The current landscape

The 2010s were supposed to be the decade of the retail apocalypse. Especially for retailers selling toys and games.

Sellers were led to believe that they had to make drastic changes to the way they do business in order to survive.

But then something happened, or didn’t. Retailers ended 2019 strong, despite rumblings of a global recession.

While there has been plenty of upheaval in retail, the only real adjustment sellers had to make is to align their operations to meet consumer’s changing demands. And this is nothing new.

The biggest part of the change for most retailers was moving sales and fulfillment operations to a multichannel model. It was that simple.

The nostalgia of the toy store

For toy and game sellers, there was the compounding issue that the aging population and declining birth rate would usher in their demise before other segments. While the worry was real, most of it was hype.

However, one of the biggest retail stories in recent years was the high profile struggles of iconic toy retailer Toys R Us. What was even more interesting was the PR campaign that played hard on the nostalgia of what that store meant to a generation of children and parents.

It brought back joyous memories of a simpler time.

The trouble for Toys R Us was no secret. The shifting demographics coincided directly with the eCommerce boom. Luckily for nostalgia seekers, Toys R Us has opened two new stores in select markets. In other words, they adjusted their strategy.

And while they may not be as big as they were in their heyday, they still exist due to right-sizing their brick and mortar footprint. So much for the four horsemen.

And now, many small and independent toy stores and niche retailers have flourished. Most of them have sustained by offering special and unique products to a strong and loyal customer base.

What’s really happening

In reality, not a lot has really changed in the industry. Like with most industries, the only change is the relationship between the brand and the buyer.

Despite what tech titans with fantasies of disrupting industries would have you believe, the marketplace changes that have taken place in recent years are not overly complicated. And they certainly do not require elaborate (and expensive) changes to operations. Ones which Silicon Valley would gladly sell you.

Despite an aging population with a lowering birth rate, the toys and games industry is still thriving.

Even with fewer dedicated specialty toy stores, plenty of retailers and large stores have entire toy departments. In many ways, toy and game merchants are identical to most other multi-product sellers.

Toys aren’t just for kids

From a segmentation standpoint, three out of five top sellers in Toys and Games on Amazon are adult party games.  Add to that collectors items and action figures that appeal just as much to adults as they do to children.

So even with a slight decline of the traditional children’s toy market and older kids shifting to video games, the market for selling toys and games could never be stronger.

Reselling toys in marketplaces 

Sellers, particularly toy resellers, who want to make Amazon part of their strategy (and who doesn’t?) need to be aware of the rules.  Amazon has strict guidelines for selling and reselling toys, mostly around merchandising and licensing rights.

There is some confusion about who has the rights to sell licensed merchandise. Amazon is pretty strict about copyrighting and is cracking down on what they see as rogue.

But as long as you are not selling counterfeit goods, then you are likely in compliance with Amazon’s rules.

It is perfectly legal to resell name brand items on marketplaces.

The top workflow needs for selling toys and games online:

Inventory visibility

This goes without saying. Inventory control and visibility is no longer a luxury. It is now just a regular part of doing business as integral to operations as electricity.

Flexibility across channels 

Almost every seller sells in more than one place. That’s why it is vital to be sure that your inventory is flexible enough to adapt and react to sales cycles on various channels.

Quantity cync 

If you resell toys, it’s important to make sure your quantities are as up to date as possible across all of your sales channels. Keep in mind that birthday and holiday gifts make it a highly time sensitive purchase. It’s vital to keep inventory accurate and up to date.

Demand planning

This is especially important for re-sellers whose supply may not always be consistent by product. Sellers have to be aware of buying cycles so as not to be left with dead stock.

Reporting

Knowing what types of merchandise sell well historically can help with forecasting what will be next year’s big seller. Using this, you can plan accordingly and maximize profit and minimize disruptions to your workflow.

Offering free shipping and returns

Generally speaking, only 15% of toy and games merchants offer free shippings and returns. Offering free shipping could help give you a leg up on the competition. There is debate out there as to whether it’s more important to offer free shipping or expidited. Our money is on free shipping.

Stay on top of rules and regulations 

Government regulators are very keen on making sure children’s toys are safe. There are many recalls for unsafe toys which sellers need to be aware of. This poses a major risk to the reputation and seller performance ratings.

Advertising

Luckily, advertising costs aren’t as high for toy and game sellers. In terms of search marketing, it represents the lowest spend of all major retail segments. Advertising is often an unaccounted for cost of doing business, so choosing a segment with lower competition can help sellers stay in the black.

In conclusion:

Children (and adults) love toys and always will. There will always be people wanting toys and people buying them. The only difference is how the buyers interact and purchase from brands.

Ready for next steps? See our guide on selling toys and games online to help set your business up.