From the publisher

So much has happened since I wrote last month’s Leader column that I almost don’t know where to start. Unfortunately, most of the developments were not exactly what we needed ahead of the allimportant Christmas period. The short version is that the UK economy was tanked by a horrendously misjudged mini-budget, the pound fell to record lows against the dollar and mortgage rates went through the roof (at the same time that new higher energy bills kicked in) – all in the space of a single week. To top it all, the Prime Minister resigned just as this issue went to press.

To say that these events dented an already fragile consumer confidence would be an understatement. I attended a fascinating NPD presentation in London last month, which reinforced what I had been hearing anecdotally about September trade – it really wasn’t good. The month started in a relatively lacklustre fashion, before plummeting rapidly downhill in the second half of the month, with the Queen’s death & subsequent mourning period, followed by the disastrous mini budget, applying a double whammy to sales in the final two weeks of September.

However, with eight key weeks’ trading before the big day, let’s try to remain positive: things can change very quickly out at retail and we can take some comfort from the adage that, no matter how rubbish the preceding months have been, parents will always do their best to make sure their kids have a good Christmas. Once the nights draw in, Christmas ads start popping up on TV and retailers apply a festive makeover to their stores, it will provide a warm glow and welcome relief that – after a tough year – something nice is just around the corner. Whether that feelgood factor is enough to overcome the very real financial pressure that many families will be facing remains to be seen - but never underestimate the determination of parents to provide a memorable Christmas for their children.

With some senior retail figures openly admitting that this could be the “most value-driven Christmas ever”, I suspect we are going to see numerous retail promotions over the coming weeks – I even hear that some toy companies are switching money from media budgets to fund retail promotions. Inventory levels at retail will undoubtedly be a factor in the frequency and depth of promotional activity; apparently, over in the US, analysts are suggesting that toy inventory levels are at record highs. That may not necessarily be the case here in the UK, but I think we can all agree that stock shortages are unlikely to be a major factor this year (except on a few red-hot lines).

Historically, one third of UK toy sales in Q4 are on promotion – will that figure rise even higher this year? Will consumers wait for promotions to purchase, with many household budgets likely to be squeezed? In fairness, NPD presented compelling statistical evidence which suggested that traditionally, toy sales are largely unrelated to economic pressures: the biggest sales dips in the past two decades coincided with the demise of Woolworths and Toys R Us, not when the UK economy went to hell in a handcart. But will that still be the case this year? Will shoppers want to spend at the same level as before – and even if they have the desire, will they physically be able to afford to do so?

The truth is that we don’t know. Each consumer will have to make that decision for themselves. Some will be relatively unaffected by the prevailing economic headwinds, others more so. US toy sales have held up remarkably well this year, predominantly because of the massive stimulus grant given to families by the government – that generous giveaway hasn’t happened here, although a modest contribution has been made by the UK government to partially offset the rise in energy costs over this winter. That payment may yet be sufficient to enable many families to avoid cutting back on festive spending. For others, it won’t be nearly enough. The old adage says that ‘hope is not a strategy’ – but I think we have to hold on to the hope that families will continue to do all they can to give their kids the best Christmas possible.

Meanwhile, as we all keep a close watch on sales figures in the run-up to Christmas, it’s also important for retailers to keep one eye on the early part of next year. Our two main features this month focus on the first half of the year, with an in-depth look at the new ranges which will be introduced to the market in Q1, plus a separate round-up of the latest Outdoor launches for 2023. Despite the unavoidable challenges of 2022, it seems there is no shortage of new product arriving early in the New Year, a testament to the enduring optimism of the toy community.

We also have an interview in this issue with the man behind the return of Toys R Us to the UK, Louis Mittoni, who we spoke to shortly after the new website went live last month. Early feedback was encouraging, as it was for the Toys R Us stores which were recently launched in branches of Macy’s across the USA. I am sure that another successful specialist toy retail brand will be enthusiastically welcomed by toy suppliers, so it will be fascinating to follow Toys R Us’ journey over the coming months.

Let’s all keep our fingers crossed that by the time you read this column, festive sales will have started to kick in – and our government hasn’t inflicted any further damage on the economy.