“Since we are lifelong shopkeepers, I always say that we have the university of the counter.” This is how José Luis Díaz Mariscal, general director of Juguettos, begins to tell how the company achieved record turnover in 2022. This direct contact with customers, translated into product selection, communication and advice in the store, he says, has boosted his income to 143 million euros, 11% more than in 2021 and the highest figure in its almost half century of life.
The origins of Juguettos date back to the 1970s, when some bazaar owners, who met at fairs and became friends, followed the maxim that unity is strength and decided to buy together to get better conditions. “They had their first experience that was based a lot on trust, which comes a bit from the spirit of the cooperative,” says Díaz Mariscal by video call from the headquarters, in the Alicante town of Villena. It worked and the word started to spread.
At first they operated as a purchasing center, but in 1978, three years after it was founded, they began to open up to other toy manufacturers and to define the project. In 1990 all the stores were renamed Juguettos, although they still maintained a distinctive last name for each partner. At the end of the decade, and now only under the first name, they strengthened their own brand. “It is a line that is being consolidated, which does not take away from the fact that lifetime licenses, with the investment in advertising and because they are brands of recognized prestige, play an important role in sales, as is logical,” says the general manager. . Currently, the own brand accounts for 15% of the catalogue, made up of more than 6,000 references, and 30% of sales.
Graduated from “the university of the counter”, in 2020 the company completed an express master’s degree in adaptation and flexibility. “The pandemic was a notable concern. It was a before and after”, recalls the manager. Stores closed, but head office staff continued to work from home. “Of course, we promoted online sales because we had no other,” he adds. “And it worked very well. We were able to get out of that quagmire and also come out reinforced both in brand positioning and in sales the following year”.
Although they are committed to continuing to strengthen it, since it is the main showcase for their businesses, electronic commerce is not at the center of the target. Their priority objective is to sell in stores, where they can differentiate themselves from other players, such as Amazon, thanks to the close relationship with the buyer and advice. “Customers want to feel unique. Don’t tell me to choose the product, help me get it right and know that what I get is what I needed, because there is no greater frustration than buying something and then it doesn’t work for what you were looking for”, he says.
When masks were still part of the normal attire of workers and customers, they had to face another challenge: problems in the supply chains. “We made advance purchases anticipating what could happen and the impact was less, but it still caught us,” says Díaz Mariscal. Lessons learned during the pandemic, close collaboration with suppliers, and planning ahead have cushioned the impact. In 2021, says the manager, consumers anticipated Christmas shopping due to the possibility of a lack of toys: “It was an absolutely extraordinary month of November. Anyone who had not had merchandise in due time and form, lost position ”.
And there was still one last twist to the script: the war-sharpened price hike that followed Russia’s invasion of Ukraine and has also made itself felt on its shelves. “We have carried out an analysis of internal costs to try to optimize all the processes, so that the repercussion of the cost of raw materials was as little as possible”, says the general manager. “That’s why we still maintain a fairly competitive price positioning.”
Toys are no longer just for children or Christmas. According to the Spanish Association of Toy Manufacturers, the last six weeks of the year concentrate 70%, but for Juguettos the Christmas campaign weighs only 48% in its turnover. Not surprisingly, they changed their slogan from “Much more than toys” to “With you all year round”. On the other hand, the segment dedicated to adults is gaining momentum. “We have a participant in the purchasing committee who is a real expert, if you will,” he says of it.
Over the years there have been ups and downs, sometimes due to a lack of generational change, in the list of partners in which today there are 42 names, with 275 stores to which are added some ephemeral stores before the arrival of the Wise men. “We have statutorily established how to facilitate the departure of partners who do not want to continue because they do not have succession. We encourage businesses to be taken over by other partners who are active and who may be interested in the area”, says Díaz Mariscal. Currently around 30 people work at the plant, and around 1,500 in stores.
Their corporate model, says the manager, frees them from the tyranny of the dividend and although some fund has knocked on their door, they do not hesitate: “We are clear about the spirit of the cooperative, that solidarity, and above all we want it to be a sustainable business and leave it to future generations.” With a 15% market share reached in May, they aspire to be the first option that consumers have in mind. Their commitment to achieve this is to continue strengthening and consolidating product selection and expansion in those territories where there is room for growth, such as the Canary Islands, where they are not yet present. The sight is set in between 10 and 15 annual openings. They also do not forget the technological advances that help update the brand with respect to the demands of customers in shopping experience, such as immediacy, payment facilities, returns, etc.
The cost requirement that expansion requires, especially in a context of rising prices, forces them to hit the mark with the new openings. “In the market right now, as the phrase said, the only sure thing is change,” says Díaz Mariscal about what other obstacles they may encounter on the way. “It changes very quickly and forces us to adapt more quickly, to have a more flexible structure. And the good thing about it is that the new generations that are joining the company have that mentality”, he assures.
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