allegedly...
One of the major talking points over recent weeks has been Argos’ decision to hit suppliers with demands for 2% turnover rebates. The timing of the move has been widely criticised, coming just after quotes had been submitted and shortly before orders are due to be confirmed for the year. Whether the threat is implicit or explicit, there does seem to be an inference that non-compliance could result in orders being adversely affected. Both domestic and FOB suppliers have been targeted, the latter just after meetings in Hong Kong had been concluded and days before Chinese New Year, which has been suggested as cynical at best. Several suppliers have pointed out that with freight rates at their lowest level for some while and exchange rates favouring sterling, Argos is already significantly ‘in credit’, without having to levy additional charges on suppliers. Ultimately, though, it’s yet another game of Russian roulette: do you say ‘no’ and risk orders being reduced, or say ‘yes’ and erode margins even further. Publically every supplier will deny that they have given in, but privately, how many will be prepared to take the risk? Either way, it’s unlikely that Argos will be the last retailer to hold a gun to suppliers’ heads in this way....
Asda is the latest in a growing line of retailers being linked with a move for the Early Learning Centre: whether this rumour is any more credible than recent media reports suggesting that Tesco is a potential suitor is anyone’s guess. Either way, everyone connected with ELC must be hoping that the situation is resolved sooner rather than later. The uncertainty surrounding ownership can’t be good for morale, yet alone the ability to conduct day- to-day business....
The confirmation from Toymaster that Conways had finally entered administration was sad news indeed, but it’s important to keep it in perspective. First, despite a few whispers in Nuremberg to the contrary, Toymaster is more than capable of dealing with the losses it will incur. Ian Edmunds was kind enough to confirm to Toy World that although they will inevitably take a hit, the Toymaster balance sheet is strong
98 Toyworld
enough to cope. Toymaster has no debt, significant cash reserves in the bank and a bad debt reserve which will cover the liability. Which leads us to the big question, what will now happen to Conways? Of course, there are several potential scenarios. Over the Toy Fair period (when it was a major topic of conversation), the general consensus was that Conways was looking to slim down to anything between 3-8 shops and lose its warehouse. Hopefully a positive outcome can still be achieved, but there are clearly obstacles to be overcome, in particular on the issue of getting hold of stock. Barry and Gordon are well respected in the industry, and there is no doubt that people will want to help them if they can: but whether credit insurance terms and conditions, or even individual company regulations, will allow people to continue to supply them is another matter entirely. This may be compounded by the fact that it is highly unlikely they will be able to rejoin Toymaster....
Disney and Toys R Us have come in for some flack over a Doc McStuffins promotional event which has backfired. Parents expressed their disappointment that the chance to “meet their favourite characters from the TV show” actually turned out to be a cardboard cut-out and a few members of staff dressed in doctor’s coats. A Disney spokesperson apologised for “the confusion” (an early contender for ‘least convincing apology of the year’ perhaps?). Promo events can be hugely valuable for both brand and retailer alike, but in fairness, how anyone thought they would get away with this is a mystery....
Allegedly was sad to hear that Stephen Green passed away in January. Stephen enjoyed an illustrious toy trade career back in the 80’s and 90’s, taking in stints as MD of Nintendo, Bandai and ERTL, and he made many good friends during his time in the toy trade, who will be sad to hear of his passing....
The licensing community has provided a fertile source of gossip over the past month, with a number of high-profile moves being
announced. Paul Bufton will shortly be leaving Warner Bros. Consumer products to join Rovio (of Angry Birds fame) to head up the company’s EMEA consumer products division. Alan Fenwick has left Turner, to be replaced by Johanne Broadfield, while Zodiak Kids has parted company with a number of people including Jennifer Lawlor. Disney’s Andrew Alsop has resigned from his position as Hardlines commercial director to join the DreamWorks ‘revolution’, where he will head up the European operation. Richard Hollis and former Tesco buyer Nick Cooke have also taken up senior roles within the DreamWorks UK operation....
It’s not just the licensing fraternity which has seen a number of recent changes: Andrea Abbis has moved to a new role in Argos, to be replaced as trading manager by Linzi Walker, who comes from the consumer electronics team. Jon Tilley has left Plum Products to join Chicco, while Hornby is in the process of conducting a consultation period with its entire marketing team, which regrettably is likely to result in a number of casualties....
We’ve only just finished the 2014 Toy Fair season, so apologies for looking ahead to 2015 already, but it seems worth pointing out that the Hong Kong Toys and Games Fair will be taking place a week later next year. The Fair traditionally takes place in the first week of January, but the 2015 dates have been announced as 12th-15th January. With the UK Toy Fair starting on Tuesday 20th January, this means that there will only be a matter of days between the two shows. Indeed, with Nuremberg and Spring Fair running over the following two weeks (28th January – 2nd February and 1st February – 5th February respectively), the four shows will run over four consecutive weeks, something that hasn’t happened for a long time (if indeed it ever has). It seems unlikely that the Hong Kong showrooms will alter their opening dates, which means that a lot of people won’t be affected by the move. But for those who do have a presence at the exhibition itself, a traditionally punishing schedule of global Toy Fairs just got that little bit more punishing.
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