A Survey on Development Environments and Conditions of Toy Industry in Jieyang

Abstract:Jieyang City, Guangdong Province, an eastern underdeveloped region, an industrial base, which is relatively weak, economic and social development, has lagged behind the Pearl River Delta region in recent years. The Guangdong provincial government is promoting coordinated regional development, attaching great importance to the economic development of backward areas of eastern Guangdong and others. In the paper, the investigation on toy industry in Jieyang City is conducted. With the results of investigation, the methods of how to get development of toy manufacturing industry are put forward to solve the employment livelihood issues.
 
Keywords：Jieyang; Economic; Toy; Self-employment; Report.

 

 

揭阳市玩具产业的发展环境和条件调查

摘要  揭阳市是广东省东部欠发达地区，产业的基础比较薄弱，经济社会发展明显落后于珠三角地区近几年来，广东省政府为促进区域协调发展，高度重视粤东等落后地区的经济发展。为了更好地了解揭阳市玩具业发展的环境和条件，笔者提出了对该市该行业的调查。根据调查结果提出解决的方法，期望为揭阳市的玩具业发展提供有用的策略，为促进该行业的更大发展做出一些贡献。

关键词  揭阳；经济；玩具；自主创业；报告                           
 
 

 

 Contents
 
1 Introduction................................................................................................................ 1
1.1 Significance....................................................................................................... 1
1.2 Framework........................................................................................................ 1
2 Methods of Investigation............................................................................................ 3
3 Development status of Jieyang toy industry............................................................... 5
3.1 Scale.................................................................................................................. 5
3.2 Product categories............................................................................................. 6
4 Investigation of development environment of toy industry in Jieyang...................... 7
4.1 Market............................................................................................................... 7
4.2 Economic environment...................................................................................... 7
5 Development conditions investigation...................................................................... 10
5.1 Strength........................................................................................................... 10
5.2 Weakness......................................................................................................... 10
5.3 Opportunity..................................................................................................... 11
5.4 Threat.............................................................................................................. 13
6 Conclusion................................................................................................................. 15
7 Summary................................................................................................................... 17
Notes............................................................................................................................ 19
Bibliography................................................................................................................. 22
Acknowledgements...................................................................................................... 25
 

 

1 Introduction

Motivated by the strong interest in toys since childhood, the author wants to open a toy store in the hometown after graduation and then use the knowledge learned to achieve good results in business, so the author wants to further study and investigate the toy industry in Jieyang before graduation to learn about the status quo of the toy industry and analyze the present development environment and future feasibility of the toy industry in Jieyang so as to lay a solid foundation for the startup after graduation, reduce ineffective work and add confidence to the favorite business for better development.

1.1 Significance

Jieyang is a less developed city in eastern Guangdong, where the industrial foundation is relatively weak and the economic and social development lags far behind the Pearl River Delta. In recent years, in order to promote coordinated development, the Guangdong Provincial Government, attaches great importance to the economic development in the backward areas such as the eastern part of the province. Jieyang should seize this rare opportunity to vigorously develop the economy, and as the traditional character is tic industry in Jieyang, the toy industry is a labor-intensive industry. Jieyang has a large population and obvious employment contradictions, so the development of toy manufacture is of great importance to solve the problem of employment.
This report is expected to study the development space and future feasibility of the toy industry in Jieyang in advance before graduation, which is of great help for the startup after graduation.^[1]

1.2 Framework

1. Development status of toy industry in Jieyang
1.1 Scale
1.2 Product categories
2. Development environment analysis
2.1 Market environment
2.2 Economic environment
3. Development conditions analysis
3.1 Strength
3.2 Weakness
3.3 Opportunity
3.4 Threat
4 Investigation of development environment of toy industry in Jieyang
5 Development conditions investigation
6 Conclusion

2 Methods of Investigation

Based on the investigation and research, this paper used the SWOT method to analyze the basic situation of the toy industry in Jieyang, including strength, weakness, opportunity and threat of industrial development, as well as the development environment. Through this paper, the toy industry in Jieyang can be fully understood for the author to improve the success rate of the business after graduation.
Analytical methods: literature analysis, online data collection, field investigation, comprehensive analysis, and SWOT method.

 

3 Development status of Jieyang toy industry

 

3.1 Scale

As the traditional pillar industry in eastern Guangdong, toy industry is also a characteristic industry in Jieyang. After years of cultivation and development, it has occupied certain shares in both domestic and overseas markets. At present, there are more than 400 toy manufacturers in the city, which employ many as 30,000 people and have an average annual production value of over 3.8 billion Yuan. In 2016, the exports reached 324 million US dollars. The toy production in Jieyang has a long history with complete equipment and abundant labor resources, however, it is relatively backward and its scale is relatively small. Enterprises lack of independent innovation capability and fail to really form an industrial cluster, so they make less contribution to the economic development in Jieyang. In other words, the toy industry development in Jieyang still has large potential and space to improve.
According to incomplete statistics, there are more than 400 toy companies (including individual businesses) in Jieyang, and 28 of them are manufacturers. About 30,000 people are engaged in the industry, which has an annual output value over 3.8 billion Yuan. In 2016, the actual industrial output value of enterprises above designated size reached 2.565 billion Yuan, an increase of 3.1 times of 2011.
Although Jieyang toy industry has formed a certain scale and its growth rate has been relatively fast in recent years, its share of output value is still small compared to the four major industries, textile and garment, hardware machinery, chemical plastic as well as food and drug, so it is still below the level of pillar industry .
China is the largest manufacturing country of toys with output of about 60-70% of the global market. Guangdong is the largest toy production base in China, with total sales more than half of China and total exports about 70%. Toy manufacturers in Guangdong are mainly concentrated in the Pearl River Delta, Shantou and Jieyang. Compared with Dongguan, Shenzhen and Chenghai in the Pearl River Delta, the toy industry in Jieyang is smaller in the number of enterprises, employees and industrial scale.

3.2 Product categories

Jieyang has complete categories of toy products, up to thousands of varieties, and the main varieties are as follows:
Model toys: ship models, car models, aircraft models, train models, spacecraft models, military models, GK, building models, assembly models, etc.
Educational toys: child teaching aids made of various materials, jigsaw, chess and card, interactive toys, parent-child toys, magnetic learning tablets, etc.
Electronic toys: electric trains, remote control aircrafts, robots, electric cars, smart dolls, musical toys, game consoles and accessories, etc.
Stuffed toys: teddy bears, animal toys, cloth dolls, simulation animals, medicine balls, inflatable toys, etc.
Festival toys: Christmas trees, Santa Claus, cheering bars, fluorescent toys, couple toys, masks, etc.
Jieyang toy enterprises are concentrated in Rongcheng District, pilot area and Puning City.

4 Investigation of development environment of toy industry in Jieyang

4.1 Market

At present, Jieyang toy products are mainly exported to Europe, the United States, Latin America, the United Arab Emirates, ASEAN, Hong Kong and other countries and regions, high-end toy products are mainly exported to the EU, the United States, etc., and middle and low-end products are mainly exported to ASEAN countries. The sales network covers terminal channels of franchise stores, supermarkets, department stores, toy retailers and e-commerce. In 2016, the toy exports reached 324 million US dollars, an increase of 6.2% year on year. In terms of the future development trend, the enterprises pay more attention to market investigation in Europe, Latin America, ASEAN and the United States and development of key markets, and in recent years, the exports to these markets have gradually increased.
Through the sales report and summary of the Chinese market in the early stage, the company will further develop the product categories corresponding to the needs of the domestic market, improve the business system, and increase domestic sales through wholesale, franchise stores, department stores and e-commerce platforms.

4.2 Economic environment

It was learned from Jieyang Customs that in 2016, the total imports and exports were 46.55 billion Yuan, an increase of 6.4% over 2015, higher than the level of the whole province and eastern Guangdong. Among them, the exports were 44.62 billion Yuan, an increase of 7.1%, and the trade surplus was 42.69 billion Yuan, an increase of 8%. The exports of mechanical and electrical products were 7.71 billion Yuan, an increase of 11.5%, toys 6.5 billion Yuan, an increase of 26%, furniture 3.36 billion Yuan, an increase of 59.8%, and agricultural products 1.54 billion Yuan, an increase of 56.7%.In 2016, the exports kept growing fast, and clothing, toys, furniture and agricultural products became the highlight of foreign trade of Jieyang. From 2010 to 2015, the retail sales of global toy market increased from 76.1576 billion US dollars to 87.119 billion US dollars with a compound annual growth rate of 2.73%.
 

5 Development conditions investigation

5.1 Strength

Strength of supporting facilities. The development of the toy industry requires supporting work such as mold, plastic products, micro motors and hardware, and these industries happen to be developed. After years of development, Jieyang toy industry has had complete industrial supporting. In addition, rich resources and raw materials related to toy manufacturing have brought great convenience to the operation of toy enterprises and saved costs and time, which has become the important strength of Jieyang toy industry. Micro motor is the heart of electric toys, and the micro motor industry in Jieyang is well known. Rongdong Office in Rongcheng District has a title of Micro Motor Town, and the products are mainly sold to Shantou and Chenghai to support toy manufacturers in surrounding areas. According to professionals, 90% of micro motors of toy enterprises in eastern Guangdong are manufactured by Jieyang enterprises. Therefore, it can be said that Jieyang has complete industrial supporting for mass toy production.
Jieyang has formed a developed traffic network of coastal port, airport, highway, railway and inland navigation. As the construction of Chaoshan Airport, Xiamen-Shenzhen High-speed Rail and a number of highways are completed, Jieyang will form a more complete regional transport hub, which more closely connects urban agglomerations in Chaoshan, Pearl River Delta and Haiti Economic Zone in space Land and labor resources are uniquely advantageous. Jieyang is a prefecture-level city in Chaoshan with the largest land area and population. The land area of the whole city is 5,240 km2, which is equivalent to the total area of Shantou and Chaozhou, so there are abundant land resources available for development.

5.2 Weakness

Low degree of industrial clustering. In recent years, Jieyang toy industry has developed rapidly, but to a certain extent, it has not formed a real industrial cluster. It is first reflected in the small scale. The industrial output value of Jieyang toy industry is only 3 billion yuans, and the annual exports are less than 300 million US dollars, which account for a small proportion in China or in the region. There are few large enterprises, so the leading effect is not strong. Second, the technology and production level is lower technology. Except some leading enterprises, most of the products have low technological content and added value that mainly compete by low costs and prices. In the industrial labor division system, it is still in the processing and manufacturing sector and occupies a small share in the high-end extension link of upstream R&D and design and downstream marketing (such as brand). As most of the workshop-based enterprises are distributed in the same part of the value chain and oriented to the medium and low-end market, leading to prominent positioning convergence and homogenized competition in Jieyang toy industry, so it is easy to plunge into a vicious circle of low cost and low quality and difficult to integrate the value chain with industrial clusters in the network. Third, although the industry supporting conditions are available, they have not formed real benefits, especially in marketing, for there is no large local professional toy market or sales center, affecting the market sales of Jieyang toy products.
Due to weak independent innovation and lack of professionals, most of toy enterprises are SMEs with low technological content and few independent brands. Toy enterprises and micro motor enterprises are mostly labor-intensive enterprises and their products have low technological content and added value, so they are overall in the low end of the industrial chain and have few independent brands. There is only one provincial brand-name product(electric toy of Goldlok Toys Holdings (Guangdong) Co., Ltd.) and a provincial famous trademark (Jieyang Defa Toy Co., Ltd.).The enterprises above designated size account for less than 10%, and only Goldlok’s annual production value is over 100 million yuans. According to the survey, at present, the profit rate of Jieyang toy enterprises and micro motor enterprises is mostly between 5-10%, and only a few brands like Gaole can reach more than 20%. It is estimated that the profit of self-owned brands is 3-4%higher.

5.3 Opportunity

From the perspective of industrial policy environment, relevant industrial development plans are conducive to the rapid development of cultural and creative industries such as toy and animation. In recent years, China’s toy industry has gradually entered the industry consolidation period and constantly promoted the brand. With the continuous improvement and standardization of the market, coupled with the state’s policy support for the “cultural industries” such as toy, animation and games, the domestic toy industry is expected to speed up. In 2009, the State Council promulgated the Plan for the Revitalization of Cultural Industries to clearly list cultural creation, animation and games as the cultural industries for priority development. In July 2012, for the first time, the Ministry of Culture published the National Animation Industry Development Plan for the Twelfth Five-Year Plan Period, explicitly listing the animation industry as the key industry to be developed in the next five years. The Guangdong Provincial Government released 2011-2015 Plan for the Revitalization of Cultural Industries in Guangdong Province and proposed that all kinds of cultural enterprises should be encouraged to set up overseas industrial entities and establish marketing channels, focusing on the construction of international marketing networks such as animation and toys. The promulgation and implementation of these policies and measures will be conducive to export-oriented SMEs of toyto get rid of the difficulties and develop soundly.
The rapid expansion of the Chinese toy market brings new opportunities. China has a large population, rapid economic development, accelerated urbanization and improved living standard. In recent years, China has implemented the policy of expanding domestic demand, and the domestic market has been recognized by the toy industry as the toy consumer market with the most growth potential. Different from the European and American markets, China’s toy market is rapidly expanding with good development momentum, its annual growth rate in recent years keeps about 15%, and in the future the growth rate will be even faster, or even up to 40%. It can be predicted that China’s domestic toy consumption will show a rapid growth trend and the toy market in mainland China still has room for development, so it is a promising market.

5.4 Threat

Intensified market competition. First, the toy industry has gradually plunged into over-competition. Jieyang toy industry agglomerate with a large number of SMEs that produce similar products in the surrounding areas, but due to the lack of other means of competition, enterprises in order to compete for customer resources for survival opportunities often reduce prices and even illegally reduce production costs to greatly squeeze the profit margin of the industry so that the industrial clusters lack of the follow-up development ability. Second, the sharp rise in raw material prices increases the difficulties of production and operation of enterprises.
Anti-dumping and technical barriers. First, the toy industry encounters anti-dumping and other issues, so the export is at the disadvantageous international market status. As the toy products exported by Jieyang are basically at the bottom of the international division of labor, despite certain international competitiveness, this advantage is mainly based on cheap labor, so enterprises generally lack of the core competitiveness. Therefore, such enterprises must rely on the massive exports to maintain their normal development. At the same time, due to the lack of effective means of competition, they can only rely on low prices to compete. Long-term low-cost competition affects the normal development of enterprises and is suppressed by international trade. Second, the developed countries continuously raise the standards of safety and environmental protection so that the enterprises face tremendous pressure.
     

 
 

6 Conclusion

Jieyang toy industry has great potential for development, and in recent years its development trend is promising, so as long as the opportunity can be seized to exert advantages and avoid weaknesses, the business will be rooted and well developed in Jieyang. Finally, the knowledge of business English learned in the university will be combinedto establish a toy foreign trade enterprise to use the e-commerce platform for communication and trade with foreign countries so as to sell the toys to every part of the world, increase sales and steadily improve Jieyang toy industry. With the rapid and sustained economic development, the domestic market demand for toys continues to increase, and the toy is expected to have a broad market in China with good development prospects and huge market potential. As a priority industry in the Twelfth Five-Year Plan, it is supported and encouraged by national industry policies, therefore, project construction is necessary.


 

7 Summary

The paper focused on Jieyang toy industry for research. Field investigation was used first, and then the SWOT method was used for analysis. Next, a large number of online data was used for analysis from the environment of economy and market. Finally, Jieyang toy industry’s strength, weakness, opportunity and threat were analyzed, and the final conclusion was drawn accordingly. In the writing course, there were many problems encountered in information collection and translation, because there were many specialized terminologies that were less met during university studies. There are still some problems in there search that have not been solved, that is, the threat oftoy enterprises has not been solved. Because the author has not formally entered the field, there is no targeted solution to the problem.

 
 

 
Notes
[1] 揭阳市委.中国共产党揭阳市第五次代表大会报告，2011年
[2] 阿尔弗雷德.马歇尔.经济学理论（1920，第三版）
[3] 王一洋.广东双转移战略.广东经济出版社，2010年
[4] 中国行业研究网.中国（内地）玩具产业发展历史和现状，2008年
[5] 国务院.文化产业振兴规划，2009年
[6] 文化部.十二五时期国家动漫产业发展规划，2012年

 
 

Bibliography

 
[1] 马俊鹏.国际经济学[M].吉林：吉林大学出版社，2016.
[2] 于丹.物流专业英语[M].北京：清华大学出版社,2014.
[3] 万钧.商务策划学[M].北京：清华大学出版社,2017.
[4] 陈宪.国际贸易理论与实务[M].北京：高等教育出版社,2009.
[5] 亚当斯.国富论[M].北京：商务印书馆，1993.