Toy Fair 2010 Recap
From Feb 14th - Feb 17th Shipwire attended Toy Fair 2010 at the Jarvis Center in NYC put on by the Toy Industry of America. The Toy industry pulls out all the stops for this show and attendance was once again good.
After I attended Toy Fair 2009 I posted a "Learnings from Toy Fair 2009" of the trends that I was seeing to Practicalecommerce.com. Before the memories fade to much I'm going to call some of this year's logistics and toy shipping trends and how Toy entrepreneurs and toy manufacturers can address them
Key Trends:
Learn to drop ship: This trend has accelerated since last year. I was so impressed by this trend last year that I wrote an entire article on manufacture drop ship. I've been watching this trend accelerate over 2009 and have even been called on to explain the difference between order fulfillment and drop shipping. Nearly every toy entrepreneur or manufacture at the show was being asked if they were able to drop ship on behalf of retailers. Many simply advertised it right on their booths. The heavier the product and the larger the retail price, the more likely retailers will want it drop shipped.
Set up a drop ship policy like you would a return policy. Pre-establish an account with a retailer and confirm how you will get paid when they order. Determine shipping turn-around time and buyer contact policy.
Tell retailers how to get you orders. Here are some options: no budget = e-mail template; low budget = web form; mid-budget = automated script or secure shopping cart login for retailers.
Automate whatever pieces you can as your sales grow. You don't have to have it 100% perfect at first; but, make sure you offer it. Automate as sales grow, this may mean a mad dash for automation if your product reaches some success. Look at what part of the process takes the longest and then automate that part. Is it the order taking, order processing or pick, pack and shipping of the order...or all of them? (Caveat: Shipwire offers Outsourced drop ship fulfillment.)
Make shipping a sales tool: Fast and Free shipping sells in retail...and for wholesale. Here are six ways to be able to market Fast and Free Shipping.
Be able to capitalize on overseas sales: Almost every merchant that had been in business for over a year that I talked to had done some international sales. Many of the younger companies were trying to solve the problem by finding an overseas distributor to handle overseas sales. Clearly it's easier to offload the burden on a middleman for a huge chunk of the margin. Many of the growing merchants who hadn't found any overseas distributors or had weak overseas distribution were looking for ways to reach growth markets such as Canada, U.K., Europe, Australia and often Japan. Here are a few ways to do it.
Most expensive and risk prone is to ship overseas via international mail. This is the most expensive type of shipment unless you're sending a bike messenger on a plane. It's also the most fraught with risk because each shipment must go through customs and your buyer could get taxed when they pick it up. Get worried when you start to factor in returns. This method is good for custom manufactured, 1 of a kinds and the highest margin products only.
Consolidated shipping is an option many look at. There are two models for this depending on your volume. 1. Group consolidation and/or parcel forwarding is the most common. Sell the product to the buyer and ship it to a parcel forwarding location (who may or may not act as the middle man) where it is bundled up with a bunch of similar shipments going to the same region. Expect delays and your buyer may have to make two transactions. customs can get bogged down if one of the packages is problematic. There are two shippers involved if there are problems. Shutter at the returns process. 2. Internal consolidation. If you have the volume you may take orders for a country for a number of weeks and then ship all the orders at once. This works for a while for some businesses with one or two target locations where they are resupplying retailers and want to consolidate freight anyway. Sometimes works for direct-to-consumer shipping; but, often the delays can increase inbound buyer support escalations.
Use an overseas warehouse and store some of your best sellers overseas closer to end buyers. This is the model for businesses that want to scale sales, reduce international shipping costs by up to 75% and automate their businesses. This method ensures you can resupply retailers, give retailers drop shipping sales options and compete in local marketplaces like Amazon and eBay. Here is a international shipping calculator.
Lastly, check the weather before you go to Toy Fair in NYC in Feb. I brought warm clothing; but, should have check my shoe tread. NYC sidewalks got treacherous and your fearless blogging bus dev guy almost killed himself a few nights on the town after the sidewalks froze over in the sleet/snow. Lessons learned all around.
Thanks to all the merchants who let me interview them with my new flip camera. I probably talked to over 100 merchants to pick up these trends and hopefully I'll get a chance to post some additional trends.
Nate Gilmore | Shipwire product fulfillment I toy industry fulfillment
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