Boxes loaded with hits for openings by prominent breakers or social media videos, all done in the name of drumming up excitement or rewarding its biggest volume customers? Fanatics/Topps insists it’s not true and now says it has an independent auditing firm’s report to prove it.
At the company’s annual Industry Conference in Atlanta Tuesday, Fanatics Collectibles CEO Mike Mahan announced that KPMG, one of the nation’s top firms, had examined the company’s processes over several months and found that its processes “prevent employees from directing high-value cards to specific customers.”
Fanatics/Topps had always asserted that the controls of its collation and packaging process were such that no funny business was going on, but decided to engage with KMPG to have an outside firm look at the process of how cards go from printer to pack. It was the company’s answer to an ongoing barrage of comments from collectors and dealers who felt jilted whenever a large breaker pulled a string of a product’s better cards.
“We believe that’s all nonsense. It’s absolutely bonkers and we wanted to come up with ways for dispelling that myth,” Fanatics Collectibles Chief Financial Officer Greg Abovsky said.
Topps insisted its pack out procedures prevented the company from knowing where any particular case or box was going, or what was inside. Abovsky says KPMG’s team of auditors looked at potential risks in the process, which employees are responsible for controlling that risk and whether they were doing their job. As part of the audit, KPMG went to the Texas facility where the cards are printed and examined the process while examining the production logs that are filled out for each job. KPMG found the collation and randomness Topps promised was being achieved.
“It is important to confirm for collectors that the process of packaging and distributing our cards is truly random,” Mahan stated.
Topps is well aware of social media posts and videos that claim otherwise but says large breakers often pull big hits because of the volume at which they’re buying and opening product—everything from Series 1 Baseball to the company’s highest end brands.
“These breakers will go through tens if not hundreds of cases of product and what tends to happen is they’ll find a few high-value cards, which is exactly how it should be based on statistics but because that’s now on video and viewed tens of thousands of times and shared and re-shared, there’s this impression that, ‘oh my god, the breakers are the ones getting all of these high-value cards.’ The reality is just in statistics. When I open a box of Bowman, I have the same statistical chance of finding those high-value cards as a breaker does but what you and I don’t do is we don’t go through 100 boxes on a regular Tuesday.”
When asked if there has ever been an instance in which Fanatics decided to seed a box with a valuable card for promotional purposes, Abovsky answered a flat “no.”
The idea of an audit was brought up not long after Mahan became CEO of Fanatics’ collectibles business, one that will eventually encompass NFL, NBA, UFC and WWE trading cards in the coming years.
“To the best of our knowledge, this is the first time it’s ever been done. When we started approaching the various firms to do this randomness assessment, all of them were going ‘huh, we don’t think this has ever been done before. We’re pretty confident this is the first time.”
In their processes, KMPG and other auditors can determine whether it believes Topps is doing what it’s supposed to but can’t make suggestions for improving the process.
Topps officials say it won’t be the only time they plan to hire an outside firm to examine its processes. Abovsky says the company will conduct the randomness audit on an annual basis but hopes the first one shows the company is committed to addressing issues brought up by its customers.
“We want to be listening and we want to be doing, not just paying lip service.”
Related Stories:
Fanatics Collectibles Hires Omar Wilkes for Athlete Relations Role
Fanatics Collectibles Hires Ken Turner for New Chief Marketing Role
Topps Announces Redemption Extension
Topps Announces Chrome Basketball, Other Upcoming Hoops, Football, UFC, Soccer, F1 Releases
Sudden Resignations at Panini as Fanatics Looks to Fill Trading Card Positions
Panini Takes Fanatics to Court Over Employee Departures
Notes: Dating Michael Jordan Rookie Card Photos; Big $ for ’69 Basketball; Fanatics Jobs; Tim Talks Autographs
Notes: Bedard Day; Fanatics Strategy; Sesame Street and 1972 Topps Football; Simms, Florio Talk Memorabilia
