Global Toy Manufacturing Industry

Globally, toy manufacturers are primarily concentrated in the U.S., EU and China, and China is the largest toy manufacturing country in the world. The majority of toys produced in China are sold to overseas markets mainly include the U.S., EU, and South American countries. Since the value-added level of Chinese toys is expected to be further elevated, the position of China would be further lifted in the global toy manufacturing industry.

Although the U.S. and EU countries are the largest toy importers in the world, they are also major toy producers for the following reasons:

(a) nearly all world-leading toy manufacturers are based in the U.S. and EU countries. Although they may have part of their products to be manufactured in developing countries, they ordinarily keep certain products, which have the highest value-added level, to be manufactured domestically;

(b) although the cost of certain toys could be lowered if they are produced in developing countries, they may generate a high transportation cost, as they are either too heavy or too large; and

(c) the automatic level of manufacturing plants in the U.S. and EU countries are generally higher than OEM factories in developing countries. Therefore, if the structure of toys is too complicated, the manufacturing cost could be lowered if they choose to produce those toys domestically.

The total export value of Chinese toys was USD18.4 billion during 2016 where the export value of toys of Guangdong, Shandong, Zhejiang, Jiangsu and Shanghai have taken almost 95% of the shares in the total export value of toys. From the product aspects, the manufacturing and exporting industry of toys indicates a strong regional characteristic. Electrical and plastic toys are primarily manufactured and exported from Guangdong province; wooden toys are primarily manufactured and exported from Zhejiang; electronic toys are primarily manufactured and exported from Shandong; plush toys are primarily manufactured and exported from Jiangsu and Shanghai. Although China is a major toy manufacturing country, the Chinese toy manufacturing industry is fairly fragmented and the technological and automatic level of most toy manufacturers is still fairly low. Therefore, the Chinese toy manufacturing industry is facing a great opportunity of optimization and integration.

Total export value of Chinese toys

The export value of toys from China to the rest of the world was increased at a moderate speed between 2012 and 2016 due to the unfavorable economic situation in the U.S. and EU. During this period, the Chinese toy export market is primarily driven by the growing demand in developing countries such as Southeast Asian countries and South American countries.

As the largest exporter of toys, the export values of toys from China to the U.S. and EU basically align with the fluctuation trends of the total import values of those countries. Although the market situation was not so ideal during previous years, both the export values of toys from China to the U.S. and EU respectively have started to revive since 2014 and a moderate speed of growth can be expected in the future, despite minor fluctuations. According to the CIC Report, China is the largest toy manufacturing country globally; Guangdong province in particular is one of leading toy producing clusters and the largest export province in China with manufacturing activities centering around cities of Shenzhen, Dongguan, Guangzhou, Shantou’s Chenghai and Foshan, contributing approximately 60% of the total export value of toys.