List of Some Major Trade Fairs Toy Hong Kong produces a wide range of toys with particular strength in plastic toys, including dolls, doll houses and other accessories, action figures, construction sets, toy guns, make-believe toys and gimmicks such as beauty kits and doctor's kits.
Taken together with re-exports, Hong Kong is the world's second largest toy exporter. Hong Kong exporters are known for producing high-quality toys, with a large share of industry revenues generated from contract manufacturing with overseas manufacturers and license holders.
To reduce operation costs and stay competitive, the majority of Hong Kong toy makers have set up production facilities offshore, mainly on the Chinese mainland. The role of their Hong Kong office has shifted towards quality control, management, marketing, product design and production planning. Amid growing concern over product safety and environmental protection in overseas market, toy safety standards and regulations have become increasingly stringent.
Hong Kong toy exporters are advised to keep themselves informed of the regulatory changes in different markets and comply with the new requirements. Industry Features Hong Kong toy makers produce a wide range of items, including dolls, doll houses and other accessories, action figures, construction sets, toy guns, make-believe toys toy versions of adult "objects", e. To reduce operation costs and stay competitive, most Hong Kong toy makers have set up production facilities offshore, mainly on the Chinese mainland.
As such, many toy companies in Hong Kong have been reclassified as import-export establishments, contributing to the apparent decline in the number of toy makers locating in Hong Kong.
Meanwhile, the role of their offices in Hong Kong shifts towards quality control, management, marketing, finance and accounts, product design, and production management.
This skew towards higher value-added activities is sharpening the competitive edge of Hong Kong toy makers, while expanding production capacity through relocation. Production on the Chinese mainland has been facilitated by an efficient network of supporting industries and services. This has greatly enhanced the competitiveness of Hong Kong toys in terms of its productivity, quality, reliability and delivery.
Building on the base of plastic molded toys, Hong Kong toy manufacturers have added production skills from the clothing industry, the electronics industry and the metal goods industry. The toy industry employs a wide range of manufacturing technologies.
Competition remains keen, especially from indigenous Chinese enterprises in open items. The rapid expansion of production capacity on the mainland set up by Hong Kong manufacturers also put much downward pressure on prices and profit margins. Orders received are smaller in lot size, and shorter delivery lead time is generally required. Sales Channels Hong Kong exporters are known for producing high-quality toys. A large share of industry revenues are generated from contract manufacturing with overseas industry giants, brand owners and licence holders, such as Disney, Hasbro, Mattel and Warner Bros.
Production specifications and product designs are usually provided by these overseas buyers. This type of arrangement, in effect, minimises local manufacturers' risks relating to product designs, inventory taking and marketing. However, Hong Kong manufacturers have increasingly offered expertise in design, engineering, modeling, tooling, quality control and other technical know-how to its customers, and developed their own brands. On the other hand, some manufacturers also export generic products as open items.
Trading companies source a wide range of open items from different small manufacturers. In order to expand business networks, explore market opportunities, and promote product image as well as brand-names abroad, Hong Kong toy makers participate in well-organised and influential international trade fairs. Below is a list of some major trade fairs: Industry Trends Retail consolidation in overseas markets has changed the business landscape for toy exporters.
In the US, for example, mass merchants including Walmart and Target, which are able to purchase large quantities, have dominated the toy market. However, the importance of the online channel to toys is increasing.
Brick-and-mortar chains have been shoring up their e-commerce operations. The mass market depends on aggressive advertising campaigns or promotional tie-ins for success. Gradually, more toy manufacturers are entering into partnerships with companies from other industries, especially fast-food chains, in their promotion campaigns. Even before the tide of toy recalls in overseas markets in , safety standards, regulations and code of practices have long been major concerns among overseas buyers.
Meanwhile, as the life cycle of toys is becoming shorter, this increases the risk of product development. Against this backdrop, an increasing number of toy companies have started to create unique toy collections. Today's children, for their part, are growing up faster than a generation before.
Kids aged 12 or above turn to non-traditional playthings such as video games, computers, music and cosmetics. This development is challenging toy manufacturers to create innovative toys that capture the interest of children. At the same time, greater efforts have to be made for pre-school toys due to an increasing demand for toys that can develop brain power, creativity, coordination and senses of players.
According to the stipulated procedures, products which have no existing CEPA rules of origin can enjoy tariff-free treatment upon applications by local manufacturers and upon the CEPA rule of origins being agreed and met. Generally speaking, for toys manufactured from textile fabrics, cutting and assembling, identified as the principal processes for the purpose of delineating their origin, must be done in Hong Kong. For toys manufactured from plastic sheets, the principal processes are cutting of plastic sheets, joining of plastic sheets by heat sealing and setting of a valve, which must be done in Hong Kong.
Detailed information is available here. General Trade Measures Affecting Toy Exports Systematic obstacles to toy trade are minimal in the traditional markets. There are no quantitative restrictions for toy imports into these markets. This applies to both Hong Kong and the Chinese mainland products. In particular, the EU has completely abolished the import quotas on Chinese toys since January On the other hand, product requirements on safety and environmental protection have become more stringent in overseas markets.
This legislation forms part of a comprehensive effort by the US government to enhance safety requirements of imported consumer goods. As a result, it becomes more difficult and costly to export to the US, since higher safety requirements means additional hurdles for the entry of these items.
For example, any products that are designed for children cannot contain more than a certain amount of lead and will be prohibited if otherwise. The requirements therein did not constitute a federal consumer product safety rule. The new Directive has updated measures, taking into account of technological developments and new safety concerns. In addition to the expanded general safety requirement, those relating to physical and mechanical properties, flammability, chemical properties, electrical properties, hygiene and radioactivity have been set out.
More stringent rules apply to chemical hazards, such as certain chemical substances, fragrances and noise that are released from toys. These restrictions do not cover all chemicals that are listed in the Directive. Thus Hong Kong exporters have to be particularly aware of the level of lead, barium, nitrosamines and nitrosatable substances in the toys that are exporting to Germany. A "ST" Mark is issued on toys that comply with the voluntary safety standards.
In May , JTA announced regulations for rubber-made toys. On the Chinese mainland, more safety standards have been introduced. Six types of toys, namely children's vehicles, battery-operated toys, plastic toys, metal toys, toys with shot projectiles and dolls, are subject to the CCC scheme.
Toys need to apply for a CCC certification mark before they can be sold, marketed, imported or used for commercial purpose on the mainland. Exporting, importing or selling defective toys are prohibited and will be subjected to a fine equivalent to the triple of the goods' value. All illegal revenue and products will be confiscated. Product Trends Sustained interest in licensing: Licensing has been a key driver of toys sales globally, particularly for traditional toys.
While a certain proportion of licensed toys is associated with evergreen characters such as Hello Kitty and Mickey Mouse, blockbuster movies and TV cartoons remain the major source of properties. Recently, a number of Hollywood-created properties including Frozen, Minions and Star Wars have created unprecedented success for the licensees.
However, in general, the trade of licensed toys of movie characters is subject to a rather short boom-and-bust cycle. According to market research firm the NPD Group, sales of movie-related toys experience a quick growth in the three weeks prior to cinematic release, then a slowdown in the six weeks after the movie has come out.
On the other hand, video games and social media are now constantly inventing new characters. Angry Birds and Minecraft are the prominent examples. Clear focus on educational values: Interlocking bricks like Lego, puzzles and construction sets that improve hand-eye coordination, patience, creativity and spatial skills continue to be highly sought-after; board and card games that develop skills such as turn-taking and decision-making remain popular as well.
Examples include robots, science and experiment kits, and arts and crafts. A Hong Kong company Fame Master, has developed 4D 3 dimensions with details educational puzzles on animals and human organs. Tech-based toys gaining popularity: The worldwide mega-trend is to integrate electronics and new technology with toys. Many dolls and toy robots can now be remote-controlled by an Android or iOS device and updated with apps to create additional and new playing possibilities.
Recently, the tiny robot BB-8, a character in the Star Wars franchise, has gained a lot of attention. The companion app is packed with official Star Wars sound effects and other features like recording holographic messages. A Hong Kong company WooWee, is famous for making tech-based toys too.
The company has recently launched Miposaur, an intelligent robot dinosaur which is equipped with the latest sensor technology enabling it to respond to the swipe of hand and play with a trackball. On the other hand, toys incorporating virtual, augmented and mixed reality are expected to be big hits. The rise of kid tablets: Tablets and apps for children are on the rise. It comes as no surprise that children now enjoy watching cartoons and playing games with tablets.
At the same time, parents are eager to allow them to have access to lower-price, kid-size versions of electronic products for learning purposes such as reading e-books and watching educational videos.
In recent years there has been an influx of learning tablets for children with features including parent control, drop resistance and pre-loaded educational apps and games. Hong Kong manufacturer V-tech has developed Innotab 3S, a Wi-Fi learning tablet which also allows kids and parents to exchange and share their text messages, photos, etc.
A thriving collectable market: For many reasons including reliving their childhoods, some adults and even seniors are collecting toys. Today, the collectables market has grown to become a significant portion of the toy industry. High spending power characterises these consumers, who show great interest in vinyl toys, model cars, action figures and statues, etc. With sophisticated molding and manufacturing technology available, manufacturers are able to design and make high-quality collectables which are scaled and detailed meticulously.
Hong Kong-based manufacturer Hot Toys is well-known for making very high-quality action figures from popular movies, video games, comics and celebrities. It is also common for traditional toy manufacturers to introduce two lines for the same product, one for kids and the other for collectors.