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Christmas ripples and choppy waters… it’s the Friday Blog!

Published on: January 20th, 2017

Christmas may be a distant memory for most of us, but the ripples from a turbulent festive trading season are still undulating. Several retailers released their festive trading results this week, and the phrase ‘mixed bag’ would seem a reasonable summary of what has been announced. On the positive side, The Entertainer, Mothercare and Shop Direct will surely be delighted with their respective performances, all posting encouraging increases in the fourth quarter. Conversely, Toys R Us unveiled a disappointing set of figures, with a domestic decrease of 2.4% and a decline in Europe and Asia Pacific of 4.9%. It’s not what they – or the industry – were hoping for, especially as TRU had made a number of bullish statements about its expectations before the festive season. Poundworld also posted a whopping loss of £5.4m, compared with a £21m profit last year. To compound their misery, one can only imagine the challenges they must be facing with the currency swing. No wonder there is talk of them moving to a multi-price point strategy.

Coming back to a point I touched on briefly in a previous Blog, NPD’s figures amply illustrated the critical importance of the last two week’s trading to the overall Q4 performance. Sales in the final week increased by + 33% in the UK compared with last year, + 29% in France and + 26% in the US. This made week 51 the second highest of the year in terms of sales, behind only – you guessed it – week 50. With so much riding on the last two weeks, no wonder a few retailers lost their nerve in the preceding weeks. This trading pattern certainly puts immense pressure on the industry as a whole, not to mention everyone’s logistics operations. And with Christmas falling on a Monday this year, we can surely expect a similar pattern, as the public will have a whole weekend to do last-minute shopping next time round.

I have finally managed to work through my copious notes from Hong Kong, so you can read about some of the interesting new products and ranges I saw at the Toys & Games Fair and in the Kowloon showrooms here. While there was greater focus on trading negotiations and currency fluctuations this year, there was thankfully no shortage of great product on view, which may help to smooth some of the choppy waters which lie ahead.

There are a couple of significant retail moves to report; with Dawn Lavalette on maternity leave, John Hext has moved over from the online trading division to head up the toy buying team at Tesco, while I understand that both Sarah Strangeways and Natalie Riley will be leaving Hamleys, with Steve Pearson now rumoured to be heading up toy buying.

I have been asked by several people for details of Jim Brearley’s funeral, which will be taking place on 26th January in the village of Great Chishill. If anyone else would like more information, drop me an email.

A quick plug for the Toy Trust Media Auction, which traditionally raises a huge sum for this very worthwhile industry charity. You can see what’s on offer here. A whole host of media companies are offering some great media-based opportunities, although one company does appear to be struggling with the concept of a media auction and how it works…they seem to be confusing it with a tombola or raffle?!

With my batteries almost now recharged from Hong Kong (not helped by picking up a nasty cold at the end of the trip), I’m looking forward immensely to Toy Fair next week. The whole Toy World team will be there, so if you’d like to catch up with us, drop us an email or pop on to the stand, GH37 – on the central aisle, right at the heart of the show. See you there!

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