Ali Mafi 50 Fifty Gifts


Not quite doomsday They say that within 15 years China will overtake the USA as the world’s biggest economy. That means ‘goodbye’ to cheap goods emanating from cheap labour from that source. Those who have dealings with Chinese factories are


probably already experiencing it. There is a shortage of labour available to produce goods at prices we want, and frankly I am delighted. Why should anyone, anywhere on the planet, want to do jobs for less than 5% of what someone here wants for doing it? OK, there are differences in the cost of living, but whichever way you shake it, it boils down to the same thing: we pay more for things because we earn more and have aspirations to earn even more. Then comes the next problem; where do we go from


here? India is not an option as it is growing almost as fast as China with already more millionaires than our population; Thailand is more expensive than China already and also growing; Vietnam, Cambodia and Laos do not have the infrastructure; and you can, for the moment, forget Africa. Above all, none of them have anything remotely resembling Hong Kong in their territory or on their doorstep. I think we sometimes forget the amazing advantage China has with Hong Kong by having an easy-to-get-around, multi-cultural, English-speaking area that acts as a funnel for dealing with a vast, sprawling country such as theirs. The reality is that we will simply have to pay higher


prices as China marches on to becoming a high technology country, just as Japan moved from cheap transistor radios and Hong Kong did from being the main source of junk. So how do we cope with higher prices? Well we are already experiencing colossal balance of trade deficits,


and if we continue our consumption at higher prices but at the same volume, we will simply bankrupt ourselves. No one, no business and, similarly, no country can keep spending more than it is earning forever. Please think about the fact that the Pound is weaker against the Dollar, and the Euro is indicative of the universal view of this economy as is the downgrading of our credit rating. The answer simply is that we will have to buy less, consider purchases more carefully, and work harder to be where we were. We genuinely don’t need the stuff we fill our homes and our lives with, and getting into a state of genuinely earning and appreciating what we have is no bad thing. Our attitude and greed is exemplified by the iPhone;


I have a 5, but cannot think of one single additional benefit it offers over my old 4S and, in fact, having a new connector means none of my iPhone accessories work. But I, like many millions, was brain washed into needing to have it. The general election in 2030 will be based on much harsher realities than now; there will be less concern about how many Bulgarians will enter the country and greater emphasis on what we need to do to sell more and buy less. Our industry is one of the most dependent on China, and will consequently be hardest hit; as if it’s not already suffering shrinkage due to a number of factors, one being the reality that kids are getting older younger. My five-year-old grandson informed me only yesterday that he is too old for toys, and much prefers his iPad which he has now had for two years...and yes, I bought it for him.


Then there is the discussion, which I have heard three times recently in the media, questioning the validity of claims being made about educational toys. And finally, the economic climate, which leads to the realisation that kids don’t need that many toys for Christmas and birthdays, and often end up paying greater attention to the packaging. We can, of course, carry on regardless and see what happens, but from my experience and knowledge this approach does not do lemmings a great deal of good, and I fail to see how it could possibly benefit us. The answer is that we need toys that appeal to older children, manufactured here and exported to the rest of the world. It seems like a ludicrous idea, but I really don’t see an alternative. This is one of the greatest inventing nations on the planet, and it’s about time we rebuilt our


manufacturing base to make what we invent. I am not going into politics, but Britain has a really poor history of getting things wrong and many of the problems in the world, such as issues in the Middle East, are due to Britain’s past mistakes. De-industrialising in favour of becoming a country relying on providing services, on the basis that we could not compete with emerging economies, was a mistake; a grave mistake for which we will pay a heavy price. Japan and Germany are both high-cost nations, and yet they manage to have thriving manufacturing economies, so we cannot keep arguing that our cost base is the prohibitive factor. It’s a simple quest: children over five don’t want


toys, so we need to sell them things they do want, and importing Chinese goods is becoming too expensive and unreliable so we need to make them here. The headache doesn’t even end there as we are also losing our grip on being service providers. Come on, let’s face it, many large UK service providers have their phones answered in Punjab. Sit and reflect , if someone had suggested to you thirty years ago that it would be feasible for BT’s customer services call centre to be in India, you would have ordered a straight jacket for them. I assure you it will not be long before our cars are electronically diagnosed through our phones by someone in India or China, or even have our health diagnosed similarly by an offshore doctor. I have been saying for years that we have been earning too much for doing too little, and have had economies based on gambling (the stock exchange and the commodities market) and escalating prices. One last thought, we have the most expensive petrol on the planet because our government needs to extract as much money out of us as possible, and having a thriving industrialised economy would have obviated the necessity for that. Simply put, we are being ripped off because we have put ourselves in a position to be and have enough spenders to whom it does not matter. I will give you a relevant example: I went to buy a watch in Hong Kong from a shop I have had dealings with before. He gave me a price, and I asked if I was getting the usual 40% discount. “No”, he said. “We have no need to do that, the Chinese pay the price without question, and we don’t need you Europeans anymore.” We are being sidelined, guys. Face it.


David


The list had a distinct value feel, with Poundworld,


Ripley Chief Operating Officer of Winning Moves


The retail situation


I read with interest the recent Retail Week/Zolfo Cooper Growth retail report for 2013. The report indexes the fastest-growing retail businesses in terms of profitability over the past three years. Aldi came out top of the survey achieving in excess of 100% accumulated profit growth over the period.


99p Stores, Aldi, Lidl, B&M, Card Factory and Home Bargains, all making the Top 30. There were also several luxury retailers on the list, proving that customers are still willing to make considered purchases at the top end of the cost/quality spectrum. Notable Toy retailers that were ranked within the Top


30 profit growth performers included Hamleys at 12th and Smyths at 17th, achieving accumulated growth rates of 40.6% and 29.4%, respectively. It was encouraging to see that many retailers,


regardless of customer segment, are achieving outstanding commercial success in the most challenging retail environment in living memory. Any retail success stories are welcomed in the new (normal) tough trading environment.


The review The Portas review of the high street has once again come in for some criticism for making limited progress since it was published in December 2011. Any retailer expecting this independent review to save their retail


business and local high street needs to quickly realise that this is only one element of a much wider self-help programme.


The challenge of ‘Adapt or Die’ is more relevant today in retail than it ever has been in the preceding 100 years, the basis for this being the current pace of change within the sector. Whilst much is being made of several established UK retailer’s lack of growth with their current business models, many have adapted, survived and indeed grown. The key message of the Portas review was for the smaller high street chains and independents to stop trying to compete with the internet and grocers, re- appraise, change and focus on their potential core differentiators of experience, specialism and service. With the type of products they stock, toy retailers


have a stronger hand than most with maximising the customer experience and providing specialist advice with quality service being a given (although this is heavily dependent on where you shop, and is not always the reality).


Toyworld 57


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70  |  Page 71  |  Page 72  |  Page 73  |  Page 74  |  Page 75  |  Page 76  |  Page 77  |  Page 78  |  Page 79  |  Page 80  |  Page 81  |  Page 82  |  Page 83  |  Page 84  |  Page 85  |  Page 86  |  Page 87  |  Page 88  |  Page 89  |  Page 90  |  Page 91  |  Page 92  |  Page 93  |  Page 94  |  Page 95  |  Page 96