Damn Microbots, YOU KILLED MEGO

[Figuremod73]

mego star wars figures would STILL be a good idea!

[MIB41]

Had Mego taken the Star Wars license, you most likely would have seen a resurgence in the 8 inch format, instead of the 3 3/4 inch scale. But Kenner grabbed it and the rest is history. But it is true. Micronauts actually kept the company afloat much longer than what they would have otherwise.

[Figuremod73]

palitoy, was there any licenses they were trying to aquire just before the company folded? such as a last ditch effort sort of thing?

[PNGwynne]

Thanks for the Museum link, Microman, and the additional info Brian.

(Admittedly, I mostly use the Museum galleries.)

[palitoy]

hey guys, dont forget the problem (and legal problems) created from the stretchable figures to....

I think the equating of Mego's downfall to the elastic line is really blown out of proportion. Not one former Mego employee I've spoken to has ever said that the Elastics had anything to do with the decline of the company, they were a failure for sure but that rumour seems to stem from a collector.

[Figuremod73]

hey guys, dont forget the problem (and legal problems) created from the stretchable figures to....

[doctor09210]

was that 10000 bc a bad line
cause it sure was ugly!

[draconianguard]

Historically, Mego seemed to only take on a license that were already successful. They never really gambled with something not proven. The Wizard Of Oz, Star Trek and Marvel and DC superheroes were already well established and popular when Mego picked them up. After the Star Wars incident, things changed. Mego gambled on a slew of unproven upcoming film and television licenses like never before. I've heard a few different stories, but my gut tells me they didn't look at Star Wars as anything special.

[doctor09210]

these guys weren't mego
were they? at one time

[MicromanZone]

[doctor09210]

wow
this forum got much more interesting than i thought it would get

any failed mego lines that made them loose extra cash

[palitoy]

But what did--was it just the waning interest in superhero toys at the time? Or a deeper, pervasive mismanagement that Mego fans don't acknowledge? Or was Mego just overextended, despite successful Micronauts sales?

Yeah it was a combination of high interest loans, sinking a lot of R&D money money into things like electronic games and the legal problems that did the company in.

When Marty Abrams ran into trouble, the creative people flew out the door and buyer confidence also disintegrated. The new president was more of a bean counter according to former employees, the company began to wither.

The other problem is, Mego had no real brand assets, they were primarily licenses, Abrams was obviously aware of this as he had tried to buy Tonka in 1980. So nobody came to swoop Mego up when they fell into trouble.

BTW Micronauts were dead by 1981, they had some great years and brought Mego hundreds of millions but it starting to collapse into itself most likely because Mego just kept offering the same assortments and Rocket Tubes was a real bust.

[MicromanZone]

But what did--was it just the waning interest in superhero toys at the time? Or a deeper, pervasive mismanagement that Mego fans don't acknowledge? Or was Mego just overextended, despite successful Micronauts sales?

Again, this great website that few know of called “The Mego Museum” has the info right here:

To understand exactly what had happened one would have to look first into the financials, Mego was borrowing money at alarmingly high interest rates, their sales for the year previous were the lowest in nearly 5 years.

In a 1981 letter to shareholders Martin Abrams explains why "An overproliferation of electronic merchandise by the entire industry, and a slowdown in consumer demand caused retailers enter this year with excessive inventories" he adds "As a result, the retailers sharply curtailed their purchases during the year, which resulted in our ability to reach, what we considered to be, a very conservative forecast."

Mego made a great deal of staff changes, they closed their Bohemia, NY assembly facility and downsized their staff. The year previous Mego borrowed $52.5 Million from the General Electric Credit Company

Of course, none of this would matter after Martin Abrams and two other executives were indicted for defrauding the shareholders of $100,000 over ten years. Many believe this was an attack at union corruption and not at Mego but it was the final straw for the world's greatest toy company.

By the Summer of 1982, it was over, the Senior VP of Finance Laurence Usdin told the New York Times that despite sales of 73.7 million, the company was over 50 million in debt.

Undaunted, Martin Abrams would attempt to ressurrect Mego in 1983 but for now, gaze into the final catalog that was still full of promise and elicited these words from its President "The Company's inventory has been reduced and the product line is now comprised of a higher proportion of less expensive and more stable items, which the Company believes is being well received."

[PNGwynne]

That's not true at all, it's a sloppy rumour that won't go away. Micronauts made the company millions and the lack of the Star Wars license did not fell the company.

But what did--was it just the waning interest in superhero toys at the time? Or a deeper, pervasive mismanagement that Mego fans don't acknowledge? Or was Mego just overextended, despite successful Micronauts sales?

[doctor09210]

WHAT THE HECK
Thats Just Scary