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Toy industry hit by slump ‘due to Brexit and 2019 election’ | Business


The UK toy industry suffered “difficult” trading conditions last year due to falling consumer confidence as a result of Brexit and the snap general election, manufacturers have said.

The British Toy and Hobby Association (BTHA) – which represents more than 80% of the industry in the UK – released fresh figures showing that overall sales had slumped by 6% to £3.2bn in 2019 amid high street gloom. However, online sales of toys and games were up 2% over the 12 months to give a 37% market share.

High street closures in 2019

Thousands of high street jobs have been lost in the last 12 months as a result of high profile retail administrations, and thousands more are at risk as Mothercare, Debenhams and Forever 21 prepare for closures. Here are some of the key industry names that have been affected.

Mothercare: Has 79 stores and 2,500 UK retail staff as its British arm prepares to go into administration.

Regis/Supercuts: Had 220 salons and 1,200 staff when it went into administration in October 2019.

Bonmarché: Had 318 stores and 2,887 employees when it went into administration in October 2019. It is still trading as it seeks a buyer.

Watt Brothers: The Scottish department chain had 11 stores and 306 employees when it went into administration in October 2019. All the stores closed and the majority of jobs have gone.

Links of London: With 35 stores and 350 staff, the jewellery chain went into administration on 8 October 2019 but its sites are still trading.

Forever 21: Had three stores and about 290 employees in the UK when it went into administration in September 2019. Stores are staying open in order to clear stock.

Albemarle & Bond: Suddenly shut all its 116 stores in September 2019 with the loss of about 400 jobs, even though it did not call in administrators. It sold its pledge books to rival H&T in the same month.

Karen Millen and Coast: Had 32 stores and 177 concessions, employing 1,100 people, when it went into administration in August 2019. All sites were closed and the vast majority of staff made redundant after the brands were bought out by online specialist Boohoo.com.

Jack Wills: Had about 100 stores and 1,700 staff in the UK when went into administration in August 2019. Bought by Sports Direct and 98 stores are still trading in the UK and Ireland.

Spudulike: Closed all 37 stores with the loss of about 300 jobs when it went into administration in August.

Bathstore: Had 132 stores and 529 staff when it went into administration in June 2019. Homebase bought 44 stores saving 154 jobs and the brand now trades from 28 stores.

Select: Had 180 stores and 2,000 employees when the fashion retailer went into administration in May 2019. In June administrators at advisory firm Quantuma carried out a CVA closing 11 stores with the loss of about 200 jobs.

Debenhams: Had 166 department stores and more than 25,000 employees when went into administration in April 2019. No store closed immediately and the chain is now owned by its lenders but two closed before Christmas with another 20 due to shut in January when the group completes a rescue restructure expected to result in the loss of 1,200 jobs.

Pretty Green: Had 12 stores and about 170 employees when Liam Gallagher’s fashion outlet went into administration in March 2019. All but one store and 33 concessions closed with 100 jobs lost but 67 saved as the brand was bought by JD Sports in April.

Office Outlet: All 94 stores have closed with the loss of 1,170 jobs after the stationery retailer went into administration in March 2019.

LK Bennett: Had 41 stores and 500 employees when it went into administration in March 2019. The brand was bought by its Chinese franchise partner, Rebecca Feng, saving 21 stores, all the group’s concessions and 325 jobs. But more than 100 jobs lost with the closure of 15 stores.

Patisserie Valerie: Had 200 cafes employing nearly 3,000 people when an accounting scandal prompted the chain to call in administrators in January 2019. About 70 of the group’s 200 stores closed immediately with the loss of 900 jobs. About 2,000 jobs were saved when about 100 Patisserie Valerie cafes were rescued by Causeway Capital, more than 20 of which have since closed. 21 Philpotts sandwich shops were bought by AF Blakemore & Son. and four Baker & Spice cafes a were bought by the Department of Coffee & Social Affairs.

Sarah Butler

Predictions that 2019 would be “the year of the movies” failed to materialise, with many blockbuster titles such as Frozen II and Star Wars launched too late – and too close to Christmas – to give the sector a much-needed boost. However, the UK remains the fourth largest market in the world, after the US, China and Japan, and the largest in Europe followed by Germany.

Natasha Crookes of the British Toy and Hobby Association said: “2019 was an unusual year by any standards. The ongoing question that is Brexit undoubtedly had a dampening effect on consumer confidence while a general election in the middle of the busiest trading month of the year wasn’t helpful.”

Typically more than half of all toy sales take place in the fourth trading quarter from October to December, and with 26% in December alone, in the immediate run-up to Christmas. But the calling of the general election for 12 December had made consumers “distracted and worried”, Crookes said.

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She was speaking at the London toy fair, a three-day BTHA event at the Olympia in West Kensington in its 67th consecutive year, which featured hundreds of exhibitors showcasing toys and games likely to be popular next Christmas.

“We are entering a new era with many structural and economic changes ahead,” said Frédérique Tutt, global toy analyst at the NPD Group. “The toy market is no exception to other retail sectors and is in a transition period, adjusting and recovering from a challenging 2019 while finding its path for the future. Despite strong leading brands and licences, toy sales declined by 6% in 2019.”

Despite the challenging trading conditions, the toy industry continued to innovate, the BTHA said, with more than 32,000 new products launched in 2019. Action figures enjoyed a 9% growth in sales, driven by Fortnite, Avengers and Toy Story, while board games and puzzles have generally proved their resilience, with a 1% increase.

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