COMING TO GRIPS TOY MAKERS FACE INDUSTRY WOES, SOPHISTICATED KID CONSUMERS.Byline: Brent Hopkins Staff Writer The holidays may be the most wonderful time of the year for toy makers, but they'll be in for a nasty fight before then. High oil prices have nearly doubled the cost of plastic, a key component of most toys. Stack-ups at the port of Long Beach and record-high diesel prices have snarled snarl 1 v. snarled, snarl·ing, snarls v.intr. 1. To growl viciously while baring the teeth. 2. To speak angrily or threateningly. v.tr. logistics, driving up costs and frustrating manufacturers. The bankrupt KB Toys K•B Toys (previously known as Kay Bee Toys) is a chain of mall-based retail toy stores in the United States. It was founded in 1922 by the Kaufman brothers. It currently operates 605 stores in 44 U.S. states, Puerto Rico as well as Guam. announced Tuesday that it's considering shuttering up to 238 more locations by the end of January, including stores in Simi Valley Simi Valley (sē`mē, sĭm`ē), city (1990 pop. 100,217), Ventura co., SW Calif. in an oil, fruit, and farm region; laid out 1887, inc. 1969. , Palmdale and Panorama City. By the end of this round of cuts, it will have 600 sites, roughly half the count from when it entered Chapter 11 in January. The industry's top two manufacturers, Mattel Inc. and Hasbro Inc., recently reported weak third quarter sales and cautioned investors that the fourth quarter could be disappointing. With stores ordering cautiously for the holiday season, no one expects a rousing end to a lackluster year. And to top it off, kids aren't even playing with the same things anymore. ``Things are tough right now,'' said David Riley, senior manager with the NPD Group The NPD Group, Inc. is a leading global market research company[1] founded in 1967 and provides consumer and retail information to manufacturers and retailers. Using actual sales data from retailers and distributors as well as consumer-reported purchasing behavior, NPD , a New York-based market research company. ``It's the whole concept of children getting older younger, where they're asking for consumer goods consumer goods Any tangible commodity purchased by households to satisfy their wants and needs. Consumer goods may be durable or nondurable. Durable goods (e.g., autos, furniture, and appliances) have a significant life span, often defined as three years or more, and that adults want, like PDAs and cell phones. The standard toy isn't as appealing to children as they once were.'' Mindful of this, along with myriad other challenges, toy makers have sought new ways to drive sales and find new market share. ``We're doing home video, TV and there's a movie in the works,'' said Isaac Larian Isaac Larian (born March 28 1954, Kashan, Iran) is the Chief Executive Officer of MGA Entertainment, the biggest privately owned toy company in the world. He was born in Iran to Persian Jewish parents. , chairman and chief executive officer of North Hills-based MGA Entertainment MGA Entertainment is a manufacturer of children's toys and entertainment products founded in 1997. Its products include the Bratz fashion doll line. External links
Wal-Mart and Target have gobbled up more and more of the market for toy sales in recent years, putting the squeeze on pure toy retailers. Larian bets that his Bratz and Alien Racer action figures will be able to make the leap out Verb 1. leap out - be highly noticeable jump out, stand out, stick out, jump appear, seem, look - give a certain impression or have a certain outward aspect; "She seems to be sleeping"; "This appears to be a very difficult problem"; "This project looks of toys into different forms of entertainment, presenting the increasingly more usual scenario of toy companies getting out of the toy business. Mattel, which made its fortune on Barbie and Hot Wheels Hot Wheels is a brand of die cast toy car, introduced by American toymaker Mattel in 1968. It was the primary competitor of Johnny Lightning and Matchbox until 1996, when Mattel acquired rights to the Matchbox brand from Tyco. , now aggressively promotes its Juice Box, a $69.99 media player that sells in electronics stores. ``We don't want to be known just for toys; we want to be known for playing,'' said Phil Jackson, vice president of marketing for games and puzzles for Mattel. ``As the world changes, we need to be there in more and more formats.'' Faced with a dwindling dwin·dle v. dwin·dled, dwin·dling, dwin·dles v.intr. To become gradually less until little remains. v.tr. To cause to dwindle. See Synonyms at decrease. number of retail outlets, other manufacturers seek new ways to get their products to buyers. Though selling through new markets doesn't haul in customers the way landing a mass-market retail order does, it allows manufacturers to land smaller but more diverse orders that can eventually add up to respectable numbers. Van Nuys-based Sota Toys sells its line of Professional Bull Riders Professional Bull Riders, Inc. (PBR) is an international professional bull riding organization based in Pueblo, Colorado, USA. PBR events are televised on Versus, FOX, and NBC. More than 800 cowboys from the U.S., Canada, Brazil, Australia, and Mexico hold PBR memberships. action figures through regular retailers, but it has also sold more than 70,000 units in its Street Fighter action figures mainly through Web sites. ``We're lucky in that we started relationships with the dot-coms, so the majority of our income will come from them,'' said Jess Bansal, Sota's vice president. ``We're still focused on being in a niche market, but the numbers that we're getting almost reflect what we'd do at a Wal-Mart.'' Though it still relies on stores to hawk its wares, Malibu-based Jakks Pacific Inc. takes a different tack. It's spread itself across many categories, selling everything from pens to video games, so it relies less on one hot seller. Though its retro TV Games and reintroduced Cabbage Patch Kids Cabbage Patch Kids are a brand of doll created by Xavier Roberts in 1978. The original dolls were all cloth and were available at local craft shows, and later at Babyland General Hospital in Cleveland, Georgia. have made a splash, it's developed products to sell in stores as varied as Linens 'n Things Linens 'n Things, Inc., headquartered in Clifton, New Jersey, is the second-largest large-format retailers of home textiles, housewares and decorative home accessories in the United States, behind Bed Bath & Beyond. and Best Buy. ``We don't consider ourselves just a toy company,'' said president Stephen Berman. ``We're in the toy business, but we're a kids entertainment consumer products company. And kids doesn't just mean children, it's people your age, people my age. We've all got some bit of kid in us.'' Brent Hopkins, (818) 713-3738 brent.hopkins(at)dailynews.com CAPTION(S): 3 photos Photo: (1 -- color) Jess Bansal, above, vice president of Van Nuys-based Sota Toys, stands in front of a life-sized Street Fighter toy while holding a toy ``Yellow Jacket'' bull. John McCoy/Staff Photographer (2 -- color) Jakks is hoping the reintroduction of the Cabbage Patch Kids will spur consumer interest in the retro doll. (3 -- color) Isaac Larian of North Hills-based MGA Entertainment, left, is taking the firm's Bratz dolls into the entertainment world. David Sprague/Staff Photographer |
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