You could call it a “Christmas miracle,” but that wouldn’t be entirely accurate.
On Friday, President Biden signed legislation to stop a much-touted potential rail strike that threatened to grind business in the U.S. to a halt with another sweeping disruption of the supply chain. Eight of the 12 railroad labor unions in the U.S. had approved new contracts with railroad operators, but the remaining four unions rejected the deals. Without government intervention, a strike could’ve started as early as today, with an economic impact of up to $2 billion a day, according to the Association of American Railroads.
In the toy industry, many retail orders had already been pulled forward into the second quarter to avoid such a disruption, and in some cases that skewed Q2/Q3 earnings. The Toy Association previously signed coalition letters led by the National Retail Federation and the U.S. Chamber of Commerce urging Congress and the White House to make a move to stop the strike.
“Working together, we have spared this country a Christmas catastrophe in our grocery stores, in our workplaces, and in our communities,” President Biden said in a statement. “I know that many in Congress shared my reluctance to override the union ratification procedures. But in this case, the consequences of a shutdown were just too great for working families all across the country.”
Now, rail workers in the UK are threatening to strike.
Heavy Foot Traffic and Stocked Shelves
Over the weekend, I made my usual swing through some of the local stores near me in the Midwest. The most glaring find is that all of the majors — Walmart, Target, and Meijer — are very well-stocked. What I saw less of this week was the aggressive pricing that was evident over the Thanksgiving holiday weekend. As the National Retail Federation noted last week, foot traffic hit record levels — and I believe that’s still the case, after being bumped into and practically run over a few times this weekend — but according to The NPD Group, consumer spending may be running lower than expected.
For consumers, the abundance of stock could lead to some great deals if retailers become aggressive in seasonal markdowns to clear the channels before the end of the year.
Flipper Frenzy
Speaking of aggressive, resellers — aka “flippers” and “scalpers” — have cast a wide net this season. While I’ve often said that the days of a singular, must-have toy akin to Cabbage Patch Kids in 1983 or Tickle Me Elmo in 1996 may be a thing of the past, certain items are just hot enough to spark some action on the secondary toy market.
Last week, MGA Entertainment Founder and CEO Isaac Larian noted that the Little Tikes Magic Workshop, picked as a Top Holiday Toy by our sister publication, The Toy Insider, was quickly being scooped up at retail by flippers commanding upwards of $175 for the $79.99 toy. While Larian said that “a lot more” are being shipped to Amazon and Walmart, the same can’t be said for the Walmart-exclusive My Life As 18-inch Grinch Sleepover Doll. The $37.97 doll has been flooding marketplace sites with an average sale price of $100.
Similarly, the much-anticipated Pokémon Squishmallows from Jazwares quickly sold out in their Pokémon Center debut and have since made their way to eBay. As of this writing, hundreds of the huggable plush characters are awaiting forever homes with a hefty price tag topping $100 each. For those playing along at home, they were sold for just $29.99 each.
No matter how this holiday season ultimately plays out, the new toys are coming, and our team continues to work on the 2023 edition of The BIG Toy Book (coming in February). If you have new toys that you’d like to get in front of retail buyers and the rest of the trade, check out the details here, and be sure to submit yours by Dec. 22 for consideration!