11/14/19

Opportunities for Success with a Small Toy Store Business in 2019 and Beyond


By on 11/14/2019 02:14:00 PM

The toy industry is primed for growth over at least the next two years, according to NPD's 2019 report. And if you're looking to set foot in a small business startup, opening a toy store could be a great idea given this outlook. However, there are several things you'll want to consider as you seek to establish a successful enterprise. Here are some key points.

What is your niche?

Although growth is forecast in the toy industry, not all categories are equal. The NPD report highlights action figures and accessories, dolls, and games and puzzles as the strongest categories for growth. Also mentioned are arts and crafts, building sets, and outdoor and sports toys.

While you may be better positioned to take advantage of industry growth by focusing on one of those categories, remember that competitors also have access to the same information and may make the same business decisions. It may be necessary to further define your niche; otherwise, everybody's success takes a dip if you all end up doing the same thing.

Focusing on what you're good at and what you love doing is pretty standard business advice, but often ignored in the world of e-commerce where you feel constant pressure to be the best at everything and perform in every metric. If puzzles are your strongest product, consider specializing in a specific age range, or using a signature material or process, such as hand-carved wood. This will make you the go-to supplier for that particular niche for more customers in your area.

Should you go, all-in?

At the opposite end of the spectrum, you also have the option to go all-in on mass distribution. If you can arrange a wholesale agreement with a distributor or manufacturer, then you can stock specific products at a lower overall cost. You can even work with overseas suppliers, as their cheaper labor and materials costs allow you to pass on savings to your customers while turning profits.

However, there's a cautionary tale in the downfall of Toys R Us; e-commerce can undercut even the biggest toy companies significantly. In all likelihood, you can't offer a lower price point on models that are already being sold in bulk by online stores. When opting for mass distribution, your best bet is to capitalize on a hit toy that isn't widely available online.

Can you manufacture a hit?

There's a possibility to nail both the advantages of establishing your niche and working with economies of scale, and that's if you happen to create your own hit toy design. There's no specific formula that works, but you can gain insider insight into what works by attending industry conventions. Do some networking to find a designer and a manufacturer whose work you like, and have them create your prototype.

Once you have your prototype, you'll want to gauge interest - and raise investment. Don't forget to patent it, and you can set about making arrangements for mass production. Custom molded plastic products, for example, can be executed by local suppliers at lower costs for high volume orders. With a cost-efficient supply line and a potential hit toy on your hands, you can work on the marketing and turn e-commerce in your favor as the sole supplier of your product. This route to success carries the most question marks, but if you're passionate about toys, it's also potentially the most challenging and exciting.

Kids are always going to demand toys, so the potential to succeed with a toy store business is there. You just have to find the right approach in a changing industry to ride the forecast for growth.

About Angela

Angela is a freelance travel writer and lifestyle blogger, blessed with 3 beautiful daughters, 5 moody cats, 1 spoiled dog, and 1 very supportive husband.

0 comments :

Post a Comment