Can you profit from investing in LEGO?
The short answer is, yes but you need to do your research and know the market.
Prices of products in the LEGO market, like any other, are subject to the economic laws of supply and demand. That means that the most profitable sets will be those that are in short supply but high demand.
If you do your research and invest well, there is no doubt that LEGO can be a better investment than shares and gold (Telegraph).
Prices of products in the LEGO market, like any other, are subject to the economic laws of supply and demand. That means that the most profitable sets will be those that are in short supply but high demand.
If you do your research and invest well, there is no doubt that LEGO can be a better investment than shares and gold (Telegraph).
How can you profit from investing in LEGO?
There are two main ways to profit from investing LEGO:
1. Investing in LEGO sets that are retired or will be retired soon
Once LEGO discontinues a set, chances are that it's price will rise on the aftermarket. For the LEGO investor who wants prices to rise quickly and thefore be more profitable, the main things to examine are:
2. 'Flipping' newly released LEGO sets that are in popular demand but in short supply
These are the sets that sell out on release and because they are so popular resellers are able to charge a higher price - if people can't wait they will pay more to get the set ahead of the restock.
Two recent examples of LEGO sets which were flipped on release in this way include:
LEGO 21309 - NASA Apollo Saturn V. RRP for the set is £109.99 but resellers were able to sell the sets for up to £180-190 due to the pre-Christmas shortage in late 2017.
LEGO 75192 Millenium Falcon. RRP for this set is £649.99 but the set was selling for up to £1000 on the resell market due to the wild demand from LEGO Star Wars fans.
Flipping newly released sets can be profitable if the demand is crazy but profiting from them isn't as easy because buyers are often wiling to wait until LEGO inevitably manufactures more.
1. Investing in LEGO sets that are retired or will be retired soon
Once LEGO discontinues a set, chances are that it's price will rise on the aftermarket. For the LEGO investor who wants prices to rise quickly and thefore be more profitable, the main things to examine are:
- How long has the set been on the market? The longer the set has been selling, the higher the probabilty that resellers have stocked up. This in turn means supply will be relatively high so prices will remain lower, and less profitable.
- How popular is the theme? This will take some researching on your part. Licensed LEGO sets - think Star Wars, Harry Potter, Lord of the Rings - tend to be much more popular than LEGO's more generic sets (such as the CITY theme).
- How large is the set? Larger sets tend to be more expensive, both to buy and to ship.
- How expensive is the set? What's the 'buy-in'? Think about your rate of return - making a £15 profit on a set that cost £20 and sold for £35 (after fees and postage) is better than buying a set for £200, seliing it for £270, and then realising the fees and postage eat in to your profits.
2. 'Flipping' newly released LEGO sets that are in popular demand but in short supply
These are the sets that sell out on release and because they are so popular resellers are able to charge a higher price - if people can't wait they will pay more to get the set ahead of the restock.
Two recent examples of LEGO sets which were flipped on release in this way include:
LEGO 21309 - NASA Apollo Saturn V. RRP for the set is £109.99 but resellers were able to sell the sets for up to £180-190 due to the pre-Christmas shortage in late 2017.
LEGO 75192 Millenium Falcon. RRP for this set is £649.99 but the set was selling for up to £1000 on the resell market due to the wild demand from LEGO Star Wars fans.
Flipping newly released sets can be profitable if the demand is crazy but profiting from them isn't as easy because buyers are often wiling to wait until LEGO inevitably manufactures more.
What are the risks?
Buying any investment is subject to your own view on risk and reward. Generally, LEGO sets tend to increase in value when they retire / are discontinued so your investment risk is minimized. There is a lower risk of you losing your money, than if you invested in shares, for example. The main risks that your LEGO invesments might not go to plan are:
- The LEGO set(s) you've invested in are are not as popular as you thought they would be and therefore aren't selling at a high enough price for you to profit
- Unscrupulous or fraudulent buyers (particularly on eBay), try and refund your sets / claim they were damaged on receipt
- Your costs - storage, maintenance, postage and insurance - outstrip your profits