‘Perfect storm’ of trading issues caused HSBC Bank and the Chinese government to close the company down.

Two weeks ago, we reported that Toy State had ceased trading with immediate effect. At the time, many people in the toy community assumed that its fate was ultimately driven by recent events at Toys R Us, especially as the company was heavily involved in the retailer’s own-brand programme.

Speaking to Toy State UK’s managing director Michael Angel, he admits that while Toys R Us was a major factor, it was by no means the only issue. A perfect storm of retail failures (not just TRU, but Ludendo and other global retailers), a series of under-performing licences and – crucially – a writing down of commercial assets including properties (a Hong Kong property crash is by all accounts becoming a genuine possibility, and banks are reacting accordingly) left the company desperately short of cash and unable to pay wages to the 3,000 workers at its factory.

At this stage, the workers complained to local government officials, and they moved swiftly, closing down the factory and taking control of disposing of assets.