As the curtain sets on another New York toy fair, and as those exhausted souls who have been mostly on the road attending toy trade shows so far in 2020 head off for some well earned rest, there are a number of clear conclusions to be made about the toy industry in general and about the New York Toy Fair itself.
Firstly, as ever, this show remains the best place to access the lucrative North American toy fair. The show is always a great mix of pizzazz, product presentation and inter personal meeting, this year lived up to the high standards set in recent years. The great and the good of the North American toy scene were in attendance as per usual and the selection of new toy products on display was epic!
The ‘C’ word (in this case meaning the coronavirus) was still a topic of conversation, and there is no doubt that there were very few Chinese visitors in attendance in New York. Since the show ended the virus has surfaced in a number of other countries round the world. Whether we see the virus as a serious global health risk or not the reality is that this pesky virus HAS affected supply chain for the toy business and other industries. There is a genuine risk of global recession as airlines cancel flights, stores are at risk of running out of stock and stock markets have tumbled. If you take a month of economic activity out of the global economy, then you inevitably risk ending up with a recessionary environment. We’re all hoping this thing clears quickly and we can all get back to work sharpish! At least in the toy business we have a business which is over balanced towards the last 3 months of the year, so we have a good opportunity ahead to chase sales, unlike some other industries/categories.
We sat in on a fascinating presentation lat New York Toy Fair lead by the team at ICTI looking at alternative sourcing locations outside of China. While there has been a trend brewing for a few years for outside of China toy sourcing, this trend looks likely to accelerate based on this panel discussion, as people question the prudence of a complete reliance on one country as the source of nearly all their products. Going forward, we expect China’s ‘OEM’ business i.e. contract manufacturing product for other companies to reduce, but the business for self developed products and brands from China to grow significantly. Seems like it is time for China’s toy manufacturing sector to take a step up the value chain, and in doing so to elevate their economy and living standards for their people, which should be applauded. It does though mean that the classic low labour cost production model in China is heading towards the beginning of the end, and prudent toy companies are already looking elsewhere. It’s likely to be a bumpy road, because China’s toy manufacturing sector has become so reliable, so efficient and so integral to the global toy business.
One other clear trend in New York was the environmental theme. This was such a prominent theme at the Nuremberg toy fair this year, but the question was whether this mighty and much revered land of gas guzzling vehicles and mass consumption would pay similar attention to this topic. New York toy fair 2020 was the time and the place where it became apparent that there is a truly global acceptance of the need for a move away from so much plastic consumption, with major announcements and initiatives from many exhibitors.
Finally, on the last day of the show, we sneaked away early to go for a guided tour of the United Nations building in New York. In the forums of this building and institution humankind has managed to avoid the senseless mass scale conflict which dominated the 1st half of the 20th century. We finished our 2020 toy fair season by reflecting on meeting people from all around the world at these toy shows including people from China, the USA, Russia, the Middle East, Europe, South America and anywhere else in the world. The world order may be changing, and there may be a lot of division out there in a political and social sense, but above all we humans remain truly inter connected. The corona virus is not just China’s problem and the planet and environment are shared by all of us. China is not leaving the toy business, just redefining roles, heading towards a move from engine room to top of deck.
What makes us different does not mean we can’t get along. Toy fair season is the ultimate proof of how inter connected humankind is, and in the end, we win together or lose together – so here’s wishing for peace and prosperity – toy fair season 2020, over and out!