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China has been the world's largest toy manufacturing and exporting hub for decades. The value of toys and games exported out of China in 2022 exceeded 100 billion U.S. dollars, accounting for 59 percent of global toy exports. Additionally, there was a considerable increase in China's domestic demand for toys over the past few years. Chinese toys and games generated approximately 56.2 billion U.S. dollars in revenue in 2022, making it the world's largest toy market.

Global toy powerhouse

Benefiting from the country's cheap labor force, China has dominated the world's toy manufacturing industry for several decades. Over 70 percent of China's toy exports come from Guangzhou province, where most manufacturers are located. Toymakers in China typically work as OEMs (Original Equipment Manufacturers), whose products are then branded and sold under names of other companies.

In spite of steady toy export growth, the Chinese toy export industry has been facing intense competition in recent years because of rising labor costs. The coronavirus outbreak in 2020 further prompted many global toy companies to move production back home. In response, Chinese toymakers changed their marketing strategy and positioning. For example, many Chinese toy companies developed their own intellectual property rights, while some initiated cross-border e-commerce businesses.

More than just child's play

According to a Statista estimates, China's toys and games market revenue nearly doubled during the past decade, despite a decline in newborns. Not just more generous parents but a booming number of adult toy buyers were also responsible for the market surge. As of 2020, there were an estimated 30 million pop toy buyers in China, bringing the market size to about 25 billion yuan. Compared to traditional toys, pop toys are usually designed for collecting purposes. Many pop toy manufacturers also cooperated with famous movie, game, or anime companies to produce licensed toys and collectibles. As of 2021, China's pop toy market is led by assembled toys such as LEGO and blind boxes.

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