EDITOR’S NOTE: This article was originally written on March 9 with updates on March 19. We recognize this is an ever-changing story. When the Editorial Advisory Committee for Toy Times magazine met to talk about the upcoming June issue, we mentioned coronavirus.It was just a simple story idea at the time that we thought we should include as content. The original story was about keeping your work area clean and how production and fulfillment was going to be impacted going forward.
That was only 16 days ago. How the world has changed in such a short time. It seems the story continues to evolve and change daily, hourly and minute-by-minute. It’s now become a hot topic in our industry – and all industries. Because of the ever-changing storyline, we’ve updated this post on Thursday, March 19, but readily recognize that it will no doubt be outdated by this weekend.
We’ve recently spoken with ASTRA members to see what strategies they were implementing.
We’ve seen stores, manufacturers and sales reps across the country practice social distancing and embrace a new normal as it relates to business operations. Shopping online seems to be a current popular trend, and stores from coast-to-coast are selling products through their website, offering curbside pick-up or delivering in creative, out-of-the-box ways.
Scott Mazerall, owner of Maziply Toys in Kingston, Massachusetts said he’s had success recently working with Shopify. Shopify is an ecommerce tool that many retail stores use to sell their product.
Mazerall said Shopify will buy future receivables for a reasonable fee with a payback rate anywhere between seven and 17 percent of daily sales.
“It makes it attractive because sales are a little slow right now,” Mazerall said. “It just offers a little more flexibility than your typical banking scenario where you’re going to have to make that monthly payment weather you have the money or not. For a time like right now, it’s really going to be my lifeline.”
Even if you don’t have a website and Shopify isn’t your answer, there are still ways to take advantage of creative revenue streams. HABA USA has been offering retailers a coupon code for customers to use on the HABA website. The code is unique to each store and if a customer uses the code on the HABA site, they receive a 10 percent discount. HABA then sends a 20 percent rebate to the store and the sales rep receives the commission on the wholesale cost.
“If you don’t have a website, I want those retailers and reps to get some kind of income,” said Phil Wrzesinski, Manager of Sales at HABA. “Is this going to be a big thing? No. Is anybody going to make a living off of this? No. But every little bit helps, and this is just something we can do. Stores can tell their customers that our vendors believe in us, and you should too.”
With the Seattle-area being one of the areas highlighted by news coverage, we talked with Karla Easton, owner of Kids Club in Seattle.
“This is unprecedented,” she said. “We’re trying to be patient and ride it out.”
As of Friday, March 13, Kids Club, which has been in business for 32 years, was open to the public. However on Monday, March 16, the decision was made to close Kids Club until April 1. Prior to the closing, Easton said they were selling a lot of puzzles, games and art supplies. Even though goods were still going out the door, Easton conceded that overall sales were down.
Schools in the Seattle area announced they were closing due to the outbreak for two weeks. That seemed to have a bump in sales for Easton, who said she noticed a lot of grandparents in the store buying toys and games to keep grandkids occupied during the school closings.
Kids Club is also connected to a children’s hair salon that Easton owns, and she said she normally has toy demos out in the salon to keep kids occupied. Comfort toys are often within hands-reach for kids who are afraid of the haircut, but that idea was nixed because of the virus prior to the store closing.
“After careful consideration, I have closed the store until April 1. I believe that the best thing we can do right now is to stay home to stay healthy,” Easton said in a social media post on March 16. “We need to get this virus behind us as soon as possible.”
Easton said she is thankful that sales had been strong since the New Year and hopes the worst is behind them in Seattle.
“My biggest fear is that someone in the store will test positive,” she said. “You just don’t know what’s going to happen. We’re all trying to stay calm and avoid hysteria.”
Amy and Joel Bender, owners of Mind Benders toy store in Whiting, Indiana have recently added a new element to their store. They’ve asked each customer who walks through the door to give their hands a squirt of sanitizer before playing. Joel Bender said that customers have appreciated the request. Local schools in that area have also closed, and Bender said he’s hoping for a cabin-fever rush to set in the coming weeks.
Like many stores across the country, Mind Benders has several demo games on the floor.
“We want to keep our atmosphere as worry-free and fun as possible. For comfort and reminders to all concerned, we have placed cute little notes near demos that read: ‘spray before you play helps keep germs away’ along with little cartoon germs pictured.’”
Demos are being disinfected often and wipes are available for guests to use as they wish. The store has a self-serve hand sanitizer near the entrance, and the store offers tissue and friendly signs remind how to properly cough and sneeze into inner elbows, and not hands.
So far, Bender said, they haven’t seen any hiccups regarding shipments from manufacturers.
“We are moving forward with orders as usual at this time,” Bender said. “We’re too excited to receive the new items to wait. We will still have customers in need of gifts, rewards and activities. We want to be ready for them.”
Mind Benders seems to be taking on the outbreak head-on. In-store events have not been cancelled and are gearing activities towards current points of interest, such as soap making or hand sanitizing making events.
Because of the continued consumer presence in the store, Mind Benders sent out a post on social media to help calm any fears.
“Worried about germs? Keep Calm & Sanitize,” the post read. “Grab a squirt by our front door. We disinfect regularly, so no worries. Relax, Play, Shop Away! We are Here to Help.”
Many ASTRA manufacturer members seem to be weathering the outbreak fairly well because of a variety of reasons.
With the threat of Chinese tariffs last year, many who were able to, bought deeply in inventory from the factories before the tariffs were levied. Others said they place smaller orders than other bigger toy companies, so even though their Chinese factories were closed for many weeks, they were able to get their orders made and shipped quickly once they re-opened.
Some ASTRA members have manufacturers outside of China, and some were prompted to pursue other manufacturing options because of the tariffs and uncertainty in 2019. Others have different reasons for having toys made outside of China.
London-based Le Toy Van makes its Rubberwood toys from its own forest in Indonesia in a nearby factory. They can be assured the forest is growing in a sustainable way, and they save on shipping. Another member, Chalk of the Town, worries that disruptions in global supply chains caused by quarantines and travel restrictions will make it difficult to get its T-shirts from India and Honduras and its marketers in Japan. Adventerra Games makes its environmental-themed board games in Poland, and has plenty of games in its U.S. warehouse.
There are, however, manufacturers who are identifying ways to mitigate challenges with the current COVID-19 outbreak. CJM Kids Corp and Next Generation Distributors said they had experienced delays with their shipment due to the production and delays overseas. They said they are working to help alleviate some of the challenges retailers are facing by taking product on consignment to assist with cash flow.
Manufacturers also said they truly appreciate ASTRA stores for not cancelling orders that were made at Toy Fair due to the coronavirus.
The COVID-19 is a fast-moving epidemic. The Toy Box in Amherst, Massachusetts was a thriving, optimistic toy store at the beginning of March. But it, too, started to feel the real affects of the virus by the middle of the month.
“After a million and one moments on the fence, I have decided to temporarily suspend in-store shopping at the TOY BOX beginning Monday, March 16,” store owner Liz Rosenberg said in a social media post. “We will be available during our typical business hours for phone orders, product consulting/recommendations by email and Facebook/Instragram, and we are working diligently on finishing the construction of our website so you can easily order online while keeping your efforts and love local.”
Before the store temporarily closed, Rosenberg said most customers were purchasing more than usual. She said she was also surprised that for the first time, not a single customer paid in cash. She also said she hadn’t noticed delays on toy shipments for her orders. However one vendor she works with that traditionally ships full and complete orders had sent a partial order with no explanation about when the rest would come.
She said her store is well stocked and is worried about the psychological effects of the outbreak and social distancing on her community.
Rosenberg isn’t the only retail store dealing with the outbreak. Many stores around the country have been dealing with the potential of needing to shut down temporarily and every day more announcements are made of stores closing.
On March 16, Play, a three-store business in Chicago had to make that difficult decision.
“Today I made one of the hardest decisions since starting this business. We will close all 3 shops to in-store shopping beginning until March 31 when we will re-evaluate,” it read. “We pride ourselves on being a community resource and place to gather. This truly breaks my heart. But I firmly believe this is the responsible decision for the greater good.”
We stand together with our ASTRA community in navigating a challenging time. We are might together and we will, as a community and industry, get through this together.
Lisa Orman owns KidStuff Public Relations, a longtime ASTRA member that has been helping specialty toy and game manufacturers and retailers grow since 1994. She serves on ASTRA’s Board of Directors and its Editorial Advisory Committee. Most of her clients are ASTRA manufacturers so she is keenly aware of the impact of market forces in play.