From the publisher

As this issue lands on desks and in inboxes, the all-important Q4 will have just begun. And even at this late stage, the next three months remain incredibly difficult to call. According to this month’s NPD article, toy sales YTD to the end of August were down -4% in value, although the summer months actually saw sales increase over last year, helped by the prolonged period of warm weather.

However, we all know that Q4 is where the big swings can happen – either way. On the one hand, we can take comfort from the fact that parents will always do their best to keep their kids happy at Christmas – I doubt that will ever change. But we can’t ignore the fact that consumers are dealing with significant increases in the cost of living and especially energy costs.

As Toy Barnhaus points out in this month’s column, many families are shopping earlier than ever this year, perhaps ensuring that gifts are bought and paid for before the massive jump in the energy price cap takes effect. As we head deeper into the festive season, it’s going to be imperative that consumers perceive they’re getting good value– although that doesn’t necessarily just mean the lowest price – and crucially, finding the presents their kids really want. Let’s hope that the recent strike action at the Felixstowe container port doesn’t disrupt the supply chain too dramatically.

Giving consumers a positive in-store experience is also going to be important – and that’s where specialist toy retailers can really capitalise. According to the latest NPD research, specialist toy retailers represent the fastest growing retail channel for purchasing toys in the UK so far in 2022. Even better, ‘Toy Specialists’ is now the joint largest channel along with online-only retailers, accounting for 30% of all toy sales by value in the first half of the year. It seems that shoppers have been heading back to specialist toy shops on the High Street and retail parks, with a marked move away from internet shopping, which is tracking -20% down in the same period. No disrespect to the online retailers, grocers and major multiples, but I see this as positive news for the UK toy community – personally, I feel a balanced toy market is a healthy market.

Of course, it’s important to keep these numbers in perspective: the shine may have come off online sales in the short term, but it’s far too soon to talk about the bubble bursting, especially as so much can change in Q4. The same could be said of the performance of the grocers and some of the major accounts. They all still have the capability to deliver strong sales numbers, and we may yet see them come into their own over the festive season. But right now, it feels that the strengths of the specialists – in-depth product knowledge, customer service, flexibility, the ability to jump on trends quickly, passion and focus – align with what many consumers appear to be looking for in their shopping experience.

Perhaps that is part of the thinking behind Tesco partnering with The Entertainer, which will be taking over the running of the toy department in around 35 of the grocer’s stores. If The Entertainer can bring what it does best to the partnership, it will have access to a huge number of consumers on a regular basis – that has all the hallmarks of a win-win arrangement. I understand that the aim is for the new stores to be open in the second half of October, in time for the all-important festive selling season. And I believe the in-store space given to the Tesco project could be up to three times greater than The Entertainer was allocated in the Asda trial, so it can really go to town with ranging and merchandising. If you add its new Tesco trial stores to its extended ELC footprint in M&S (the partnership will be growing from 10 to 30 stores in the coming weeks), The Entertainer really is strengthening its presence across the entire retail spectrum. With Smyths also having an incredibly strong trading year (according to my sources), it’s good to see the specialist toy retail channel flourishing here in the UK.

Elsewhere, it was encouraging to hear that the London Toy Fair is now sold out, four months ahead of the show’s opening. I am not remotely surprised: this year's successful event was the only global Toy Fair able to go ahead in Q1, and with question marks remaining over Hong Kong plus New York Toy Fair moving to September, London and Nuremberg will both offer a fantastic platform for toy suppliers and retailers to connect at this crucial time of year. It’s nice to see a few big name exhibitors returning to London Toy Fair too – and perhaps we’ll see an influx of international visitors again this year, with the reduced number of trade fair options at the start of the year.

But before all that happens, there’s the small matter of the Christmas rush to navigate – hopefully that kicks into gear very soon.