Toys have been a product for playing while having an educational aspect. Children worldwide are indulged with toys to play with and have fun. Many toys are categorised according to the age factor of the child. Various categories of toys can be divided, from dolls and other soft toys to that Rubik's Cube and Jigsaw puzzles, etc. The sport kits, chess boards, and other outdoor-indoor educational toys are also considered under this category. In India, every fourth person is under 14, and the growing demand for educational toys is driving the Indian toy market. Thus, to start up a toy store business would be smart, though it takes a lot of planning, research, and analysis.
Did you know?
Infant/pre-school toys and unisex toys account for the majority of the share in the Indian toy market.
Scope of Toy Business
A toy store business is a business idea that will grow in any generation. Moreover, a toy store business is categorised into different niches, including soft toys, electronic toys, puzzles, dolls, sports kits, etc. Most of the highest-grossing toy business in India is situated in the regions of Maharashtra, Karnataka, Tamil Nadu, Delhi, and Gujarat. The toy business market in India had grown up to the revenue of $1.35 billion (approx. ₹21,000 crores), at present till the year 2021. However, the IMARC survey shows that the toys business in India might reach up to the height of $2.73 billion by 2027. This new generation is getting busier and busier nowadays, but no matter how busy the youth become, the kids will always look for an escape, which is a handful of toys for them.
Therefore, planning to open a toy store business in India is one of the greatest and the smartest ideas of the present time. Several steps and procedures need to be considered before taking a step forward in the toy store business.
Several reports determine the scope of a toy store business. Some of the important considerations that need to be analysed before starting up a toy store business are:
- Market drivers Success Factors.
- Value chain.
- Comprehensive mapping of the competitive landscape.
- Market outlook.
- Market performance.
- SWOT analysis.
Steps and Planning
Several steps and procedures need to be considered to start a toy business. Some of the basic steps which are considered before setting up a store business are:
The first step that needs to be considered is starting a toys business. The major role is to determine the category of the toy store, whether it's going to be a large-scale retail shop or is it going to be an in-house manufacturing store. There is a need to understand and know the skill and creativity behind starting a toy store business. Moreover, the planning should involve the type of setup of the toy store, whether online or offline or both.
Innovation is one of the major aspects of starting up any business. When it comes to the toys business, innovation and creativity are very much required for the growth in the toy market. The requirement and needs of the children greatly affect the revenue of the toy store business. Though, attractive and innovative ideas will lead to the growth of the toy market.
Researching is very much important before stepping into any kind of business. The basic thing that needs to be analysed is the marketing function, demands, supply chain, the source of raw material, availability of the raw material, etc. Suppose you start the toy store business in a new city. In that case, you need to research and analyse the rules and regulations regarding the business in that particular city.
- Niche Selection
A toys business can be categorised into several niches. Therefore, considering a particular niche is necessary to consider whether a toy store sells only soft toys or outdoor games/equipment. A large-scale toy store business might consider all age groups of children.
One of the greatest aspects of a successful toy store is the location. The location needs to be cost-effective and easy to reach in a highly-populated area. After analysing different areas, the store must be set up in those areas where the number of children is higher, with a great demand for toys in the market.
Funding is the most important aspect of a toy store business setup. There will be a delay in many procedures required to set up a toy store business with an improper funding system. Therefore, considering a proper funding or loan system is required to start up a business. A total of around ₹10-20 lakhs needs to be collected as an initial investment.
After dealing with all of the research, planning, location, and funding, the last thing that comes to the consideration of any business is marketing and promotion. If that toys business is offline or online, marketing and promotion are required in that particular area and city to attract customers and increase the sell-out rate.
Apart from the initial stage of planning, researching, and determining the location of the market space, the legal aspect needs to be considered for the safe and secure running of the business. Some of the legal documentation required for the toy store business are:
- The business registration: A toy store business needs to have a full-fledged verified registration and legal documentation to determine the type of the business structure. Either it is a sole proprietorship, under a partnership, limited liability company (LLC), or a corporation.
- Licence: A particular toys business must have a state and a local business licence. Several licences are required before starting up the toy business, including the Certificate of Occupancy, Resale Certificate, Business Permit, etc.
- Tax policies: Every business, whether a large-scale business or even a small-scale business, is taxed accordingly. Therefore, having a legal tax policy is quite required to determine the taxation over the business.
- Insurance: Having insurance for a business is very much necessary to protect and safeguard the business from any incident that might happen all of a sudden.
There is an obvious need for investment to start up at a toy store business. However, there are two of the primary investments that need to be done on the basic stage,
- Marketspace area: Buying up or renting a commercial space for the company's setup or the store sums up to a great amount that needs to be invested in the initial stage. Therefore, determining the cost of the space or the rent amount must be calculated accordingly.
- Raw material: investment needs to be collected to stock up the raw material for the start-up of the business. It needs to consider the source of the raw materials to lower transportation expenses.
Starting a toys business is quite a smart and innovative idea. Much research, innovation, and planning are required in setting up such a business. Once the initial planning stage is done, the basic stage of the manufacturing, set up of machinery, etc., comes up for which a great amount of funds is required. Having a good source of funds is necessary for setting up a successful and seamlessly running business. One of the basic considerations in the toys businesses is proper planning and legal documentation, including licence, permits, taxation policies, etc.
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