Toy News Blog

Greetings All,

 

Well the corporates are at it again and they have intimated an increase in wholesale pricing to please the shareholders. Both Hasbro and Mattel are gearing up to offset continued logistics issues and cost increases. Mattel and Hasbro have imposed 5-6% wholesale price increases and will likely have another round later this year, analysts said. So far there has been little pushback from consumers but that could change, according to executives from both companies. The rising costs will hit gross margins, with Mattel forecasting a decline this year to 47% from 48.2% a year ago amid higher prices for raw materials (resins) and ocean freight, said Mattel CFO Anthony DiSilvestro. Both companies brought in inventory earlier, with product arriving in May-June rather than the more typical August timeframe. Despite these rising costs, both companies are forecasting sales increases for this year. Mattel is projecting an 8-10% increase, while Hasbro is in the 4-5% range.

 

Well all I can say is they are living in a dream world if they think they are going to increase their margins by 8 per cent, my prediction is a downturn in profits by 18 per cent, especially for Hasbro. The main reason for this is multilevel and comes from a stormfront of poor woke culture and MBA decisions in the past 12 months. Lets look at a few.

 

Point one: They have lost touch with their customer base, they think $50 toys are bought by children when we all know they are middle aged men and women in a throw back to the nostalga of their childhoods, and cash flush investors looking to make a good return on investment in fields other than art and the stock market. They rely too heavily on social media influences and squeaky wheel minority opinions, trying to be a good social citizen instead of just doing the core business of making toys, figures and games.

 

Point two: They are too MBA heavy in the corporation and devoid of creatives, the companies have lost direction and swing from one media hyped property to the next with little investment in determining if the market will support their endeavours. Recent events in hollywood have shown whilst the media is good at pushing adgendas and hyping crap as the next big thing, the consumers eyes are open and we are saying no thank you, not interested! Corporations can not rely solely on the feedback or placating adorances of biased youtubers and influencers, you actually have to speak to the customers, its called market research. As a researcher myself I can tell you now, monitoring the Facebook forums and looking at the actual sales data about 25 per cent of the stated sales potential actually materializes and this is a trend that has existed for some time, the fact is; social media is a guide, and it is dominated by individuals with hidden addenda's or interests and people wanting to be seen in the forums as an active member for some form of self gratification. In the cars sales world they are tyre kickers and the only true indicators is to stand in the stores and watch what people are buying, looking at and talking about.

 

Point three: They established a customer base of fans and then completely ignore the desires of their customers, The classic example of this is the continued process of exclusive releasing lines to particular retailers. Their customers/fans have been telling them now for years they are not happy with the practice and not only does it continue it is actually getting worse. To add salt into the wound they then do limited releases across multiple retailers at the same time and all that does is frustrate the collector as they try to find time in their work day to visit a retail site and beat the scalpers to the preorder in order to acquire the product. Then they did the insane act of transitioning to a non visible display box for their main 6 inch collector figure lines. Now i know this is contentious, but I am going to say it, the influencers and FB posts that say there has been little reduction in sale as a result of this are full of shit. In my role as a procurement officer I can tell you in the past 18 months, sales on 6 inch figures in the Black Series and Marvel select have shrunk 30 per cent, now who can be sure whether this is as a result of the changes to packaging or the current world environment or the price increase no one will know but I can tell you this:

Point four: These companies can't decide if they want to be makers or retailers, and this is detrimental to the whole industry. Both companies have introduced direct to public sale portals over the past few years in direct competition to the retailers of their products. So why is this bad? Well to start with retailers don't get the product at the same price the company does, yet they are expected to sell for the same RRP. Retailers are required to promote their products but are often shorted in distribution or orders are cancelled putting the retailer in a bad light with the consumer, one has to ask if you have a crap supply and distribution chain why would you want to add retail to your portfolio? The end result of this practice will be the demise of third party retailers and all sales will be done through the corporate retail portal with all profits kept in company, the down side to that is there will be no competitive pricing and they will keep upping the prices, until you all say no! The Hasbro Pulse campaigns are a prime example of this. Oh and don't get me started on the MOTU Eternia castle really?

 

Point five: Woke politics permeating the companies, recently the gender pronoun debacle was bought to my attention and I must say I pretty much unsubscribed from all my corporate feeds. I mean seriously I follow these sites for product information and I give two craps about yuor gender politics issues, do your job, give me the information, answer the questions and thank the consumer for existing and allowing you to have a job in a great field.

 

So in summary we have covered quite a bit today, but basically the dreamers in the two big multinationals these days are not the makers, creatives or the manufacturers; they are the corporate scrooges rubbing their hands together looking at ways to screw their customer base for a long desired "At A Boy" from the Wal street investor pack.