The toy market is no exception to the fierce competition that the entire distribution industry faces. According to the consulting firm NPD, 43% of the industry’s total sales are concentrated in hypermarkets. The remaining 57% is distributed through channels that include specialists like Toys ‘R’ Us or department stores like El Corte Inglés.

It is easy to see how little space these distributors leave for small toy shops. Independent shops have it very difficult and it is necessary to have the support of a shopping center that allows them to offer attractive prices. On the other hand, the association is one of the solutions and Toy Planet is a paradigmatic example. Despite the crisis that the economy is going through, this toy chain has not stopped increasing its sales. In fact, it will end this year with a sales increase of more than 7.5% after adding 15 new stores to its network.

To get here, the company took a number of steps. “In 1988, faced with environmental and competitive changes and new, more aggressively priced distribution formats, a number of Valencian retailers decided to join forces in order to buy better in 1988,” explains Ignacio Gaspar, General Manager of the company. That was the Joguets cooperative, the nucleus of today’s Toy Planet.

“For the first 10 years, we focused on purchasing and joined forces to negotiate better, with greater economies of scale and better discounts. But since 1996, sales have also been considered, especially since 2003, when the private label was created,” emphasizes Gaspar.

proximity and experience

At a time like this, when the crisis is particularly affecting consumption, Toy Planet has managed to increase its sales year after year. What are the keys to your business? What are the differences compared to other institutions?

Physical near… “Our basic positioning consists of a local supply business in a very good location. We are on the main streets of the main cities in Spain,” explains Gaspar. It is also gradually finding its way into shopping malls.

…and personal. Compared to the business models of large-scale sales, in which self-service prevails, the small average size of the sales outlets (around 250-300 square meters) enables more personal customer care. Something that the buyer appreciates very much.

private label. It has a dozen of its own brands covering all segments of toys from 0 to 12 years: Infant Planet (for children), PequeBebé (traditional doll), Babies & Ladies (dolls and accessories), Role Planet (simulation games), Art Planet ( Craft and Artist World), Makeup Planet (makeup), Music Planet (musical instruments), Motor Planet (scale vehicles, radio control and slot machine), Air Planet (sports and outdoor toys), Game Planet (board games), Digital Planet (electronic games) and Party Planet (costumes).

national toy companies. The company strives for a certain balance in the origin of its range. Only 25% of the products offered are imported. The remaining 75% are products invoiced by Spanish toy companies or multinationals.

Essential Experience. The company is looking for employees with industry knowledge. It does not open its own stores and grows by integrating existing stores into its network or opening new outlets from its partners. To join the chain, you must have at least two years of experience in the toy industry. In his network there are even companies with 75 years of experience.

What do you offer your employees?

In a highly competitive sector like this, working with a headquarters like Toy Planet brings certain advantages that are difficult to achieve alone. These are the services:

Trademark. Integration into the chain presupposes taking refuge in a flag with national implantation. In addition, it has the strengthening of its own product brands, which makes it possible to create unity between stores.

Negotiation with suppliers. Gaspar stresses that the plant plays a primary role in “negotiating commercial terms with national suppliers and setting the framework for action.” From there, the supplier stays in touch with the store based on these master agreements.”
Implementation of innovations. The general director of Toy Planet emphasizes that the factory guarantees that the novelties will hit the shelves “as soon as possible”.
communication tools. Gaspar highlights the release of 10 catalogues, “an essential tool”.

Diversification and initiative

Seasonality, while not as big an issue as it was for this sector some time ago, is still high. According to the Spanish Association of Toy Manufacturers (AEFJ), almost 70% of total sales were made in the last quarter of the year. Toy Planet manages to reduce this concentration. “From November 1st to January 6th, what we traditionally call the Christmas sale, we sell 56%. It is no longer the 70-75% that was previously stated,” explains Gaspar. It also recognizes that the average purchase receipt has gone down. In order to meet the seasonality and the slowdown in consumption, the company has pushed various initiatives.
More and better. The head office has developed two banners that complement its activities. The first, which is closest to the company’s core business, is Petit Planet, which focuses on child care. The other is Garden Planet, which offers outdoor furniture. While they don’t make up a very important percentage of the company’s worldwide sales (Petit Planet contributes 5% of total sales and Garden Planet 8%), they do contribute to the seasonal adjustment of sales.
Promotions all year round. The company also combats the seasonality of Christmas by preparing several campaigns a year, for example during carnival, summer or the start of school. “For us, these are integral campaigns,” affirms the CEO of Toy Planet.

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