Great ResignationInflationSupply ChainsLeadership

Possible toy shortage looms this holiday season

July 29, 2021, 4:22 PM UTC

Santa might have to cut his summer vacation a bit short this year.

Continuing troubles in the shipping industry are making toymakers and retailers concerned about whether there will be a sufficient supply of toys this holiday season. Concerned parents might want to begin shopping earlier than usual.

The disruption is even worse than last year, when many ports were closed, say toy industry execs. (Most toys are made in China.) This year, bottlenecks at seaports are to blame. Some toys are expected to experience months-long delays before hitting store shelves.

“There could be still unanticipated supply chain challenges, and it’s hard to tell what the future may hold,” Mattel CEO Ynon Kreiz said on an earnings call.

Even the toys that do make it to shelves could be more expensive. Manufacturers are running up costs as they try to combat the supply issue. As a result, renegotiations are underway with retailers on prices, which are normally agreed on up to a year in advance.

The Wall Street Journal notes that prices on L.O.L. Surprise dolls and Little Tikes have already seen some prices jump from $10 to $12 and from $29 to $35. And Mattel, on its earnings call, said the price of Barbies, Hot Wheels, Fisher-Price, and American Girl, along with other products, would be higher in the second half of the year, though it’s unclear if retailers will pass those costs along as well at this point.

Hasbro, also, says it will increase prices to “offset the rising cost of freight and commodities we continue to see across the business.”

Retailers, typically, have holiday toys on shelves by October, catering to early shoppers. But supply chain issues could push that later, meaning the retail frenzy that usually starts in mid- to late-October could be even more ferocious this year—especially for the year’s hottest toys.

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