EghtesadOnline: Iran’s toy market is dominated by imports, both legal and illegal, as the domestic toy industry is struggling to catch up.
Locally-produced toys currently make up 20% of the market, Chairman of Institute for Intellectual Development of Children and Young Adults’ Toy Supervision Council Secretariat Mohsen Hamooleh told Financial Tribune.
Founded in the fiscal 1999-2000 at IIDCYA, the secretariat is in charge of managing affairs related to toy production and issuing permits for producers.
According to Hamooleh, Iran’s monthly average toy imports during the first half of the current fiscal year (ending March 20) stood at around $7.5 million, indicating a 57% increase year-on-year, Financial Tribune reported.
China, Taiwan, Germany, France, Italy, Hong Kong and the US are major exporters of games and toys to Iran.
The official noted that over 25% of toys on the market are smuggled into the country.
In another interview, Deputy Managing Director of Avaye Baran Institute—an Iranian producer and distributor of games and toys—Yasser Mehri said production of toys in Iran dates back to the fiscal 1976-77.
Mehri believes the Iranian toy industry is growing and the number of domestic brands, products and toy stores are on the rise, yet he expressed concern that the excessive inflow of contraband Chinese toys has negative economic implications amid their poor quality.
According to Hamooleh, around 150 small- and medium-sized production units are operating in the toy production sector, although only a few have licenses from the Ministry of Industries, Mining and Trade.
He named Gilan Plastic Company, Bazita Company and Dorj Toy Company as some of the active toy producers in Iran.
“Annual statistics show growth in production of domestic educational, entertainment, intellectual and creative toys, as families show more interest in these kinds of games,” he said.
Hamooleh noted that mismanagement, expensive raw materials and high wages result in high end prices of Iranian toys compared to imported ones.
“Per capita consumption of toys in Iran has been over $15 in the past five years. This is while the global average is at $34; in the US it is $35, in Europe $250 and in China $6.3,” Hamooleh added.
Mehri referred to difficulties in procuring raw materials such as plastic, paper or wood, currency fluctuations, shortage of modern technology and machinery, and lack of specialized workforce as the main challenges facing domestic producers.
“A change in mentality and view toward games and toys is necessary in Iran, especially in the system of education. Toys are not taken seriously in Iran,” he said.
The Toy Association Inc. data suggest that global toy sales experienced continued growth in recent years, with 2016 sales increasing 4% over the prior year to $88.8 billion.
According to Statista, the global toy industry is a billion-dollar industry dominated by five main players: Mattel, Namco Bandai, Lego, Hasbro and Jakks Pacific.
American toy manufacturing company Mattel is the industry leader with the highest revenue among major toy companies in 2016. Danish company Lego, known for its interlocking plastic bricks, closely followed Mattel with about $5.4 billion in revenue. Tokyo-based Namco Bandai, strong in its domestic market, ranked third in terms of revenue; Hasbro and Jakks Pacific complete the top 5.
The Seventh Game and Toy Exhibition was held at the Institute for Intellectual Development of Children and Young Adults in Tehran earlier this month. The annual event is a platform for domestic toy producers to showcase their latest products and services.