Topps out---Fanatics in

[Grid]

Originally Posted by JRX

The problem with your analogy is that topps isn't on its last legs. They just had back to back years of record revenues, recent time at least. They made a deal that for whatever reasons wasn't financially feasible for topps meaning if you're fanatics you can't just do what topps did and expect to make money. They may make some base products, but they either have a plan for something radically different or they naively think the sports card market will continue to grow exponentially.

Did you read what you quoted? Topps isn't on their last legs, right now. Topps, without the ability to produce actual licensed sports cards, will not have the same value when the clock runs out.

Here was my quote, that you must have missed

"Fanatics would be fools to buy out Topps right now. After posting their 2020 sales, they are worth more now than ever before. But more than half of all those sales are sports cards. And without MLB, the company, as a whole, is worth half as much. "

No chance, Topps without the MLB, is worth the same. And their physical card division makes up more than half the companies revenue. Take away that stream, and yeah, they are on their last legs.

They can focus on candy and NonSports, like I mentioned in the same post. But without baseball cards, that entire division is hobbled.

[auctionjmm]

Originally Posted by ottobord

I don't get this impression the way they sell cards on their site.

That's also because they sell a limited number of cards now. I believe it will be different when they have 50 products per sport and need distribution and retail channels to move it. The infrastructure involved is a lot more than just shipping a few tins out to department stores. Just think if you combined the square footage of every distributor, online retailer, and LCS in the US, the size of space and number of employees it would require to move all the product themselves. And surely Josh Luber (who claims that sneakers and cards were his two childhood loves) understands the excitement of walking into a card shop and buying in person.

I think it's a reasonable expectation that LCS' and online retailers will be able to apply for direct accounts to access product, and that distributors will be able to bid on contracts as well to supply retailers. They MAY add some product to department stores and other retailers (heck, I used to buy my baseball cards at the video store) but I would hope not at the expense of Local Card Shops and online retailers like BO who can offer same day shipping and move product at lightening speed.

[Kracer52]

Originally Posted by JRX

I think that quote includes more than the cards. Regardless, if topps could make it financially work, they would have matched the deal in a heartbeat. It is interesting the hobby has for a long time been sustained by the collector and only recently did the flippers come in. Now it seems like they want to make the flippers the base of the industry, but I don't think they can sustain it. You can't go back to the collectors as your base after you spent so much on the licensing rites, you're now relying on the hype investors/flippers.

Agreed completely. I think a portion of that is likely equity, but we don't know enough details yet.

I think that even though it sounds like they gave Topps a chance to match, they structured this contract in a way that they knew they never could. I don't think Topps could have done anything to retain these rights.

[Paderborn1907]

Originally Posted by Biohazarddfl

I have seen "NFT" a heck of a lot in this discussion. Not trying to side track things, but is anyone actually buying that garbage? When I go to myslabs, I can see maybe 20 sales in months and none seemingly over $4. Of course I've seen news clippings of crazy prices on some NFTs, but the day-to-day data and interest tell me that this is kind of a fake trend. Please tell me why I'm wrong(seriously)

Sent from my SM-G973U using Tapatalk

As an international collector I really enjoy the collecting, flipping and investing without all those headaches. Platforms are still in their infancy and still lots of things to improve, but some of the NFTs are really good looking.

BTW Panini MLBPA will drop packs in 3 Days, one reward will be a Mike Trout Color Blast, might be one of his last ones since Panini most likely will lose the MLBPA NFT license too

[Grid]

Originally Posted by KhalDrogo

There is so much untapped potential in the sports cards market. For decades we've dealt with amateur hour from the biggest players in the hobby. We are finally seeing the market mature, with legitimate companies and ownership groups taking control of the hobby. I am very bullish from a collector's and investor's standpoint. There's finally real incentive to grow the hobby beyond these clown manufacturers pumping out as much junk as possible.

Cosigned! Just by dumping the current distribution platform, Fanatics can make selling cards that much more profitable by themselves.

In the olden days, these card companies needed someone to get their product out into the wild. And that was all the Distributors. Big and small ones, scattered around the country.

Those Distributors couldn't survive by just moving product to LCS, they needed someone to take bulk from them, and move product online to the masses.

Fanatics has both distribution and an incredible web presence already. They can cut out the mark up (distributor) and the double mark up (who they sell to) and go direct to consumers, much like an Amazon does.

You, the consumer, might even save a buck. And Fanatics can certainly make more money than the current guys do, by reducing how many other people get to make money on their cards.

[JRX]

Originally Posted by Grid

Did you read what you quoted? Topps isn't on their last legs, right now. Topps, without the ability to produce actual licensed sports cards, will not have the same value when the clock runs out.

Here was my quote, that you must have missed

"Fanatics would be fools to buy out Topps right now. After posting their 2020 sales, they are worth more now than ever before. But more than half of all those sales are sports cards. And without MLB, the company, as a whole, is worth half as much. "

No chance, Topps without the MLB, is worth the same. And their physical card division makes up more than half the companies revenue. Take away that stream, and yeah, they are on their last legs.

They can focus on candy and NonSports, like I mentioned in the same post. But without baseball cards, that entire division is hobbled.

I guess it was more a quibble with the WCW analogy in that Vince bought them after they had fallen apart, but I see your point. I still don't know if fanatics cares about the topps brand. If this really is a 20 yr agreement, again that's not clear at all, they won't need it. They'll have an entire generation of people buying fanatics products.

[spuds1961]

Originally Posted by pewe

I’ve seen quoted that this deal plus other recent licensing arrangements (I think non-memorabilia) are worth $2B through 2046… yikes that’s a long time


Sent from my iPhone using Tapatalk

I will surely be dead by then as I am turning 60 in 2 weeks and if I make it to 85 I will be shocked.

[Kracer52]

I really don't see what incentive Fanatics will have to keep LCS' in the loop. Distribution will be much simpler to do it via e-sales and big box retail. It gives them much more control, and much better margins than having to go through various distributors. Especially if they're starting this thing from the ground up. No existing distribution is a big hurdle, but its also a strength because they can set it up however they want. If they sell retail products through Walmart/Target/Meijer/Whatever else, and "hobby" of some sort solely through Lids and their e-channels, theres no reason to sell product at a lower margin wholesale prices.

[JRX]

Fanatics is also getting into sports betting, maybe they'll make cards that come with a "free" bet on mvp. The current set of sports betting platforms are already incredibly predatory, I expect that to only continue to grow.

[Kracer52]

Originally Posted by JRX

I guess it was more a quibble with the WCW analogy in that Vince bought them after they had fallen apart, but I see your point. I still don't know if fanatics cares about the topps brand. If this really is a 20 yr agreement, again that's not clear at all, they won't need it. They'll have an entire generation of people buying fanatics products.

Agreed, I don't see why they need any of these existing products. From everything that has come out, it sounds like they want to do it their own way. If they are the exclusive home of 3 of the Big 4 sports, there aren't any alternatives for consumers anyway. They have no real competition, why pay for assets they may not want?

[auctionjmm]

Originally Posted by Grid

Cosigned! Just by dumping the current distribution platform, Fanatics can make selling cards that much more profitable by themselves.

In the olden days, these card companies needed someone to get their product out into the wild. And that was all the Distributors. Big and small ones, scattered around the country.

Those Distributors couldn't survive by just moving product to LCS, they needed someone to take bulk from them, and move product online to the masses.

Fanatics has both distribution and an incredible web presence already. They can cut out the mark up (distributor) and the double mark up (who they sell to) and go direct to consumers, much like an Amazon does.

You, the consumer, might even save a buck. And Fanatics can certainly make more money than the current guys do, by reducing how many other people get to make money on their cards.

I just commented on this above and while my comments oppose this viewpoint, I can see both being true. While ordering online is convenient, running up to the LCS or Walmart is even more so. There has to be at least a handful of distributors contracted to help with shipments to retailers. The worst case scenario would be going 100% online and putting all LCS out of business and not having cards available for purchase at retail outlets.

[JRX]

Originally Posted by Kracer52

I really don't see what incentive Fanatics will have to keep LCS' in the loop. Distribution will be much simpler to do it via e-sales and big box retail. It gives them much more control, and much better margins than having to go through various distributors. Especially if they're starting this thing from the ground up. No existing distribution is a big hurdle, but its also a strength because they can set it up however they want. If they sell retail products through Walmart/Target/Meijer/Whatever else, and "hobby" of some sort solely through Lids and their e-channels, theres no reason to sell product at a lower margin wholesale prices.

I made a similar argument in other threads as a way for topps or whoever to make more margin. The current distribution model is a relic. However, its not something that topps or panini were in position to replace easily. That's not the case with Fanatics.

[Kracer52]

Originally Posted by JRX

I made a similar argument in other threads as a way for topps or whoever to make more margin. The current distribution model is a relic. However, its not something that topps or panini were in position to replace easily. That's not the case with Fanatics.

Yup. I imagine it would be difficult for the existing players to do that very quickly just due to existing distribution contracts that I am sure are a tangled mess. Fanatics won't have that problem because they can start fresh.

Probably not a good thing for consumers in some ways, and will have positives in other ways.

[Silent George]

Originally Posted by SupermanBrandon

I personally dont care. I hope it is greener. I actually think Topps will be brought in (purchased by Fanatics) and will continue as it has for 70 years. My comment was more for the ones that wanted change but now dont actually want change.

I think when most people wanted change, it wasn't to remove topps, it was to give topps serious enough competition that they made better products (and also the ability to enjoy something not topps). it was the wish of "We don't want Topps to be the exclusive holder"

And the monkey's paw answered.

[allstarcomics]

Originally Posted by JRX

I joked about the hair locks, but seriously what more can you do with a physical card? Put pieces of bat, ball, glove, uni, sneakers, jock strap? Add a QR code to some highlight? Someone mentioned cross sport auots. Something like that seems geared only to high end "sports card investors"

fingerprint card, hand drawn sketches of players, I'm sure there are countless things collectors would swoon over I always though having many multiple photos with various print runs for a player is way cooler than "rainbow" parallels

[JRX]

Originally Posted by Kracer52

Yup. I imagine it would be difficult for the existing players to do that very quickly just due to existing distribution contracts that I am sure are a tangled mess. Fanatics won't have that problem because they can start fresh.

Probably not a good thing for consumers in some ways, and will have positives in other ways.

That's another side of this. Obviously the deal couldn't work for topps. So Fanatics cant' do what topps did. Does that mean they don't do as much physical product or does that mean they cut out all the distributors and LCS and still do cards, but keep a bigger piece of the pie. You may end up in a situation where you still get your cards but you lose your shops and card community.

[JRX]

Originally Posted by allstarcomics

fingerprint card, hand drawn sketches of players, I'm sure there are countless things collectors would swoon over I always though having many multiple photos with various print runs for a player is way cooler than "rainbow" parallels

As long as you can't lift the prints from the card, the union will go for it lol

[fadster]

Topps will probably be fine, it will take time and it'll be a broader business but they'll be ok. They have massive global licenses in UEFA, F1, WWE and Star Wars. They are just unlocking their potential in UEFA and F1 is in early days, they sell a pack of UCL Match Attax in the UK every 1.2 seconds, that's $70m+ annual sales for one growing product in one country.

They have also started manufacturing soccer and F1 cards in Italy so if things do end up going south in the US I wouldn't be surprised if they break up the business. Spin off Topps Europe back into Merlin (the company they took over in the 90's and they have just brought back) and sell the rest to Fanatics.

[auctionjmm]

Originally Posted by Kracer52

I really don't see what incentive Fanatics will have to keep LCS' in the loop. Distribution will be much simpler to do it via e-sales and big box retail. It gives them much more control, and much better margins than having to go through various distributors. Especially if they're starting this thing from the ground up. No existing distribution is a big hurdle, but its also a strength because they can set it up however they want. If they sell retail products through Walmart/Target/Meijer/Whatever else, and "hobby" of some sort solely through Lids and their e-channels, theres no reason to sell product at a lower margin wholesale prices.

It depends if they value the experience that people get from going to a shop. There's nothing better than going to a shop on a Saturday, chatting with the owner, discussing the hobby with other hobbyists, having access to a huge amount of inventory. I doubt Lids would have the space to even store all the product. And what fun is it walking into an apparel store to buy cards with some 17 year old girl ringing you up and nobody on site who even knows or cares enough to talk to the consumer about the products?

If you think about it, alcohol manufacturers don't need bars to exist. Shipping a few cases of beer to Joe's Bar isn't really a huge incentive, and people can drink at home much cheaper. BUT the bar atmosphere has it's place in society for socializing and providing entertainment and money to local economies so they certainly serve a purpose.

[GeechQuest]

Originally Posted by Grid

Cosigned! Just by dumping the current distribution platform, Fanatics can make selling cards that much more profitable by themselves.

In the olden days, these card companies needed someone to get their product out into the wild. And that was all the Distributors. Big and small ones, scattered around the country.

Those Distributors couldn't survive by just moving product to LCS, they needed someone to take bulk from them, and move product online to the masses.

Fanatics has both distribution and an incredible web presence already. They can cut out the mark up (distributor) and the double mark up (who they sell to) and go direct to consumers, much like an Amazon does.

You, the consumer, might even save a buck. And Fanatics can certainly make more money than the current guys do, by reducing how many other people get to make money on their cards.

The hobby is so stepped on and manipulated at so many levels, BECAUSE IT HAS TO BE TO KEEP THE DINOSAURS ALIVE, that product costs are higher than they would be otherwise.

There's more money in efficiency, we've just never had big investment tap the potential. We have it now.

[Grid]

Originally Posted by Kracer52

I really don't see what incentive Fanatics will have to keep LCS' in the loop. Distribution will be much simpler to do it via e-sales and big box retail. It gives them much more control, and much better margins than having to go through various distributors. Especially if they're starting this thing from the ground up. No existing distribution is a big hurdle, but its also a strength because they can set it up however they want. If they sell retail products through Walmart/Target/Meijer/Whatever else, and "hobby" of some sort solely through Lids and their e-channels, theres no reason to sell product at a lower margin wholesale prices.

Agreed. Sad, that your LCS might be the end of an era. Or, they do what many are doing right now. And that is, buying hard to find product from flippers, and flipping it once more on collectors in their shop.

Fanatics has a deep reach with current customers (stores). How many of us still have a LCS near us? Now, how many of us have a Target, Walmart or Lids near us?

Guess what, they all already are selling Fanatics stuff. Instead of walking into your old LCS for hobby, you can walking into a Lids in the mall. When Target unpacks that case of hats and shirts that came from Fanatics, they can pull out whatever retail cards Fanatics sent to them as well. Maybe they even start stocking hobby? You will take this old stock shelving gig away from the current Distributors that have been known to work with flippers.

I tell you what, I 100% trust that a corporate run Lids wont mark up a "hot" box 50% when a player blows up, like your LCS would.

[imbluestreak23]

Originally Posted by JRX

I think that quote includes more than the cards. Regardless, if topps could make it financially work, they would have matched the deal in a heartbeat. It is interesting the hobby has for a long time been sustained by the collector and only recently did the flippers come in. Now it seems like they want to make the flippers the base of the industry, but I don't think they can sustain it. You can't go back to the collectors as your base after you spent so much on the licensing rites, you're now relying on the hype investors/flippers.

Flippers just now coming in? You mean sneaker bois.

Mr. Mint making thousands by ripping off unsuspecting sellers of minty fresh vintage collections drew in millions of collectors in the 80s wanting to cash in on their retirement to become cardboard millionaires.

In 2021, many flippers HAVE become cardboard millionaires thanks to scarcity.

Bye bye scarcity.

[Grid]

Originally Posted by auctionjmm

I just commented on this above and while my comments oppose this viewpoint, I can see both being true. While ordering online is convenient, running up to the LCS or Walmart is even more so. There has to be at least a handful of distributors contracted to help with shipments to retailers. The worst case scenario would be going 100% online and putting all LCS out of business and not having cards available for purchase at retail outlets.

See what I just posted above this reply. Fanatics DOES sell through retail stores. That is where the likes of Walmart get their licensed shirts and hats from already.

If its easy for you to get to Walmart now, what if Walmart had a hobby box section for these Fanatics cards? You LCS can sell you singles and supplies. But, they dont get to mark up the hobby boxes they bought from the marked up distributor they use.

[Kracer52]

Originally Posted by auctionjmm

It depends if they value the experience that people get from going to a shop. There's nothing better than going to a shop on a Saturday, chatting with the owner, discussing the hobby with other hobbyists, having access to a huge amount of inventory. I doubt Lids would have the space to even store all the product. And what fun is it walking into an apparel store to buy cards with some 17 year old girl ringing you up and nobody on site who even knows or cares enough to talk to the consumer about the products?

If you think about it, alcohol manufacturers don't need bars to exist. Shipping a few cases of beer to Joe's Bar isn't really a huge incentive, and people can drink at home much cheaper. BUT the bar atmosphere has it's place in society for socializing and providing entertainment and money to local economies so they certainly serve a purpose.

I'm not sure that is a great analogy. With bars, the entertainment/community aspect is as much the product as the alcohol. The margins are also much better than they are with cards anyway.

The problem is, people line up at 6 am to buy mediocre cards at their local big box retailer. The location of the sale is clearly not slowing down sales, and with the increase in margins, I can't imagine the value of "community" will be valuable enough.

Maybe they'll be altruistic and set up a program for LCS', I just don't see how it is more viable financially than creating their own channels.

[auctionjmm]

Originally Posted by Grid

Agreed. Sad, that your LCS might be the end of an era. Or, they do what many are doing right now. And that is, buying hard to find product from flippers, and flipping it once more on collectors in their shop.

Fanatics has a deep reach with current customers (stores). How many of us still have a LCS near us? Now, how many of us have a Target, Walmart or Lids near us?

Guess what, they all already are selling Fanatics stuff. Instead of walking into your old LCS for hobby, you can walking into a Lids in the mall. When Target unpacks that case of hats and shirts that came from Fanatics, they can pull out whatever retail cards Fanatics sent to them as well. Maybe they even start stocking hobby? You will take this old stock shelving gig away from the current Distributors that have been known to work with flippers.

I tell you what, I 100% trust that a corporate run Lids wont mark up a "hot" box 50% when a player blows up, like your LCS would.

And this could be problematic on many levels. Let's say this were true today. National Treasures Basketball comes out with a retail price point of $999.99. You don't think there will be a line around the corner at Lids, instant sellout, and a bunch of people striking out? Look what happens with new video game systems and some kids wait months or longer before they can even grab one because the MSRP is 5x less than they are selling for online. Or how hard it is to get sneakers. At least the LCS may cut you a better deal if you are a long time customer (I still get great deals to this day).

For as much as some people hate it, there is no way to supply all trading cards at MSRP without instantly selling out of everything and leaving people bitter because they don't have the time to stand outside of Lids on Wednesday morning.

EDIT: So somehow, someway, the price point would need to be high enough to not draw massive crowds and instant sellouts with every release, OR the supply be enough that we no longer see wax prices through the roof on secondary market because there is too much to go around. But we all know what happens to singles when cards are overproduced so...