Citations › Citation ID: 105

C105. BOOK: David C. Robertson, Brick by Brick: How LEGO Rewrote the Rules of Innovation and Conquered the Global Toy Industry (Crown, 2013), p. 109.

Ovesen also inaugurated a near-term, measurable goal that consisted solely of a number: 13½ percent. He established a financial tracking system dubbed Consumer Product Profitability (CPP), which measured the return on sales of individual products and markets. CPP gave LEGO an unimpeded view into where it was losing and making money. To survive, any existing or proposed product should demonstrate that its return on sales would meet or surpass that 13½ percent benchmark, which was based on the company’s analysis of its competitors’ earnings and its expectation of what a premium toy brand should deliver.

13½ percent - The profit margin that Knudstorp set and expected every product to hit.