Companies in this industry operate physical retail stores that sell new toys, games, and hobby and craft supplies; some also sell products online. Major companies include Toys "R" Us, GameStop, Michaels, Hobby Lobby, and AC Moore Arts & Crafts (all based in the US), as well as Citta del Sole (Italy), Hamleys (UK), LEGO Group (Denmark), and Toyworld (Australia).
Consumer spending is a key driver of demand for toy and hobby stores. In addition, population growth among young children (under 12) drives demand for toy stores, and population growth among women 35 and older drives demand for hobby stores. The profitability of individual companies depends on the ability to generate store traffic and effective merchandising. Large companies offer wide selections and deep discounts. Small companies can compete effectively by offering specialized products, providing superior customer service, or serving a local market. The US industry is highly concentrated: the top 50 companies generate about 85% of revenue.
PRODUCTS, OPERATIONS & TECHNOLOGY
Major products include toys (30% of sales), craft supplies (15%), and kitchenware and home furnishings (15%). Other products include games, hobby goods, artificial flowers, and sewing and knitting materials. Among traditional toys, key categories include outdoor and sports toys, infant and preschool toys, and dolls. Toy stores may provide assembly or delivery services. Hobby stores may offer classes, known as “how-to” seminars, and picture framing or floral arrangement.