2015 Toy Industry PDF

WWW.IBISWORLD.
COM Toy, Doll & Game Manufacturing in the USMay 2015 1
Game time: Despite recovering demand,

operators will face significant pricing pressures
IBISWorld Industry Report 33993

Toy, Doll & Game
Manufacturing in the US
May 2015 Zeeshan Haider
2 About this Industry 16 International Trade 34 Key Statistics

2 Industry Definition 19 Business Locations 34 Industry Data
2 Main Activities 34 Annual Change
2 Similar Industries 21 Competitive Landscape 34 KeyRatios
2 Additional Resources 21 Market Share Concentration
21 Key Success Factors 35 Jargon & Glossary
3 Industry at a Glance 21 Cost Structure Benchmarks
23 Basis of Competition
4 Industry Performance 24 Barriers to Entry
4 Executive Summary 25 Industry Globalization
4 Key External Drivers
6 Current Performance 26 Major Companies
9 Industry Outlook 26 Hasbro Inc.
11 Industry Life Cycle
30 Operating Conditions
13 Products & Markets 30 Capital Intensity
13 Supply Chains 31 Technology & Systems
13 Products & Services 31 Revenue Volatility
15 Demand Determinants 32 Regulation & Policy
15 Major Markets 33 Industry Assistance
www.ibisworld.com | 1-800-330-3772 | info @ibisworld.com

WWW.IBISWORLD.COM Toy, Doll & Game Manufacturing in the USMay 2015 2
About this Industry
Industry Definition This industry comprises companies (including electronic), hobby kits and
that manufacture dolls, doll childrens vehicles (except metal
accessories, action figures, toys, games bicycles and tricycles).
Main Activities The primary activities of this industry are

Manufacturing action figures
Manufacturing dolls, doll parts and doll clothing
Manufacturing stuffed toys
Manufacturing childrens automobiles
Manufacturing crafts and hobby kits
Manufacturing childrens and adult games
Manufacturing science kits
Manufacturing toy and hobby models
Manufacturing video game machines
The major products and services in this industry are

Baby carriages and childrens vehicles (excluding bicycles)
Dolls, action figures, toy animals and stuffed toys, including parts
Electronic toys and games (including home video games)
Models and crafts
Nonelectronic games and puzzles, including parts
Other nonelectronic, nonriding toys, including parts and pet toys
Similar Industries 33461 Recordable Media Manufacturing in the US

Operators in this industry manufacture electronic video game cartridges and reproduce video game
software.
33699a Motorcycle, Bike & Parts Manufacturing in the US

Operators in this industry manufacture bicycles and metal tricycles.
33992a Athletic & Sporting Goods Manufacturing in the US

Operators in this industry manufacture sports and athletic goods for children.
Additional Resources For additional information on this industry

www.nam.org
National Association of Manufacturers
www.toyassociation.org
Toy Industry Association Inc.
www.census.gov
US Census Bureau
WWW.IBISWORLD.COM Toy, Doll & Game Manufacturing in the US May 2015 3
Industry at a Glance
Toy, Doll & Game Manufacturing in 2015
Key Statistics Revenue Annual Growth 10-15 Annual Growth 15-20

Snapshot
$1.9bn -4.8% -1.7%
Profit Exports Businesses
$102.5m $1.6bn 573

Revenue vs. employment growth Import penetration into the manufacturing
Market Share sector
Hasbro Inc. 20 0.36
9.7% 10 0.34
0
0.32
% change
-10
%
0.30
-20
-30 0.28
-40 0.26
Year 07 09 11 13 15 17 19 21 Year 07 09 11 13 15 17 19 21
Revenue Employment
SOURCE: WWW.IBISWORLD.COM
p. 26
Products and services segmentation (2015)
4.0%
Key External Drivers Dolls, action figures, toy animals and
Import penetration into stuffed toys, including parts 4.0%
Baby carriages and children's
the manufacturing sector 10.1% vehicles (excluding bicycles)
Trade-weighted index Models and crafts
Demand from hobby

and toy stores
Per capita disposable
income 16.9%
Demand from
department stores
Nonelectronic games and
puzzles, including parts 41.7%
Electronic toys and
games (including home
video games)
p. 4
23.3%
Other nonelectronic, nonriding toys,
including parts and pet toys SOURCE: WWW.IBISWORLD.COM
Industry Structure Life Cycle Stage Decline Regulation Level Heavy

Revenue Volatility High Technology Change Medium
Capital Intensity Low Barriers to Entry Medium
Industry Assistance Low Industry Globalization High
Concentration Level Low Competition Level High
FOR ADDITIONAL STATISTICS AND TIME SERIES SEE THE APPENDIX ON PAGE 34
Industry Performance
Executive Summary | Key External Drivers | Current Performance
Industry Outlook | Life Cycle Stage
Executive Operators in the Toy, Doll and Game profit margins to compete with low-cost
Summary Manufacturing industry have experienced imports, the prospect of which has
a challenging operating environment reduced the attractiveness of this
over the past five years. Industry industry. Furthermore, many
operators manufacture discretionary companies in this industry have
items, and demand for these products completely disbanded US-based
represent a strong, positive correlation production operations and shifted
with per capita disposable income, production facilities to East Asia and
consumer sentiment and available leisure China, which has also reduced revenue.
time. Most of these demand drivers took Given the significant offshoring and
a turn for the worse during the recession, price competition from imports, which
as consumer sentiment fell considerably, are expected to account for 98.5% of
due to high unemployment, a bleak domestic demand in 2015, revenue is
economic outlook and a fall in per capita expected to decrease at an annualized
disposable income. Furthermore, rate of 4.8% to $1.9 billion, during the
five years to 2015, inlcuding an expected
increase of 7.9% in 2015 alone.
Despite
higher demand, toy manufacturers will The industry is expected to perform
better over the next five years. This
lower prices to stay competitive, hurting profit recovery will be spearheaded by a new
and emerging trend of reshoring,
products produced by industry operators whereby companies relocate their
tend to overlap, causing manufacturers to manufacturing operations back to the
compete fiercely on price, with United States, where there are lower
consumers consistently seeking bargains. compliance and transportation costs and
Since price competition in this a greater ability to respond to changes in
industry is high, domestic operators the market. Increasing labor costs in
have been forced to reduce prices to China are also incentivizing this trend.
compete with cheap imports, sourced This phenomenon of reshoring, coupled
from low-cost economies such as with improving conditions in the
China and Vietnam. However, as a domestic economy, will prevent industry
labor-intensive industry, imported revenue from declining as rapidly as it
products have a significant advantage did in the past five years. Nonetheless,
when it comes to production costs. As revenue is expected to decline at an
a result, domestic industry operators annualized rate of 1.7% to $1.7 billion
have been forced to settle for lower over the five years to 2020.
Key External Drivers Import penetration into the their lower prices. Import penetration
manufacturing sector into the manufacturing sector is expected
Growth in the volume of imported toys in to increase in 2015, posing a potential
the United States has created intense threat to the industry.
competition for domestic toy
manufacturers over the past five years. Trade-weighted index
Despite instances and perceptions of The trade-weighted index (TWI)
inferior quality, imported toys have measures the strength of the US dollar
become increasingly popular among relative to the currencies of countries that
consumers over domestic goods due to trade with the United States. A drop in
Key External Drivers the value of the US dollar leads to lower Per capita disposable income
continued relative export prices and higher relative Toys, dolls and games are discretionary
import prices, benefiting industry items so changes in disposable income
revenue. Conversely, when the TWI rises, levels influence industry demand. A rise
there is greater import competition and in household disposable income increases
industry exports are relatively less the propensity for customers to purchase
competitive in the global market. The more industry products, causing a growth
TWI is expected to increase in 2015. in demand. Per capita disposable income
is expected to increase during 2015,
Demand from hobby and toy stores presenting a strong growth opportunity
Regarded as specialists in the toy retail for the industry.
market, hobby and toy stores are key
buyers of industry products. Hobby and Demand from department stores
toy stores purchase an extensive range of Discount department stores, such as
goods from industry manufacturers. Walmart and Target, have grown to
Therefore, an increase in demand for toy, become leading retailers of childrens
doll and game products from hobby and toys. An increase in demand at the retail
toy stores translates to demand and level also leads to growth in demand for
revenue growth for manufacturers. The toys at the manufacturing level. The
Hobby and Toy Stores industry is Department Stores industry is expected
expected to increase throughout 2015. to decrease in 2015.
Import penetration into the manufacturing Trade-weighted index

sector
0.36 115
0.34 105
0.32 95
Index
%
0.30 85
0.28 75
0.26 65
Year 07 09 11 13 15 17 19 21 Year 07 09 11 13 15 17 19 21
Current The Toy, Doll and Game Manufacturing

industry has suffered over the five years to
order to remain competitive. Many
industry operators had to exit the industry
Performance 2015, due to falling demand brought on by altogether because they could no longer
poor economic conditions and increasing compete with low-cost imports, which
competition from low-priced imports. caused industry establishments to decline
Imports have gained considerable cost at an annualized rate of 0.7% to 577
advantages over domestically produced locations over the five years to 2015. These
goods during the past five years due to factors combined are expected to reduce
lower labor costs and significantly lower revenue at an annualized rate of 4.8% to
environmental regulation abroad. $1.9 billion in 2015; however, revenue is
Imported toys have therefore become expected to rise by 7.9% in 2015 due to a
significantly inexpensive compared with substantial increase in exports stemming
domestically produced goods, and, as a from strong demand growth from Mexico.
result, domestic industry operators have According to data sourced from the United
cut down on their profit margins to remain States International Trade Commission
competitive. However, this reduction in (USITC), industry-specific exports to
profitability also encouraged many industry Mexico have increased 1011.5% year to
operators to shift production from the date, resulting in a 26.1% increase in
United States to Asia and the Far East in exports over the same period.
Diving demand Demand in the Toy, Doll and Game

Manufacturing industry is primarily Operators
reliance on
influenced by economic conditions such as retail demand resulted
consumer confidence and disposable
income levels. While consumer sentiment is losses during the recession
expected to climb in 2015, it experienced
steep declines during the recession, falling owning their distribution and retail outlets,
22.1%. In addition, per capita disposable or by selling directly to third-party retailers,
income fell for the first time in nearly two manufacturers can better manage
decades over the same period. Since then, its production volumes and maximize profit
recovery has been marginal and slow. These margins. Unfortunately, operators
factors forced consumers to curb spending increasing reliance on retail demand
on discretionary items, including toys, dolls resulted in painful losses during the
and games. Many consumers who did recession and immediately after, when
purchase industry-related products during retail spending plummeted.
this time opted to seek out sales and Fortunately, demand for toys, dolls and
bargains online and at second-hand stores games has been rebounding as the economy
rather than pay full retail prices. has gradually recovered. In 2010, consumer
As retail spending slowed, demand for sentiment and household disposable income
manufactured goods declined, with rose, encouraging consumers to increase
revenue falling a staggering 30.5% during spending that they withheld at the height of
the recession. Industry operators rely the recession. Revenue for the Hobby and
heavily on demand from retailers, Toy Stores industry (IBISWorld report
especially with the onset of wholesale 45112) also increased in 2010 and has been
bypass, which effectively eliminates on the rise ever since. Such increases in
wholesalers from the supply chain and is a downstream demand are expected to bolster
growing trend among manufacturers. By demand at the manufacturing level.
Produced in China In addition to falling demand, competition

from low-priced imports has presented a To
remain buoyant in
significant challenge to the industry. In
2010, imports accounted for 97.1% of
a contracting industry,
domestic demand and are expected to be operators were forced to
$18.5 billion or 98.5% of domestic demand, reduce markups
declining at an annualized rate of 4.9% over
the five years to 2015. The growing share of
Chinese imports has primarily driven this and energy and transportation related over
phenomenon. Due to the countrys relaxed heads for domestic manufacturers, thereby
labor and environmental laws, Chinese improving margins. Overall, IBISWorld
manufacturers enjoy lower production costs, expects profit, measured as income before
allowing them to pass cost savings on to interest and taxes, to account for 5.5% of
domestic retailers, and ultimately revenue in 2015, up from 3.8% in 2010.
consumers. This trend has placed significant As US factories struggle with low
pricing pressures on toy manufacturers in profitability, major players have either
the United States. Even though imports relocated their facilities to China or other
have declined slightly over the past five overseas destinations, or have outsourced
years, they continue to represent a production to third-party manufacturers to
significant proportion of domestic demand take advantage of lower overhead and labor
and present a major threat to the domestic costs. Mattel and Hasbro are examples of
industry. Furthermore, exports, which are major industry players following this trend.
expected to account for almost 85.0% of According to their respective annual
revenue or $1.6 billion in 2015, have also reports, a significant portion of Mattel
declined at an annualized rate of 1.0% due to products are manufactured in company-
a strengthening dollar. In order to maintain owned facilities in China, while a majority
sales and remain buoyant in a contracting of Hasbro production is outsourced to
industry, US operators have been forced to Chinese factories. Offshoring, coupled with
reduce markups over the past five years, falling demand, has caused many domestic
resulting in significant declines in operators to close facilities and reduce
profitability over most of the past five years. workforces. In the five years to 2015,
However, a recent decline in oil prices if employment has fallen at an annualized of
expected to reduce the price of raw materials 2.8% per year to 7,621 workers.
Toy recalls and new An increase in outsourcing and lead found in paint, while others were
regulations offshoring has created both opportunities recalled for choking hazards presented by
and disadvantages for domestic loose magnets. These recalls created
operators. Relocating allowed companies considerable losses for industry
to achieve more cost savings, however operators, including Mattel, which had to
relaxed product standards and recall its Barbie and Fisher-Price brands.
regulations in overseas facilities led to a Similarly, Hasbro reported losses from
decline in product quality. This decrease the recall of its Easy Bake Ovens. In
began to negatively affect the industrys addition to the immediate losses incurred
bottom line as major problems emerged. as a result of having to pull products from
Since 2008, the US government has shelves, these recalls also tarnished
recalled a plethora of Chinese- consumer confidence and trust in these
manufactured toys due to unsafe levels of respective brands.
Toy recalls and new As a result of these sweeping recalls, may not meet new regulations. This
regulations the Consumer Product Safety disposal cost has created a significant
Commission implemented new financial burden for operators across the
continued
legislation in 2008 to protect children industry. The Toy Industry Association
from unsafe lead levels, choking hazards (TIA) publicly estimates this cost to be
and other chemicals that may cause roughly $2.0 billion.
illness. This law, known as the Consumer However, the problems with imported
Product Safety Improvement Act toys and their subsequent costs have also
(CPSIA), bans manufacturers from prompted a major shift toward relocation
producing or selling childrens products to the United States. KNex Brands LP, a
that do not meet the enhanced safety family-owned company based in Hatfield,
regulations. In addition, companies are PA, is one of the industrys players
required to test products for lead and moving production back to the United
other harmful chemicals. States. This trend will continue as
Although CPSIA provided peace of mind manufacturing costs rise further in China
to consumers, it has adversely affected the and manufacturers seek alternative
industry. Many manufacturers, lacking the strategies to keep production costs low.
resources to test every item for compliance, Reshoring is expected to benefit the
have simply disposed of inventories that domestic industry in the future.
Changing tastes Children, aged nine and younger, are

traditionally regarded as the key buying In
response to a changing
market for toy manufacturers. As a result,
the ranges of toys produced have been
market, operators
systematically geared toward specific age focused on electronic and
groups within that prime market. interactive toys
However, manufacturers began to
experience declining sales within this key
market in the early 2000s. Operators on electronic and interactive toys. In
subsequently acknowledged that demand addition, operators have invested
was being affected by an age millions of dollars in attempts to spur
compression phenomenon, whereby more demand for traditional toys by
children were outgrowing toys at a bringing them into the 21st century. For
younger age and demanding more adult- example, Mattel debuted its Barbie
like merchandise, such as personal Digital Dress Doll at the New York Toy
computers and DVD players. While the Fair in February 2013. The doll features a
economic downturn caused a temporary dress with an LED touch screen on which
hiccup in demand for tech-centric toys, children can create custom designs.
which are often more expensive than Other plans for Barbie in 2013 included
traditional toys, a growing proportion of three full-length animated features, as
children continues to favor electronic toys. well as a comprehensive digital
In response to changing market experience, including online games and
conditions, manufacturers began to focus Barbie webisodes.
Industry Despite challenges faced by local

manufacturers over the past five years, Industry revenue
Outlook IBISWorld expects the industry will fare
10
better during the five years to 2020.
Nonetheless, revenue is projected to 0
decline at an average annual rate of 1.7%
to $1.7 billion over the next five years, -10
% change
with a 1.9% decline expected in 2016. As
economic conditions improve, -20
consumers will likely increase their

-30
discretionary spending, which will
subsequently increase demand for toys, -40
dolls and games. Year 07 09 11 13 15 17 19 21
However, the long-term outlook for
the industry is not encouraging. US SOURCE: WWW.IBISWORLD.COM
manufacturers will continue to face

increasing competition from low-cost space to imported goods. Consequently,
imports and vie for contracts with a many industry operators will be unable to
shrinking number of retailers. Given the survive in this competitive environment.
limited amount of shelf space in stores, IBISWorld expects that the number of
retailers will place significant pricing industry establishments will decline at an
pressures on domestic operators to lower annualized rate of 0.6% to 560 over the
their markups, or they will give up shelf five years to 2020.
Downstream demand As the US economy recovers, consumer Advances in product design and the
picks up sentiment and per capita disposable income, introduction of new electronic and
two key drivers of industry demand, are interactive toys will drive industry growth
expected to increase at annual rates of 2.5% through 2020. In the past five years,
and 2.4%, respectively, over the next five growth in demand for these products was
years. Renewed confidence in the economy limited by uncertain economic conditions
and higher discretionary spending are in the earlier part of the period. However,
forecast to drive retail purchases, as with improving economic conditions,
households begin to spend on products that consumers will have more discretionary
they delayed buying during the recession. As funds at their disposal during the outlook
a result, retailers will likely increase the period. With increased spending on
volume of purchases from toy electronic toys, consumer demand will
manufacturers, boosting industry demand. again be satisfied.
Increasing pressure In the Toy, Doll and Game have internalized distribution functions
from retailers Manufacturing industry, wholesalers and have begun supplying goods directly
were traditionally viewed as the key to retailers. Wholesale bypass greatly
market for manufacturers because they benefits industry operators because it
were able to efficiently distribute toys to allows them to charge higher prices for
a large number of US retailers. However, goods. In addition, manufacturers are
an increasing number of manufacturers able to gain greater control over
Increasing pressure production volumes. However, the risks. Due to pricing pressures exerted on
from retailers competitive nature of the industry has manufacturers to achieve maximum cost
led a small number of retailers, such as savings, remain competitive and win
continued
Walmart, Toys R Us and Target, to supply contracts, industry operators will
gain control over a large portion of the be forced to lower prices and absorb
retail market. losses. Consequently, IBISWorld expects
Unfortunately for operators, that average profit margins will decline,
dependency on a few large toy retailers is in spite of higher sales of high-margin
expected to continue through 2020, electronic toys. Profit is expected to
exposing industry operators to greater account for 5.1% of revenue by 2020.
China to lose its Due to rising labor costs in China, which

have reduced the appeal of offshore Due
to rising labor costs
advantage
production, industry operators are in China, operators are
increasingly moving production back to the
United States. US-based production reshoring production
reduces freight and compliance costs for
many manufacturers, as products from an annualized rate of 1.1% to 7,213
China are frequently recalled due to health workers over the five years to 2020.
hazards and noncompliance issues. In In spite of the trend toward greater
March 2013, The Wall Street Journal reshoring, IBISWorld expects import
reported that industry operator, KNex, was penetration in this industry will keep rising.
aiming to relocate its production facilities A stronger dollar and potential free trade
back to the United States due to rising costs agreements with East Asia and Vietnam in
in China. Producing locally also provides particular, will encourage domestic
manufacturers with greater control over retailers to import toys at an even lower
their inventories and designs, and allows cost. Consequently, IBISWorld expects
them to quickly respond to changes in imports to increase at an annualized rate of
domestic demand, which is critical to 1.6% to $20.1 billion in 2020 and they are
remaining profitable in the industry. anticipated to account for 99.1% of
While China continues to enjoy major domestic demand for the same year.
advantages as compared with the United Exports are also expected to decline
States, US industry operators are further despite a temporary increase in
planning to increase their capital 2015. As the US dollar appreciates, US
expenditures and alter their product exports become less competitive. The
designs so as to make their production dollar is expected to appreciate 3.2% per
and packaging process as automated as year, over the next five years, which is
possible. To achieve this, KNex has expected to reduce exports at an annualized
bought a Baxter robot from Rethink rate of 0.6% to $1.5 billion. Nonetheless,
Robotics Inc., which performs simple despite a rising dollar, the importance of
packaging tasks to aid in the production exports is expected to increase over the
of toys in its Hatfield, PA, facility. Similar next five years as operators seek demand
investments in capital equipment will on the international market for high-
enable the industry to benefit from quality domestically manufactured toys.
reduced labor costs and reliance on Exports as a share of revenue are expected
imports. IBISWorld expects that to increase from 85.0% in 2015 to an
employment in this industry will fall at estimated 89.9% in 2020.
Life Cycle Stage The industry is expected to grow at a
slower rate than the economy
The industry is facing a demographically shrinking market
Increased levels of offshoring and outsourcing are
causing the number of establishments to fall
Many industry products are becoming obsolete as
children demand more sophisticated and digital toys
20 Maturity Quality Growth

% Growth in share of economy
Key Features of a Decline Industry

Company High growth in economic
consolidation; importance; weaker companies Revenue grows slower than economy
level of economic close down; developed Falling company numbers; large firms dominate
importance stable technology and markets Little technology & process change
Declining per capita consumption of good
15 Stable & clearly segmented products & brands
10
Quantity Growth
Many new companies;
minor growth in economic
importance; substantial
5 technology change
0 Cardboard Box & Container Manufacturing

Motorcycle, Bike & Parts Manufacturing
Hobby & Toy Stores
Toy & Craft Supplies Wholesaling
Toy, Doll & Game Manufacturing

-5 Decline
Shrinking economic
importance
-10
-10 -5 0 5 10 15 20
% Growth in number of establishments
SOURCE: WWW.IBISWORLD.COM.AU
Industry Life Cycle The Toy, Doll & Game Manufacturing at a much younger age. They are
industry is in the declining stage of its life outgrowing toys more quickly and are
cycle. Although decline in industry turning to tablets, gaming consoles and
This industry revenue is expected to decelerate during other forms of entertainment. Hence,
is D
eclining the five years to 2020, IBISWorld expects this industry is facing an increasingly
that industry value added (IVA), which shrinking market, which will contribute
measures an industrys contribution to to its decline in the long run.
GDP, will decline at an annualized rate of New products and technologies are
1.9% over the ten years to 2020. This regularly being launched to keep the
indicates a slow rate of growth, as market interested and the industry
compared with an expected growth rate of relevant. Of special importance are
2.5% for GDP during the same period. licensing deals with film studios such as
Enterprises in this industry will continue Disney, and many industry operators
to decline as the industry consolidates and time new product launches to coincide
operators exit the industry in response to with the releases of Disney movies
a high level of import penetration. A rise based on these products. Capital
in imports is expected to continue, aided investment is being made to render this
by a strengthening US dollar. Together, industry more automated and
these trends will reduce the number of productive. As a result of increased
establishments in this industry by 0.7% reshoring, many firms are looking to
during the ten years to 2020. design products in more cost-effective
This industrys markets are also ways, aiming to reduce labor and inputs
facing an imminent demographic and costs. However, IBISWorld believes
psychographic shift. In 2009, that widespread reshoring and vast
individuals under the age of 20 technological improvements will not
accounted for 27.3% of the total US occur quickly enough to help this
population. According to the US Census industry recover completely. As
Bureau, this number shrunk to 26.7% in childrens interest in toys begins
2012 (according to the latest available decreasing even more quickly, families
information) and is expected to decline have less leisure time and the industrys
further in the coming years. In addition, main market shrinks demographically,
children have begun preferring digital this industry will eventually continue
and interactive toys to traditional ones on its downward trajectory.
Products & Markets

Supply Chain | Products & Services | Demand Determinants
Major Markets | International Trade | Business Locations
Supply Chain KEY BUYING INDUSTRIES

42392 Toy & Craft Supplies Wholesaling in the US
Toy and Craft Wholesalers are major customers for the Toy, Doll and Game Manufacturing
industry and are regarded as the primary link between manufacturers and the retail market.
45112 Hobby & Toy Stores in the US
Hobby and Toy Stores are able to purchase a range of merchandise directly from
manufacturers whereby they bypass traditional wholesale channels.
45322 Gift Shops & Card Stores in the US
Operators in Gift Shops and Card Stores purchase a range of merchandise for resale in novelty
stores.
KEY SELLING INDUSTRIES

32221 Cardboard Box & Container Manufacturing in the US
Operators in this industry supply packaging for toys, dolls and games.
32614 Polystyrene Foam Manufacturing in the US
This industry supplies pads, shaped cushioning, polystyrene foam and products used for
packaging dolls, toys and games.
32619 Plastic Products Miscellaneous Manufacturing in the US
This industry supplies plastics used in the manufacture of toys, dolls and games.
32629 Rubber Product Manufacturing in the US
This industry supplies rubber products, such as rubber tubing, used to manufacture toys, dolls
and games.
33121 Metal Pipe & Tube Manufacturing in the US
This industry supplies metal parts used to manufacture toys, dolls and games.
Products & Services Electronic toys the high price tags on many of these toys
Electronic toys make up the largest remain an obstacle for many cash-
product segment within the Toy, Doll strapped parents; therefore, growth in
and Game industry, and are expected to revenue derived from the electronic
generate an estimated 41.7% of total segment of the Toy, Doll and Game
industry revenue in 2015. This product industry is expected to remain tepid until
segment includes electronic pets, a substantial economic recovery takes
hand-held games, radio-controlled toy place. However, upon rebounding from
cars and internet plug-and-play games. the economic downturn, this product
Over the past five years, this product segment is expected to grow in line with
segment has grown in response to consumer demand.
changing consumer demand. Kids
between the ages of eight and 12 are Board games, puzzles and
increasingly demanding more other nonelectronic toys
sophisticated toys, such as cell phones, Other nonelectronic toys, such as board
laptops and learning-oriented video games, puzzles, collectible card games,
games. While youth-oriented electronic building blocks and related parts and pet
toys continue to grow in popularity, this toys will account for about 40.2% of
product segment was badly hit during the industry revenue in 2015. However, this
recession, as unemployment shot up and product segment is forecast to lose ground
disposable income dipped for the first in the long term, as children increasingly
time in nearly two decades. Unfortunately, gravitate toward high-tech toys. While
Products & Markets
Products & Services Products and services segmentation (2015)

continued
4.0%
Dolls, action figures, toy animals and
stuffed toys, including parts 4.0%
10.1% Baby carriages and children's
vehicles (excluding bicycles)
Models and crafts
16.9%
Nonelectronic games and
41.7%
Electronic toys and
puzzles, including parts games (including home
video games)
23.3%
Other nonelectronic, nonriding toys,
Total $1.9bn including parts and pet toys
electronic products are favored in the long economic conditions continue to improve
run, revenue from this product segment and consumer spending increases.
has remained somewhat strong
throughout the recession, as opposed to Dolls and action figures
the electronic toys segment. As a share of Dolls and action figures will likely account
industry revenue, this product segment for 4.0% of industry revenue in 2015.
actually grew during the recession. In While the percentage of revenue generated
response to rising unemployment and a by these products is small, this product
drop in disposable income levels, segment has remained strong over the
consumers opted for relatively less past five years because of its low price
expensive nonelectronic toys. Additionally, point and widely recognized brands, such
increasing purchases of toys for pets have as Barbie, American Girl and G.I. Joe,
also given a boost to this segment. retaining their popularity. Additionally,
these products have experienced a boost
Models and craft kits in sales through licensing and cross-
Models and craft kits, which are forecast promotions with motion pictures. For
to comprise an estimated 10.1% of example, major company Hasbro Inc. has
revenue in 2015, are the third-largest in place a licensing agreement with Marvel
product segment within this industry. Entertainment to manufacture dolls,
Products within this segment include action figures and other toys based off of
childrens art and painting supplies, popular Marvel superheroes, such as
coloring books, science kits and models Spiderman, Iron Man, X-Men, the Hulk,
cars, airplanes and rockets. While Thor and Captain America. Hasbro also
demand for these products declined owns the rights to produce Star Wars toys,
during the recession, these products have as a result of Disneys purchase of Marvel
remained relatively stable as a share of Entertainment in 2009 and Lucasfilm Ltd.
industry revenue due to their traditional in 2012. Similarly, Mattel Inc., another
and well-established market and relative major player within the industry, has a
cost-savings as compared to electronic licensing agreement with DC
toys. In the five years to 2020, the share Entertainment Inc. to manufacture
of revenue generated by sales of models Superman, Batman and other toys based
and craft kits will increase marginally as off of DC Comic superheroes. Major
Products & Markets
Products & Services industry players experience spikes in dolls 2015. These items are characterized as
continued and action figures sales when comic book nonelectronic. There is significant import
character storylines are successfully penetration in both these products and there
adapted to high-grossing motion pictures is little roomleft for further offshoring.
and video games. Over the next five years, However, international manufacturers have
the share of revenue generated by dolls caught up with the domestic ones in terms
and action figures sales is forecast to of quality and durability with a much more
remain strong. competitive price. Consequently, demand
for domestically manufactured baby
Baby carriages and childrens vehicles carriages and childrens vehicles has
Baby carriages and childrens vehicles are declined over the past five years, reducing its
expected to account for 4.0% of revenue in share of revenue.
Demand Demand for toys, dolls and games is spend playing with these devices has come
Determinants linked to trends in real household under scrutiny. Manufacturers have
disposable income, changes in product responded to parental concerns by
design, advances in technology, consumer incorporating educational elements into
preferences and seasonal fluctuations. Of games. However, technologically advanced
these, changes in disposable income have toys, such as flying helicopters and online
the greatest impact on demand for toy, games, often require special attention or
doll and game products. As the level of supervision. Parents who spend less time
real household disposable income supervising their children may opt for more
increases, consumers enjoy greater traditional toys that their children can
purchasing power and are able to demand safely play with by themselves.
a broader range of industry products from Demand for industry merchandise is
retailers. The increase in demand at the largely seasonal. Over 40.0% of toy, doll
retail level translates to demand growth and game retail sales occur in the fourth
for manufacturers. quarter, in the build up to the holiday
Consumer preference plays a vital role in season. Concurrently, manufacturers
determining demand for toy, doll and game experience their highest product demand
products. As sophisticated toys have gained leading up to the winter season.
popularity, electronic products have Seasonality for toys is exemplified by
become a favorite with customers. While product types: outdoor games in spring,
electronic toys continue to grow in travel games for summer vacations and
popularity, the amount of time children board games for long winter nights.
Major Markets Exports international market. Furthermore, due to

Exports make up the largest segment, extremely significant import penetration
accounting for an estimated 85.0% of in this industry, US manufacturers
industry revenue in 2015. This segments turned to international markets, such as
proportion of revenue has increased over Canada and Mexico. Given their
the past five years, from 70.0% in 2010. In proximity to the United States, these
the aftermath of the financial crisis, the neighboring countries allow for cheaper
US dollar initially weakened, making US transportation costs and more favorable
products more competitive in the trade conditions under the North American
Products & Markets
Major Markets Major market segmentation (2015)

continued
2.0% 3.2%
9.8% Wholesalers
Hobby and
Mass merchandizers toy stores
85.0%
Total $1.9bn Exports
Free Trade Agreement. However, as the the end-user market, they have been able
dollar began to strengthen from 2011 to meet changes in order volumes more
onward, exports began decreasing, with this efficiently, especially during peak selling
trend expected to continue. periods, such as the holiday season. Mass
merchandisers are expected to generate
Retailers 9.8% of revenue within this segment,
This segment makes up an estimated while hobby and toy stores are expected to
13.0% of industry revenue in 2015. generate 3.2% of revenue in 2015.
Retailers include toy and hobby stores,
electronic retailers and mass Wholesalers
merchandiser stores, such as Walmart Accounting for an estimated 2.0% of
and Target. Over the five years to 2015, industry revenue in 2015, wholesalers
revenue in this segment has experienced purchase toys, games and dolls from
some growth due to the rising prevalence manufacturers for resale to various
of wholesale bypass. By purchasing retailers. Revenue has decreased over the
directly from manufacturers, retailers past five years due to the growing
have been able to better control costs, practice of wholesale bypass and falling
operating margins and product consumer confidence in the economy.
availability, thereby increasing their However, with a major influx of lower-
inventory sourcing from manufacturers. cost, foreign-made toys being imported,
Manufacturers have also benefited from wholesalers role in the distribution
this trend. By being in direct contact with chain has moderately strengthened.
International Trade Imports created a volatile domestic market for US

The influx of imported toy, doll and game manufacturers, who have had to compete
products into the United States has with lower-cost producers overseas.
significantly altered the domestic market Chinese operators enjoy more relaxed
during the past five years. Imported toys labor and environmental regulations,
and games from Asia have increased allowing them to produce goods at a
competition within the industry. This has fraction of the cost of US production.
Products & Markets
International Trade Total imports in 2015 are expected to

reach $18.5 billion. Industry trade balance
continued
Most industry imports come from
10
Level & Trend China, accounting for 88.7% of total
imports in 2015. However, this number
xports in the
E 0
has been static since 2010 and IBISWorld
industry are H
igh expects that it will decline as
$ billion
and S
teady manufacturing costs in China rise and -10
industry operators look elsewhere to gain
Imports in the a competitive advantage. Other important -20
industry are H igh trading partners include Mexico (3.8%),
and D
ecreasing Indonesia (1.5%) and Vietnam (1.3%). -30
Despite a high level of imports, this Year 07 09 11 13 15 17 19 21
market segment has not been immune to Exports Imports Balance
the effects of the recession. In the five years SOURCE: WWW.IBISWORLD.COM
to 2015, the value of imports fell at an

average annual rate of 4.9%. This drop is Exports
the result of a booming 2007, during which Exports of industry products are
imports rose 28.3%, alongside a slower but estimated to total $1.6 billion in 2015,
continuously strong 2008, before the marking a 1.0% average annual decline
market segment fell significantly in 2009. since 2010. In 2015, exports are expected
In the five years to 2020, imports are to account for 85.0% of industry revenue.
expected to grow an average of 1.6% per This seemingly steep decline reflects
year, as economic conditions improve and drop-offs from the extreme growth of the
domestic demand picks up. mid-2000s, when exports grew by double
Exports To... Imports From...
3.8% 1.3%
Vietnam
4.7% Mexico 1.5%
Other Indonesia
3.2%
Paraguay 3.4%
United
12.1% Kingdom
Canada
18.4%
Other
62.9%
Mexico
88.7%
China
Year: 2015
Total $1.6bn Total $18.5bn
SIZE OF CHARTS DOES NOT REPRESENT ACTUAL DATA SOURCE: USITC
Products & Markets
International Trade digits. This growth was primarily driven Canada and Mexico, in particular, remain
continued by a triple-digit increase in trade levels strong, as these countries benefit from their
with Mexico during the period and was proximity to the United States, and from
unfortunately short-lived, as exports fell favorable trade conditions under the North
drastically in 2008. American Free Trade Agreement. Over the
Canada, Paraguay, Mexico and United next five years, IBISWorld expects exports
Kingdom are expected to remain major will continue to decline at an average annual
export destinations in 2015, accounting for rate of 0.6% through 2020, as the dollar
12.1%, 3.2%, 62.9% and 3.4% of total gains in strength and industry operators
industry exports, respectively. Exports to become more domestically oriented.
Products & Markets
Business Locations 2015
West
AK
0.0 New
England
ME
Great Mid- 1.1
Lakes Atlantic 1 2
NY 3
WA MT ND 5.9
5 4
3.0 0.4 MN
Rocky
1.1 2.6
WI
OR Mountains SD
0.2
Plains 1.7 MI
4.4
PA
5.0
6
7
4.4 ID IA OH 9 8
0.7 WY 4.2
0.3
NE
1.1
IL IN WV VA
5.0 2.2 0.6
West NV
0.6 0.3
KY
UT MO
0.7 NC
1.5
2.0 CO KS 2.8 1.5
4.2 0.7 TN
SC
Southeast
0.9
CA 0.4
15.8
OK AR GA
0.0 0.6 AL 1.7
AZ MS 0.4
1.7 NM
0.4 Southwest 0.2
TX LA
0.0 FL
3.1 4.6
West
HI
0.2 Additional States (as marked on map) Establishments (%)
1 VT 2 NH 3 MA 4 RI Less than 3%
1.3 0.7 3.5 0.4 3% to less than 10%
10% to less than 20%
5 CT 6 NJ 7 DE 8 MD 9 DC
20% or more
1.6 2.6 0.4 1.3 0.0
Products & Markets
Business Locations Proximity to downstream markets

Distribution of establishments vs. population
enables manufacturers to increase
delivery speed while reducing
30
transportation costs. However, due to
the large number of downstream
markets and the relatively small 20
number of companies in this industry,
the dispersion of establishments does
%
not follow a clear trend. Analysis 10
suggests that the majority of industry
manufacturers in the United States are
located in the West and the Mid- 0
Atlantic region, which, on a combined
West
Great Lakes
Mid-Atlantic
New England
Plains
Rocky Mountains
Southeast
Southwest
basis, comprise an estimated 40.0% of
total establishments.
The West accounts for an estimated
25.0% of total establishments. This is in Establishments
line with downstream demand, as the Population
region accounts for the second-highest SOURCE: WWW.IBISWORLD.COM
number of toy stores at about 18.0%.

California, in particular, is the densest The region has access to some of the
state, accounting for about 15.8% of total largest US seaports, making it an
manufacturers. The Mid-Atlantic region attractive location for manufacturing
accounts for an estimated 15.0% of the industries to import raw materials and
number of establishments nationally. ship exports overseas.
Competitive Landscape
Market Share Concentration | Key Success Factors | Cost Structure Benchmarks
Basis of Competition | Barriers to Entry | Industry Globalization
Market Share Toy manufacturing is a lucrative business moving their production facilities to
Concentration in the United States. While industry overseas locations such as China, in
concentration remains low, it has attempts to manufacture goods at a lower
increased over the past five years and is cost than was possible domestically.
Level
expected to continue its upward trajectory. Over the next five years, industry
Concentration in As a result of a 0.7% per year contraction concentration will increase further as the
this industry is L ow in enterprises, the exit of operators from number of enterprises decrease at an
this industry has been fuelled by a rise in annualized rate of 0.7%. As more US
imports. The influx of more-affordable operators reshore manufacturing
toys into the domestic market created an operations, and existing unprofitable
intensely competitive environment for players exit the market, large
existing players. Faced with eroding manufacturers will benefit from
margins and loss of buyers, some purchasing and technical economies of
operators were simply forced out of the scale and will account for a greater
market. Other manufacturers resorted to proportion of industry revenue.
Key Success Factors Establishment of brand names Ability to quickly adopt new technology
Recognizable brand names and positive Patented technology can be essential
images help operators remain competitive to competing with imports. In
IBISWorld identifies and win supply contracts and shelf space. addition, the adoption of new
250 Key Success technology will play a key role in
Factors for a Having a diverse range of clients making domestic manufacturers more
business. The most Diversifying of client rosters offsets the competitive as production reshores to
risk and potential financial impacts of the United States.
important for this
losing important customers. Of particular
industry are: importance is the ability to target a large Must comply with required
consumer base segmented by age and product standards
interests so as to diversify risk. Operators should ensure that
manufactured products meet design
Having links with suppliers and legislative specifications in order
Maintaining strong links with suppliers to avoid tarnishing their reputations
helps in negotiating competitive prices and incurring significant losses by
for inputs, payment, trade credit and having to recall their products because
delivery terms. of safety concerns.
Cost Structure Profit remain fixed. In addition, imported

Benchmarks Profit is measured as income before products continue to pose a threat to
interest and taxes. Declining downstream profit margins. In order to compete with
demand and falling revenue over the past lower-cost imports, US manufacturers
five years has impaired Toy, Doll and Game have been forced to discount prices and
Manufacturing industry profit margins absorb losses. Increases in raw material
(earnings before interest and taxes). Falling costs have also eaten into profit: the price
revenue has caused industry operators to of plastic materials and resin has
experience a higher cost per unit, since increased at an average annual rate of
expenses, such as rent and salaried wages, 1.2% over the past five years.
Cost Structure However, the recent decline in the price for toy, doll and game manufacturing
Benchmarks of crude oil has brought down costs for toy include plastic, wood, rubber, metal and
manufacturers. Since plastic and other raw textiles. The prices of these materials can
continued
materials used in manufacturing toys are be volatile, and many have gone up in
derivatives of hydrocarbons, many of which price over the past five years.
are obtained from crude oil and since the
manufacturing process is energy intensive, Wages
declining oil prices have improved profit Wages are the second-largest expense
margins over the past couple of years. item, representing an estimated 18.3%
Additionally, increasing demand for of industry revenue in 2015. Labor is
electronic toys, which have higher margins used to assist in the production, packing
has also increased profitability. Overall, and distribution of goods, and for
IBISWorld expects profit to account for conducting sales, research and
5.5% of revenue in 2015. development, management and other
activities. Over the past five years, many
Purchases manufacturers have reduced labor to cut
Purchases of raw materials are the largest costs and improve margins.
expense for this industry, accounting for Furthermore, many domestic companies
an estimated 42.0% of total revenue in have relocated their production facilities
2015. This is typical of manufacturing to lower-cost production countries, such
industries, as operators buy large as China. This exodus of manufacturing
amounts of raw materials to produce operations has further reduced the
their final outputs. Input materials used number of US workers in the industry.
Sector vs. Industry Costs
Average Costs of
all Industries in Industry Costs
sector (2015) (2015)
100
7.0 5.5 n Profit
n Wages
10.7 18.3 n Purchases
80 n Depreciation
n Marketing
n Rent & Utilities
n Other
Percentage of revenue
60
56.7 42.0
40
1.5 3.5 2.7
2.5 1.0
20 2.8
26.5
19.3
0
Cost Structure Wages as a share of revenue have Rent and utilities

Benchmarks increased from 16.6% in 2010 to 18.3% Rent and utility costs are expected to
in 2015, because revenue has fallen account for 2.7% of total revenue in 2015.
continued
much more rapidly in comparison. These costs, which largely cover
expenditures on the use of leased
Depreciation machinery, buildings and storage
Depreciation is expected to account for facilities, have decreased over the past
1.5% of revenue in 2015. Over the past five years as operators have closed
five years, the deprecation expense for underperforming plants to cut costs.
the industry has increased due to a
shifting reliance from labor to capital in Other
order to improve efficiency and reduce Costs associated with marketing and
costs for larger operators. As trends in advertising are expected to account for
additive manufacturing start influencing 3.5% of industry revenue in 2015. Other
this industry more, deprecation expense expenses incurred by this industry
is expected to increase over the next five include insurance, freight, employees
years. However, overall depreciation fringe benefits expenses and
expense has fallen from 1.8% of revenue administrative costs. Collectively, these
in 2010 because of declining revenue and expenditures are estimated to account for
a small return on investment. 27.0% of total revenue in 2015.
Basis of Competition Until the introduction of electronic and peak buying times such as the winter
interactive toys, industry manufacturers holiday season, was critical in an
Level & Trend largely operated in a saturated product extremely competitive environment. A
market, differentiating themselves from key strategy for manufacturers was their
ompetition
C in this competitors through price, product range ability to forsee demand trends for
industry is H
ighand and availability and play value. Operators certain products in order to avoid over or
the trend is S teady existed in a well-defined product market, undersupply issues. Manufactures also
which catered to nearly every age tended to highlight a products play
category and consumer preference. Price value, an assessment of a products value
was viewed as the primary point of based on its contribution to a childs
differentiation, subject to seasonal development. The competitive
fluctuations depending on product environment faced by manufacturers
capacity and industry demand. essentially created a low level of product
differentiation between competitors
Internal which commonly led to new designs
In the traditional toy market, product being hastily copied by existing players.
ranges offered by various manufacturers Many product segments such as dolls and
were almost as important as price, as this soft toys are characterized by widespread
enabled enterprises to differentiate imitation of popular designs.
themselves in a highly saturated market. While factors such as availability and
The importance of product availability play value continue to be important in
was also a key factor in remaining todays toy manufacturing environment,
competitive, as it was seen as crucial to the development and introduction of
maintaining relationships with technology which facilitated the
wholesalers. The ability to produce introduction of electronic and interactive
sufficient merchandise, especially for toys to the market, created an entirely
Basis of Competition new basis of competition for players. The partaking in activities such as hiking,
continued concept of merging technology and toys climbing trees, riding bikes and watching
was considered revolutionary, aided to a birds. It was widely perceived that
large extent by ever-shrinking microchips outdoor play boosted the creativity and
and their ability to create robotic toys social well-being of children. The gradual
that follow instructions or interact with migration of children to indoor activities
children. However, the addition of over the past three decades has often
technology to the competitive landscape been labeled a cause of obesity epidemic
has created setbacks. Manufacturers have in the United States during this period.
come to acknowledge that once However, a strong rise in highly
introduced, technological products structured activity organized sports or
require constant upgrading via the cultural classes (art and music) can also
addition of new features, if they are to be attributed to this decline. As a result,
remain relevant to todays consumer. increasing consumer awareness of the
importance of exercise and healthy
External lifestyle choices has heightened the level
Toys have traditionally competed with of competition among sporting good
other leisure activities for childrens manufacturers. Sporting manufacturers
attention. Before video games and have marketed the health benefits
electronic toys, children spent the associated with sports participation in a
majority of their time playing outside, bid to boost sales.
Barriers to Entry Prospective operators planning to enter

the Toy, Doll and Game Manufacturing Barriers to Entry checklist
Level & Trend industry will face a number of challenges. Competition High
The most significant barrier to entry is the Concentration Low
arriers to Entry
B amount of time, research and capital Life Cycle Stage Decline
in this industry are required to establish a brand, along with Capital Intensity Low
Mediumand S teady the complexities involved in developing Technology Change Medium
unique product designs, and protecting Regulation & Policy Heavy
intellectual property rights and Industry Assistance Low
trademarks. The high-cost and long-term
nature of brand reputation is, hence, the SOURCE: WWW.IBISWORLD.COM
largest barrier to entry. Already

established brands such as Hasbro and The market share controlled by
Mattel have respective product offerings existing industry players can act as a
and new entrants will be compelled to natural deterrent to new operators.
invest money and time to persuade Today, the retail landscape for toys is
consumers to shift away from recognizable dominated by a few large stores including
brands. Once a new product has been Walmart, Target and Toys R Us, and a
developed, manufacturers must invest in large portion of these retailers shelf
trademarks to protect themselves from space is occupied by products
copyright issues. The development and manufactured by incumbent players. As a
protection of intellectual property rights result, new entrants will find it difficult to
ranks high with manufacturers, as this compete against the industrys largest
enables them to exclusively produce a players in gaining new supply contracts,
brand or use a patented product design. thereby ensuring sales.
Barriers to Entry New players also face the issue of demand alternative labor during the
continued finding skilled labor. It can be particularly production process. Manufacturers must
difficult to secure skilled production assess their labor requirements on a
workers such as CAD-trained designers regular basis. Experienced workers are
and tertiary qualified management. Also, approaching retirement and can be
the development of new products can costlier for a company over the long term.
Industry The Toy, Doll and Game Manufacturing due to the price competitive nature of this
Globalization industry has experienced increasing levels industry, imports have been well received,
of globalization over the past five years. The often viewed as offering better value for
key driver has been the rapid increase in money. Their impact on the domestic
Level & Trend imported goods into the US market. The market has been extensive, with US
lobalization
G in influx of imports has largely come from manufacturers forced to compete on price
this industry is developing Asian countries such as China. as opposed to product range and quality.
Highand the trend Imported goods are often considerably less The overall effect of imports on the local
costly to produce than domestically economy is possibly best surmised by its
is I ncreasing
manufactured items, but are also share of the domestic demand, which is
synonymous with lower quality. However, expected to be 98.5% in 2015.
International trade is a Trade Globalization Going Global: Toy, Doll & Game Manufacturing
major determinant of 2004-2015
an industrys level of
200 Export Global 200 Export Global
globalization.Exports offer
growth opportunities
for firms. However there 150 150
Exports/Revenue
Exports/Revenue
are legal, economic and Toy, Doll & Game

political risks associated
100
Manufacturing 100
with dealing in foreign
countries.Import
2015
competition can bring a 50 50
greater risk for companies
as foreign producers satisfy
2004
domestic demand that 0 Local Import 0 Local Import
local firms would otherwise 0 40 80 120 160 0 40 80 120 160
supply. Imports/Domestic Demand Imports/Domestic Demand
Major Companies
Hasbro Inc. | Other Companies
Major players
(Market share)
90.3%
Other
Hasbro Inc. 9.7% SOURCE: WWW.IBISWORLD.COM
Player Performance Hasbro Inc. is the second-largest US toy years, predominantly to China. This
manufacturer by revenue, with a large practice has allowed the company to take
portfolio of brands including traditional advantage of low labor and overhead
Hasbro Inc. trading cards and board games, puzzles, costs, resulting in significant cost savings.
Market share: 9.7% action figures, plush toys and dolls, These products are then distributed to
Industry Brand Names childrens electronics and learning aides. domestic operators, such as wholesalers,
Playskool It is the largest toy manufacturer that still specialty toy stores, discount retailers,
Transformers manufactures in the United States. mail-order and catalog houses,
My Little Pony Hasbros products are broken down into department stores and mass
four categories: games and puzzles merchandisers across the United States.
(including Monopoly and Scrabble), boys The company records its manufacturing
toys (G.I. Joe and Transformers), girls revenue in the Global Operations
toys (My Little Pony and Baby Alive) and segment, which comprises revenue
preschool toys (Playskool). The company generated from manufacturing activities,
employs about 2,700 people in the worldwide, including the companys
United States and is headquartered in manufacturing plant in Massachusetts.
Pawtucket, RI. Since most of the sales from this segment
Hasbro manufactures its products as intersegmental, the Global Operations
through company-owned plants in the segment has a very small profit margin,
United States and via third-party which is not reflective of the average
facilities. However, the major player has profitability of this industry.
substantially increased the level of As with other operators in the
outsourcing to Asian countries over the industry, Hasbro has suffered from the
Hasbro Inc. (US industry-specific operations) - financial performance*

Revenue Operating Income
Year ($ million) (% change) ($ million) (% change)
2010 199.6 N/C 2.4 N/C
2011 228.2 14.3 2.5 4.2
2012 171.9 -24.7 -1.8 N/C
2013 194.0 12.9 0.8 N/C
2014 175.0 -9.8 1.7 112.5
2015 180.7 3.3 2.7 58.8
*Estimates
SOURCE: ANNUAL REPORT AND IBISWORLD
Major Companies
Player Performance age compression phenomenon, a trend rate of 2.0% to $180.7 million in the five
continued whereby children began trading in years to 2015. Improvements in
traditional toys for more sophisticated disposable income and consumer
gadgets, such as video games and confidence helped boost sales by 14.3% in
electronics, at younger ages. In response 2011, despite a 6.1% decline in revenue
to this trend, in 2005, Hasbro launched during 2010 due to a decline in boys toys
several new brands (e.g. Tiger sales. During the recession, Hasbro
Electronics) to target the 8- to 12-year- demonstrated solid growth as toys with
old demographic, in hopes of maintaining movie and television tie-ins exhibited
its market share through selling strong sales. For instance, theatrical
electronic-based games. However, the releases of both Transformers and G.I.
company experienced little success, as it Joe in 2009 increased demand for
faced high competition from video game related action figures and other similar
manufacturers. Furthermore, poor products, leading to a 1.7% revenue
spending conditions due to a weak growth in the same year. Hasbros
economy deterred consumers from income also remained strong in 2009;
paying premium prices for electronic industry specific operating income
toys. Consequently, Hasbro announced in increased by 47.3% as a result of a rise
early 2009 that it would abandon its in total sales, positive product mix and
electronic division. Instead, the company decreased marketing and sales
refocused its strategy to emphasize its expenses. In 2015, Hasbros US
core products, which have ties to motion industry-specific revenue is expected to
pictures and television shows. To achieve slightly rise. This will most likely occur
this, the company entered a joint venture because of strong first quarter sales, as
with Discovery Communications to create compares to the previous year.
a new childrens channel during the same Additionally, Hasbros long-standing
year. This channel, called The Hub, was investment in technology and
launched in October 2010. productivity will continue to pay off
and will boost its operating income by
Financial performance 54.9% for 2015. A fall in the price of
Hasbros industry-specific revenue is crude oil is also expected to improve
expected to decline at an average annual profit margins for the company.
Other Companies Although a considerable portion of the Alivans

Toy, Doll and Game Manufacturing Estimated market share: 0.1%
industry is dominated by global players Founded in 2003 and headquartered in
Hasbro and Mattel, the remainder of the Panama City, FL, Alivans is one of the
industry is characterized by a large largest producers of handcrafted magic
number of small- and medium-sized wands in the world. The company, which
companies. Larger players have been employs about 8 people, offers a
increasingly offshoring or outsourcing multitude of different wands, wizard
production overseas to take advantage of staffs and other magic-themed toys,
inexpensive labor and overhead costs. including merchandise based on the
As a result, smaller manufacturing popular Harry Potter movie series. As a
facilities dominate the domestic private company, Alivans does not
production of toys and dolls. disclose financial information to the
Major Companies
Other Companies public. However, in 2015, according to The company closed its last major US
continued Hoovers, the company is expected to production facility in 2002, and has since
generate $0.8 million in revenue, giving focused only on design, marketing and
it an industry market share of 0.1%. distribution for its US-based operations.
Mattel Inc. KNex Brands LP

Estimated market share: N/A Estimated market share: 1.6%
Mattel Inc. is the worlds largest KNex was founded in 1992 and sent its
manufacturer and marketer of toy first shipment for sale to Toys R Us.
products. The company offers a diverse The company is headquartered in
range of products for children of all ages, Hatfield, PA, and employs about 400
including toys for infants and people. KNex and its affiliated
preschoolers, girls toys, boys toys, youth manufacturer, The Rodon Group, have an
electronics, hand-held games and estimated combined revenue of $100
educational toys. Mattels domestic million, according to The Wall Street
segment is divided into three categories: Journal. In 2012, the company took over
Mattel girls and boys brands, which the production of Tinkertoys under
include toys such as Barbie dolls and Hot license from Hasbro. Like other
Wheels; Fisher-Price brands, which industry players, KNex had moved
include Little People, BabyGear, Power most of its manufacturing operations
Wheels and Dora the Explorer; and to China and the Far East. However,
American Girl brands, which include the over the past few years, KNex has
My American Girl and Bitty Baby brought a significant amount of its
collections. Mattel has also entered into production operations back to its
licensing agreements to produce and headquarters in Hatfield. The company
market toys based on Disney characters, believes that it can gain long-term
Disney films, Nickelodeon characters, advantages such as lower compliance
Warner Bros. characters such as Batman costs, shorter response times and a
and Superman, and Sesame Street greater ability to monitor production
characters. However, in 2010, the Sesame quality and design. According to estimates
Street license was granted to Hasbro. from Hoovers the company generated
This license includes a deal with Sesame $28.9 million in 2014 and IBISWorld
Workshop for rights to produce Sesame expects KNex will generate $30.0 million
Street toys through 2020. in revenue from its US industry-specific
Mattel manufactures toy products via operations in 2015, putting its estimated
company-owned facilities and third-party market share at 1.6%.
manufacturers. Over the past five years,
the company has focused most of its Little Tikes
core-product production in company- Estimated market share: N/A
owned plants in order to achieve greater Little Tikes was established in Aurora,
flexibility in the production and delivery OH, in 1969 and is currently
of its products. Mattel has moved most of headquartered in Hudson, OH. The
its manufacturing facilities from the company employs about 800 people at its
United States to China, Indonesia, only manufacturing facility in the US, in
Thailand, Malaysia and Mexico as part of Hudson. Little Tikes is another industry
its continuing effort to reduce overall player that exemplifies the recent
manufacturing costs. This move has preference for reshoring toys, dolls and
enabled the company to take advantage games manufacturing back to the US.
of cheap labor and low overhead costs. Over the past few years, the company has
Major Companies
Other Companies brought back many of its manufacturing capital investments to ensure that it
continued operations back to the US, citing significant remains competitive, despite increasing
logistical problems and high freight costs as labor costs in the United States. The
two of their primary concerns. Company company recently invested $3.0 million in
officials contend that labor cost is not the new injection modeling technology, which
only concern when making a decision became operational in 2014. Since Little
regarding where to produce. Equally Tikes is a privately held company and is a
important are logistical, quality and subsidiary of MGA Entertainment, it does
response time concerns alongside energy not publicly report its revenue. However,
costs. The United States has an advantage IBISWorld expects revenue to be
in those areas, claimed the company in a significant, given that, according to some
Cleveland Business article in July 2013. sources, Little Tykes contributed $250.0
Little Tikes has seen growth in recent years million in revenue to Newell Rubbermaid
after moving more of its manufacturing before being acquired by MGA
back to the US and is making considerable Entertainment in 2006.
Operating Conditions
Capital Intensity | Technology & Systems | Revenue Volatility
Regulation & Policy | Industry Assistance
Capital Intensity The level of capital intensity in this

industry is low to moderate. On average, Capital intensity
Capital units per labor unit
this industry spends $0.08 on capital for
Level
every dollar spent on labor, which reflects 0.5
The levelof capital the importance of manual labor to the
intensity is L ow product assembly process and the need 0.4
for qualified personnel for the design 0.3

components of production.
The level of capital requirements for 0.2
manufacturers can be extensive, covering 0.1

items such as plant and equipment used
in the production process. The level of 0.0
Economy Manufacturing Toy, Doll &
research and development activity Game
Manufacturing
undertaken by a company also affects Dotted line shows a high level of capital intensity
investment in plants and machinery. SOURCE: WWW.IBISWORLD.COM
The development of new products has

generally been associated with and an overall rise in capital
substantial changes to existing investments. Manufacturers also tend
machinery and production processes, to spend more on capital investments
Tools of the Trade: Growth Strategies for Success
New Age Economy Investment Economy

Recreation, Personal Services, Information, Communications,
Health and Education. Firms Mining, Finance and Real
benefit from personal wealth so Estate. To increase revenue
stable macroeconomic conditions firms need superior debt
are imperative. Brand awareness management, a stable
and niche labor skills are key to macroeconomic environment
product differentiation. and a sound investment plan.
Capital Intensive
Labor Intensive
Hobby & Toy Stores

Cardboard Box & Container Manufacturing
Traditional Service Economy Motorcycle, Bike & Parts Manufacturing Old Economy
Wholesale and Retail. Reliant Toy & Craft Supplies Wholesaling Agriculture and Manufacturing.
on labor rather than capital to Toy, Doll & Game Manufacturing Traded goods can be produced
sell goods. Functions cannot using cheap labor abroad.
be outsourced therefore firms Recordable Media Manufacturing To expand firms must merge
must use new technology or acquire others to exploit
or improve staff training to economies of scale, or specialize
increase revenue growth. in niche, high-value products.
Change in Share of the Economy SOURCE: WWW.IBISWORLD.COM

Capital Intensity to remain competitive within the driven by the trend of keeping the
continued market by investing in new technology. number of employees to a minimum and
This trend was exemplified by the using temporary employees during peak
launch of electronic and interactive times (the third and fourth quarters of
toys into the market. each fiscal year). While the level of capital
Growth in the level of capital intensity has decreased over the past five
investment for this industry has had a years due to a dramatic decline in
resulting negative impact on the demand revenue, IBISWorld expects that the
for semi-skilled labor. While skilled industry will continue to become more
production staff has always been required capital intensive over the next few years
for the assembly of products, a rise in as industry operators reshore
automation technology has effectively manufacturing to the United States and
made such staff redundant. The demise attempt to substitute capital for labor to
of labor across this industry has also been compete with low-priced imports.
Technology & Systems In terms of manufacturing technology, modifications. In addition, per childrens
the types and extent of technology vary product safety laws, Consumer Product
Level across product segments. However, there Safety Improvement Act of 2008 (see
are some common technologies Regulation and Policy), manufacturers
The level
of employed by larger manufacturers to have transitioned to using lead-free paint
Technology Change streamline production and reduce costs. and non-toxic raw materials.
is M
edium For instance, most large manufacturing Over the five years to 2015, changes in
operations utilize computer-controlled technology have been accelerated by the
machinery and other automated age compression phenomenon in the
handling and assembly technology to industry. In response to this trend,
perform repetitive tasks. Although these manufacturers have launched more
forms of machinery are relatively sophisticated toys with advanced
expensive to set up and install, the electronic components. For example,
associated productivity gains are microchips that provide lifelike features
substantial. An increase in output to toys and complex operating systems
volume reduces the cost per unit, as have been installed for learning
fixed costs are spread across more units. platforms. With youth electronic toys
Types of materials used as inputs to sales projected to increase, such
the manufacturing process are also advancements in technology are
changing, with lighter and more durable expected to continue in the industry
materials being utilized for product over the next five years.
Revenue Volatility Revenue for the Toy, Doll and Game triggered by the economic recession,
Manufacturing industry is influenced by significantly hindered demand over the
variations in the level of personal five years to 2015.
Level
disposable income and consumer Demand has also been adversely
The level of confidence. Spending on industry affected by growing competition from low
Volatility is H
igh products increases when consumers are priced imports. Imports from Asia,
more confident about their financial especially China, have placed increasing
position. The decline of these drivers, pressure on the industry by offering
Revenue Volatility retailers a broad range of toy products at initially caused concern within the industry
continued highly competitive prices. As a result, due to a gap in product availability;
domestic operators have been forced to however, the introduction of new goods
reduce their price points in order to soon filled the void.
remain competitive, causing overall revenue Over the five years to 2015, the industry
to decrease in the process. Conversely, experienced high revenue volatility.
advances in product technology and design Volatile exchange rate conditions coupled
have fueled rise in demand for interactive with economic uncertainty led to large
toys. Age compression in society prompted fluctuations in revenue over the past
a shift in consumer preferences, which five-year period.
A higher level of revenue Volatility vs Growth

volatility implies greater
industry risk. Volatility can 1000 Hazardous Rollercoaster
negatively affect long-term
Revenue volatility* (%)
strategic decisions, such as 100

the time frame for capital Toy, Doll & Game Manufacturing
investment.
10
When a firm makes poor
investment decisions it
may face underutilized 1
capacity if demand
suddenly falls, or capacity 0.1 Stagnant Blue Chip
constraints if it rises 30 10 10 30 50 70
quickly. Five year annualized revenue growth (%)
* Axis is in logarithmic scale
Regulation & Policy Consumer Product Safety Because most industry products are
Improvement Act geared toward children under 12 years of
Consumer Product Safety Improvement Act age, operators in this industry
Level & Trend of 2008 (CPSIA) is the most recent industry- experienced considerable testing costs. In
he level of
T relevant regulation to be introduced. This addition, many stores have also incurred
Regulation is act aims to protect children from unsafe large disposal costs for goods that do not
Heavyand the levels of lead and phthalates by banning the meet the new regulation and
sale of all childrens products that do not governmental standards, which have hurt
trend is S
teady
meet the new federal regulations. CPSIA profit margins in the past five years.
also requires manufacturers to test all
products and parts intended for children Other regulations
under 12 years of age, including all toys, Along with many other manufacturing
dolls and games that are sold. If stores industries, the Toy, Doll and Game
are found selling items do that meet the Manufacturing industry is subject to
new federal regulations, violators are federal, state and local environmental
subject to criminal and civil charges laws, and health and safety laws and
under the act, with fines up to $100,000 regulations that impose workplace
for each violation and prison sentences standards and limitations on the
up to five years. discharge of pollutants into the
Regulation & Policy environment. These laws also establish allowances for sulfur and nitrogen oxides,
continued standards for the handling, generation, along with strict requirements applicable
emission, release, discharge, treatment, to ozone emissions and other toxic
storage and disposal of certain materials, materials. The Clean Water Act regulates
substances and wastes. Such laws include the discharge of pollutants into the
US Clean Air Act and the Clean Water surface water. This act establishes a
Act. The US Clean Air Act requires system of minimum national efficiency
compliance with air quality standards standards for water quality, on an
and empowers the Environmental industry-to-industry basis. Industry
Protection Agency (EPA) to establish and operators are also subject to occupational
enforce the limits on the emission of health and safety, wage, overtime and
pollutants. The EPA also establishes other employment laws.
Industry Assistance The Toy Industry Association, Inc. importance of safe play throughout the
(TIA) was founded in 1916, and is the United States.
national trade association for US The National Association of
Level & Trend producers and importers of toys, games Manufacturers mission is to enhance the
he level of
T and childrens entertainment products. competitiveness of manufacturers and to
Industry Assistance Together with the US government, TIA increase understanding among
is L owand the has developed toy safety standards. TIA policymakers, the media and the general
also works with consumer public about the importance of
trend is S teady
organizations, such as the International manufacturing to US economic strength.
Consumer Product Health and Safety With the implementation of the Uruguay
Organization (ICPHSO) and, most Round agreement effective January 1,
recently, the National SAFE KIDS 1995, all US duties on dolls and traditional
Campaign, to communicate the toys were completely eliminated.
Key Statistics
Industry Data Industry Price of plastic
Revenue Value Added Establish- Exports Imports Wages Domestic materials and resin
($m) ($m) ments Enterprises Employment ($m) ($m) ($m) Demand (Index)
2006 4,621.5 996.6 787 776 16,075 1,568.4 20,087.1 712.8 23,140.2 198.4
2007 3,320.3 639.2 777 770 12,349 2,286.7 25,102.5 517.6 26,136.1 195.9
2008 3,413.6 517.8 712 705 11,044 1,757.8 25,810.8 463.0 27,466.6 215.0
2009 2,373.3 580.7 667 660 9,814 1,775.8 22,915.7 419.6 23,513.2 190.8
2010 2,377.0 527.0 598 593 8,800 1,663.6 23,759.5 394.9 24,472.9 210.1
2011 2,417.0 595.2 594 589 7,828 1,561.4 20,627.8 408.2 21,483.4 229.9
2012 1,740.1 443.5 563 560 7,481 1,410.9 19,060.3 349.5 19,389.5 235.2
2013 1,716.3 393.9 545 543 6,538 1,255.3 18,241.0 287.5 18,702.0 245.3
2014 1,726.8 434.5 563 559 7,292 1,256.4 18,552.6 322.3 19,023.0 257.8
2015 1,863.5 470.7 577 573 7,621 1,584.0 18,529.3 340.3 18,808.8 223.0
2016 1,828.3 469.2 574 566 7,724 1,553.8 18,892.0 341.2 19,166.5 211.7
2017 1,786.9 451.2 563 559 7,246 1,561.8 19,332.3 326.1 19,557.4 221.5
2018 1,751.7 448.4 562 558 7,277 1,536.0 19,800.6 327.6 20,016.3 228.9
2019 1,728.6 436.8 560 555 7,184 1,516.0 20,028.0 319.3 20,240.6 233.3
2020 1,711.7 435.0 560 554 7,213 1,538.3 20,061.9 320.3 20,235.3 236.1
Sector Rank 288/405 285/405 134/405 123/405 244/405 121/373 36/373 267/405 108/373 N/A
Economy Rank 1075/1364 1116/1364 941/1364 879/1364 1054/1364 139/428 38/428 1067/1364 126/428 N/A
Annual Change Industry Establish- Domestic Price of plastic ma-

Revenue Value Added ments Enterprises Employment Exports Imports Wages Demand terials and resin
(%) (%) (%) (%) (%) (%) (%) (%) (%) (%)
2007 -28.2 -35.9 -1.3 -0.8 -23.2 45.8 25.0 -27.4 12.9 -1.3
2008 2.8 -19.0 -8.4 -8.4 -10.6 -23.1 2.8 -10.5 5.1 9.8
2009 -30.5 12.1 -6.3 -6.4 -11.1 1.0 -11.2 -9.4 -14.4 -11.3
2010 0.2 -9.2 -10.3 -10.2 -10.3 -6.3 3.7 -5.9 4.1 10.1
2011 1.7 12.9 -0.7 -0.7 -11.0 -6.1 -13.2 3.4 -12.2 9.4
2012 -28.0 -25.5 -5.2 -4.9 -4.4 -9.6 -7.6 -14.4 -9.7 2.3
2013 -1.4 -11.2 -3.2 -3.0 -12.6 -11.0 -4.3 -17.7 -3.5 4.3
2014 0.6 10.3 3.3 2.9 11.5 0.1 1.7 12.1 1.7 5.1
2015 7.9 8.3 2.5 2.5 4.5 26.1 -0.1 5.6 -1.1 -13.5
2016 -1.9 -0.3 -0.5 -1.2 1.4 -1.9 2.0 0.3 1.9 -5.1
2017 -2.3 -3.8 -1.9 -1.2 -6.2 0.5 2.3 -4.4 2.0 4.6
2018 -2.0 -0.6 -0.2 -0.2 0.4 -1.7 2.4 0.5 2.3 3.3
2019 -1.3 -2.6 -0.4 -0.5 -1.3 -1.3 1.1 -2.5 1.1 1.9
2020 -1.0 -0.4 0.0 -0.2 0.4 1.5 0.2 0.3 0.0 1.2
Sector Rank 30/405 39/405 87/405 82/405 48/405 8/373 294/373 42/405 328/373 N/A
Economy Rank 129/1364 155/1364 411/1364 371/1364 218/1364 9/428 336/428 200/1364 370/428 N/A
Key Ratios Imports/ Exports/ Revenue per Share of the

IVA/Revenue Demand Revenue Employee Wages/Revenue Employees Average Wage Economy
(%) (%) (%) ($000) (%) per Est. ($) (%)
2006 21.56 86.81 33.94 287.50 15.42 20.43 44,342.15 0.01
2007 19.25 96.05 68.87 268.87 15.59 15.89 41,914.33 0.00
2008 15.17 93.97 51.49 309.09 13.56 15.51 41,923.22 0.00
2009 24.47 97.46 74.82 241.83 17.68 14.71 42,755.25 0.00
2010 22.17 97.08 69.99 270.11 16.61 14.72 44,875.00 0.00
2011 24.63 96.02 64.60 308.76 16.89 13.18 52,146.14 0.00
2012 25.49 98.30 81.08 232.60 20.09 13.29 46,718.35 0.00
2013 22.95 97.54 73.14 262.51 16.75 12.00 43,973.69 0.00
2014 25.16 97.53 72.76 236.81 18.66 12.95 44,199.12 0.00
2015 25.26 98.51 85.00 244.52 18.26 13.21 44,652.93 0.00
2016 25.66 98.57 84.99 236.70 18.66 13.46 44,174.00 0.00
2017 25.25 98.85 87.40 246.61 18.25 12.87 45,004.14 0.00
2018 25.60 98.92 87.69 240.72 18.70 12.95 45,018.55 0.00
2019 25.27 98.95 87.70 240.62 18.47 12.83 44,445.99 0.00
2020 25.41 99.14 89.87 237.31 18.71 12.88 44,405.93 0.00
Sector Rank 187/405 5/373 5/373 331/405 109/405 355/405 305/405 285/405
Economy Rank 883/1364 6/428 6/428 702/1364 699/1364 684/1364 799/1364 1116/1364
Figures are in inflation-adjusted 2015 dollars. Rank refers to 2015 data. SOURCE: WWW.IBISWORLD.COM
Jargon & Glossary
Industry Jargon AGE COMPRESSIONA phenomenon whereby children TWEENThe stage between middle childhood and
are outgrowing toys at a younger age and demanding adolescence in human development, generally ranging
more adult-like products. from 8 to 12 years of age.
OFFSHOREThe relocation of a companys business WEBISODEAn episode, such as a TV show, which may
process, such as manufacturing or accounting, from one or may not have been telecast but can be viewed at a
country to another, whether the work is outsourced or website.
stays within the company. WHOLESALE BYPASSA popular trend within retail and
OUTSOURCEThe act of procuring goods or services manufacturing industries where producers supply goods
under contract with an outside supplier. directly to stores, eliminating the middleman.
PHTHALATEA substance is added to many plastics (to
increase flexibility, transparency, durability and
longevity) that is being phased out of many products in
the United States over health concerns..
IBISWorld Glossary BARRIERS TO ENTRYHigh barriers to entry mean that IMPORTS Total value of industry goods and services
new companies struggle to enter an industry, while low brought in from foreign countries to be sold in the
barriers mean it is easy for new companies to enter an United States.
industry. INDUSTRY CONCENTRATIONAn indicator of the
CAPITAL INTENSITY Compares the amount of money dominance of the top four players in an industry.
spent on capital (plant, machinery and equipment) with Concentration is considered high if the top players
that spent on labor. IBISWorld uses the ratio of account for more than 70% of industry revenue.
depreciation to wages as a proxy for capital intensity. Medium is 40% to 70% of industry revenue. Low is less
High capital intensity is more than $0.333 of capital to than 40%.
$1 of labor; medium is $0.125 to $0.333 of capital to $1 INDUSTRY REVENUEThe total sales of industry goods
of labor; low is less than $0.125 of capital for every $1 of and services (exclusive of excise and sales tax); subsidies
labor. on production; all other operating income from outside
CONSTANT PRICESThe dollar figures in the Key the firm (such as commission income, repair and service
Statistics table, including forecasts, are adjusted for income, and rent, leasing and hiring income); and
inflation using the current year (i.e. year published) as capital work done by rental or lease. Receipts from
the base year. This removes the impact of changes in interest royalties, dividends and the sale of fixed
the purchasing power of the dollar, leaving only the tangible assets are excluded.
real growth or decline in industry metrics. The inflation INDUSTRY VALUE ADDED (IVA)The market value of
adjustments in IBISWorlds reports are made using the goods and services produced by the industry minus the
US Bureau of Economic Analysis implicit GDP price cost of goods and services used in production. IVA is
deflator. also described as the industrys contribution to GDP, or
DOMESTIC DEMANDSpending on industry goods and profit plus wages and depreciation.
services within the United States, regardless of their INTERNATIONAL TRADEThe level of international
country of origin. It is derived by adding imports to trade is determined by ratios of exports to revenue and
industry revenue, and then subtracting exports. imports to domestic demand. For exports/revenue: low is
EMPLOYMENTThe number of permanent, part-time, less than 5%, medium is 5% to 20%, and high is more
temporary and seasonal employees, working proprietors, than 20%. Imports/domestic demand: low is less than
partners, managers and executives within the industry. 5%, medium is 5% to 35%, and high is more than
ENTERPRISE A division that is separately managed 35%.
and keeps management accounts. Each enterprise LIFE CYCLEAll industries go through periods of growth,
consists of one or more establishments that are under maturity and decline. IBISWorld determines an
common ownership or control. industrys life cycle by considering its growth rate
ESTABLISHMENTThe smallest type of accounting unit (measured by IVA) compared with GDP; the growth rate
within an enterprise, an establishment is a single of the number of establishments; the amount of change
physical location where business is conducted or where the industrys products are undergoing; the rate of
services or industrial operations are performed. Multiple technological change; and the level of customer
establishments under common control make up an acceptance of industry products and services.
enterprise.
EXPORTSTotal value of industry goods and services sold
by US companies to customers abroad.
Jargon & Glossary
IBISWorld Glossary NONEMPLOYING ESTABLISHMENT Businesses with no WAGESThe gross total wages and salaries of all
paid employment or payroll, also known as employees in the industry. The cost of benefits is also
continued nonemployers. These are mostly set up by self-employed included in this figure.
individuals.
PROFITIBISWorld uses earnings before interest and tax
(EBIT) as an indicator of a companys profitability. It is
calculated as revenue minus expenses, excluding interest
and tax.
VOLATILITYThe level of volatility is determined by
averaging the absolute change in revenue in each of the
past five years. Volatility levels: very high is more than
20%; high volatility is 10% to 20%; moderate
volatility is 3% to 10%; and low volatility is less than
3%.
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WWW.IBISWORLD.

COM Toy, Doll & Game Manufacturing in the USMay 2015 1

Game time: Despite recovering demand,

IBISWorld Industry Report 33993

2 About this Industry 16 International Trade 34 Key Statistics

www.ibisworld.com | 1-800-330-3772 | info @ibisworld.com

About this Industry

Main Activities The primary activities of this industry are

The major products and services in this industry are

Similar Industries 33461 Recordable Media Manufacturing in the US

33699a Motorcycle, Bike & Parts Manufacturing in the US

33992a Athletic & Sporting Goods Manufacturing in the US

Additional Resources For additional information on this industry

Key Statistics Revenue Annual Growth 10-15 Annual Growth 15-20

$102.5m $1.6bn 573

Demand from hobby

Industry Structure Life Cycle Stage Decline Regulation Level Heavy

Import penetration into the manufacturing Trade-weighted index

Current The Toy, Doll and Game Manufacturing

Diving demand Demand in the Toy, Doll and Game

Produced in China In addition to falling demand, competition

Changing tastes Children, aged nine and younger, are

Industry Despite challenges faced by local

consumers will likely increase their

manufacturers will continue to face

China to lose its Due to rising labor costs in China, which

20 Maturity Quality Growth

Key Features of a Decline Industry

0 Cardboard Box & Container Manufacturing

Toy, Doll & Game Manufacturing

Products & Markets

Supply Chain KEY BUYING INDUSTRIES

KEY SELLING INDUSTRIES

Products & Markets

Products & Services Products and services segmentation (2015)

Products & Markets

Major Markets Exports international market. Furthermore, due to

Products & Markets

Major Markets Major market segmentation (2015)

International Trade Imports created a volatile domestic market for US

Products & Markets

International Trade Total imports in 2015 are expected to

to 2015, the value of imports fell at an

Exports To... Imports From...

Products & Markets

Products & Markets

Business Locations 2015

Products & Markets

Business Locations Proximity to downstream markets

number of toy stores at about 18.0%.

Cost Structure Profit remain fixed. In addition, imported

Sector vs. Industry Costs

Cost Structure Wages as a share of revenue have Rent and utilities

Barriers to Entry Prospective operators planning to enter

largest barrier to entry. Already

are legal, economic and Toy, Doll & Game

Hasbro Inc. 9.7% SOURCE: WWW.IBISWORLD.COM

Hasbro Inc. (US industry-specific operations) - financial performance*

Other Companies Although a considerable portion of the Alivans

Mattel Inc. KNex Brands LP

Capital Intensity The level of capital intensity in this

for qualified personnel for the design 0.3

manufacturers can be extensive, covering 0.1

COM Toy, Doll & Game Manufacturing in the USMay 2015 1