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Steven Reece We are a leading Consultancy to kids entertainment brands including TV, toys & games. Our services include cutting edge qualitative consumer insight and consulting with entertainment brands to maximise their merchandising potential.

Board Game Manufacturing – Tips & Pitfalls To Avoid

Posted in Uncategorized on 24 September 2013

Board Game Production – Tips & Pitfalls To Avoid

Recently we’ve had an upsurge in enquiries relating to board game manufacturing and how to find the right board game factory from people/companies looking to manufacture their own games.

No doubt the paradigm smashing impact of Kickstarter has had an impact in this case. Because now there is an option for Game designers/creators to go direct to the consumer without board game publishers as gateway to retail and therefore the end player/purchaser.

However, inexperienced people and board game production can often be an expensive car crash waiting to happen. Here’s some tips & pitfalls to avoid:

1. Think Long & Hard before you press that button & commission manufacturing – the moment you confirm production start/pay upfront manufacturing fees is the moment you are stuck with whatever comes off the production line! So be certain you want to take on the risk before you start. And do everything you can to test demand/interest. We’ve often been asked to look at games where the client has tens of thousands of units sitting in the warehouse because they can’t get anyone to buy them…not a lot we can do at that point apart from hand over the contact details of clearance dealers!

2. Reduce the risk as far as you can – i.e. playtest the game and the game instructions until you can’t bear to play it any more, pre-sell as many copies as you can ideally 100% of your shipment, but if not, the prudent operator would look to pre-sell enough copies of the game to breakeven before even manufacturing. And check for typo’s, spec issues to the most minute detail you and several other people can bear.

Just to emphasise the importance of this point – in the past we’ve worked on Board Games selling tens of millions of copies…and there is no worse feeling than having to eat up margin/delay shipments to customers or having to dump your newly delivered stock due to errors/issues. In the past we’ve gone to such lengths as flying to the board game factory to watch the game on the production line to ensure print bleeds and other factors were as we wanted them. The unsupervised game that makes it into and out of the factory with little vigilance is often the one that causes all the problems!

3. Work with professionals who can fill in your knowledge gaps – there are numerous factors involved in board game production that go beyond what you can expect to pick up as you go along. And the reality is why would you want to take such a slapdash approach when you can employ qualified, experienced expertise to reduce the risk of getting it wrong? You can easily find top quality board game graphic designers who don’t cost the earth, for sure you can find someone else who can make an image look good, but that’s only the glossy part of the process - experienced people can help deliver artwork on spec to the factory die-lines to reduce the risk of errors which will cause you stock obsolescence/money down the drain. You need to find the right factory to manufacture your board game as well…

…so now we’ll look at how you can go about that.

4. What you need to look for in a board game factory –

a). Hunger for your business – there is nothing more dispiriting than trying to spend huge amounts of money with suppliers who aren’t that interested in your business.

b). Fit between your forecast and their overall business – the bottom line on this is there are dozens of good board games factories we could recommend, but not all of them would actually want your business, or even more importantly, be able to fulfil it to the standards we would want. For instance if you want to manufacture 2,000 games for Kickstarter or some other purpose, there are giant conglomerates churning out millions of games who just wouldn’t give your order that much focus, whereas there are smaller factories who are not set up to manufacture millions of board games. Getting the right fit between your order size and factory is normally a key start point.

c). Customer service/communication is key – regardless of what else a board games factory has going for it, if the customer service is poor or absent you will eventually pay the price by way of costly mistakes. A hungry supplier should respond to all your communications within 24 hours unless there are mitigating circumstances i.e. for china board game manufacturing Chinese new year, for USA board game manufacturing labor day, thanksgiving etc.

Above all you need a factory with a proactive, responsive and customer centric approach. There are factories out there who are very production focused i.e. they deal well with the challenges of producing your games, but not so well with interfacing with you.

d). Reliability – this often becomes THE most critical factor, because the bigger your company gets, the more demanding your customer becomes. For instance if you are supplying major grocery stores i.e. Carrefour, Tesco, etc., or US mass market accounts i.e. Walmart, reliability of supply becomes a huge factor for them due to the nature and complexity of their business/supply chain.

e). Competitive costings – many companies we work with focus almost entirely on costings. There is of course no doubt that you need to get competitive manufacturing costs for your board game manufacturing…however, in this day and age the difference between the credible suppliers is not so great as it perhaps once was, and so we find that often while it’s a given that every board games company wants the best price possible, other factors can outweight this concern.

f). No skeletons in the cupboard – your board games factory of choice needs to be capable of meeting the most stringent of ethical and QA audits if you want to build/keep business with major retailers. The reality is that there are companies who can crank out good products at a good price, but in a way which would send a shiver up the spine of most ethical people in the West. Look for appropriate certifications as a start point.

5. Sourcing Agents can save you money and reduce your risk – sometimes even comparatively large board games companies work with sourcing agents to find the right factories in China and other countries. The reason being that the legwork involved can be prohibitive. But perhaps more importantly, a good sourcing agency will pull together a strong credentials deck for any factory they recommend, in effect handing to you on a plate a credible and comparatively more reliable option. Don’t ever pay upfront fees to Sourcing Agents though, their upfront advice should normally be free, with their remuneration coming as a fee based on amount spent i.e. a percentage. This normally works in your best interests because you only buy if the pricing package is competitive, regardless of the agency fees.

We offer a sourcing agency service, so if you have any questions on how to get your board game manufactured, if you are an existing company looking for new reliable suppliers who already supply well known board game companies or if you’d like assistance securing quotes from the right factories, please feel free to get in touch.

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A Glimpse At Future Toy Tech…?

Posted in Uncategorized on 20 September 2013

Future Toy Tech In Action…?

This has to be one of the best portrayals yet of how Technology is going to change to fit around how the user needs it to work versus how it comes out of the box/off the factory production line the easiest.

The mind boggling part of this is that the Toy industry has always been brilliant at taking consumer electronics technology and speccing it to a hot price and hot functionality for kids…just imagine what we can do with this kind of Tech in terms of Toys and the interaction of Toys with the world around the child.

Very exciting times ahead…if you’d like to understand more how the Toy industry is going to change based on Technological advancements, feel free to drop us a line. But in the meantime, enjoy this fantastic look into the not too distant future:

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The Myth Of Cannibalisation – Why Toy Brand Cannibalisation Is An Exaggerated Threat

Posted in Uncategorized on 15 September 2013

Why Most Toy Shouldn’t Worry About Cannibalising Their Own Brands

Most toy companies labour under the misapprehension that their products can’t exist alongside competing products in their own portfolio.

This perspective is true in one sense, but false in another.

The reality is that demand is limited, and consumers will only buy so many Toys. So therefore anything else vying for consumer spend in the same space can be seen as a competitive threat. However, it’s faulty logic to presume therefore that a company shouldn’t have competing products in it’s portfolio.

To give you two huge examples:

1. Monopoly board game - how many versions of Monopoly does the average family need? I can’t answer that question, but I can identify that of the hundreds of versions of Monopoly each has a different positioning/motivation to purchase. And so therefore multiple Monopoly games are sold to the same people…often year after year.

2. Monster High / Barbie – Monster High sits in the adjacent space on shelf to Barbie in numerous stores. It definitely sits in the same category, and yet Mattel’s bright young thing has grown exponentially in a short space of time despite this, with a massive incremental sales boost. For sure Barbie will continue to have it’s ups and downs, but then competition is inevitable…

…so the key point is that by having 2 brands/products on the shelf instead of one your market share improves, and you deliver another competitive threat for the other toy companies in your space to deal with.

None of which means that anybody should aspire to running ‘also-ran’ brands, far from it, in our opinion, you either have ‘heroes’ or ‘zero’s’, there’s no place for in betweens any more.

But the reality is that someone or something will compete with your products & brands, so why not let it be you? Because the more shelf space you have the more leverage you get, and perhaps you might even move towards a category management position with some of your retailers eventually where you control/heavily influence what is listed.

 

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Understanding Children’s Toy Product Preferences – Hierarchies Of Toy Appeal

Posted in Uncategorized on 14 September 2013

We thought you might find this article on our sister website www.KidsBrandInsight.com interesting.

The article looks at why we need to understand how children’s wish lists affect the purchase dynamic for toys & other kid related products:

http://www.kidsbrandinsight.com/2013/09/13/understanding-childrens-toy-product-preferences-hierarchies-of-toy-appeal/ 

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Toy Fair Planning…Get It Right!

Posted in Uncategorized on 10 September 2013

Toy Fair Planning…Get It Right!

It’s about this time in the Toy industry cycle that Toyfair planning becomes a real area of focus.

Toy Fair is your chance to put your company out there, by way of an exhibition stand for anywhere from 3-6 days at the key trade shows. However, you don’t want your company to be out there in the wrong way!

To ensure you make the most of the Toy Fair opportunity for those exhibiting, here’s some handy hints:

1. Set a budget, and stick to it – do you really need those dancing girls/boys, the 90″ Plasma screen and 20 crates of champagne for ‘entertaining’? Probably not! So set the budget & keep to it.

2. Create an inviting environment to present to your customers in -  your buyers are likely to have sore feet, dry mouths, presentation/product overload & more. So why switch them off right from the start? You don’t need to create a prison style environment, when comfortable seats take just a little more organisation than the standard ones provided by the event organiser.

3. Setup to deliver an impactful presentation – sometimes your product does all the work for you, but everybody else has fun product too. So how can you make your presentation go with a bang? Do something different and avoid death by powerpoint if you want buyers to have any idea what you presented to them when they get back to the office & try and remember everything they saw.

4. Seek specialist help to manage logistics/organisation – in a previous role, we brought in a professional Events Manager one year to help us manage an event as we had not been doing ourselves justice. The Events Manager managed to deliver an infinitely better looking, more productive stand & overall show while effectively paying for themselves due to efficiencies & savings made due to their better knowledge and supplier contacts.

We’re still working with that Events Manager and her team today to offer either hands off Consultancy advice, or hands on Project Management for trade show stands, product launches, PR events and more.

If you’d like to know more, please feel free to drop us a line.

 

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How To Find The Right Toy Factory

Posted in Uncategorized on 05 September 2013

How To Find The Right Toy Factory

We began offering our Toy sourcing services by accident.

We found that most companies we Consulted for had gaps in their supplier framework, or in some cases inertia was leading some clients to stay with suppliers who were frankly not up to scratch.

However, while we saw clear opportunity, it would be fair to say that toy manufacturing isn’t the most scintillating topic out there, so we didn’t rush into solving this problem for clients…

…until one particular client practically begged us to help them find the right solutions using our contact networks and resources. And so we did. Since then we have found this to be one of the strongest areas where we can add value to the businesses of Toy companies across the world.

Effectively we operate this service as a Toy Sourcing agency, meaning that the factory pays us for bringing your business to them, so you don’t have to pay us. And of course, if the factory doesn’t deliver the prices/service you need, you aren’t obligated to use them, so far this approach has proven to be a win-win all round.

We work with a comparatively limited number of factories so that we know they are reliable, cost effective, offer good customer service and comply with relevant safety standards.

We have a tick list of critical factors we need a factory/supplier to fulfil before we will consider recommending them.

Every year we’ve been doing this, our business has grown, and every client we introduced to new factories is still using the new factories, so we must be getting something right, despite not finding this a very exciting area of our business it could nevertheless be a useful resource for  your business…

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Don’t Forget The Silent Majority…

Posted in Uncategorized on 03 September 2013

Don’t Forget The Silent Majority…

These are incredibly exciting times for the toy industry. Kids tablets are all the rage with several being top selling items in terms of $value.

Skylanders topped a $billion, and Disney’s Infinity looks set to wow.

On top of all this, came the news that Lego Minifigures, a phenomenally successful low price iteration of the Lego brand will have it’s own toy/digital game crossover offering before too long.

These are all huge trends which are in the process of carving out large chunks of the market.

However, one point to note is that while these tech driven phenomenon drive huge sales numbers, there is still a silent majority we’re in danger of forgetting – that is traditional, non-Tech toys.

Traditional play patterns still predominate if we look at the market share by category stats. An obvious example would be Lego again, which while having many exciting new fangled iterations, has at it’s core the same play pattern that’s been engaging and developing kids for decades.

The board games category, for long written off as doomed continues to plug away year after year, some years up, some years down, but still making up a significant chunk of the business.

Vehicles, playsets and dolls continue to own a massive chunk of the market, even if the brands they are based on are being launched via different media than they might have been before.

And above all, children themselves still continue to want to play with both Tech and non Tech toys.

If you had the patience, permission and inclination, and you stacked up all the Tech toys in Toys R Us on one side of the store, and all the non-Tech toys on the other (I’m not including simple voice chips as ‘Tech’), you’d only have just over an aisle full of Tech toys.

There is no doubt based on kids focus groups we’ve conducted recently that kids are loving the LeapPad, Kurio & Innotab, there’s also no doubt that they are loving Skylanders etc., but in every kid’s bedroom these days is an absolute plethora of toys. At least a box full, if not a whole room full.

Our research suggests that children can get anywhere between 6-30 gifts just from other children attending their birthday parties alone, all of which has to be bought, all of which has to be developed, and all of which drives a significant portion of toy business total sales.

And at Christmas and other key periods, kids today don’t just receive the major headline gift, they get many more smaller presents.

So let’s embrace the opportunity, innovation and momentum provided by all this exciting Tech, but let’s not forget the silent majority plugging away year after year, fulfilling children’s play needs with less technology, complexity and lower pricepoints.

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Understanding The Post Global Financial Crisis Toy Industry

Posted in Uncategorized on 15 August 2013

Understanding The Post Global Financial Crisis Toy Industry

Perhaps this post should have started with ‘anticipating’ versus ‘understanding’ the Toy industry post GFC, but I’m an eternal optimist!

For the first time since storm clouds gathered over financial institutions, and thus the rest of us, there are definite green shoots of recovery, and even growth (albeit slow) evident in several major economies of the world.

There is no doubting that we aren’t yet out of the woods, but recent increases in consumer spending, GDP & several other measures in Europe’s big 3 – Germany, France & UK – heralds a definite upturn.

So as we now look to how the toy business will be in this post financial apocalypse, there are certain evident differences pre & post GFC:

1. Dearly departed retailers – there are numerous previously core retailers who didn’t make it. On balance, while this was very painful for all concerned at the time, it seems probable to me that in the longer term the demise of a significant portion of physical retail chains was inevitable.

2. Bricks & Mortars loss was Online’s gain – we’ve all known this upcoming trend was going to become a massive juggernaut at some point, and between the start of the GFC and now, the momentum/market share uplift has been weighty.

3. Slimmer, leaner, meaner Toy companies – the Toy industry is a great place to work. While there is always a ‘sharp’ end of the business, and while there are always risks, hundreds of Toy companies big & small have had to address overstaffing issues, poor commercial practises & general inefficiency, in order to get through the GFC & depressed demand it’s caused.

4. Brands, brands, brands – brands are critical in this industry, and in the last few years this has become even more the case as retailers fall back to ranges/products which they perceive less risk in stocking, and known brands tick all the right boxes there.

5. Broader pricing spectrums – one of the common themes in many Toy companies ranges during these troubled times have been the introduction of more lower priced products, while at the same time, hero priced products i.e. Kids Tablets etc., have also been hugely successful.

6. Licensor consolidation combined with more power to the Toy companies – one company in particular has seen huge gains in this period – Disney’s acquisitions have been staggering, and as demand picks up & as there movie making machine ramps up, we’ll see continued growth for Disney. Aside from Disney’s massively increased leverage, I see a shift in the power balance between content owners & Toy companies, at least partly because so many of the larger Toy companies are now content developers & owners themselves. And for content owners trying to secure new licensing programs, versus the hundreds or thousands of existing proven licenses out there, let me tell you – it ain’t easy!

7. Cost inflation/reduction in competitive advantage of China manufacturers – if we look back to the happy pre GFC days, China ruled the roost. Today, there is no escaping the sheer scale of capacity & expertise in China, but a fair proportion of the cost advantage has been eroded, which shifts back some demand/opportunity to local manufacturers after decades of focus on China. Those Chinese factories who prosper today are those who embrace reliability, quality & customer service above all…many of the factories we work with in our role as sourcing agents have these qualities and so they are succeeding, even prospering, but those also-rans at the bottom of the pile have already fallen by the wayside!

So the Toy industry today is very different to the Toy industry pre GFC, and while there is plenty that hasn’t changed, we shouldn’t presume that it’s just the same old thing all over again.

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Surviving Adversity In The Toy Industry

Posted in Uncategorized on 25 July 2013

Riding The Ups & Downs of The Toy Industry

Anyone who has been in the toy business for longer than a few years has seen their fair share of catastrophes and rock bottom low moments. If you think about it’s actually completely inevitable that we will all at some point reach that point…

…because we work in a hit or miss industry, complicated by safety issues, intellectual property complexities, aggressive competition, an elongated cashflow cycle and many other challenging factors.

For those of us who toil to produce an annual product line, we’re going to have good years when we launch the hits, and bad years when our hard work frustratingly delivers total dogs onto the shelf…this is inevitable if you play the numbers game coming back for another round of fun year after year, selling cycle after selling cycle.

And that’s just the standard level of risk before we look at other complexities.

Speaking as someone who has made multiple $million mistakes in my career I have to say that at times it’s felt like it’s time to go learn how to park cars or mow lawns rather than ride this outrageous roller coaster ride with it’s thrilling ups and it’s gut wrenching downs.

But like all positive people, there comes a time to dust oneself down, analyse and learn what one can from the mishaps, screw ups and twists of misfortune, and then get back on the ride for the next roller coaster ride.

At the time of writing, there have been some (more) notable problems for significant companies in our industry, and so my message to them and anyone else bumping along near the bottom is that this is a long term game, with multiple ‘innings’, so don’t let a bad innings take the wind completely out of your sails…because the tide always flows back, and so it does for good people, good companies and good brands in this industry.

And in the meantime, here’s one of my favourite quotes about living the moment, taking risk and dealing with the grim reality of failure versus a life sat on the sidelines:

“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.” Theodore Roosevelt (I think he might have known what he was talking about!).

 

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5 Tips For Finding Reliable Cost Effective Toy Factories

Posted in Uncategorized on 12 July 2013

5 Tips For Finding Reliable Cost Effective Toy Factories

If you look at the P&L of virtually every toy company in the world, there is one cost item which accounts for the highest %age of sales – manufacturing. For most toy companies, manufacturing accounts for between 20-30% of net sales value.

That’s a really hefty chunk of costs!

But what’s surprising is how many non corporate companies fail to maximise the delivery of this critical part of their business. Which is not that surprising in one way, in that creating really cool products & chasing/securing licensing deals is much more exciting for sure, and getting the right product to market can create the difference between winning and losing…

…but so can an efficiently managed Sourcing function!

The challenge for those companies not large enough to have dozens of people working in this area is that normally a small team of one or two people is left to manage a huge amount of burden, especially at key times, in terms of order processing & everything else that goes along with manufacturing.

Management time is normally stretched between too many functions, and so the chance to reduce costs, increase reliability & quality compliance is sometimes missed. So here’s 7 Tips to make a difference to your efforts to find reliable toy manufacturing & good toy factories to work with:

1. If you can’t find new toy factories or board game factories, find someone who can – either ask around your industry colleagues or use a good sourcing agent. We offer a sourcing agency service, so drop us a line if you need help finding good factories.

2. Use factory database services – a good example of this is Alibaba.com.

3. Due Diligence – believe it or not, it’s really easy to find ‘a factory’, what is much harder is to find a reliable toy factory meeting all necessary safety standards and delivering at competitive costs. So once you have a shortlist of factories, you need to go through due diligence. For starters, most factories (rightly or wrongly) will tell you who else they are supplying, so find out who their current customers are, and ask these companies what they think of the toy factory. Beyond that, don’t just take the word of the factory that they meet certain standards, get a copy of the certificate, then check with the authorising authority.

4. Know your stuff – in this internet age, most of the information you can possibly need is online. So don’t let the factory tell you what safety standards you need to meet, find out yourself & interrogate the factory on whether they meet the standard. Check out this link for a list of global toy safety standards http://www.toy-icti.org/info/toysafetystandards.html 

5. Visit the factories – your reputation/business is on the line every time you put product on shelf. Why wouldn’t you visit the factory you are considering using? If you add a factory tour trip onto the end of a trip to HK toy fair you will significantly reduce the risk of any issues.

So that’s just a few quick tips to help you find toy manufacturers and board game manufacturers in China & other markets.

iI you’d like to take advantage of our Sourcing introductions service, please feel free to drop us a line. We are working with around a dozen factories who we know well & highly recommend.

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