LEGO retiring old sets? Why does The LEGO Group stop producing/selling older sets when they can still be hot items? I understand that they might affect the sale of future models but older models are rarely replaced by their newer counterparts.

As a fan of LEGO Trains, I cannot find anything for these ones:

Level Crossing:
7834
4532
7936
10128

Train Crossing:
7996
7857

These are just examples. There are a lot of other items, both train and non-train related, which are discontinued and are sold on eBay etc. for the price gold. Obviously if LEGO would keep on producing them, they will definitely benefit.
In order to sell older sets, TLG would have to either:

(1) continue a production run even when the demand for a set has dropped off

Production capacity is limited to a set number of components / sets at a time, and it makes sense to focus on newer, more profitable lines. For example, the moulds which produce LEGO parts are unbelievably expensive, but each mould can only produce a certain number of parts before it needs to be replaced.

or

(2) reproduce older sets

TLG has tried that in the past, and it hasn't proven particularly profitable for them. The problems are similar to (1).

or

(3) store sets longer in the hope that demand will pick up again

Which is risky, and typically less profitable than focusing resources on making new sets.



You can bet that TLG spend a lot of effort figuring out how to maximise the profitability of the company. Of course, it is possible that TLG has occasionally made the wrong decision and retired a set too early. I imagine, however, that these occasions are relatively rare (and even if they aren't, I don't suppose they'd tell us anyway).