Custom plush toy company

[FPLTD]

Just wondering what the % profit could be? I reckon between 40 - 70% but would be interested if anyone had any ideas. Thanks

 

[MOIC]

Are you asking as a manufacturer, importer, wholesaler or retailer? All will have different margins.

30% - 600% is probably your ball park figure to work on.

 

[FPLTD]

Are you asking as a manufacturer, importer, wholesaler or retailer? All will have different margins.

30% - 600% is probably your ball park figure to work on.

 

[FPLTD]

Thanks for the reply, we'd be asked to make 1000 toys, they'd be manufactured in China at a factory, we'd then import them to the UK by air or sea.

 

[MOIC]

Who will. be responsible for the shipping, customs and delivery?

 

[FPLTD]

We’d be responsible for the entire shipment so we’d need to factor all, factors

 

[japancool]

Thanks for the reply, we'd be asked to make 1000 toys, they'd be manufactured in China at a factory, we'd then import them to the UK by air or sea.

If those 1000 toys are for one customer, why would the customer come to you rather than dealing directly with a factory in China, or an agent there?

 

[FPLTD]

We take the brief and design the toys in the UK, manufacture takes place in China

 

[HFE Signs]

What are the payment terms? Often it's 30% deposit and 70% payment at point of shipping, this comes with great risk on your part. What if the goods arrive and are not as you expect? You will need goods in transit insurance too.

Remember to check import duty, you should be able to get the commodity code and get an exact cost for duty here: https://www.gov.uk/trade-tariff

Be sure you understand the shipping arrangements DDU DDP etc.

 

[FPLTD]

Yes 30/70

In terms of % profit, what can we expect — I’d reckon around 50-70%, so if we sell at £8 we should be making around £4 per unit, after all costs incurred

 

[thetiger2015]

Custom plush toys?

So a customer would come to you, they'd ask you to make them, you'd set the minimum order at 1,000 units?

Quite a few companies already do this. It completely depends on the target market. If you're selling to luxury retailers, the margin is higher. If you're selling to someone who has an RRP ceiling of £10 per unit, they're going to want them £5 per item all in. They won't go over that.

 

[MOIC]

Calculate ALL your landing costs, then add what you think is appropriate for your business category and the customer.

if the customer is a retailer, then it's normal to add 30% to your landed cost, but this will depend on the agreed payment terms as well as other points including warranty, repeat business and avoiding your customer potentially side stepping you.

Ultimately it's got to be viable for you and your customer to keep working together.

If they used an agent, they could theoretically get the same product from the factory at cost plus 5-10%, albeit they'll have the 'hassle' of shipping, clearing customs and all that importing a plush toy involves, especially certification for EN71 (multiple categories). The importer is responsible for this.

Some large groups prefer to be supplied by a UK supplier for imported goods due to customer returns, servicing, credit terms, and certification.

 

[FPLTD]

Here are some quick, real world calculations, that I think stack up

 

[japancool]

50% is your markup, rather than your profit margin. It seems low, but you're effectively acting as the wholesaler here. I would think you should be looking at 50% margin (100% markup), if that works for your client.

Are you charging a separate design fee?

 

[FPLTD]

The problem is that a higher % would make the proposition unviable for the client, if we were to charge £7.98 and not £6.98. We could negotiate much harder with the manufacturer, even on 1000 units a cost price of £2.16 as opposed to £3.16 is considerable toward the bottom line. There are other factors such as the complexity of the toy but these figures are on what I'd consider a standard, decent composition ie some embroidery, detail, of an 8" plush toy. Yes we'd charge for the design but not a huge amount. Ultimately there is the kind of toy you find in a fair ground grabbing machine, and then there is a Disney toy sat in Hamley's, you could produce both but costs would be a lot less if you simply digitally printed everything and didn't concern yourself with embroidery, sewing technique, etc.

 

[japancool]

I take it you're not VAT registered?

 

[FPLTD]

VAT is included in the projections above, unless I've made an error? My father in law is an established accountant heading up a firm so will take care of all of that for me.

 

[japancool]

Sorry, I see it now. The way the figures are laid out was a bit confusing.

By the way, are you arranging your own shipping, or is the factory doing that for you? If they are, be careful of extra fees when the shipment lands.

 

[FPLTD]

We'll arrange our own shipping.

How do you feel about the figures, in terms of a profit margin?

 

[japancool]

We'll arrange our own shipping.

How do you feel about the figures, in terms of a profit margin?

I still think it's a little low, but as long as it's acceptable for you and your client, then it's fine.

I'm not sure how much the client intend to sell them for, but in my industry (pop culture), you would expect to only make a 30-35% margin at retail (so a markup of perhaps 40-50%, so the retailer would be selling at around £10-11).

 

[FPLTD]

Oh cool, pop culture as in vinyl toys? Or something different.

 

[japancool]

Oh cool, pop culture as in vinyl toys? Or something different.

All sorts, including vinyl, plastic and plush toys.

 

[FPLTD]

Great, lets talk - drop me a PM.

 

[japancool]

Great, lets talk - drop me a PM.

Sorry - I'm in that sector but I don't sell plush toys myself. My product line is something else entirely.

 

[FPLTD]

No I understand that, I'm interested in toys outside of plush

 

[DoolallyTap]

The opening scenario is so vague but lets give it a stab,
Let me get this, a client asks you to design and make a 'plush toy' wit ha quantity of 1000. You want to sell it to the client for £7.98, presumably plus VAT.
You want to buy it from China for £2.16 plus shipping, plus duty, plus import fees, plus VAT, and if it's classed as a toy it must conform to a variety of regulations. Air freight is about £14 per kilo, sea freight takes time and is cheaper. Lets say 1 piece weighs 100 grammes, that's £1.40 for shipping. Lets assume all the other stuff adds another £1.50, so total 'IN 'price to you is, say £5.00. Which means 5x 60% + = selling price £8. This is 37.5% GP or £3.00 per piece, or £3000 for 1000 pieces.
The client wants a sample before placing the order, you want a 50% deposit with order, client wants 90 days, no deposit, what are you going to do?

I know what I would do.