The toy sector’s Christmas wish
Spanish manufacturers say that exports have provided a lifeline during the crisis, and that domestic sales are slowly starting to pick up
Sales of toys this Christmas have been patchy, according to the Spanish Association of Toy Manufacturers (AEFJ), with one week of good sales, followed by another not so good. “It’s a rollercoaster ride, up and down, but we haven’t really picked up much traction,” says José de la Gándara, the CEO of Famosa, one of the country’s biggest toymakers. Nevertheless, he says he is confident that this year’s sales will be better than 2012’s. The figures suggest that the sector is recovering, thanks mainly to exports, which in November increased by 6 percent on last year, a rise that’s worth around 280 million euros.
The AEFJ says that for the first time since 2010, toy sales forecasts are “optimistic.” The hopes of toymakers are resting on sales between now and January 4. January 6, the day when Spaniards traditionally give their Christmas gifts, falls on a Monday, meaning that there will be a full six-day period running up to that day within which people will have time to buy their presents. The AEFJ says that this could send sales up by 14 percent on last year. There may be uncertainty in the toy sector, but there is also optimism.
“We will reach our targets in the end, even if we have to suffer until the last day,” says De la Gándara, whose company saw turnover of 209 million euros last year, and hopes to reach 225 million this year. Famosa has some 2,300 products under 30 different brands, among them Pin y Pon and Parque de Atracciones (Fun Fair), which is proving to be one of this year’s most popular toys, alongside Barriguitas, Nenuco, and Spain’s answer to Barbie, Nancy. The group employs some 750 people around the world, of whom 450 work in Spain, most of them in a new manufacturing plant in Alicante.
The toy sector is surviving the depression thanks to exports to France, Portugal, the United Kingdom, Germany and some of the emerging economies of the former Soviet bloc. According to the AEFJ, dolls are the most popular export, generating sales of more than 50 million euros this year; they are a particular favorite of the Russians.
We realized years ago that we couldn't beat the Chinese on price"
Exports in Alicante province have increased by 7 percent, and are now worth 99 million euros. In Valencia they have risen by 4 percent, and in Madrid by 20 percent. Europe is still the main destination for toys made in Spain, and there has been an 18-percent increase in sales in Portugal, and a 22.7-percent rise in Russia, representing sales of more than 12 million there up until September.
Emilio Rico, based in Onil, a small manufacturing town 35 kilometers north of Alicante, says that this year’s sales campaign has been “pretty good, within the context of the crisis overall.” He owns a small company employing 50 people called Paola Reina, with an annual turnover of around 6 million euros, 80 percent of which comes from exports. “We realized several years ago that we couldn’t beat the Chinese on price, so we decided to go for a quality product,” says the 57-year-old, whose upscale dolls sell for between 15 and 100 euros and are made in Europe, using European materials: hair from Germany and clothes made in France or Italy.
“I can’t compete with China, and anybody who survives these days does so by making something different,” says Rico, showing one of his dolls from the La Familia de las Amigas (The Family of Friends) collection, which is proving the hit of the Christmas season.
José Antonio Pastor, the AEFJ’s president, says that the export market has proved a “life-saver” for Spain’s toy manufacturers, who have suffered the impact of a five-year depression and soaring unemployment. Domestic sales fell by 2 percent in the first six months of the year, a smaller drop than in previous years; in 2012 sales fell by 11 percent, and 10 percent in 2010.
He says that parents’ main concern when buying toys is price, and that they spend time looking on the internet, but still prefer to buy in a store. In 2012, online sales of toys were just 4 percent of the total, although 64 percent of shop customers already knew what they were going to buy, having checked price and features online, according to a 2012 survey carried out by the AEFJ.
The AEFJ has set up its own website to help would-be buyers, called Ludomecum.com, which has full details about all the products made by its members. It has also launched an online campaign: www.unjugueteunailusion.com, along with www.observatoriodeljuego.com.