At the largest fair for toy industry in the western hemisphere this weekend, toy makers, as usual, apparently endless rows of hugs, action figures and puzzles, showed to seduce retailers to choose their products.
But this year the chatter on Toy Fair New York was not dominated by the next Barbie, but a larger game, one of the global tactics that could make most toys more expensive for our consumers.
Almost 80 percent of the toys sold in the United States were made in China. Last week, just when
Large and small businesses of family businesses to try to find out well-known names to find out how they can manage the new costs with regard to rates. Stationed on a stand covered with plush hugs, said Linda Colson, the vice -president of sale at Mary Meyer Corporation, that her company, based in Vermont, was in a state of paralysis about prices. “We don't know what to do,” she said. “I think many people in this building just wait to see what everyone is doing.”
Jay Foreman, the Chief Executive of Basic Fun, a toy manufacturer and distributor in Florida, sells to retailers, including Walmart and Target. After Mr Trump ordered the rate of 10 percent in China in February, Mr Foreman began to think about ways to prevent these costs from being passed on to his customers. So last Wednesday he met the board of directors of his company to come up with a plan that would split the burden: the company, the factories in China and his retail customers would each absorb 3.5 percent of the extra costs.
But only a few hours later, Mr Foreman tuned to CNBC and heard Mr Trump declare that new rates for China could jump to a total of 20 percent this week. The plans of the company “went straight out of the window,” said Mr Foreman, whose company employs around 110 people in the United States and a total of 165 people worldwide.
“Now they cannot be absorbed and that extra rate must be passed on to the consumer,” he added. “It tipped the Domino.”
The Tonka Mighty Dump Truck, which makes Basic Fun under a license from Hasbro, is currently selling for $ 29.99. That price will probably increase between $ 5 and $ 10 for consumers, Mr Foreman said.
Some of the larger companies of the treaty gave confidence that their Chinese suppliers would absorb part of the extra costs, because factories would not want to lose things.
Safari, who sells animal statues, produces around 90 percent of his products in China, said Danny Falero, the marketing director of the company, and manufacturers have said they are willing to make some concessions. He emphasized that his company did not intend to increase prices unless Mr Trump came into force.
“It's a bit of theater, so let's see what actually lands, and then we will make adjustments based on that,” said Mr. Falero.
Threatening rates weigh heavily on Luis Prior, who owns Mavia Toys, a small company in Corbin, KY. His three -year company designs sensory toys for children with special needs and are sold to teachers, hospitals and museums.
Mr Prior said that, regardless of whether the rates on China remained at 10 percent or doubled on Tuesday, he should increase his prices. But the uncertainty has made it impossible to make specific price decisions, he said. When he returns from the convention this week, Mr. Prior is planning to go through his products, to go item and to rule again.
“Exhaustion,” said Mr. Prior. “That is the only way I can describe it.”
Three billion toys are sold every year in the United States, which generates $ 42 billion in sales and supports nearly 700,000 jobs, according to the Toy Association, a trade group that represents the American toy industry.
For an exemption from Mr Trump's broad rates, the association lobbys, partly pointing to the fact that small companies make up around 96 percent of the industry, said Greg Ahearn, the chief executive of the group. During the first term of Mr Trump in the White House, he had imposed 10 to 25 percent rates on many Chinese products – but he ran backwards at rates on toys, in addition to other consumer goods.
Although most toys are made in China, some production has moved to Mexico in recent years, but Mr Trump also said that the rate of 25 percent he had imposed on Mexico and Canada would take effect on Tuesday.
The Toy Association has visited and encouraged the offices of senators to get his message to people in the Trump administration, Mr Ahearn said, and communicated with its members every day to share the latest updates on rates.
Mr. Trump's announcement of an extra rate on China coincided with Mr Ahearn's preparations for the toy fair. “It was not good, and now it is unbearable for us as an industry,” Mr Ahearn said, adding that a rate of 20 percent will inevitably be passed on to the consumer.
In an interview with CNBC on Monday, the trade consultant of the White House, Peter Navarro, Mr. Trump's tariff plans doubled, and said that their effect on consumer prices would be “Second Order Small” in the account of the simultaneous plans of the administration to enlarge industry, the size of the federal government.
“I don't see the president faltering on this,” he said.
Five years ago, Sharon Azula and her husband started a company called the Tooth Brigade that sold dental -like pillows. Last summer they lowered the selling price for a pillow – a small stuffed animal with a tooth bag – to $ 14, a decrease of $ 16, which helped to stimulate the question.
Rates, especially if they are 20 percent, will probably force Mrs. Azula to increase prices again, because everything they sell is made in China. When she started the brand, she and her husband wanted to produce their products in the United States, but it was too expensive, she said.
Now, to a pillow on her toy fair, Mrs. Azula said she was worried that higher prices could let the company sink.
“When I'm here, I don't try to think about it,” she said torn. “But if you try to think about what the future will be – I don't know. I just don't know. “
