21-07-2025
Toy Industry Resilient Despite Tariffs; It's Game On For Holiday
Wigglitz, tiny 3D-printed collectible figures, were one of the viral hits influencers were eager to ... More get their hands on at The Toy Insider toy showcase.
Toy manufacturers and toy sellers are facing pricing and supply chain concerns due to tariff uncertainty but they are encouraged by signs that demand for toys and collectibles appears to be strong as the industry prepares for the holiday season.
At the annual July toy showcase hosted last week by toy news and reviews website The Toy Insider, more than 60 toy companies displayed the products they are betting on to boost sales to an enthusiastic crowd of several hundred toy influencers.
The number of innovative products on display, and the amount of engagement with the toys by the attendees 'was exciting to see because it's sort of the opposite of what folks would expect to find from the toy industry this summer,' said James Zahn, Editor-in-Chief of trade publication The Toy Book, and a senior editor at The Toy Insider.
The industry has been battered this year by dramatic shifts in tariffs, first being hit in April by a 145% tariffs on goods made in China. That rate was lowered in May to 30%, pending further negotiations. The 30% rate is set to expire in mid-August, and could be increased again.
Close to 80% of the toys sold in this country are made in China.
DoodleFace, one of the companies that exhibited at The Toy Insider event, makes all of its products ... More in upstate New York.
The imposition of the short-lived 145% rate caused some companies to temporarily halt production of new products. That could result in shortages later in the year.
Toy makers are responding to the tariff pressure by focusing on lower cost toys that are still affordable even with a tariff-driven price increase, or by shifting production to countries with lower U.S. tariffs. Other companies shipped product to the U.S. in advance of the imposition of the new tariffs.
The industry's response, and the innovative lineup of toys being released for the holiday is 'another great example of the resilience we always talk about every time there's a new challenge that pops up,' Zahn said. 'You have all these creative people that come together and they try to make the best play experiences possible and deliver that. And they're doing that,' he said.
Spinmaster's Melissa & Doug brand was showing playsets that let kids "cook" food with water at The ... More Toy Insider toy showcase.
Juli Lennett, vice president and toy industry advisor, at market research firm Circana, also described the toy industry as resilient in reporting that U.S. toy sales rose 6% during the first four months of this year.
'The good news is consumers are signaling that they will spend on the things they need and those that make them happy,' Lennett said when releasing the data.
The industry also is getting a boost from the growing number of adults who are purchasing toys for themselves. In the first quarter of this year, toy sales for adults 18 and up grew by 12% compared to the same period last year. Adults spent $1.8 billion on toys in the first quarter, the highest spending of all age groups.
Attendees at the Toy Insider event mentioned the most viral collectible toy craze of the moment - the Labubu dolls sold by Chinese company Pop Mart - as a sign that Gen Z consumers still have lots of money to spend on trends and quirky collectibles. The small dolls are sold in blind boxes, meaning buyers don't know which doll they are getting until they open the box, which drives more sales if someone is seeking a particular design or color.
Sales of the dolls, which retail for about $30, with rare, limited edition dolls fetching hundred on the resale market, have soared this year. Pop Mart reported last week that it expects its profits for the first six months of the year to be up 350%.
One of the most popular booths at The Toy Insider event was the Nintendo exhibit, where they were demonstrating the Nintendo Switch 2. The new version of the Switch, which sells for $450, broke sales records when it was released in June, selling 3.5 million units in four days, becoming the fastest selling video game console of all time.
The Chinese tariffs are expected to have a bigger impact on companies that sell mid-priced toys, in the $25 to $100 range, rather than those that sell big-ticket items like the Nintendo Switch 2, or those that sell items that are priced under $10.
Josh Loerzel, president of Sky Castle Toys, at The Toy Insider event with one of the company's new ... More releases in the viral Sticki Rolls line. a Jumbo sticker for decorating a room or a school locker.
Josh Loerzel, President of Sky Castle Toys, maker of viral hit toy Sticki Rolls, which are bracelets with shareable, collectible mini stickers that can be peeled off and used for decorating, or trading, said at The Toy Insider event that fact that a number of the company's new releases this year are priced at $4.99 minimizes the tariff impact.
'When you have a $5 item you can whether the tariff storm,' Loerzel said. The company tightened up its cost controls to ensure it could sell its new items - Jumbo Stickis, jumbo stickers that can be used for removeable room or school locker decor, and Sticki Rolls Creepies, inspired by the Japanese kimo-kawaii (creepy-cute) art trend, at $4.99.
The Chinese tariff pressure is creating an opportunity for toy startups making toys in this country.
Two of those, Wigglitz and Doodle Face, attracted a lot of social media and influencer attention at The Toy Insider showcase.
Wigglitz are small 3D-printed plastic figures of animals and other creatures, with moveable parts, that sell for $2.99 each, or by the bag for $24.99. The company prints the figure in Utah, where it is headquartered.
DoodleFace, a company that makes wall art and play figures that kids can color, erase, and re-color thanks to a specially coated cardboard, does all of its manufacturing in its upstate New York facility.
For the companies that do have to worry about tariffs, one of the big concerns for the holiday season is running out of inventory due to production slowdowns when the 145% tariffs were imposed, Zahn said.
'Even companies that have solid inventory levels right now might have a hard time reacting if there's a surprise hit for the season,' he said.
The unpredictability of the tariffs rates, and the widely fluctuating rates for all the countries where toys are made 'makes it hard for anybody to plan and forecast,' Zahn said. 'Companies are trying to figure out what their margin is going to be, but then the price changes,' he said.
