The $21 billion toy industry has seen steady growth year-over-year, but not without its hiccups. Bankruptcies of retailers such as Toys R Us, and collapsing brick-and-mortars leave many newcomers and small businesses worried.
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“The retail environment is really changing so we don't really know what is going to be had,” Chris Byrne, content director for Toys, Toys, Pets and More told FOX Business at the 2018 American International Toy Fair in New York.
“One of the wonderful things about the toy industry is that it is always about the product … what we have seen is a lot of small companies doing a lot of innovative product that can get to market much faster than the big companies,” he added.
YULU Toys is one of those companies. YULU Toys hit store shelves in 2017 with Operation Escape, which became Target’s (NYSE:TGT) best-selling toy for the holiday season.
“For young entrepreneurial companies who have a quick speed to market there is still great potential,” Jochem van Rijn, co-founder of YULU Toys, told FOX Business.
YULU hopes to double their $15 million sales success in 2018 with a new tabletop game, Tic Tac Tongue, and outdoor play toys.
For startups, it’s more than just hoping for a smash hit; it’s all about strategy. Keith Meggs, CEO of Far Out Toys, echoes the importance of competing with the big companies, like Mattel (NASDAQ:MAT) or Hasbro (NASDAQ:HAS), through smart marketing.
“While we can be small and nimble and quick to market, we can also present ourselves in the same way you would expect to see from a major toy company,” Meggs told FOX Business.
TV commercials, social media are all an important component. Far Out toys will soon launch Splashout, an indoor/outdoor game.
“For a startup in the toy industry, the hardest thing will be getting to the market so you need a good sales group and obviously you need a good toy,” Shay Chen, CEO and founder of Flycatcher Inc. told FOX Business.
Chen and his team are betting on technology as the future of the industry. Their first product, smART Sketcher Projector, soft-launched in Barnes and Nobles in 2017 and beat sales expectations.
“We have a 2019 and a 2020 item as well … so the company is getting bigger and with time,” Chen said.
Be sure to watch the video above for more insight from these startup entrepreneurs.