$30 million worth of Funko Pop figurines are headed to the dump, as the company looks to purge exces
- Funko will throw away $30 million worth of its plastic figurines, the company said this week.
- The move comes after Funko Pop inventory ballooned nearly 50% in the last year.
- Funko's CEO said the company is seeking ways to improve its efficiency.
Thousands of Funko Pop figurines will end up in the dump, as the company that makes the popular plastic trinkets gets rid of $30 million worth of its inventory.
Funko — best known for figurines that depict a wide range of pop-culture icons from Darth Vader to Freddy Mercury — announced its decision in a press release earlier this week, citing ballooning inventory and limited warehouse capacity.
According to the company, by the end of 2022 its inventory was valued at $246.4 million, an increase of 48% from the same period last year.
The way forward, according to the company, is to throw away much of that inventory, as its button-eyed dolls clutter warehouses and store shelves.
Per the release, Funko "intends to eliminate" the surplass toys and "reduce fulfillment costs by managing inventory levels to align with the operating capacity of our distribution center," a move that could cost upwards of $30 million.
"This is expected to result in a write down in the first half of 2023 of approximately $30 to $36 million," reads the press release.
Funko had a bit of a boom during the pandemic, when many were stuck at home and sitting on disposable income, Yahoo Finance reported in 2020. The increase in sales helped the company recover from a 49% sales plunge in the second quarter of 2020, according to Yahoo.
Now, it seems Funko may be right back where it started.
Still, Funko executives said the company is working hard to course correct and keep its brand top-of-mind for consumers across the globe. At the end of its 2022 fiscal year, the company reported a 37% growth in direct-to-consumer sales.
"During the fourth quarter and in early 2023, we have made progress in addressing operational issues that impacted our results in the second half of 2022," CEO Brian Mariotti said in a statement. "We have strengthened our executive and operational management team and have taken significant steps to improve our operating efficiency."
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