Retail Profile - Toymaster

Changing the game at Toymaster

The independent toy buying group Toymaster is planning some changes to the way it operates, placing greater emphasis on its FOB programme and shifting internal roles to better reflect the strengths of its team members. Paul Reader, Toymaster’s commercial director, paid a visit to the Toy World office to chat with Rachael Simpson-Jones about what these changes will mean for members and suppliers, how the group is helping indies overcome challenging trading conditions and why a one-size-fits-all approach doesn’t always work.

Toymaster has been around since 1989. The buying group helps independent toy retailers compete in the marketplace. Its mission is to help members trade more profitably by building strong relationships with suppliers, working closely with big name brands and products, securing indie exclusives, and working on a full 12-month marketing programme including window and in-store display materials, promotions and loyalty schemes. It also produces an annual consumer Christmas catalogue in three different page configurations to suit every member’s needs and offers advice on all aspects of toy retailing when required. Its bespoke Toymaster Information Management System (TIMS), meanwhile, streamlines members’ accounts and invoicing, freeing up more time to spend on the shop floor and allowing the retailer to run their business efficiently.

It’s a popular, well-respected, well-run group. Yet despite this, Paul, ever the pragmatist, says the group has had to face up to the challenging retail sector. Recruiting new bricks & mortar retailers remains a priority to strengthen the group’s position in the market: a stronger independent sector is both important and necessary. Toymaster recognises that it must adapt, improve its current offering and continue to support its existing members and suppliers.

To this end, Toymaster is turning its attentions back to its FOB (Free On Board) programme. Long a successful mainstay of the group’s strategy, it has always been about the best performing brands and mostly hinged upon a spring/summer range previewed in October, delivered in January/February, and an autumn/winter range previewed in March and delivered in August. Paul credits Zuru for changing the group’s outlook on FOB. Its ever-changing, trend-led assortments mean Toymaster needs to take a more year-round approach to FOB lines that, in turn, will provide its members with a higher turnover of new product to tempt shoppers back again and again.

Brian McLaughlin - an experienced buyer with a background at Toys R Us and Early Learning Centre and the group’s development manager of some five yearswill be transitioning to a new role overseeing the group’s reinvigorated FOB programme, working alongside the Member Committee. He will also continue to support the group on new business development and play an integral role in supporting the management team at Northampton. “Brian moving to a role that better utilises his skill set means we can free up time to get more involved in the retail side of the group, something we’ve wanted to do for ages,” explains Paul. “We still have the enthusiasm, energy and desire to make a difference and we want to make a more serious contribution to helping our members trade more profitably. As a team, we’re proud of how much we’ve listened to our members over the past couple of years. Our regional meetings and our May Show in Harrogate are great for bringing people together but it’s hard to pin everyone down and canvas them on the things that really matter, especially when everyone is so busy. Being at (and understanding what is happening at) the coalface is so important: we want to be getting out there into our members’ stores and hearing that feedback first hand.” At the same time, Paul is upfront about the fact that being at the coalface means taking a step back from other areas of the business, especially the product side. He still finds it hard to let go, but, he says, the time is right. He is also effusive in his praise of his colleagues: clearly, the problem is not a lack of talent. He says: “We’ve got a strong team looking after the members, suppliers, product, marketing and graphics, not forgetting analysis and data collection. All these areas of the business are important, and we’re looking to build, grow and develop this year together with the help of our Member Committees.”

If there’s one thing that its decades of experience have taught the group, it’s that a one-size-fits-all approach does not always work. With its vastly diverse membership, focusing on the different retail types within the group is going to be a real focus for this year.

Toymaster’s approximately 140 members, who between them own and run 280 stores, span everything from high street single stores, shopping centre and out of town retailers (including several garden centres) to so-called ‘seasiders’ and truly niche specialists. These different stores have different needs. “What we are seeking to do is better understand every one of our members and devise bespoke support solutions for each,” Paul says. “For our seasiders, for example, July and August can be the equivalent of Christmas, whereas those might be quiet months for members in areas that don’t see much tourist footfall. We know traditional ‘mom and pop’ retailers very well, but even here there is more to learn: we need to layer on the knowledge of what everyone else requires from us. We can only do that by getting out there and asking them what it is they need.”

Paul and I also discussed the nature of the indie sector in terms of recruitment. He says: “It can be difficult. There appears to be little in the way of fresh blood coming in, and stores are rarely being passed down through the generations when owners reach retirement age. However, there is a silver lining: indies that close in lucrative locations leave a gap into which an existing member could insert a second (or third or fourth) store of their own.” Toymaster is analysing these opportunities carefully and drawing on the extensive knowledge of its members to exploit the situation in a way that benefits the industry and its members. After all, older indies = more experience. But perhaps the answer here isn’t new indies, necessarily, simply more of them?

Without the luxuries of an own label brand or other commodities to fall back on, and dealing only in toys and games, Toymaster’s relationships with suppliers are crucial. It seems that for some, though, the myth persists that the indie sector is too difficult to work with because there are too many individual stores. This is clearly a bugbear for Paul, who’s very keen to dispel the falsehood. He says that once suppliers start working with Toymaster and its members, they quickly realise the group is laser focused on ensuring their success. Toymaster’s members, he tells me, have a very important role to play in brand building, as has been proven time and again: when Spin Master’s Paw Patrol range first launched, for example, it was indies which gave it the exposure it needed to shine. But the support must go both ways. One of Paul’s frustrations is that exciting product viewed at international trade shows and previews, which the Toymaster Committee will offer positive feedback on, often doesn’t make it to London Toy Fair. When asked why, the answer is usually that ‘it wasn’t right [for the market]’. Reading between the lines, the assumption is that it just didn’t receive enough interest from the major toy retailers, even though it would have been perfect for indies. “If you’ve got an opportunity and other majors have passed it by, then talk to us,” he implores. “We really can make it work - or at the very least give it a chance.”

During the past couple of years, there’s been much discussion of who should get new launches first. Toymaster’s position has always been that no one can react quicker than an indie, especially on emerging trends, and that its members are passionate about raising the profile of new launches on social media. Some suppliers have offered superb support as a result, including Ravensburger, which launched (and continues to launch) its Disney Lorcana TCG at Indies and hobby stores a fortnight before it arrives at the nationals. Paul would like to see more suppliers debuting new ranges with indies first, ideally. He says: “As individuals, indies might not shout the loudest, but as a collective we can make a heck of a lot of noise.”

A more recent area of debate has been the aggressive pricing activity witnessed in the run up to Christmas, with several majors slashing RRPs on toys tipped to be Christmas best-sellers as early as October. The extent of the sales activity - and the brands caught up in it - certainly raised a few eyebrows from many in the industry, but Paul says some Toymaster members held firm on pricing regardless – and did very well. Other members opted to compete on price, which you could say is just as bold a strategy.

“It’s getting harder to maintain margins,” Paul explains, noting that the group’s margins have declined two years in a row, something that will be addressed and is apparently a top discussion priority with suppliers. “We have this saying: ‘it’s only margin when it sells’. You could have a product on the books with a 55% margin but if you can’t sell it, well, there’s no margin at all. Indies must buy the right lines at the right price point; it’ all about buying smarter. For this we will need the support of all suppliers if we are to improve our profitability. 2024 is the year we all should be looking to buy better.”

Elsewhere, the group will be guiding its members on better ways of stocking big name brands and allocating sufficient space in store. In a nutshell, there are instances when too many indies are trying to offer too much, when instead they would perhaps benefit from narrowing down the SKU count and focusing instead on key price points and best-sellers. Pokémon remains a huge brand for the Indies and Disney Lorcana has got off to a very strong start. Paul hopes the momentum of the TCG will be maintained as each successive chapter in the story is released. He’s also expecting big things from Asmodee’s Star Wars Unlimited TCG, which the group is helping to launch at Toy Fair. If you fancy a sit down, a cold drink and a card game at the show, head to the Toymaster Lounge on the Upper Level. The team will also be on hand to catch up with members and speak to prospective new ones about the benefits of joining the group.

In 2024, it’s clear we’re going to see a different approach from Toymaster, with an enhanced focus on FOB, a more tailored approach to member support and an internal reshuffle that’ll allow the team to serve its members even better. For 35 years, the group has set out to help its members trade more profitably – and coming into the New Year, this promise has never been so important.