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General Sales Trend and Forecasts
Design innovation, low prices keep industry afloat
Toy Exports
Domestic Toy Market
Comparative Statistics on Taiwan's Toy Exports/Imports
Product Trends
Government Actions/Proposed Actions
Design innovation, low prices keep industry afloat
Optimism on future prospects remains high despite the continued decline in exports. Taiwan's toy makers battle the odds by banking on their strong design skills
and their capacity to regularly come up with reasonably-priced new models that conform to international standards.
Taiwan Toy Manufacturers Association chairman Aling Lai points to the Asian financial crisis, the recent plunge of Russia's currency which had an effect on Europe and the United States, the shrinking toy demand because of the flagging world economy, and high labor costs that forced even more makers to relocate production offshore as the major contributing factors. Taiwan's toy exports 14.38 percent drop in 1998, last year's $422.87M against 1997's $493.88M.
The entrance of the new millennium will therefore see makers focusing on upgrading
technology, upgrading, enhancing design innovation, and strengthening managerial skills. Companies likewise aim to establish their own brands, take control of distribution channels, and aim for a faster and more efficient internet marketing system.
Toy Exports
1997 proved to be a difficult year for Taiwan's toy industry due to the impact
of competition in the global market.
In 1997, total domestic production (video games included) was US$625 million,
down 15.5 percent compared with 1996. This was evident in the total export value
that dipped from US$585 million in 1996 to US$494 million in 1997.
Educational toys and indoor games, the leading categories, increased by 19.1
and 4.8 percent, respectively, over the preceding year. Video games, inflatable
toys, constructional toys, musical toy instruments and electric trains though
went down by 50 percent.
The United States remained the largest market, which accounted for 31.91
percent of total exports. Other major markets for volume orders were Japan
(16.37 percent), Hong Kong (8.43 percent), Germany (5.89 percent), the United
Kingdom (3.17 percent), Singapore (2.23 percent), and Australia (1.88 percent).
The total export volume including domestic and overseas production would be
over US$1.1 billion. Export figures would be higher if shipments from factories
run by Taiwan manufacturers in mainland China and other areas overseas were
included. Local manufacturers have capitalized on their expertise in making
high-tech products for many years. They operate large production networks in
Mainland China although R&D, design, management and business operations remain
in Taiwan.
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Domestic Toy Market
Toy importation continued at a steady pace in 1997 until the government's
approval of indirect importation of various toys from Mainland China to Taiwan
increased the volume by 50 percent. This translated to a total of US$161
million, or 55.1 percent of domestic sales compared to 44.9% in 1996.
Several factors contributed to Taiwan's brisk local toy trade:
- national expenditure for leisure/recreation will remain high as GNP per
capita had reached US$13,467 in 1997, and is expected to amount to about
US$13,245 this coming year
- Many newly established wholesale outlets and discount stores have gone
into toy retail which contributed to the expansion of the market
Among imported toys, video games with well-established TV ad reputation,
indoor games, model toys, educational toys and stuffed toys, among others,
enjoyed brisk sales in 1997.
The rise in volume of domestic sales is due mainly to toys indirectly
imported from Mainland China to Taiwan.
The permission granted by the Government to indirectly import toys except
for H.S. Code 9504 and 9505 from Mainland China to Taiwan made a great impact
on domestic sale networks.
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Comparative Statistics on Taiwan's Toy Exports/Imports
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Product Trends
Increasing prices and developing high-end value-added products has been
putting pressure on Taiwan's industry. Taiwan companies have committed
themselves even more to upgrading their product development skills and
embracing global manufacturing networks.
Yearend sales saw TV games as well as educational toys, toy vehicles, indoor
games and franchise-licensed toys doing very well.
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Government Actions/Proposed Actions
(other than those related to toy safety)
The Government regularly implements programs to assist Taiwan toy
manufacturers in creating new designs. Manufacturers in designated industries
may request for technical assistance in material selection, product design
and testing, improving manufacturing process, molding and the introduction of
complex parts and components.
Government support extends to helping manufacturers upgrade from OEM to ODM
and to help ailing enterprises survive. To date, manufacturers have already
upgraded to ODM.
The ISO 9000, 9001, 9002 product quality certification and sales strategic
alliance were also conducted with the assistance of the Taiwan Government.
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