TOTAL LICENSING By Jacqueline Vong
Toronto-based Jacqueline Vong is a China market specialist and tracks Asian developments in the marketplace with her editorials. She currently owns a consultancy called Playology International specializing in licensing, franchise management and content development and sales for North America and Asia. You can reach her @PlayologyIntl or www.playologyintl.com
Josh Punin (above) and David Selvaraj, of DJ Indian Sourcing and Manufacture Consulting. You can reach both of them via Josh at jpunin@toysasiapac.com.au
India’s Toy Story As the anniversary of the first international reported case of Covid-19 has come, we have seen a growing interest in relying less on the Chinese market for manufacturing. There are a number of reasons to look beyond China including labour prices, exchange rates, container availabilities, long holidays delays. To further support this, Josh Punin of DJ India Sourcing and Manufacture Consulting states, this is “driven by retailers in US where they need to start seeing a diversification and production outside of China. It’s not about taking away opportunities from China.” As 75% of the world’s toy manufacturing comes out of China and only 1% currently comes out of India, it is time to explore the emergence of India as a manufacturing power. David Selvaraj, a partner from DJ India Sourcing, has highlighted some key advantages to manufacturing in India. Population: India is the only population in the world that can rival China’s workforce. 60% of the population of India are the younger generation and are in the labor force or entering.
24
Labor Cost: Labor cost is relatively stable with little indication that it will increase dramatically in the next 5 years. Comparatively, China’s labor cost has been rising year over year. Currently the labor cost in India is approximately one third of the Chinese. Language: The fact that international business is done predominantly in the English language, and there may be less lost in translation moments when dealing with manufacturers over in India. Experience: The manufacturing of toy goods has matured day by day with major companies paving the way such as Hasbro, Mattel and Spin Master. The manufacturers are expanding their factory capacities. And, under the guidance from international best in class companies like Walmart, and Amazon who just announced recently that they are setting up their first ever manufacturing line in India, the manufacturing sector is poised to learn from the best. Government support: The support of Modi’s Indian govern-
ment on labor laws, taxation and compliance, the foundation is being laid down for this country. The government is promoting state governments to open toy parks in special economic zones in various states like Bangalore, Gujarat to further create economic incentives for business owners to invest in manufacturing. Vaccination roll out: Manufacturers were prioritized in the Indian vaccination roll out so there is sufficient work force ready for any new business inquiries. Tech: Software vendors around the world consider India as one of the most lucrative and high potential markets in the world. The growing number of data centers in the market, the development of new age telecommunication and artificial intelligence automation coming out of India are proof that India is becoming a very important market in the technology world. India has come a long way and under the right conditions, it is quickly organizing itself on the global and domestic stage to be a big manufacturing player in the toy industry.
