type of plastic derived from sugar cane, to replace materials sourced from fossil fuels. |
The products only represent 1-2% of the total amount of plastic produced by Lego - leading some to question how committed the firm was to its 2030 goal. | The products only represent 1-2% of the total amount of plastic produced by Lego - leading some to question how committed the firm was to its 2030 goal. |
But Mr Christiansen stressed that Lego bricks were durable, not "single use" plastics and rarely thrown away. "Our bricks are sometimes kept for 40-60 years," he said. | But Mr Christiansen stressed that Lego bricks were durable, not "single use" plastics and rarely thrown away. "Our bricks are sometimes kept for 40-60 years," he said. |
Despite this, he said the firm was investing heavily in finding durable yet sustainable alternatives. | Despite this, he said the firm was investing heavily in finding durable yet sustainable alternatives. |
"The safety and durability of blocks is not trivial, and we are looking for the right materials." | "The safety and durability of blocks is not trivial, and we are looking for the right materials." |
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