Gifts / Sports & Toys

According to the observation report of Huacheng's import and export data, affected by the high international oil prices and other factors, toy multinationals Mattel, Hasbro, Lego and other enterprise products have recently adjusted their prices, and some varieties have even increased by more than 20%. China is the world's largest toy producer and exporter, and the second largest toy consumer market. How is the current operation of China's toy industry? Will China's domestic toy prices follow the trend? With regard to these consumer concerns, the author interviewed Li Zhuoming, President of Guangdong Toy Association, the largest toy production base in China, when the 34th Shenzhen International Toy Fair was held in Bao'an New Hall of Shenzhen International Convention and Exhibition Center from August 18 to 20.

The market is severe and complex. Li Zhuoming said that the operation of China's toy industry in 2022 will be complex and severe.

In terms of product export, from January to June, the export of Chinese traditional toys reached 21.399 billion US dollars, up 24.7% year on year. Although the results seemed good, many enterprises suffered from poor profits due to high raw material prices and rising production costs. What is more serious is that due to the repeated impact of the global COVID-19, the demand in the international market tends to weaken. The growth rate of product exports increased by 28.6% year-on-year in January, and fell to less than 20% in May. Huacheng import and export data observation report.

According to the observation of the import and export data of Huacheng, there are no small difficulties in the domestic market. Due to the frequent outbreaks of the epidemic, wholesale markets, shopping malls, supermarkets, off campus stores, boutique gift shops, amusement parks and other major toy distribution places across the country are closed and closed from time to time; Toy sales on e-commerce platforms also suffered from poor logistics, slow delivery and poor consumption experience.

In terms of price, the current horizontal competition is still fierce, so although the price of raw materials is soaring, the overall price of products tends to rise, but the range is not large. The market retail price of some products, such as electric baby carriages, has even decreased year-on-year.

Consolidate the industrial chain

China's toy industry is export-oriented. With the formal entry into force of the Regional Comprehensive Economic Partnership Agreement (RCEP) in January and the elimination of epidemic isolation measures in Vietnam and other countries, the production cost of toy enterprises in Southeast Asia is far lower than that of China. Some people worry that overseas orders of Chinese enterprises will gradually drain.

In this regard, Li Zhuoming believes that China's toy industry has developed in the market competition. Take Guangdong for example. Guangdong produces and exports about 70% of toys to China, accounting for about 50% of the global market. Faced with the rising competitive pressure at home and abroad, enterprises strive to create their own brands to research and develop products to enhance added value. By the first quarter of this year, the "general trade" proportion of Guangdong toy private brand exports had risen to 43.9%, while the "processing trade" had declined to 27.2%, which also reflected the achievements of China's toy industry transformation and upgrading. In fact, China's toy enterprises now attach great importance to technological innovation. With the help of industrial Internet, they are thriving. The cultivation and incubation of "specialized, special and new" and "small giant" enterprises are also very effective. Huacheng Import and Export Data Observation Report.

As the production technology of toys is leading the world level, it is difficult for international competitors to replace the advantages of Chinese toy enterprises. After the Sino US trade friction, some multinational toy companies tried to transfer their orders to other countries, but because the product quality, construction period and service were difficult to guarantee, the orders returned to Chinese manufacturers. Based on the technology and industrial chain advantages of toy enterprises and the good atmosphere of the overall business environment, China's toy industry continues to maintain its competitiveness in the global market.

"Specialization and innovation" for breakthrough

It is another interesting trend for China's toy industry to actively form a differentiated development of "specialization, refinement, and novelty".

Li Zhuoming introduced that although the per capita toy consumption level of children in China is not high, the population base is large, and it is the second largest toy consumption market in the world after the United States. In 2021, the consumption of traditional toys in China is estimated to be 77.28 billion yuan, and with the addition of fashionable toys, the market consumption will exceed 100 billion yuan. Such a big cake has attracted world famous toy enterprises to enter China and seize the market. For example, the "Toys R Us" in the United States has continued to expand more than 200 stores, and the "Lego" brand retail stores in Denmark have sunk to the third and fourth tier cities.

Facing the strong competition of international big brands, Chinese toy brands, apart from the competition of high performance price ratio, have opened up a new way with "specialization, specialty and novelty". For example, building block toy enterprises have developed products with local characteristics, such as "Liaoning No.", "Forbidden City" and "Anhui Folk House", by taking advantage of the current strong domestic trend of "national economy". At present, many enterprises in Guangdong Province, such as Senbao Building Blocks, Qunlong, Xiongcheng Plastic, and Goldes, have been recognized as "specialized and new" SMEs by government departments at all levels.

Diversified development of toy consumption

Li Zhuoming said that despite the complex and severe operation of the toy industry this year, with the efforts of enterprises, there have been some gratifying changes in the market. Bing Dwen Dwen, the mascot of the Olympic Games at the beginning of the year, is hard to find. Recently, consumers have rushed for the reachable duck toy matched with KFC's set meal. Behind this is the trend that toy consumption has been successfully expanded to young people, which will provide a broader field for the industry to expand. At present, more enterprises try to launch NFT toys (digital toy collections) while the universe is hot, and they have also achieved some results. Huacheng Import and Export Data Observation Report.