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A Five-Star Event(HKTDC Toys & Games , Vol 02,2005)


Vol 2 2005






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A Five-Star Event
Survey Report 2005

A Five-Star Event

Survey Report 2005

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The toys industry in Hong Kong is expected to fire on all cylinders in the coming year thanks to a strong emphasis on products linked to the hugely popular Star Wars theme. Entitled, Episode III: Revenge of the Sith, this film is widely regarded as the best of the series, having already captured the imagination of both young and old in the US and elsewhere. The earlier five Star Wars movies spawned a gold-mine of merchandising business, particularly toys, that far outstripped the films' box office takings.

The success of this strategy will be seen clearly at the upcoming January 2006 edition of the Hong Kong Toys & Games Fair.

"The release of another blockbuster movie in the Star Wars series is likely to spearhead an opportunity for Hong Kong toymakers to bounce back after a year seriously affected by the knock-on effect of record oil prices," says chairman of the TDC Toys Advisory Committee Jeffrey Lam.

"This year, the outlook for Hong Kong toymakers is more positive and we are still looking for growth. Nothing stimulates the market like a pacesetter that gets the mums and dads back into the stores, especially in the US, and we are hoping that this year we have such a torch-bearer in the form of this movie," Lam continues.

"Everybody will be delighted to see this movie serve as a launch pad that sets off a chain reaction that, hopefully, leads to gains in toy sales across the board. Otherwise, many manufacturers may be looking at only average prospects."

Reviewing developments following the 2005 Hong Kong Toys & Games Fair, Lam says several factors affected trade, led by the leap in oil prices. "There was a knock-on effect in the price of plastics, copper and other materials used in the toys industry," says Lam. "We also saw increased prices for the ICs used in many of today's electronics, leading to increased prices for audio toys.

"Happily, the market seems brighter this year and toymakers are cautiously optimistic that external influences will become more settled and lead to a resumption of steady growth," he says.

"The bottom line is that things are getting better, and the industry mostly anticipates a positive result this year."

Meanwhile, Hong Kong Trade Development Council senior exhibitions manager Anne Chick noted that the 2005 fair more than lived up to its reputation as Asia's biggest and the world's second-largest such event.

"The 2005 event recorded an increase of 16% in buyers - for a total of 29,974 - coming from 128 countries and regions, while we saw an increase of 5% in exhibitors from 35 countries and regions," says Chick.

She is upbeat about the upcoming edition. "We are confident of building on gains made at the 2005 fair," she says, noting that in general the industry is also "cautiously optimistic" for 2006.

"New in the 2005 edition was a section for Magic-related items. We also expanded the Outdoor and Sporting Items section, while Hobby Goods was back by popular demand and displayed a wide range of models, action figures, jigsaw puzzles, miniatures and collectibles," Chick says.

"For 2006, and recognising a sector of growing importance, there will be an enlarged Baby Toys and Products section and a special section for Candy Toys," she promises."

Meanwhile, the Hong Kong International Stationery Fair 2006 will be held concurrently at the Grand Hall and Foyer of the Hong Kong Convention and Exhibition Centre.

Strength In Diversity

The phenomenal reputation of the Hong Kong Toys & Games Fair is emphasised by the strength and depth of its international representation, especially among countries and regions hosting their own pavilions.

At the 2005 fair, for example, the Chinese mainland, Germany, Italy, Korea, Pakistan, Spain, Taiwan and Thailand all hosted their own pavilions.

There were plenty of people, buyers and exhibitors alike, only too ready to offer praise and favourable comments for the 2005 fair.

Among many highly satisfied buyers, for example, was Apache, France, buying manager Lisa Hornsey who said: "This is our fifth visit to this fair, and Hong Kong is the start of everything in this business as everything filters through from here. Much of the manufacturing takes part in this part of the world, so here you are closest to the products and the people."

Confirming this, Intex (HK) Ltd director of international marketing Lisa Elliott added: "The fair has long played a part in our marketing plans, but now that we have opened a sales facility on the Chinese mainland it assumes even greater importance."

An old hand at the Hong Kong Toys & Games Fair, Korvit Manshouwer, of Thailand's Hanky Panky Toys Ltd, enthused: "We have been a strong supporter of the fair for more than 15 years, and it starts the year for us in good fashion. We get feedback from our customers on our newest products and we also get to see non-European customers who don't visit the Europe-based fairs."

Finally, product planning section assistant manager Yasushi Muto, one of 10 buyers from Sanrio Co Ltd of Japan, said: "There are 1,000 Sanrio outlets in Japan and we have been placing OEM orders with many Asian suppliers. We are really impressed with the product variety. Of course we'll come back next year."

With praise like that, the ongoing success of the Hong Kong Toys & Games Fair seems assured for a long time to come.

Future Confidence

In the midst of buyer-exhibitor negotiations during the 2005 fair, Oracle Market Research conducted an on-the-spot survey for the Hong Kong Trade Development Council.

Importantly, about 70% of exhibitors and buyers were upbeat about market prospects for 2005, the survey revealed.

Exhibitors indicated expectations of highest growth in Western Europe (58%), followed by the US (52%). They also said there was good potential for emerging markets including Russia, Eastern Europe, the Chinese mainland and Southeast Asia.

More than one-third of exhibitors and buyers said they were already selling to the Chinese mainland. They also said they expected that figure to increase during the next three years.

According to the survey, toy categories nominated for the fastest growth in 2005 were battery-operated and electronic toys and games, educational toys and computer toys and games.

The survey also said that about one-third of buyers were purchasing baby toys and products. Growth potential in that field was estimated at more than 10%; especially in toys for children aged 2-4 followed by toys and products for infants such as gyms, playmats and strollers.

Creativity and training in language and communication skills were seen as crucial for baby toys.

Among outdoor and sporting items, the 10-19 years age group was seen as leading sales growth, with the greatest potential in bicycles, scooters, skateboards and skates.

The full report can be viewed at www.hktoyfair.com/survey/main.htm.

WRITTEN BY GEOFFREY SOMERS

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