Opinion - Rick Derr - Letter from America

Opinion Looking forward to 2024…

After 20 years working at A.C. Nielsen/D&B Research Company, Rick opened the first Learning Express Toys franchise in the Chicago area in 1996, and then became a sub-franchiser, opening nine more stores. Although leaving the corporate environment behind, he has combined his expertise in data and numbers with a passion for the toy retail space. This month, Rick shares with us how the year has ended up for indie retail in the USA and tells us his personal highlights.

Did I see the grumpy old Grinch lurking in the shadows of Christmas? We have no time for a furry, green mean-spirited personality here, although we love green, as long as it’s dollars.

While the first 10 days of December started off with promise - and sales roughly on a par with a year ago - we then experienced a marked drop in footfall and dollars spent. As someone who’s been a retailer for the past 28 Christmases, this one certainly ranked near the bottom in terms of excitement, both from a product perspective as well as from a human perspective. The atmosphere has been very low-key here in Chicagoland and I’m not sure whether this is because of the warmer than usual weather patterns; because of the economy (although November had showed strength in consumer spending); because of world events or even the many other concerns right now. It’s anyone’s guess. Writing this in December, my prediction is that the year will end up with about a 5-10% decline in dollar sales year over year for the month, and that would mean an overall decline in the 10-12% range for 2023.

On a brighter note, 2022 was in the top four all-time sales years, so at least such a drop will reflect a resetting of a new normal baseline. Volumes are still 25-30% up versus pre Covid levels. Our goal is to maintain this level and start a steady growth from these new levels. Here’s to a solid and more exciting 2024.

Looking back, 2023 did bring great joy for me personally, as I grew my network of toy friends and was able to keep learning globally. Here are several memorable highlights for The Toy Man:

• Working with the Incubator Mentor at our local High School

• Testing the Zigazoo platform for social media during 2023.

• Attending the Toymaster Harrogate show in the UK, where I found my No.1 seller.

• Attending ACD Games Days and learning about true game stores and their growth.

• Meeting with several inventors and testing out many new concepts/products in store.

• Joining the MESH (Mental Emotional Social Health) advisory board.

• Attending ASTRA (Association of Specialty Toy Retailers) in June, where I was also given the opportunity to be a speaker.

• Leading Franchise Council for the 10th year at Learning Express Toys and talks at our Convention in June.

• Completing Certified Expert Play Training in July with certification.

• Being one of five Indie toy stores to host the YIC (Young Inventors Challenge) by People of Play.

• Attending LA showcases and New York Toy Fair.

• Being nominated for a Tagie Award as Indie Toy Retailer along with Midco Toys (UK)

• Being awarded the President’s Lifetime Achievement Award for Volunteer Service working with Kidz Korna in the city of Chicago. Signed by Joe Biden.

Looking ahead, I do see headwinds continuing to affect the toy industry. Hasbro has already demonstrated that with the cutbacks it announced back in December. My two biggest concerns for the year ahead, here in the states, are a slowdown in new products (perhaps still the lingering effect of the Covid pandemic?) and the massive credit card debt the average American consumer is undertaking right now. This is not sustainable and there will be a correction at some point.

I hope all Toy World readers had a happy and healthy holiday, and my wish for you is that you start the year 2024 with the positivity and joy that the toy industry brings to us all. Thank you for making me feel a part of your community as well.