In toys industry, the large retailers like Wal- Mart, Toys R Us, and Target are the buyers, and then sell them to the end customer (parents and children). The bargaining power of buyers is average because there are so many channel distributions. For instance, if Wal- Mart denies carrying a product because Lego charges a high price, Lego still keeps this price and charges it to other retailers who want the product. The end consumers who need the specific product and if Wal- Mart is not carrying those, end consumers can choose other retailers to purchase from. All large retail chains have considerable negotiating leverage in purchasing the product. When the economic is going down, the end consumers spend less on entertainment product, such as toy, the large retailers must take their prices down to compete. And the toy industry has not any choice but to acquiesce to the buyer power if they want to maintain positive relationship.
The effect of consumer- accessible 3-D printing is slim in the short future. This product is a new innovation with the price range between $300 for a kit to $4,000 for a printer. If more competitors come to the market and 3D printing more popular, the prices could more flexible. Competitive rivalry
The competitive rivalry in the toy industry is very high. Competition is based primarily onto new design and develops new toys to attract consumers. In the U.S, large companies such as Hasbro Inc., JAKKS Pacific Inc and Mattel Inc. now have the other competition like Lego Group and local companies in respective countries join the U.S competitors thus enhancing the competitiveness in the market. Because of the high competitive rivalry in the industry, high product differentiation becomes a core strategy for survival. In contrast, the competition is currently low in the 3D printing industry. The 3D technology is still new with the cost to have one printer is high. The adverting in 3D printing marketplace is relatively low.
Substitutes have given a high influence to toys industry. There are many different ways for people entertain themselves. Toys are the good one for entertainment purposes but instead of buying Barbie dolls, Scene It, Uno, and Marvel action figures, consumers may choose other entertainment such as playing outdoors, playing sports, going to the movie theatre. Due to the fact that there are so many outlets and varieties of entertainment, besides toys and