Ann Arbor toy store options dwindle in fight against big-box stores, Internet, regulations
Mudpuddles co-owner Jan Benzinger's toy store is located in Kerrytown.
Melanie Maxwell | AnnArbor.com
As the 2011 holiday shopping season draws to a close, the list of local toy shops is set to get even smaller after Tree Town Toys announced that it would close its Plymouth Road store around the end of the year.
The Internet has been cutting into sales at independent toy stores for years — but now big-box stores are selling some specialty toys at rock-bottom prices, presenting an additional challenge, said Tree Town Toys co-owner Hans Masing. Meanwhile, federal regulations have reduced the number of toy manufacturers that can sell their products in the U.S., reducing the options for independent stores, he said.
Mudpuddles focuses exclusively on sales of specialty toys at its physical store and does not sell online.
Melanie Maxwell | AnnArbor.com
Kids shop for toys at Mudpuddles during Midnight Madness in November.
Jeff Sainlar | AnnArbor.com
Masing described Tree Town Toys as a “viable business,” but said he and his wife and co-owner Tricia Masing opted to give up the 18-hour work days they were enduring.
Instead, they will focus on their separate business, a toy fulfillment and warehousing service called DragonFlyDepot.com, and likely online sales through TreeTownToys.com.
Masing acknowledged that sales had declined over the last few years. One of the most aggravating developments, he said, was that big-box competitors are starting to carry specialty products at low prices. For example, Walmart recently began carrying a line of animal figurines made by a European company called Schleigh.
"They're at Walmart cheaper than I can buy them," Masing said. "I can't compete against that.”
Meanwhile, some European manufacturers stopped shipping specialty toys to the U.S. after the passage of the Consumer Product Safety Improvement Act of 2008 while some U.S. manufacturers could not keep up with the additional safety regulations, Masing said.
“We’ve lost a lot of products that really did make us special,” he said.
Jan Benzinger, co-owner of the Mudpuddles toy store in Ann Arbor’s historic Kerrytown district, said big-box stores’ push into specialty toys is “definitely an issue.”
“A lot of times I will find things at Target for less than we pay for them, so we just immediately drop those companies,” Benzinger said. “For us, those are unfair business practices. You just shouldn’t do that to your stores, sell them for so much less to the big-box store. It really does hurt the little guy.”
Benzinger said her shop was still able to obtain most of the products it wants to sell, although at least one European manufacturer, Selecta, stopped shipping to the U.S. after federal regulations stiffened.
Tree Town Toys, co-owned by Hans Masing (above) and wife Tricia Masing, will close toward the end of the year.
File photo | AnnArbor.com
“We didn’t find that to be too much of a problem for us,” she said.
Local toy retailers said the challenges mean that customer service is more important than ever. Shops like Ashley Street's Lexi's Toy Box and Felch Street's Palumba, which sells "natural" toys under the Camden Rose brand, are finding success by catering to a niche customer base.
Kathleen McHugh, president of the Chicago-based American Specialty Toy Retailing Association, said big-box stores can’t offer the customer service that consumers can find at a small local toy shop.
“Specialty products are really hard to sell without somebody explaining them and knowing about them and knowing their right age-range,” McHugh said.
About 20 percent of American consumers planned to visit a toy store for the holiday shopping this season, according to a study by the NPD Group.
NPD found that about 31 percent of consumers planned to buy toys during the 2011 holiday shopping season, down from 32 percent in 2010. The National Retail Federation put the figure at 43.1 percent in 2011.
Online retailers present a major threat to local toy stores, but that’s nothing new. Local shops are also used to dealing with a tough economy in Michigan.
That's not new either, but Masing suggested that the economy is worse than it looks. Although the state's employment rate fell to 9.8 percent in November, a federal measure of "total unemployment" — which includes people who are underemployed — is currently 19.2 percent in Michigan.
"That's one out of five," Masing said. "That's a substantial portion of our economy. So folks have to be bargain driven right now, and the cost of operating a brick-and-mortar store and providing training and customer service and all of the things that are necessary to provide a top-notch shopping experience are more and more difficult."
Benzinger suggested that an additional hurdle facing Tree Town Toys was Pfizer Inc.’s 2007 announcement that it would close its 174-acre research campus on Plymouth Road, displacing more than 2,100 workers.
“I do think they relied a lot on the Pfizer people,” she said. “I would imagine that hurt them a lot.”
She said Mudpuddles is enjoying a “pretty super holiday season” despite the challenges but acknowledged that it could be partly because of the store’s location in Kerrytown.
“Kerrytown is kind of a jewel of Ann Arbor,” she said. “I think Ann Arbor itself is a little bit of a bubble, but then I think Kerrytown is a bubble within Ann Arbor.”
Regardless of the store, retailers are genuinely working harder than ever, McHugh said.
“Retail is very tough right now and if you’re not committed to it 150 percent, it’s not going to work for you,” she said. “We had early indications … things were on track for a very good holiday for independent retailers, but that doesn’t mean they haven’t had to work very hard for it.
“They’re working harder, but hopefully the results will be there by the end of the year.”
Tree Town Toys, whose lease was set to expire by the end of the year, opened in 2006 as an outgrowth of a website called BrainStationToys.com.
But over time, the Masings’ Jackson-based warehousing business became more lucrative — and running the physical Tree Town Toys store took up too much time and cash.
"It's frankly turned into 18-hour days," he said. "We have kids and we want to actually participate in physically growing up with them. Something had to give."
Contact AnnArbor.com's Nathan Bomey at (734) 623-2587 or nathanbomey@annarbor.com. You can also follow him on Twitter or subscribe to AnnArbor.com's newsletters.
Comments
bunnyabbot
Mon, Dec 26, 2011 : 6:01 p.m.
I find it really annoying that annarbor.com did two stories which involved TTT, yet Hans has commented so many times on the articles as if this were his own blog. He was interviewed, this isn't his own personal website to keep commenting about it. Perhaps if he spent less time blogging and more time working in the store he would have done better. Also any store that is a small business that has eight employees carries a load of expenses. Obviously they chose family over store and that is wonderful. But stores are almost always more sucessful and generally more profitable when the owner(s) is the one working the longest hours as per hour they are much cheaper labor. Owning a store/business isn't all easy and it takes quite awhile, years and years, before owners can work less and still pull down enough to pay employees. Honestly I was surprised to read that they had eight employees.
Sallyxyz
Sat, Dec 24, 2011 : 11:11 p.m.
If anyone thinks that the big box stores are good for the country, think again. They have lowered retail wages, they don't offer substantial health care benefits for workers, they pollute the landscape with their chemicals poured on the many islands of mulch in their acres of asphalt parking lots (I watched a tanker truck full of poison drenching the mulched islands in the parking lot of Meijer this summer), and sell cheap goods made in China, Thailand and India. They have effectively driven many local small businesses under, and added to the congestion and carbon emissions due to their locations outside of cities. If anyone thinks this is good for America, good luck.
braggslaw
Sun, Dec 25, 2011 : 12:52 a.m.
Don't shop there.
talker
Sat, Dec 24, 2011 : 11:09 p.m.
When I read comments about "big box" stores being able to buy toys cheaper and being able to profit when selling toys for less than independent stores can buy them, It reminded me of what happened to local, pharmacist owned "drug stores." A pharmacist in another part of the country had his own store. When he realized that national chains were able to sell products for less than he could buy the wholesale, he chose to sell his shop to a national chain while they were still paying entrepreneurs a decent amount. If wholesalers in toys would sell to big and little stores at the same price, little stores could compete. Of course there are many reasons why manufacturers need to accommodate their biggest customers. Maybe retail customers staying away could change things, but unfortunately we are talking about toys for children (and in the case of needed medicine in the pharmacy issue) and parents won't deny their children. I'm not advocating higher prices. The "big box" toy stores aren't better at stocking and selling toys. In fact, service is often better at the smaller, independent stores. The "big box" stores win because they pay lower wholesale prices. Wall Street wins and Main Street loses again.
Sallyxyz
Sat, Dec 24, 2011 : 10:43 p.m.
I understand the problem with being undercut by big box stores. But how is it that in European cities and towns, the small mom and pop operations are thriving, and there are big box stores on the outskirts of those towns and cities as well? Could it be that the values of Americans vs Europeans is a factor? Perhaps the fact that Americans are mostly concerned with "getting a good deal" rather than supporting local small businesses has something to do with this. I don't know, but I do know that having visited many European cities and towns, there are thriving small shops, as well as in Canada, and all of these places also have big box places outside of the towns. What is the difference?
say it plain
Sun, Dec 25, 2011 : 4:30 a.m.
Correct me if this isn't true in your experience, but as I recall big box stores on the outskirts of european towns and cities, they almost never carry the same kinds of products as the cute village-center shops. I think this is exactly the issue that is brought up here with the local small-business owners claiming that when they see the same products they themselves carry at a much lower price at the big-box places, they get frustrated. The small shops used to be able to carry specialty products more easily, before this latest silly legislation, before the small-scale manufacturers stopped sending goods to the US, or before small-scale US manufacturers were driven out of business because of the cost of complying with the new regulations. I am all for safety, but why can't we do it smartly? If all those different european nations can agree on a standard, what exactly would it cost us to come up with a similar one and let it be a *single* one instead of varying state to state on top of that?
A2Realilty
Sat, Dec 24, 2011 : 3:15 p.m.
Since there are several comments here about the CPSIA and its validity... (Safe toys for children must be good!!!) ...I thought that I would also chime in to support and elaborate on what Hans posted. I'll use an example... Let's say that you manufacture a toy that is made of polypropylene. The new regulation requires that you pay to have a third party lab test your toy for several topics, such as lead. This is a significant cost to you and is worthless. Keep in mind that there is no lead in polypropylene. In other industries, you could use facility certifications, such as ISO coupled with prints, specifications and certificates of conformance to establish the material safety that you need and not be required to test needlessly for the absence of something that won't physically be present. Before I started working in the toy industry, I worked for a Class III medical device manufacturer that made equipment and disposables used in neonatal cardiovascular surgeries. It was easier to select ,and document as safe, a material for use at the medical device manufacturer than it is within the toy industry. This is absurd and solely due to bad legislation crafted by lobbyists and legislators that don't understand what is truly required to make a toy safe.
Hans Masing
Sat, Dec 24, 2011 : 9:41 p.m.
*lee miserables* - I know A2Realilty in real life, and I am fairly certain you won't see him at any Tea Party rallies. :-)
say it plain
Sat, Dec 24, 2011 : 5:08 p.m.
Thanks for chiming in with the further details on that...it's important for people to get a sense of how this is working against perfectly fine manufacturers, and benefitting probably the largest players at the expense of the smaller. I wonder who currently benefits from it. I mean, legislators will continue to be clueless about the very text of the bills they vote for of course, but who else would stand in the way of eliminating unnecessary and prohibitive regulation? The people who profit from it, I presume. So, is it that there are testing companies out there who like the new revenues? Or is it that the big toy makers like how it limits their competition from those who can't afford the extra hurdles? Or some of both?
Sarah
Sat, Dec 24, 2011 : 1:17 p.m.
Thank you Tree Town Toys, for being a great store with a great staff. You will be sorely missed by my family and many others. I will admit that I've spent more time and money at Mudpuddles lately (it's a natural stop when my toddler son and I are at the farmers market on Wednesdays) but we've loved supporting both stores, and the other independent toy sellers in the area. There are still people who are willing (and happy!) to pay a few extra dollars at a local store instead of a big box. My family will continue to do so.
Hans Masing
Sat, Dec 24, 2011 : 9:42 p.m.
Thank you, Sarah! We'll miss awesome folks like you but are thrilled that you are going to keep shopping local. It makes a huge difference!
pseudo
Sat, Dec 24, 2011 : 12:55 p.m.
I love how it is somehow problematic that we have regulations that require proof that you won't poison our kids is bad. Baloney. There is a competitive issue here and the enemy is us, not those regulations.
Hans Masing
Sat, Dec 24, 2011 : 9:52 p.m.
I encourage you to read the CPSIA (or at least summaries of it) before you start criticizing those of us who have to live it every day. No one wants toxic or dangerous toys, but at the same time the legislation is so far reaching without thinking about reality. Do we want lead in toys? On the face of it, no. Seems simple, no? One product we had to removed from our shelves (of only a very, very small handful) was a toothbrush holder shaped like a robot. There was lead detected in a screw holding on a washer that was the robots eye. Is this an unsafe toy because it has lead in it? According to the CPSIA it is, and has to be removed from the shelves. In reality, however, a child would never come in contact with the lead in the screw unless there was a fairly egregious parenting issue going on - and then I'd be more concerned about intestinal perforation than I would about lead content. Now consider also that the CPSIA does not take in to account *SOLUBLE* lead - lead that will actually leave the product in case a part is ingested. The manufacturer of that product (from the UK) provided testing data for their EN71 certification that showed that yes, there was lead in the screw, however it would not come out of the screw even if it was swallowed. This is tested by placing the parts in a weak hydrochloric acid solution as part of the testing, and determining if digestion will access the chemicals. So, effectively, there is zero lead that could actually harm a child - but the CPSIA says it is unsafe, and that is extrapolated to 'poisoning our kids'. I totally get the sentiment, but it should also be backed by fact and reason. :-)
Fiddlesticks
Fri, Dec 23, 2011 : 10:54 p.m.
Don't forget the Ann Arbor Hands On Museum store has a selection of educational toys and games. In addition, the impression I got from the previous article about Tree Town Toys is that the shop will remain open as Rider's Hobby? I was also impressed with the fact that Rider's Hobby contains many of the same educational kits/ science-y toys from many of my favorite mail order catalogs at competitive prices but minus shipping fees.
Hans Masing
Sat, Dec 24, 2011 : 9:52 p.m.
'friends with benefits' :-)
rileyzma
Sat, Dec 24, 2011 : 1:20 p.m.
Riders is its own business. Different owners. They were simply sharing space, roommates if you will.
rileyzma
Fri, Dec 23, 2011 : 7:34 p.m.
Interesting - essentially the same story that was posted on Monday - why twice in one week do we hear about TTT closing?
zip the cat
Fri, Dec 23, 2011 : 6:30 p.m.
Amazon,Amazon,Amazon No shipping charges No taxes No out of sight parking fees No traffic No hassells. Nuff said
Hans Masing
Sat, Dec 24, 2011 : 9:56 p.m.
<a href="http://www.michigan.gov/taxes/0,1607,7-238-43529-155531--,00.html" rel='nofollow'>http://www.michigan.gov/taxes/0,1607,7-238-43529-155531--,00.html</a> Forgot to include that handy link for your reference. :-)
Hans Masing
Sat, Dec 24, 2011 : 9:55 p.m.
Wait, you aren't paying your Michigan Use Tax for your online purchases? You are responsible for the tax, whether or not Amazon collects it. And there is the exact issue with Amazon lobbying to block collection of online sales tax. Michigan tax laws go back to 1937 for the exact scenario that online sales creates. If Amazon collected sales tax, many people would have far fewer issues with how it is destroying our communities. Also, if your house is on fire some day and it take 30 minutes longer for the fire trucks to arrived because stations have been closed, or maybe the police take 45 minutes to get to your house when you are being robbed - remember that it is your sales taxes that help support the critical infrastructure of our city.
1bigbud
Fri, Dec 23, 2011 : 7:10 p.m.
You forgot Great Customer Service No Pain int BU77 sales people (with lies) Service is Great I only have myself to blame if its wrong I can't wait til i feel good about buying a car from Amazon So far Costco works good for that
Sarah123
Fri, Dec 23, 2011 : 4:07 p.m.
Mudpuddles is definitely one of my son's favorite stores. Great selection of quality toys and books, and a super-friendly staff. Plus, they have the best prices on Thomas trains compared to anywhere else in Ann Arbor (and a great selection, too!). I think Jan is right about Kerrytown being a bubble within Ann Arbor. Great stores, people, and atmosphere there, with special events all the time. In addition to Mudpuddles being a gem, Elephant Ears is one of our favorites, too!
braggslaw
Fri, Dec 23, 2011 : 4:06 p.m.
I understand the plight of the small toy store owner, but nothing is unfair about consumers getting the best deals. the small store store owner needs to focus on service, alternate products, etc. something that makes you special when compared to a Target or Walmart.
talker
Sun, Dec 25, 2011 : 2:53 a.m.
We are all hurting when people reduce the amount they pay the state in sales taxes. Sometimes it appears a product is cheaper on-line, when the savings is just part of what the sales taxes would be. When someone buys on-line from a vendor that doesn't collect sales taxes to send to Lansing, that customer (aided by the, on-line vendor) is cheating and taking money away from all of our safety, including preventing prospective police officers, etc. from being hired.
talker
Sun, Dec 25, 2011 : 2:46 a.m.
Unfortunately there are people who go into local stores and then buy slightly cheaper on-line. Sometimes the savings on-line comes from not paying the sales taxes customers are supposed to pay to the state when on-line retailers don't collect the sales taxes. When people get service locally and then buy 0n-line, they are stealing in two ways: First, they are getting the service locally but deliberately doing the business elsewhere. Second, when some of the people stores service buy elsewhere, the true customers are smaller in number and not enough to maintain the business profitably. It's not a matter of small store owner providing service. The problem occurs when people who get service from the small store owner then buy from the Target or Walmart at a lower price (because Target and Walmart didn't pay to educate and provide more service employees).
Stupid Hick
Sun, Dec 25, 2011 : 12:37 a.m.
Bragg, where in the article or in any of Hans' responses do you read that small business owners claim they are "entitled" to peoples' business?
TommyJ
Fri, Dec 23, 2011 : 8:58 p.m.
Saving a few dollars is important to many consumers, but you must also remember that you get what you pay for. Personally, I'd rather pay a few more dollars and never have to set foot in a Wal Mart again. I'd rather pay a few more dollars for actual customer service.
braggslaw
Fri, Dec 23, 2011 : 5:58 p.m.
You can make your case.... but the final arbiter is where the consumer wants to spend his money. If people don't value service than that is a choice made by the consumer. I have heard the big box versus small store argument before, there is a sliver of truth but that does not mean the small store is entitled to get business if it is more expensive. "saving a few dollars" is importan to me and I know it is important to others. No store is entitled to business, they have to win in the market place.
Hans Masing
Fri, Dec 23, 2011 : 5:13 p.m.
...and customers need to understand the value and expense of this service. About 10% of our operating costs were training and ongoing education for our staff in the products we sell, behavioral development in kids, current events surrounding toys, customer service, etc. You are absolutely right, but fewer and fewer people value service over 'the deal' and saving a few dollars. They also forget that buying in big-box stores moves most of the money they are spending out of their community, while shopping in locally owned establishments keeps more tax and sales revenue in Ann Arbor.
wolfman jack
Fri, Dec 23, 2011 : 4:04 p.m.
Toys are largely the purview of the young. As such, they are largely a commodity good. Price matters. I can only remember a couple of actual toys I bought my kids when they were young. The toys were immaterial to me. They were only required commodities with a short useful life. The last actual toys I bought came from the Dexter Mill (those hard rubber farm animals that stand up to everything). Grandfathers shop for toys where they buy bird seed. I would suggest a trade in some sort of inverse goods with better margins. I personally will pay too much for books. ( Or too little for too many books). I've been known to pay to much for pet supplies. I'll even vastly overpay for Deli food (which is delightful even if costly). Might I suggest paying too much for picnic and entertaining supplies ? When was the last time you saw a really good picnic basket - or a larder hamper filled with seasonal delights ? I know I can order one but I haven't "seen" one in a store for twenty years. The culinary gift basket/delivery market in this town has to have some traction. There's room for more than just the Z empire.
bunnyabbot
Fri, Dec 23, 2011 : 3:37 p.m.
actually when a big box store negotiates prices with the smaller toy manufacturers they are cutting into that small companies profits, meaning they cannot expand as fast (or meet demands) and keep money in thier local economy. A lot of these companies then decline in quality as they try to make the toys cheaper and then they go out of business or sell to a larger company which cheapens the product further with more of it made in China. This happens with all products across the board all the way down to socks and shoes. Also, the box companies consider a lot of items loss leaders. The average overall sale at the register for box stores is also much higher than speciality stores. Their margins for profit are much more narrow on individual items. And then of course they suck all that money out of local economies. as for Mudpuddles, I think they just have a better buying sense than TTT did. They've been in business longer and to me were just the better toy store. How can MP have outstanding sales selling the same thing as TTT and TTT go under?
Stupid Hick
Fri, Dec 23, 2011 : 4:58 p.m.
"How can MP have outstanding sales selling the same thing as TTT and TTT go under?" Did Hans say that TTT was forced out of business because it was losing money? Or did he say he and Tricia made a personal choice to close the bricks-and-mortar store to focus on their logistics business and reclaim time for their family?
modeltim
Fri, Dec 23, 2011 : 2:53 p.m.
If the government would enforce antitrust laws which explicitly state that it is illegal for companies to undercut others with lower prices when the ultimate intent of such unfair business practices is to drive them out of business whereby they can then raise their prices after they've gone broke. It's called monopoly capital. I know those longstanding laws are just so quaint these days.
braggslaw
Fri, Dec 23, 2011 : 4:07 p.m.
If the large stores can make a profit, then nobody should get involved in the marketplace. There is a difference between dumping and a 1% margin.
Doug
Fri, Dec 23, 2011 : 2:27 p.m.
"We've lost a lot of products that really did make us special," he said. What made them special is that they were probably made in China or elsewhere and very toxic. We do need protection from foreign manufacturers. I do feel bad for small businesses that can't compete, but we must be assured that what they are selling is safe.
Doug
Fri, Dec 23, 2011 : 4:32 p.m.
Hans, Obviously my comments should not have reflected your business. My apologies.
Hans Masing
Fri, Dec 23, 2011 : 2:40 p.m.
What made them special was that they were handmade here in the USA, and couldn't afford to comply with the safety regulations - even though their products were 100% safe. Wood, linseed oil, bees wax. <a href="http://www.handmadetoyalliance.org/" rel='nofollow'>http://www.handmadetoyalliance.org/</a> has arisen as a result of this, to try to save this cottage industry and avoid specifically what you are referring to - only having foreign-made plastic toys available to our children.
jenny murray
Fri, Dec 23, 2011 : 2:20 p.m.
Wow, some real simplistic views of this issue in these comments. When small businesses are driven out, money leaves the local economy. That's a problem. That's a big problem.
Wolf's Bane
Fri, Dec 23, 2011 : 2:18 p.m.
Vote with your dollars. For example, don't go to WalMart.
Wolf's Bane
Mon, Dec 26, 2011 : 7:54 p.m.
I've never gone to WalMart and I am very happy.
ferdcom
Fri, Dec 23, 2011 : 3:38 p.m.
People are voting with their dollars. They're just not voting the way you want them to.
kay
Fri, Dec 23, 2011 : 2:16 p.m.
I do everything I can to shop and spend locally--this is so frustrating. I just discovered TreeTownToys--and now I have already lost it. So sad!
Carole
Fri, Dec 23, 2011 : 2:07 p.m.
This is sad indeed. And, once again thanks to the government we will be losing some very valuable small businesses who provide personal service to their customers. Used to be that most businesses were very ethical and provided safe products to the be purchased. It seems these days, many businesses go for less quality trying to make bigger bucks. For myself, I will continue to look for the smaller, local businesses and purchase USA made items. Or go without. We all need to stand up for America and purchase American products.
Stupid Hick
Fri, Dec 23, 2011 : 4:59 p.m.
"And, once again thanks to the government we will be losing some very valuable small businesses who provide personal service to their customers." Did Hans say that TTT was forced out of business because of government regulations? Or did he say he and Tricia made a personal choice to close the bricks-and-mortar store to focus on their logistics business and reclaim time for their family?
Hans Masing
Fri, Dec 23, 2011 : 2 p.m.
Thanks for the great reporting, Nathan! I do want to add that while all of the factors mentioned above did contribute to a more difficult business landscape for small toy stores, not renewing the lease for Tree Town Toys is ultimately a personal decision that Tricia and I made with our kids - as a family. We are honestly working all day and night on both businesses, and something really had to give. When we looked at the entire picture of our operations, and we looked at the amount of effort that our retail store took to keep operating, and compared it to our logistics and charitiable support business, we realized that the obvious choice for us what to close the store. We'll miss it - we loved the direct customer interactions, the day to day buzz, but ultimately the choice was personal. Jan of Mudpuddles (who is an awesome human being, btw!) posited that Phizer closing may have contributed to a decline in sales. Yes - when Phizer left, we did see a decline in business, particularly during lunch, but it wasn't enough of a decline to make a significant impact to our bottom line.
dsct61
Sat, Dec 24, 2011 : 12:20 p.m.
Thanks for some great years of browsing and buying at your store! I have thoroughly enjoyed taking my daughter to your store, buying gifts for birthday parties, and Christmas shopping for the special gifts. Enjoy your time with your family and know you've given some Ann Arbor kids a lot of special outings to a great toy store and a lot of special toys!
Steve Hendel
Fri, Dec 23, 2011 : 1:47 p.m.
""A lot of times I will find things at Target for less than we pay for them, so we just immediately drop those companies," Benzinger said. "For us, those are unfair business practices. You just shouldn't do that to your stores, sell them for so much less to the big-box store. It really does hurt the little guy." If a toy maker can sell 100 units to Tree Town and 10,000 units to Walmart, why is it unfair that Walmart gets a better unit price? Retailers and manufacturers give quantity discounts all the time. In the end, I think these Mom and Pop operations often just don't want competition.
FaithInYpsi
Sat, Dec 24, 2011 : 4:12 a.m.
It is unfair since they promise you that they won't be selling to the "big box" stores when you buy from them. The next thing you know they are showing up at Sams, Target, WalMart, etc. It is a contract you sign that YOU won't sell them on perhaps eBay but they sell to other companies at a much lower price that absolutely can sell for less than you paid. It is all about the money and the Mom and Pop operations get the shaft.
braggslaw
Fri, Dec 23, 2011 : 4:08 p.m.
Innovate and be different, stop complaining.
xmo
Fri, Dec 23, 2011 : 1:41 p.m.
Nothing like the US Government eliminating jobs by passing more useless laws. "some European manufacturers stopped shipping specialty toys to the U.S. after the passage of the Consumer Product Safety Improvement Act of 2008 while some U.S. manufacturers could not keep up with the additional safety regulations, "
say it plain
Fri, Dec 23, 2011 : 10:58 p.m.
Wow, thanks for that thorough and clear reply @Hans Mansing! Are there any groups (i.e., independent retailer associations) that might be trying to 'fix' this situation? I understand how it might be difficult to vote against anything labeled "for our Kids' Safety Act" and all lol, but I'm wondering who benefits from this...sounds like a great way to get small interesting product-lines totally eliminated from the marketplace (as well as many of those nice european-made products from larger companies) particularly if there are federal *and* state regulations that require slightly different testing procedures, yikes! I realize our congresspeople barely read any of the stuff put before them, but they also like to please their lobbyists, and I can't help but consider that not only was this a conspiracy of silliness, but also of profit-motive.
Stupid Hick
Fri, Dec 23, 2011 : 5:08 p.m.
Holy cow. Three people actually voted up my previous comment, which leaves me wondering whether they read it literally or recognize my sarcasm.
Hans Masing
Fri, Dec 23, 2011 : 5:08 p.m.
(...part 2) Meanwhile, in the US, products that were perfectly safe (hand-knit organic wool baby slings, for example) now fell under the scrutiny of the CPSIA and the state regulations, which stiff penalties on the *RETAILERS* if they sell products that do not conform - up to and including felonies with jail time. Even if they sold them unknowingly, and even if the manufacturer had misrepresented the contents of the product. When legislation is named 'The Keep Our Children Safe Act', it's very difficult politically to vote against it - even if it is misguided in its implementation. What, you dont' want to keep our children safe? *sigh*
Hans Masing
Fri, Dec 23, 2011 : 5:07 p.m.
*say it plain* - Great questions. The problem with the recalls that were happening were primarily with manufacturers operating in the Asian manufacturing space - China, Thailand, etc. Components would be sent to second and third tier suppliers for manufacture, and quality problems would arise. Lead in paint, for example, was a concern. It turned out that there were no clear standards in place in the US for what constituted 'safe'. Meanwhile, in Europe, there have been standards for toys that are reasonable and comprehensive (EN71 - <a href="http://en.wikipedia.org/wiki/EN_71)" rel='nofollow'>http://en.wikipedia.org/wiki/EN_71)</a>. We purchased for sale here in the US many product that conformed to the EN71 standard, and were 100% safe. As the CPSIA was being enacted, many states scrambled to enact their own safety legislation - creating a hodge-podge of regulations that no manufacturer could ever conform to. There was a push among specialty manufacturers and retailers to have the US adopt the EN71 specifications for toy safety (and I testified to the Michigan Senate Committee responsible for the Michigan legislation to exactly this effect), however the DC mindset was that we had to do it 'our' way. So, we ended up with a different set of regulations, testing requirements, etc. Not better or worse, but different from the EN71. This meant that well-established and very safe German-made toys, for example, had to now test not only to EN71 (which is expensive due to the requirement for outside certification), but also now had to do so for the CPSIA, *and* potentially 40+ different US State regulatory sets. A number of these brands cut back their products they ship to the US to avoid the crushing cost, and some brands stopped selling entirely. (...continued)
say it plain
Fri, Dec 23, 2011 : 4:39 p.m.
I wish this report had gone into greater detail about which aspects of this 2008 legislation caused the change in European suppliers' willingness to ship. For instance, what new roadblocks are we putting up in the name of safety? I like my toys lead and cadmium free, so I'm wondering what Bush administration decided was now needed to prevent that, and which lobbying groups were involved in creating 'bad' legislation of this sort. Does the law require testing by say some US company who might have had President Bush's ear in their possession at the time or something and only certain companies feel like paying the ransom fees for admission to the US toy market?
Hans Masing
Fri, Dec 23, 2011 : 3:28 p.m.
*sigdiamond* - The Consumer Product Safety Improvement Act of 2008 is a United States law signed on August 14, 2008 by President George W. Bush. <a href="http://en.wikipedia.org/wiki/Consumer_Product_Safety_Improvement_Act" rel='nofollow'>http://en.wikipedia.org/wiki/Consumer_Product_Safety_Improvement_Act</a> I get the sentiment you are expressing, but facts are facts. Bad legislation is not the sole responsibility of just one party or the other. This was bipartisan legislation, top to bottom.
sigdiamond
Fri, Dec 23, 2011 : 3:01 p.m.
I wonder what left-wing anti-business president signed that act into law.
Stupid Hick
Fri, Dec 23, 2011 : 2:16 p.m.
Hear hear! Making money is more important than children's safety.
justcurious
Fri, Dec 23, 2011 : 1:10 p.m.
"A lot of times I will find things at Target for less than we pay for them, so we just immediately drop those companies," Benzinger said. "For us, those are unfair business practices. You just shouldn't do that to your stores, sell them for so much less to the big-box store. It really does hurt the little guy." I agree with 15crown00's comment. The true motive behind a business needs to be making a profit. That holds whether you are a manufacturer or a retail store. How can you expect that company to just sell a low volume of their product to a small store? This isn't a charity, it's free enterprise.
Rob
Fri, Dec 23, 2011 : 4:44 p.m.
@M: They shouldn't! The price of the thing is the price of the thing. "Making it up in volume" is still taking a hit. (I will now go back to my castle in the sky.)
M
Fri, Dec 23, 2011 : 1:48 p.m.
Yeah, it really sounded like "I know they buy a thousand times as many goods, but they shouldn't get a better deal than us". That is literally untrue for everything, everywhere. You have to make up for the lack of buying power with a great location and a great service. One or the other was missing, and from the sounds of it, it's the location.
15crown00
Fri, Dec 23, 2011 : 12:11 p.m.
small independent stores or chains simply can't compete with the BUYING POWER of Big Chain Stores or Big Box Stores.they buy it for less and sell it for less.IT'S THAT SIMPLE.End of Story.
Katherine
Fri, Dec 23, 2011 : 5:39 p.m.
Nothing in the economy is that simple. If it were the country wouldn't be in the mess it is. That being said, large corporate stores decimate local economies and your low price on your widget is why your local emergency services, schools, roads are suffering and your property taxes and utilities are rising. Tax revenue is what keep your community viable along with local businesses that pump 68% back into the economy. Twice what a corporate store does. I encourage you to get educated about local economies and the effects of online and big box shopping has on them.
Hans Masing
Fri, Dec 23, 2011 : 1:54 p.m.
I agree completely, fwiw. Dragonfly Depot (our other business) has been trying to create an aggregate of small toy and gift stores across the country to actually create a large buying group to combat exactly this problem. However, you'd be surprised how many independent retailers don't get the value in combining and aggregating buys in to larger, consolidated orders. We'll get there eventually, but it's a tough road.
DennisP
Fri, Dec 23, 2011 : 11:43 a.m.
Such irony. The very stores that prompted the 2008 lead-testing legislation are benefiting from it as the law impacts local small competitors costing the US and local economy retail and manufacturing jobs. It was Wal-mart, Amazon and those kind that brought the cheapest and most toxic toys to our shores from China. Now, quality manufacturers in the US are declining and higher-quality, responsible and accountable local stores are facing challenges in acquiring the kinds of toys that made them unique. Those stores, perhaps, couldn't compete on price but could compete on the basis of quality and specialty in their selection. But, they are now finding their selections dwindling, while our quality choices narrow and our local stores close or choose other directions. We don't want lead in our toys, but it's seems so perverse that a law that was supposed to help ends up subverting the local industry while the giants that brought about the need for the law benefit.
EyeHeartA2
Sat, Dec 24, 2011 : 4:13 p.m.
"The problem was the *unintended* consequences." That's almost always the problem. From smashed cars to mortgage foreclosures.
Hans Masing
Fri, Dec 23, 2011 : 2:57 p.m.
The main problem with the CPSIA wasn't the effort to ensure that toys are safe. Nobody in the industry would ever argue that - it's critical. The problem was the *unintended* consequences. Sweeping legislation was applied that impacted "all products intended for use by persons under 13 years of age" (not a direct quote, but the point is in there), and mandated chemical content of these products. You know what became illegal to sell (with me potentially facing a *felony* charge and prison)? Batteries (toxic chemicals). Bike chains (lead). Books printed before 1986 (arsenic in the binding). Pinewood derby cars (cadmium in the axel nails). Are any of these things unsafe in and of themselves? No, they aren't. Add to that the fact that the legislation required mandatory testing by third parties of products from each batch - at a cost of about $3000 - and a toy company that makes wooden trains, but only does a few hundred a *year* in their homes, suddenly can't sell their products. The best part, however, is that the mass manufacturer lobbyists managed to include wording in the bill that allows the largest manufacturers (and the ones that were causing the problems) to *self certify* - in other words, bypass the legislation's core that they forced on to small manufacturers. Toy safety = good. Overlegislated unintended consequences = bad.
Mike
Fri, Dec 23, 2011 : 1:29 p.m.
The one thing most well meaning liberals don't seem to understand is that legislation to control one problem usually has a much larger impact on those who are playing by the rules. You cannot legislate every danger and problem from society and in most cases there are already rules and regulations in place which are not enforced anyhow. Be careful what you ask for because our legislators are more than happy to give it to you and will do so even if you don't want it. Merry Christmas to all!