Far be it from me to prattle on about supply chains to all of you on the front lines fighting the battle every day. From out here it looks like an old car which keeps getting driven after the thingamabob goes bad until the next thingbreaks, then it starts making a horrible racket, so you just turn the stereo up which fixes it for a while until the whole engine seizes up.
Keeping ports open sounds a lot like cranking a Best of BTO 8-Track.
It feels good but it’s not going to fix the problem.
Holiday sales are predicted to be strong as several varieties of government stimulus have left households flush. Savings now represent 10% of consumers disposable income which is quite a way above the pre-epidemic norm. The Labor Department reports that hourly wages were up 4.6% in September. Monthly retail sales increased 13.9% from a year earlier. That said, consumer inflation – higher prices – accounted for 5.4% of that increase.
Strong top line sales figures don’t necessarily mean “Happy Days” for toy manufacturers in a year where shipping container rentals cost more than the profit of the goods inside. 2021 remains a year where most companies will be glad just to pay their bills and maintain their hard fought shelf space rather than enjoy strong bottom line profits.
Through it all, toy industry hiring has been quite strong since mid-July. Toyjobs has been running at full throttle (more car metaphors?) We’ve been filling mostly Marketing and Product Development slots. That makes me optimistic. Hopefully it means that companies are looking to do something new. Perhaps it’s a harbinger of them investing in new products, lines and categories.
Typically in August and September we see a lot of Sales searches, as companies gear up for next year’s sales cycle. This year, that hasn’t been the case and I chalk it up to retailers penchant for taking sales meetings on a remote basis. Manufacturer’s don’t need as many Sales Execs if no one is trapped at the airport and everyone just needs to stroll down to a pre-set Zoom Room.
I suspect that this too will gradually revert back over time as certain manufacturers seek to gain advantage by visiting buyers in person. Relationships are key when it comes to squeezing that one extra SKU onto the shelf or scoring a rumored private label line. Competitors will soon follow suit once that begins to work. Experience has shown me that even during times of great disruption, things gradually tend to revert toward the mean and only change permanently at the margins.
Lastly, just a short word about Brian Goldner. I didn’t know him well as Hasbro hasn’t been a Toyjobs client since the mid- eighties. I did work with him a bit back in his Bandai days. One unusual thing about him was that he was able to combine his hi-energy, hard charging way with his basic friendliness and good humor. His vision and perhaps even more importantly his execution, took Hasbro against the tide and into entertainment business which led them from being the perennial Number Two past Mattel into the leadership position of the toy industry (yeah, yeah I know Lego actually has higher sales volume). My condolences to his family and friends. I hope that it’s meaningful that he left his mark and he made a difference. He left us way too young. May his memory be a blessing.
All the best,