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Toymakers in China have their work cut out as no foreign companies, fearful of the SARS outbreak, placed contracts at the Chinese Export Commodities Fair in Guangzhou, which saw a 90 percent plunge in toy orders.
"This year's toy orders dived 90 percent, none from foreign companies," said Xiao Fang of Shanghai Toys Imp & Exp Co Ltd. "We saw only one related foreign businessman at the fair, just because he is based in Guangzhou."
Shanghai is home to some 300 toy companies, or 6 percent of the country's total. Only five local companies attended the fair.
The lack of orders from international buyers means that made-in-China plush fabric toys, like cute stuffed rabbits and dogs, will be absent from the global market.
International retailers and distributors should be placing purchase orders now to prepare for Christmas sales. But the outbreak of the severe acute respiratory syndrome has obviously put off several international buyers.
According to the Shanghai Toy Guild, China's toymakers are likely to lose three-quarters of their overseas orders this year because SARS fears are preventing foreign buyers from visiting domestic factories.
Made-in-China products used to occupy 70 to 80 percent of the world's toy market. But Chinese businesses are worried about losing the US$8 billion export market.
"The toy industry is labor-intensive," said Xu Quanning, guild secretary general. "If the factories cannot get enough orders, production will be delayed or will be stopped in the third quarter, which should be the busiest season for toymakers."
Factories in Guangdong Province churn out 75 percent of the toys exported annually and are expected to be the biggest victims in the present situation, not only in the reduction in foreign orders but also in meeting newly issued quarantine standards meant to prevent the spread of the virus.
Xu noted that most of the 7,000 toy companies are privately owned and their working environment is very crowded.
The guild predicted that the SARS epidemic would also affect domestic sales. Toy sales in the second quarter usually accounts for more than 40 percent of the year's total, but this year could be an exception.
"The shopping malls are empty, people just are not in the mood to buy things, let alone toys, which are not a daily necessity," said Xu with the guild.
(Shanghai Daily May 8, 2003)
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