Analysis of global toy market in 2021

Positive and negative effects of the epidemic on Industry

The impact of the outbreak of COVID-19 on the toy industry is complex. At the beginning of 2020, many toy factories in China were shut down due to epidemic prevention and isolation measures. And the industry was seriously damaged. Fortunately, by the second quarter, as the epidemic eased and the production of enterprises gradually returned to normal. China as the world's largest toy producer and exporter, has basically operated normally.

Unexpectedly, due to the rampant spread of the epidemic, many countries have implemented home isolation measures. As a result, parents have increased toy consumption for their children. The market demand is booming, and the sales of online toys have increased significantly. This situation continues to this day. Therefore, 2021 will bring both opportunities and challenges to the toy industry.

Opportunities: as the main toy consumption areas in the world, European and American countries have been plagued by the epidemic so far. The home isolation measures taken by various countries have made outdoor toys, puzzles, building blocks and other products quite popular. In the United States, toy sales increased by 19% year-on-year in the first three quarters of last year. Toy sales on several e-commerce platforms increased by more than 50% year-on-year. 

The development of cross-border e-commerce is particularly bright. Guangdong as China's largest toy and export base, in the first three quarters of 2020, "other trade" including cross-border e-commerce exports increased significantly by 79.08% year-on-year. In the past, toy exports were mainly composed of "general trade" and "processing trade". 

In recent years, "other trade" has increased rapidly. By the third quarter of last year, the export amount of "other trade" of toys in Guangdong exceeded "general trade" and became the second main force of product export. This can be seen from the rapid development of cross-border e-commerce. This situation is expected to continue in 2021.

In terms of challenges: "today's world is experiencing great changes that have not been seen in a century". If the world economy recovers as expected by major financial institutions in 2021. It is likely to lead to the continued rise of raw material prices on the basis of the sharp rise last year. And trade protectionism will still rise. Export enterprises should pay particular attention to the fact that in December last year, the central working conference focused on "deepening the market-oriented reform of interest rate and exchange rate and maintaining the basic stability of RMB exchange rate at a reasonable and balanced level". 

It is expected that the RMB will not appreciate rapidly against the US dollar in the short term last year, but in view of the global optimism about China's economic development, the RMB exchange rate is believed to remain strong. In terms of production costs, the state clearly proposes to "increase the proportion of labor remuneration in the initial distribution, improve the wage system and improve the reasonable wage growth mechanism". 

Therefore, maybe labor costs will still rise in the future. In this context of industrial economy, enterprises must pay attention to strengthening product innovation and improving product added value.

The prospect of industrial development is still bright

As the current toy market demand growth is largely due to the epidemic situation and home isolation measures, some people are worried about whether the toy market demand will also decline significantly in the future as the epidemic situation is controlled.

Such worries are not groundless. However, toys are different from daily necessities. They have the attributes of creative products, and the market demand is full of elasticity. As long as enterprises can develop enough creative products, they can stimulate consumption and expand market capacity. Therefore, as long as enterprises pay close attention to the market and actively develop and innovate, the market demand can expand rapidly.

At the beginning of last year, Steve pasher, chairman and CEO of the American Toy Association, said in an exclusive interview with Xinhua News Agency: as a major producer, exporter and consumer, China's important position in the global toy industry will not change due to the COVID-19 epidemic