NPD: U.S. Toy Industry Poised to Turn the Corner on Sales Post-Toys‟R”Us

The following article is based on a press release issued by The NPD Group on August 1, 2019.

August 1, 2019 | The U.S. toy industry saw retail sales drop by 9 percent, or $734 million, to $7.4 billion, year-to-date through June, according to The NPD Group. The decline was dragged down by unfavorable comparisons to the previous year as a result of the Toys‟R”Us liquidation sale. Looking at the compounded annual growth rate (CAGR) from 2016 to 2019, which was up nearly 1 percent, paints a more accurate and favorable picture of the state of the industry.

According to NPD, the remainder of the year looks positive, with the negative Toys‟R”Us comparisons no longer impacting current trends, as well as the anticipated positive effects of a strong slate of license-friendly movies in the second half of the year.,. The industry is already experiencing positive growth since June, with a 9 percent increase in sales over the latest three weeks ending July 20, 2019, versus the same time period in 2018.

“In the next six months, we should see a complete reversal of the negative trends as we will see gains due to new sales compensating for the pantry loading from the liquidation as well as a reduction in the evaporation of toy sales due to the Toys‟R”Us closure,” said Juli Lennett, NPD’s vice president and toy industry advisor.

Steve Pasierb, president and CEO of The Toy Association said: “The Toy Association concurs with NPD’s read on the market while innovative, aggressive toy companies have long ago responded to and have already moved past the direct damage caused by the Toys”R”Us bankruptcy and the marketplace disruption of their subsequent liquidation. There are countless new, smart, fun, and engaging toy and play products flowing from our members that are certain to delight kids and parents alike in the coming months and years.” 

Pasierb added: “Unfortunately, with President Trump’s recent announcement of a 10 percent tariff on all remaining goods manufactured in China, the negative specter of tariffs still looms over both the U.S. toy industry and the holiday spending power of families across America, including those who purchase toys for their children. It appears there will be at least one Grinch trying to steal Christmas.”