State of the Toy Industry Survey: September v. November Results

In September, we took the toy industry’s temperature with our State of the Toy Industry Survey. We decided to check back with you in November and see if the outlook had changed. It had.

Here are the numbers:

Year to date, my business is up, down or flat:

                            Sept.          Nov.

DOWN                                 46.8%        50.5%                         

UP                                        30.5%        31.7%

FLAT                                     22.7%        16.8%

Respondents were more slightly more optimistic about their businesses in September. More than half, 53.2%, stated they were either up or even with last year. In November, that percentage declined to 48.5%.

I predict that at the end of 2020, My business will be:

Sept.          Nov.

DOWN                                  39%           46.5%

UP                                        37.7%        33.7%

FLAT                                     23.4%        18.8%

And respondents are not as optimistic about the future either. In September, 61.1% anticipated ending the year up or flat. That percentage declined to 52.5%. That’s almost a 9% decline.

I predict that at the end of 2020, the toy industry, in general, will be:

         SEPT.          NOV.

UP 5%                                   13%           21.8%

UP 4%                                   3.9%          10.9%

UP 3%                                   11.7%        17.8%

UP 2%                                   8.4%          11.9%

UP 1%                                   7.1%          5.9%

DOWN MORE THAN 5%       31.8%        14.9%

DOWN 5%                            8.4%          5%

DOWN 4%                            0.6%          1%

DOWN 3%                            5.8%          3%

DOWN 2%                            3.9%          1%

DOWN 1%                            3.2%          3%

Here is where it gets curious. In September 52.5% anticipated the entire toy industry would be up or even. That percentage rose in November. 68.3% of respondents predicted the industry, as a whole, would be up anywhere from 1% to 5%. In fact, roughly one-third predicted the industry would be up 4 to 5%.

These results paint a complex picture. The majority of the respondents believe the industry is outpacing them. One-third think industry performance is dramatically better than theirs.

There is no obvious explanation, but here are some thoughts:

Perhaps those who are struggling are more likely to fill out the survey.

Possibly respondents are reading and hearing how well the industry is doing, particularly Mattel, and just assume everyone else is faring better.

Perhaps they think the industry increases are taking place with big companies: Mattel, MGA, Hasbro, and Lego.

And respondents may be seeing who made the Walmart and Target Hot Toy lists and assume those companies will be the big winners.

The bottom line, respondents know their situation better than they know someone else’s. My take away is that though the industry is resistant to the current economic and health issues confronting the country; it is not bullet proof. Companies are struggling, and the final numbers for 2020 may well reflect that reality.

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