How to Make Big Profits Investing in Lego?

Brett from Niche Laboratory here. In this post I’ll run through a great new way I’ve found of making money offline. Today we’ll be looking at the world of Lego investing, and how it has easily beaten stock market investments, as well as being generally a lot easier than trying to make money online with a blog or a YouTube channel.

My First (Small) Fortune Made From Selling Lego

Back in 2005 I finally found a better paying job and I celebrated by buying some new Star Wars themed Lego. I thought it was really cool that there was finally a product that combined my twin childhood obsessions of Lego and Star Wars.

While browsing a discount store called PoundStretcher I found an entire shelf of small Star Wars Lego sets being sold at a very attractive price. I ended up spending £210 (about $375 at the time). I bought so much that the checkout lady asked if I’d left enough there for other customers to buy. I found this quite hilarious because what weird kind of stores put inventory onto shelves and then don’t want the customers to buy them?

Fast forward 4 years and I decided that I didn’t really want the two large boxes of Lego hanging around in my apartment, so I checked on eBay and realised they were worth more than I’d paid for them.

A LOT MORE.

Over the period of a couple of months I sold my entire inventory. They sold very quickly, and they sold for good prices too.

I no longer have that particular eBay account so I can’t check my records. However I believe that the sets I bought for £2.50 sold on eBay for £17.50. That’s a total Return on Investment (ROI) of 600%, or an annualised return of 62.66%!

Sure, there were eBay fees but I recouped those from charging more postage fees than it actually cost to ship the items.

My Second Attempt to Make Money Selling Lego

In 2021 I’d had a good run on the stock market and I was getting nervous about having such a large percentage of my net worth invested in volatile stocks. So I looked at what I could diversify into.

I hate the whole digital currency thing, and didn’t want to buy property as I’d just sold my rental apartment a couple of years before.

Then after visiting the Lego store and seeing so many cool sets it made me think of all the sets I didn’t buy in 2016

I had the massive revelation…

ALL Lego sets are Limited Edition.

Lego has a cool business but there are two critically important facts about their business operations:

1. They release at least 80 sets a year.
2. Making sets involves a lot of complicated machinery.

An additional consideration is that the majority of their expanding network of Lego stores are quite small. So if the company releases 80 sets a year then it has to discontinue 80 sets a year or there simply won’t be enough room on the shelves for all the new sets! The same goes for toy shops and even warehouse based operations like Amazon.

What happens in practice is that Lego retires a certain number of sets per year. Once sets are retired, they are hardly ever re-released. Of course the same items can appear in Lego sets. For example the Star Wars iconic Millennium Falcon spacecraft has been released as 17 different sets over the years. But these sets are essentially new sets (and dedicated collectors will want to own every single set).

Many Lego sets have soared in value since their release. For example I bought set 7264 Imperial Inspection for £44.99 in 2005. According to Brick Economy this set is now worth £258.76 boxed – that’s a 475% gain in value since its release (which averages 6.85% a year).

Of course past performance is no guide to future performance. The main issue is that there are now a lot more people hoarding Lego sets and the Lego company itself is a lot more savvy when it comes to collectors. However, there is also a lot more interest in Lego generally. For example my sister absolutely loves her Friends Central Perk set and she has now bought an Architecture set as well as a Lego replica of her real life car.

If you check out eBay you’ll see there is a lot of interest in Lego sets. They almost always seem to sell – assuming the price is right of course.

How to Buy Cheap Lego

There’s a really important phrase in business:

Make Money on the Buy

Check out this Forbes article if you want to know more about this term.

But basically it means that if you acquire an item for the right price, then you’re more likely to make money when you come to sell that asset at a later stage.

This term works for most things – stocks, property, gold, and definitely LEGO!

What it means in practice is that if you’re intending to buy Lego sets to sell on again at some point in the future it is critically important that you buy your Lego sets at a good price.

So how can you achieve that?

Basically, before you buy any Lego, you need to ask yourself a question:

Are the sets attractively priced?

Over the long term, all Lego sets generally revert to their initial retail price. So if you can find Lego sets on sale at a 50% or greater discount compared to their recommended retail price then you’ve potentially got yourself something that you can sell for twice the price you purchased it at. If you buy sets that are particularly attractive (Star Wars, Harry Potter) then so much the better.

The best Lego bargains can generally be found in high turnover general retailers that tend not to know the value of specific items they are selling. As I mentioned earlier in this post, I found my best Lego bargains ever on sale in the Poundstretcher discount retailer. Whenever you’re passing a big box general retailer then walking down the toy aisle to see if there are any discounts is a good idea. Walmart, KMart, Tesco, Sainsburys and similar retailers are good for this.

It’s also possible to find online bargains from time to time. Amazon regularly cut the prices of particular Lego sets and if you’re interested in buying up particular sets then you can set up price cut alerts at CamelCamelCamel. For example I bought the Lego Friends Central Perk set from Amazon at just over a 25% discount to the recommended retail price. I regularly checked the price of the set and it changes on a weekly basis.

I’m also a great fan of BOGOF offers – in the UK Argos is good for this and I’ve picked up discounted Speed Champions, Harry Potter and Star Wars sets from them.

Finally I’ll just mention that Lego.com is also worth a look. A number of Lego sets are exclusively sold through their own online shop (or in their physical stores), so you can’t get them anywhere else. If you’re serious about Lego investing, or you buy a lot of Lego anyway then you’ll definitely want to join their VIP programme. The VIP reward points are quite valuable. Their exact value varies but in the UK at least the amount of points you get from purchasing a set is equivalent to a 5% discount on the retail price.

Sometimes Lego will also give away a free set when you spend a certain amount of money in their online or offline stores. These can be highly collectible. For example at the time of writing Lego was giving away a free Charles Dickens set with every £150 order. This set generally sells for £30 on eBay so that’s equivalent to a 20% discount on the order. These sets can be quite valuable since you can’t buy them individually.

One more tip – if Lego (or another retailer) have an offer like this then splitting up your orders means you’ll end up with more freebies. In other words, don’t put in one £300 order – put in two £150 orders then you’ll receive two freebies!

Oh and look out for double VIP points offers too!

Which Lego Sets Are Worth Investing In?

As with any type of investment be sure to do your own research and don’t invest more money than you can afford to lose.

It’s kind of difficult to know which sets will be sure-fire bets for the future. However, sites like Brick Economy have tonnes of facts and figures about which sets should do well in future.

When investing in Lego sets I primarily look for these types of sets:

Big Discounts

Lego sets generally revert to their recommended retail price after they retire and are no longer available from regular online or offline stores. So if I can buy a set at 25% or more below the recommended retail price then I’m reasonably confident I’ll make a profit on them.

Smaller Sets

I don’t have a huge amount of storage, so I tend to prefer investing in smaller sets. The very small sets can do exceedingly well. For example somebody isn’t going to worry too much about paying $20 for something that originally cost $5, but they will be a lot more picky about paying $1200 for a set that originally cost $300.

Sets With Play Appeal

Lego is primarily a children’s play toy, so I like to look for sets with playability. Moving parts and pieces that come apart are always good for this. It’s also possible to see how popular a current Lego set is by scrolling through the Amazon listing if it’s a product they sell themselves. Don’t forget to check the reviews too – not all Lego sets get rave reviews.

Sets With Crossover Audiences/Markets

The Lego company has done tremendously well this century from moving into niches where people will buy their products even if they’re not necessarily into playing with Lego or collecting Lego itself.

The two biggest product ranges that illustrate this point are the Lego Star Wars and Harry Potter ranges. Many fans of these series will buy the Lego merchandise even if they’ve never really played with Lego when they were kids. And of course there are many Lego collectors that will want to own these product ranges too.

Another successful crossover range for Lego investors and collectors has been the Speed Champions range. These are scale replicas of well know cars from manufacturers including Ferrari and Porsche.

More recently Lego has moved into making TV show and other media related sets. These have to date been very worthwhile investments. I recently bought The Big Bang Theory set second hand from eBay and I really regret not investing in the set when it was originally released in 2015. I also regret not buying the Flintstones set, and although I did buy The Simpsons minifigures, I regret not buying their house or the Quick-E-Mart sets.

In 2021 I did pick up several of The Friends Central Perk sets. While Lego is likely to have made a lot more of these sets than they did with the other TV show themed sets, there is also a lot more interest in this particular show. Personally I reckon I will offload my spare sets to coincide with the show’s 30th anniversary [can you really believe it’s been so many years?].

Don’t neglect the less well known Lego ranges. For example Brick Headz have proven very lucrative investments since their release in 2016, and they’re a great entry level product range to start collecting.

Personally I’m quite interested in accumulating the Xtra range. These are cheap polybag sets of themed Lego pieces that are useful for anyone building up a Lego city or other type of themed display. For example they sell bags of food, sport and fairground themed pieces. I’m pretty sure these will double or even triple in price, and they’re super easy to post too.

What Can Go Wrong With Lego Investing

About the most critical thing in Lego investing is that Lego investors are VERY picky about the condition of the packaging. Generally speaking more recent sets are worth around a third less on eBay if they’re not sealed in their original packaging (so a sealed box that will sell for $30 will only sell for $20 if you’ve taken the pieces out of the box and actually made the set). This price differential gets a lot larger for older, vintage sets. For example I own Lego set 373 which was offered on eBay for $450 boxed, but because the pieces it uses are generally very common it’s probably worth $50 or less without the original box.

Storage

If you’re intending to sell Lego then you’ll need to buy some first of course. It’s worth bearing in mind that Lego boxes can be quite large, and they can take up a lot of room.

When hoarding stock to sell it’s generally a good idea to hold onto stock for as short a time as possible. For this reason, professional Lego resellers tend to buy sets that are approaching retirement, rather than sets that will still be available from retail sites like Amazon or the Lego stores themselves.

More advanced sellers use Amazon’s own warehouses to store their stock but this has hefty fees so you need to be confident about the ability of your investments to make a profit.

Be aware that if you’re intending to sell unpackaged Lego sets and individual pieces, Lego bricks are incredibly good at absorbing smells from their environment and tobacco smoke in particular is a big issue with Lego. So if you or your housemates are habitual indoor smokers this might not be a good business enterprise for you.

Also be aware that Lego bricks get discoloured in light – the white bricks are particularly prone to this. This discolouration can be reversed using hydrogen peroxide and sunlight, but if you’re storing bricks or sets then keep them out of the light where possible.

Other than these points, make sure your Lego storage area is:

• Dry and not damp.
• Dark so boxes won’t get discoloured from lighting (particularly the sun).
• Boxes won’t get crushed from people moving other items around them.
• Safe and secure.

Postage

When you’re selling collectible Lego you want to ensure that your packaging is good quality and the Lego box itself won’t get damaged. This becomes of critical importance if you’re selling expensive sets to collectors.

My tip for posting Lego is to start hoarding the packaging materials eCommerce companies like Amazon include in their boxes. The plastic ‘air bricks’ and the brown paper you find inside boxes is VERY useful when it comes to sending your own Lego sets out to your customers.

Returns/Fraud

Selling products online can be problematic at times. Fraud is widespread and Lego is desirable to fraudsters since it’s so easy for them to sell on again.

When selling Lego on a platform like eBay just ensure you follow their usual precautions. It can be a little safer just shipping to buyers in your own country.

Amazon offers Lego resellers potentially higher profits, but just be aware that Amazon makes it super easy for buyers to return products they no longer want… and there’s no guarantee your pristine rare collectible Star Wars Cantina will be in a resaleable condition should somebody return it.

Fickle Markets

The Lego company has a gigantic product range, and I’ve heard they release at least 80 new sets a year. Actually it may be more than that.

At the time of writing their store lists 35 different themes:

Although they’re experts in the toy niche, many of their product ranges bomb and aren’t particularly collectible either.

I’ll point out though that Lego always has some intrinsic value – unlike crytocurrencies it’s highly unlikely its value will fall to zero. About the very worst that can happen is the set will remain at the price you paid for it.

Don’t Buy What Interests YOU

One final tip I have is that you don’t necessarily need to buy Lego sets that interest you. In fact I’d say that if you’re at all sentimental about things then it’s better to invest in sets that don’t personally interest you!

For this reason I tend to invest in the Lego Speed Champions range (I have no interest in cars) and the Brickheadz range (I have little interest in making and displaying these all over my house).

An insider tip from professional investors is that the Duplo range (Lego sets aimed at preschoolers) can be very good investments and offer as good returns as Harry Potter or Star Wars ranges.

Other Ways of Making Money From Lego

While most Lego investors generally buy and hoard particular boxed sets of Lego, there are many other ways of making some extra cash from bricks. Let’s look at some of these…

Parting Out Sets / Selling Individual Bricks

Have you ever tried piecing a jigsaw together only to realise it’s missing a piece?

The same is true when you’re trying to make a Lego set, particularly if you bought it second hand or it’s a set you were given in childhood and now want to remake.

Thankfully there’s a whole industry of people who make a side income (or their entire income) selling used Lego bricks online. One of the best known sites is BrickLink. There’s also another Lego marketplace at BrickOwl.

These sites are really useful for people who need to find the missing pieces for their particular Lego sets. While Lego’s stores and online stores allow you to buy specific pieces, their range is very limited. On the Lego brick marketplaces there is a much more extensive range – at the time of writing their catalogue stretched to 68,595 different items. BrickLink also has some sophisticated functionality. For example if you want to build a set that’s no longer available it will generate a complete list of the bricks you’ll need, plus tell you which vendors have the parts you need.

There is potentially some good money to be made by buying cheap Lego sets and picking up bulk loads of Lego from thrift stores and yard sales. Just bear in mind that separating the sets can take a lot of time and organisation. Most bricks are also only worth something like $0.04 each and it will take a while to learn to recognise what’s valuable, and what’s not.

As an example, one Lego ‘brick’ that’s really valuable are TV antennae, like this one:

It’s actually quite likely this one brick is worth as much as most of the other generic bricks put together.

Incidentally, the most highly desirable parts of any Lego set are usually the little people (called minifigures, or minifigs in the industry). Hence I tend to prefer buying sets that come with a lot of minifigs. There are actually a lot of collectors that just collect the minifigs rather than the actual Lego sets. Back in 2005 when I first started looking for Lego on eBay there were a lot of people who would buy Star Wars Lego sets then sell the minifigs individually.

Geographical Arbitrage

I’m not an expert at this but it’s becoming apparent to me that Lego is worth a lot more in different parts of the world. For example Lego appears to be discounted more in the USA. One Australian YouTuber also bemoaned the lack of set availability in Australia. Lego is also popular in Japan and people are quite likely to pay high prices there. Lego was also priced at a premium when I lived in China.

Designing Lego Sets (MOCs)

If you like building things out of Lego then an alternative way of making Lego from your talents is to sell the plans to make things out of Lego.

People are really interested in MOC’s (My Own Creations). You can upload them to social media platforms and talk about them, and if they’re particularly good you could actually sell the plans so that other people can make them. In theory you can even find the parts and then sell somebody a complete kit.

MOC’s are popular in every niche. One I’ll look at is the military niche. The Lego company itself tries to avoid releasing overly military themed sets (cancelling the Osprey vehicle just 10 days before launch). This may also be the reason that green Lego bricks used to be exceedingly rare – I only have two green bricks from my entire Lego collected between 1977 and 1983.

As a result of the lack of official sets, MOC’s with plans for building tanks, aircraft and ships are very popular.

I’m currently looking at this MOC, which allows Lego collectors to combine the Friends, Seinfeld and other TV-themed sets into one gigantic building:

The designer of this MOC sells the plans as a digital download for $25 a floor.

Blogging/YouTubing

As you might expect there are a lot of people blogging about Lego as well as making videos for YouTube and Tik Tok. Obviously the market is pretty saturated these days, but if you have a unique idea then you could still do OK. For example, this channel shows how to make amazing geometric shapes using common Lego parts:

Essential Resources

If you’re interested in Lego investing then I recommend you check out these resources – especially before you start committing your hard earned cash into the venture.

• Brick Economy is the #1 online resource for gauging the potential value of a particular Lego set.
• Brick Link is a large marketplace for Lego sets and individual sets.
• Toys Period is a great resource for information (including instructions) for older and vintage Lego sets.
• Wolf of Bricks is by far the best Lego investing YouTube channel there is, although we’ll agree to differ on the outlook for the Elf Clubhouse set!

So as you can see in this post, there are many ways of making money from Lego, and they could potentially be more lucrative and much easier than trying to establish a blog or a YouTube channel.

Would you ever consider investing in Lego, or do you think the whole thing is weird and mysterious? Drop your comments below!