Bil­lion yuan

China Daily (Canada) - - DEPTH -

fea­ture when the prod­uct line was in­tro­duced in the 1960s.

Thou­sands of wed­gies are still made and sold ev­ery year through school sup­ply dis­tri­bu­tion com­pa­nies, some of which have been Guide­craft cus­tomers since the 1960s. Since 2000, Guide­craft has been pro­duc­ing its wed­gies in China, where about 90 per­cent of its toys are made with the re­main­ing 10 per­cent pro­duced in Thai­land.

“We con­tract out, but we have close re­la­tion­ships with our fac­to­ries, in­clud­ing qual­ity con­trol and sourc­ing teams,” said Alexandra Ro­mano, di­rec­tor of mar­ket­ing, at the com­pany’s booth at the New York toy fair.

Ap­prox­i­mately 55 per­cent of the com­pany’s toy fur­ni­ture is made in Viet­nam, about 40 per­cent in China and 5 per­cent in Thai­land, ac­cord­ing to Ro­mano.

“We have been sell­ing in China for about a year. The of­fice and busi­ness there has been very well re­ceived,” she said.

Guide­craft started out fo­cus­ing on toys for the ed­u­ca­tional or school mar­ket and has sought to ex­pand to cre­ative toy prod­ucts for con­sumers and the ed­u­ca­tional mar­kets. Guide­craft’s lineup now in­cludes build­ing toys de­signed to com­ple­ment the de­vel­op­ment of STEM — sci­ence, tech­nol­ogy, en­gi­neer­ing and math — skills.

This year Guide­craft is in­tro­duc­ing “grip­pies’’ — magnetic build­ing blocks that can be used to con­struct just about any­thing, an an­i­mal, build­ing or per­son. They are called open-ended build­ing toys.

“This is prob­a­bly the star of our show be­cause it ap­peals to the retail cus­tomer and school-sup­ply cus­tomer,” Ro­mano said.

Middle class sales

She said Guide­craft is keenly aware that China’s ris­ing middle class can trans­late into more sales. “We are just one year into sell­ing there, and it is grow­ing. Be­cause the fam­i­lies are smaller in China there is a lot of fo­cus on the one child from the par­ents and grand­par­ents. They want to give that one child ev­ery ad­van­tage in­tel­lec­tu­ally, so it makes a lot of sense to pur­chase an ed­u­ca­tional toy,” she said.

Andy Xie and Sean Jiang of Jiangsu Guo­tai In­ter­na­tional Group Guo­mao Co Ltd based in Zhangji­a­gang City in Jiangsu prov­ince were sur­rounded by all kinds of plush toys at the com­pany’s booth at Toy Fair.

“We make and sell our own line and we also do some con­tract man­u­fac­tur­ing for other com­pa­nies as well,” said Xie.

The com­pany mar­kets the toys in the US and China. “Com­pared to Europe, Amer­ica has been steady the last few years,” said Jiang, not­ing that Europe has faced a slower re­cov­ery from the world fi­nan­cial cri­sis than the US.

He said China’s eco­nomic slow­down is start­ing to af­fect the toy in­dus­try. “We are still grow­ing, but at a slower rate than be­fore,” he said.

Like Zhang, Xie said his com­pany is con­sid­er­ing mov­ing some pro­duc­tion to Viet­nam be­cause of lower la­bor costs.

Par­ents’ in­flu­ence

In an­a­lyz­ing how toy buy­ing de­ci­sions are made, Jiang and Xie noted the in­flu­ence of par­ents.

“I think when the kids are young the par­ents pick the toys for them. When they get older, they want to make the de­ci­sion them­selves,” said Xie. “That doesn’t nec­es­sar­ily mean the par­ents will al­low that.”

In ad­di­tion to la­bor costs, the IBIS re­port said the toy man­u­fac­tur­ing in­dus­try needs to tackle a short­age of de­sign­ers.

“Al­though do­mes­tic toy com­pa­nies have be­gun to ad­dress this is­sue, qual­i­fied and in­no­va­tive lo­cal de­sign­ers re­main scarce. Large ex­ist­ing en­ter­prises at­tract new tal­ent in de­sign fields by of­fer­ing large salaries and ben­e­fits. As a re­sult, there is a very lim­ited pool of tal­ent for new en­trants,” said the re­port.

An­other is­sue the in­dus­try has to fo­cus on is prod­uct qual­ity and safety ac­cord­ing to the re­port. In 2007, many Chi­nese-made toys were re­called in the US due to qual­ity is­sues. Many Euro­pean coun­tries also re­duced toy im­ports from China.

Chi­nese man­u­fac­tur­ers were forced to ad­dress the con­cerns, the re­port said. Still the re­port noted that ex­ports tend to be of higher qual­ity than the toys sold in the main­land.

Con­tact the writer at paulwelitzkin@chi­nadai­lyusa. com.

ZHU YINWEI / FOR CHINA DAILY

Ryan Zhang, owner of Jiangsu Holly Ever­last­ing Inc

A boy plays with gi­raffe-shaped Lego bricks at a toy fair in Hangzhou, Zhe­jiang prov­ince.

in 2015 ($9.7 bil­lion)

*es­ti­mated

Source: Euromon­i­tor In­ter­na­tional

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