The toy industry continues to be challenged across a number of metrics including declining birth rates, reducing shop fronts, changing consumer shopping patterns and technology-based products, which compete against more traditional toy-based ranges. As is always the case, change also creates opportunity for smart people and businesses that can see how they need to interact with their customer.
Toy Networx has been a more traditional wholesaling business for many years now. It has managed to find a niche in the market where they have been able to do business by representing global brands such as Hasbro & Mattel (and others) and generic toy brands to compliment their portfolio. Recent changes to the ownership and vision for the business have seen Ben Bliss, the current owner and Managing Director, look to create a new CEO position in the business. He has since engaged Jonathan Byrnes (a former Hasbro & Funtastic Executive) to head-up the organisation to develop a new business model, which will be sustainable into the future. Jonathan and team have been hard at work re-branding and building an exclusive product portfolio, which will ultimately give them a point of difference in the market.
We spoke to Jonathan leading into the Toy Fair to get an update on how these plans are coming together…
Jonathan, first off, can you give us a bit of background on your career and how you came to join Toy Networx?
Thanks Tony, sure. I started life in New Zealand working for Farmers Department stores and quickly joined their internal trainee management program – a replica of the Harrods model in London. In this program I learnt every aspect of a large retail department store business, from store receiving to buying and merchandising through to large format store management. I was one of the youngest managers ever to manage a store. Then I moved into FMCG and worked for Coca Cola Amatil in the grocery division managing supermarkets, covering all aspects of the sales process and local in store marketing programs.
Fast forward a few years after living in Europe and working in various roles I settled in Melbourne back in 2003. This is where I started my Toy career working at Hasbro in the field – managing Vic Tas independents. I loved working in the field and getting to know all the amazing people face to face, that make up our industry. A few years on, I made the move to Funtastic where I looked after Kmart and Myer. This was an exciting role which I enjoyed very much. Then my children came along and I took a year off to be with them in their early years.
My other passion is property and this is where I stayed for several years while the boys were young, (operating my own business) renovating, building and all things property related. This included being featured in a regular segment on Channel 10’s “The Living Room.” Now I have taken on a new challenge and bought into the Toy Networx business.
In terms of the task ahead of you, how do you see the toy business and market both here in Australia and overseas?
I see the toy business and market both here and overseas moving into challenging times ahead. With so many external global factors such as the current coronavirus outbreak, political unrest in Hong Kong and many other global and local economic factors in play; I think it is really important for our industry to remain true to our heritage but also drive innovation in product development. I also feel there will be a big push into more sustainable product development, and I think environmentally conscious consumers, suppliers and manufacturers will drive the innovation in our industry moving forward. I don’t think enough emphasis is placed on this currently within our industry.
Where do you believe Toy Networx fits into this equation and what are your immediate opportunities for growth?
We are the bridge between suppliers and customers, large and small. We hold a unique position in the market where we offer traditional one on one service to the independent market. We are easy to deal with, have the latest in electronic ordering technology, we will split cartons and ship individual items and our customers can visit us and buy off the shelves. All of this, while providing the best traditional dedicated service our customers have come to love and expect from Toy Networx. A key focus for me since joining the business has been to explore and implement growth, but also diversity. As a result, I am really excited to announce our new strategic partnership with Hinkler Books.
From March 1st 2020 Toy Networx will be the key National Independent distributor for Hinkler. This is an incredible opportunity for us, bringing a number of new opportunities to the Toy Networx business. It opens up many new accounts for us as a business, while allowing us to offer a truly diverse range of products. I am looking forward to offering this new range to both our existing and new toy and newsagency customers. I believe when you see the entire range at Toyfair, you will agree too.
Our local market is not large, so I am working very hard to create more partnerships such as the Hinkler partnership above. We are actively exploring other growth opportunities and hopefully will have more exciting announcements further into 2020 and beyond.
In terms of your impending re-brand, how did this come about and what do you think it will bring to your business?
Tony, as you know a brand identity is crucial to any business. Toy Networx has been through many evolutions over its almost 50 year history under a variety of trading names and iterations. My vision for the business for the next 50 years is that we are current, on trend and relevant to a changing market. I felt the re brand was a vital component to relaunch the “all new” Toy Networx into the future. (it’s also a great excuse to get Ben to wear a suit to the Toyfair dinner! There’s a first for everything I guess)
We understand that you have been hard at work developing and building a new product portfolio. Would you mind giving us an overview of what this looks like?
We have a major focus on developing our own exclusive range for the Australian & New Zealand market that incorporates both our own product innovation and in some cases licensing agreements. We will have on offer exclusive brands which will not be competing with mass market. While we will offer main skus, our focus is to grow independents’ range and offering. As part of this project, we have developed a great range of low cost, good margin Volume driver items. We are launching a brand new Fisher Price Barbie & Hot wheels range which we will have on show at Toy Fair.
What will be the point of difference to the customer by investing in the Toy Networx service model?
We have, and always will remain true to the Toy Networx heritage – being a cash and carry/wholesale business. With our new partnership with Hinkler, and continuing partnership with Five Stars International and other innovation underway we will have the ability to offer more product than ever before, across multiple brands and categories. Our aim is to make the customer experience easy and fast, while providing our customers the platform to be able to order, source and deal with us for all products from many suppliers with one delivery / consolidation in the easiest way possible to suit their needs. That may be a fax (yes we still get them!) a phone call, a visit from a rep, an email online or carrier pigeon. We will cater to all and any requirements because we understand the diversity of the market and the intricacies in the way our customers work.
We understand you are also developing an exclusive catalogue and promotional offer, can you tell us a little about this?
We produce up to 20 catalogues per annum. Catered to all sizes of retail business. We make it very simple and easy for our customers to participate in our catalogue program. We offer a great range of items across these catalogues mixing brands and generic items as well as for this year planned, our own development & exclusive items. With good margin, ease of ordering and strong growth Year on Year – a key focus for 2020 is to expand our catalogue program into new areas with increased innovation and product offering.
As part of your rebrand, we believe you are planning on re organizing your online platform to work in concert with your more traditional direct services?
We have been very pro active over the years in the technology space and we run an extremely good online ordering system for our customers. We understand that our customers are small businesses and may not have the time to see a rep or take a phone call to place an order. Our system lets our customers order at a convenient time to them via the web or an app. The technology space is one I am personally focused on to drive innovation for our business and make it even better, with more expansion and capabilities to come.
As part of your re organisation, you have also been building a new team. Can you tell us a little about your new team members and what they will bring to your growth plans?
We have contracted David Clancy to head up our new specialty division. He is well known to the industry and brings to our business over 22 years worth of experience. From humble beginnings starting at Target, through to Lego and Funtastic we are excited to have him on board.
Projecting forward beyond the next 12 months, where do you see the business landing in a market which continues to change on a daily basis?
I have incredibly high aspirations for the “New Toy Networx” My vision for the business is to continue to do what we do and continually improve on our process. Drive innovation, explore new technology and bring a fresh and sustainable product range to the market. It’s good for our readers to get an insight into the nature of your rebrand and how they can partner with you. Your brand new stand at Toy Fair (K37) will be an ideal opportunity for potential partners and partners to visit you and discuss business. We also believe you will be hosting an exclusive party at the show as a thank you to the industry?
Our party initially came about aimed at the independent trade. As it has evolved over the years it has become a bit of an institution and something we are known for at the Toy Fair. This year will be our biggest yet and we sincerely look forward to sharing a great night out with the amazing people that make up our industry.