>>11415200There's so many factors at play that a blanket statement will be incorrect- toys from the largest companies like Mattel and Hasbro have different cost setups and margins compared to all the smaller toy makers. However you can assume that a profit margin on MSRP whether it's sold from a Walmart/target or sold direct to consumer from the company online is usually a target of between 40-50%, but the money might be accounting for different things on the backend.
For example a toy from a major company sold at a retailer will likely have a per unit production cost(actual cost per figure of materials, assembly, paint, and packaging) that is around 1/5th of the MSRP. The company then accounts for their cost (molds and product development, operating costs and salaries) are about 2/5ths of MSRP. And then the retailer itself will buy the toys to sell them to the consumer and have an initial target of approx. a 100% markup, but also have things like sales and unsold inventory built in, so another 2/5th to 1/2 of MSRP.
Take a toy, figure A, from major company, that is usually MSRP $20:
>$3.50 to make per unit (THIS is what is tariffed)>$6.50 goes to toy company(this is paying for molds, operating costs, salaries)>$10 goes to Target before they mark it down by 30% and only get $6, etc>145% Tariff makes figure unit cost increase from $3.50 to $8.75>Company still needs their $6.50 so retailer now must buy for $15 >Retailer still must hit their margin so toy is now on shelves for $30 instead of $20Final price $30, a $10 increase
It's very different for a small toy company doing DTC sales not in major retailers, because the unit cost will usually be closer to 40-50% of the price:
So on a $20 toy, figure B, from small company:
>$10 unit cost (THIS is what is tariffed)>$10 to company(molds, operating costs, salary)>145% tariff makes unit cost $25>Company still needs $10 so toy increases to $35Final price $35, a $15 increase
