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LEGO: world's third largest manufacturer of play materials

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elahe hosseinzadeh

on 20 October 2013

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Transcript of LEGO: world's third largest manufacturer of play materials

Main things to know
Lego is a popular line of construction toys manufactured by The Lego Group, a privately held company based in Billund, Denmark.

The company is still owned by the Kirk Kristiansen family who founded it in 1932.

Based on the world-famous LEGO® brick, the company today provides toys, experiences and teaching materials for children in more than 130 countries. The LEGO Group has approximately 10,000 employees, and it is the world's third largest manufacturer of play materials.

The company's flagship product, Lego, consists of colourful interlocking plastic bricks and an accompanying array of gears, minifigures and various other parts to construct objects as vehicles, buildings, and even working robots.

Lego began manufacturing interlocking toy bricks in 1949. Since then a global Lego subculture has developed, supporting movies, games, competitions, and six themed amusement parks.

As of 2008, around 400 billion Lego parts had been produced – 62 for every person on the planet.

1960s – 21st century
Lego pieces of all varieties constitute a universal system.

Each Lego piece must be manufactured to an exacting degree of precision. When two pieces are engaged they must fit firmly, yet be easily disassembled.

Primary concept and development work takes place at the Billund headquarters, where the company employs approximately 120 designers.

The company also has smaller design offices in the UK, Spain, Germany, and Japan, which are tasked with developing products aimed specifically at these markets.
The average development period for a new product is around twelve months, in two main stages.

The first stage is to identify market trends and developments, including contact by the designers directly with the market; some are stationed in toyshops close to holiday periods, while others interview children.

The second stage is the design and development of the product based upon the results of the first stage. As of September 2008 the design teams use 3D modeling software to generate CAD drawings from initial design sketches.

Since 1963, Lego pieces have been manufactured from a strong, resilient plastic known (ABS).
Lego factories recycle all but about 1 percent of their plastic waste from the manufacturing process every year. If the plastic cannot be re-used in Lego bricks, it is processed and sold on to industries that can make use of it.
Manufacturing of Lego bricks occurs at a number of locations around the world. Moulding is done in Billund, Denmark, Hungary; and Mexico. Brick decorations and packaging is done at plants in Denmark, Hungary, Mexico and in the Czech Republic.

LEGO: world's third largest manufacturer of play materials
Business Studies
By: Elahe Hosseinzadeh
The Lego Group began in the workshop of Ole Kirk Christiansen, a carpenter from Billund, Denmark, who began making wooden toys in 1932.

In 1934, his company came to be called "Lego", from the Danish phrase leg godt, which means "play well".

It expanded to producing plastic toys in 1947.

In 1949 Lego began producing, among other new products, an early version of the now famous interlocking bricks, calling them "Automatic Binding Bricks".
The Lego Group's motto is "the best is never too good").This motto was created by Ole Kirk to encourage his employees never to skimp on quality.

By 1951 plastic toys accounted for half of the Lego Company’s output

In 1958, the modern brick design was developed, and it took another five years to find the right material for it. The modern Lego brick was patented on 28 January 1958, and bricks from that year are still compatible with current bricks.

Since the 1960s, the Lego Group has released thousands of sets with a variety of themes.

In 1978, Lego produced the first minifigures, which have since become a staple in most sets.
Bionicle is a line of toys by the Lego Group that was marketed towards those in the 7–16 year-old age range.

The line was launched in January 2001 in Europe and June/July 2001 in the United States. The Bionicle idea originated from the earlier toy lines Slizers (also known as Throwbots) and the short-lived RoboRiders.

Bionicle was discontinued and replaced with Hero Factory in 2010.

In May 2013, the largest model ever created was displayed in New York, made of over 5 million bricks; a 1:1 scale model of an X-Wing.

The Lego Group estimates that in the course of five decades it has produced some 400 billion Lego blocks.
Annual production of Lego bricks averages approximately 36 billion per year, or about 1140 elements per second. If all the Lego bricks ever produced were to be divided equally among a world population of six billion, each person would have 62 Lego bricks. According to an article in BusinessWeek in 2006, Lego could be considered the world's No. 1 tire manufacturer; the factory produces about 306 million tiny rubber tires a year.

Licensed themes
Over the years, Lego has licensed themes from numerous cartoon and film franchises. These include Avatar: The Last Airbender, Batman, Ben 10, Bob the Builder, Cars, Harry Potter.
Clones of Lego
Several competitors have attempted to take advantage of Lego's popularity by producing blocks of similar dimensions, and advertising them as being compatible with Lego bricks.
In 2002, Lego sued the CoCo Toy Company in Beijing. It was ordered to cease manufacture of the products, publish a formal apology and pay damages.
The English company Best-Lock Construction Toys was sued by Lego in German courts in 2004 and 2009. The Canadian company Mega Bloks were sued by Lego in 2005 for trademark violation, but the Supreme Court of Canada upheld Mega Blocks rights to sell their product.

Related Products
Video games
Lego has branched out into the videogames market since 1997
Official website (lego.com)
First launched in 1996, the Lego website has developed over the years, and provides many extra services beyond a shop and product catalogue.
Theme parks
Merlin Entertainments operates six Legoland amusement parks, the original in Denmark, the second in England, the third in Germany, the fourth in California, the fifth in Florida, and the sixth in Malaysia.
On 13 July 2005, the control of 70% of the Legoland parks was sold for $460 million to the Blackstone Group of New York while the remaining 30% is still held by Lego Group.
Retail stores
Lego operates 46 retail stores (34 in the United States, 7 in the United Kingdom, 5 in Germany, 4 in Canada and 1 in Denmark).
Children's clothes
Since 1993 LEGOwear Clothes have been produced and marketed by a Danish company called Kabooki under license from Lego Group.
Board games
Lego Games launched in 2009–2010
Films and television
In the past, Lego has turned down approaches from Hollywood to make a feature-length film based on the toy. A number of straight-to-DVD computer animated movies have been produced.
Books and magazines
Lego has an ongoing deal with publisher Dorling Kindersley (DK), who are producing a series of illustrated hardback books looking at different aspects of the construction toy. The first was "The Ultimate Lego Book", published in 1999. There is also the Lego Club and Brick-master magazine, the latter discontinued in 2011.

Board of Management
Vig Knudstorp
CEO/Chief Executive Officer

Mads Nipper
CMO/Chief Marketing Officer

Bali Padda

COO/Chief Operating Officer

John Goodwin
CFO/Chief Financial Officer
Financial Highlights of 2012 ( Danish Krone, in millions)
Revenue :

Net profit:


Lego company
Ole Kirk Christiansen
Legoland, denmark
Largest lego model, NYC
Human lego

Thanks for your attention!
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