‘Helpful’ suggestions…it’s the Friday Blog!

Published on: 9th August 2019

New owner Reliance Brands has teased that it plans to open Hamleys stores in the US and Canada in order to – and I am lifting this next phrase directly from several media reports – “capitalise on the vacuum created by liquidation of Toys R Us.” The reports provide a tantalising glimpse into the Indian company’s plans, but offer no detail whatsoever. It might have been helpful if we knew the number of stores, location, timing and the other crucial elements that would make this into a decent story, but sadly this information is currently AWOL. However, it’s certainly worth keeping an eye on proceedings. As for whether Hamleys can genuinely fill the “vacuum” – or indeed, whether such a vacuum actually exists – I’ll leave you to make up your own mind.

Meanwhile, the Brexit saga / fiasco (delete as to personal preference) rumbles on, with evidence that it is beginning to have tangible consequences for UK toy companies. I know of at least one acquisition deal which fell through because an American company found it impossible to persuade US banks to lend it cash to acquire a British company due to concerns over Brexit. I was also forwarded an email sent to a company by a prospective new client in France, which said: “Our management has decided not to develop new partnerships with companies located in the UK, due to the unknown outcome of the Brexit. I know this is a difficult time for you and I’m sorry we cannot work together. I hope this will be reconsidered in a few years once the economic & political horizon is clear.” A few years! In fairness, the person who wrote this email may not be too wide of the mark. Even if we do leave with No-Deal on October 31st, that is not the end – just the beginning of years of negotiations and uncertainty, as we’ll need to replace all the international trade deals we have with new deals…including one with the EU itself. I bet that will be fun to negotiate after the mud-slinging by our government in recent weeks. Whilst everyone will have a personal view on the rights and wrongs of Brexit, developments like this illustrate the professional challenges that UK companies will face for quite a while yet – how very helpful.

The advantages of co-ordinated international action – just one of the many EU benefits we’re turning our back on – were neatly illustrated by Amazon’s response to the French government levying the GAFA (Google, Apple, Facebook and Amazon) tax. Knowing France had gone solo by implementing the tax, Amazon openly admitted that rather than paying, it would simply be passing the cost on to businesses that use its Marketplace platform. Quelle surprise, as the French might say. “We operate in the very competitive and low-margin retailing sector,” bleated an Amazon spokesperson, neglecting to mention that the company made a record $10b profit last year. To be fair, it’s not easy to negotiate or argue with a company which is the living embodiment of those automatic switchboards we all detest so much: “Press 1 for sales, 2 for accounts, 3 if you wish to talk to someone about us paying our fair share of tax….I’m sorry, no-one is available to take your call. Please hang up and try again later.” (Repeat to infinity).

On to more positive news, congratulations to Sara Taylor on her promotion to general manager UK for Spin Master – the announcement got a huge amount of traction on our social media sites last Friday, showing just how well-liked and respected Sara is throughout the industry. I can also reveal that Jessica Blue will be leaving Informa today. After 15 years with the company behind BLE and Licensing Expo, Jess is taking on a new challenge within another US-based exhibition company. We join all her former colleagues in wishing her all the best in her new role. BLE brand director Anna Knight will be expanding her remit by caretaking Jess’ role in the short term…although she assures me that she has no plans to move to America at any stage!

On the subject of licensing, the Licensing Survey which appeared in our August issue has certainly been creating a few ripples – we received some very honest feedback from licensees about the challenges they’re facing with licensed product at the moment (click here for the full survey). There is more illuminating content to come in the second part of the article, which will be published in the September edition of Toy World. No spoilers, but one issue which is increasingly rankling with licensees is the number of ‘helpful’ suggestions coming from licensors on product design and development – as one pointed out, “the product design should be left to the licensee, who are the experts in their field.” And this issue is certainly not limited to licensors: suppliers are constantly telling me about certain retailers offering ‘helpful’ feedback (known by some as ‘sticking their oar in’). In fairness, you could argue that licensors and retailers have a vested interest in helping to deliver a successful product, and they are only offering advice that they believe will be in everyone’s interest. But at what point do you have to trust that toy companies know what they’re doing when it comes to design and development?

On that note, a newsletter from one of the grocery retailers which was doing the rounds this week may have raised a few eyebrows among suppliers: I guess it’s possible that Isaac, Mattel, Jakks and all the other doll suppliers will have ripped up their future development plans and gone back to the drawing board as a result of a technical manager’s ‘helpful’ suggestions about new inclusive doll lines that he feels suppliers should be introducing (especially ‘helpful’ since a number of companies are already doing exactly what he is suggesting…although it doesn’t sound as though those suppliers are on the buying teams’ radar?).