Company Profile - MGA

MGA UK hits the sweet spot

As Sara Taylor, MGA Entertainment’s new UK & Ireland managing director prepares for her first full year at the helm of this successful and disruptive toy business, she tells Toy World how she plans to continue stabilising MGA from the top down and building upon its success to date with new toy and content launches, a hugely streamlined warehousing operation and much more.

What kind of position does MGA find itself in coming into 2023?

We’re heading into 2023 in a much better situation than we were in at the start of 2022. This time last year, we had double the amount of on-hand and in-transit inventory than we do today. That inventory has taken us the best part of the year to clear down. Starting 2023 with a much cleaner stock holding puts us in a far stronger position. We also saw some record sales weeks during November 2022; while the market was down -5% in the month, MGA was up +0.4%. Overall, according to NPD data last month, we are the No. 5 corporate manufacturer in the UK, year to date.*

Rainbow High has been a particular highlight and sales reads are encouragingly strong. It’s currently the No. 3 best-selling doll brand and was the highest gaining property in Dolls from July to November last year, with sales increasing every single month during this period despite the overall Doll market showing strong decline.*

We’ve worked really hard on bringing newness and innovation to our brands, whilst being very mindful of the economic uncertainties we face heading into 2023. I believe that maintaining £9.99 price points, and even reducing price points on core dolls, will serve us well in the new year. A great example of this approach in action is our newly launched L.O.L. Surprise! Mini Sweets range, which launched in December at £9.99 and £12.99 price points. The range has got off to a very strong start. Our evergreen Little Tikes brand also retains the No. 1 position in Ride-Ons with the Cozy Coupe, as it has done every year since 2019. As of November 2022, it was also the No. 1 Summer Seasonal toy brand year to date – just as it was in 2021.*

In a previous piece shortly after you joined the company, you spoke a little about how MGA is improving its warehousing setup. Can you elaborate on what’s taken place and what it means for both MGA and its customers?

I am delighted to report that as of 12th December, we are finally in one single MGA dedicated warehouse in Doncaster. Warehousing and logistics has been our biggest challenge over the past two years, to the point where we were having to use seven different locations at one stage. I know this has caused a huge amount of disruption and frustration for our customers. I would like to personally thank each and every one of them for bearing with us through these turbulent waters and want to say that I really am looking forward to (quite literally) delivering a great service in 2023. It is a source of huge frustration and disappointment for all our teams when deliveries fail and don’t go out as they should. However, with the people and products we have at MGA, it’s exciting to see what we’ll now be able to achieve with these improvements firmly in place.

You’ve also mentioned your desire to ‘stabilise’ MGA from the top down and further improve relationships with the company’s partners. How will you achieve this?

Stability and consistency are so important to the success of any company, and I believe we are making strong progress towards achieving a very stable base in the UK - not least due to the warehousing fix. I’ve been working closely with our HQ in LA and I’m sharing many best practices which can be rolled out across other global markets.

An example of this is Brand Finance, a vital function that sits between Finance and Marketing, but which was not in place at MGA. On 12th December, Pete Roberson joined us from Spin Master as regional director Brand Finance, EMEA. Amongst other things, this is a crucial role for ensuring our pricing delivers the correct internal and external margins and achieves parity across Europe and the UK.

What is there to look forward to this year in terms of product launches, retail activations, content etc?

Part of the stability I’ve been talking about is being driven by excitement and anticipation for several new product and brand launches in 2023. We have had a phenomenal response in both LA and showroom previews to these developments, and as I mentioned, one of the early launches - L.O.L. Surprise! Mini Sweets - has already got off to an incredible start. We’ll have staggered product launches in every quarter of 2023, supported with best-in-class media, content and instore activations. One of the biggest surprises when I came to MGA was the amount of incredible content we create, which features on just about every platform out there. This high-quality, high-energy content is what makes us stand out so strongly from the competition. And it’s in addition to highly targeted TV and digital media activity, which really brings everything together.

What is MGA’s strategy for navigating the coming 12 months?

Without question, 2023 is probably going to be one of the most challenging years for the toy industry, especially the Q1 period. Low and reduced price points, innovation, newness and collectability are at the heart of our product developments for next year - we want to put the consumer and their needs at the forefront of everything we do.

It is of critical importance that we regain customer trust in our warehousing improvements, so buyers have the confidence to invest their budgets in some of the best-selling brands in the industry, with on-time delivery assured.

We’ll need to be both proactive and reactive to market changes. None of us really know what the economic impact is going to be on us as an industry, or as a nation. Forecasting will really be in the spotlight: we all know having too little inventory can be just as damaging as having too much, and while it’s always a better class of problem when something takes off in a big way, you equally never wants to overdo things (especially in year one).

As I have been telling the fantastic team at MGA UK, we’re going to do all of this while having a lot of fun. It's a lot easier to enjoy your work and have fun when things start working as they should, now we have everything in place – people, product, warehousing - 2023 is going to be a lot easier, and more fun, than it has been the past few years.

*The NPD Group UK, November 2022