It is around this time of year that retailers let everyone know that toys will be in short supply in the run-up to Christmas.

Woolworths are no exception and Nick Hill has already expressed concern regarding the tighter restrictions the Chinese are imposing following recent lead-paint related product recalls. It is not just the toy industry that can go through these issues. The food industry is not immune to having non-EU approved ingredients accidentally being added to products in the UK grocery sector.

The positive side of this story though, is how these discoveries are being made and that the companies are acting responsibly and doing something about it. Recalls are expensive to say the least and the toy industry must be applauded for its actions. It is reassuring to see that in almost every survey this year over 50 per cent of all predicted top 10 toys for Christmas are licensed.

This means that kids are still going for licensed ranges - no surprise there then. However, the proposed advertising restrictions on toy companies will surely affect the way in which children are informed and can learn about toy ranges. Perhaps they will learn about them via the internet or actually going to toy stores.

One of the big stories going around the licensing industry is the bankruptcy of Gaffney’s licensing agency in Australia. This was a surprise to many as Fred is a big character himself and for many years ran the continent’s leading licensing agency. What this does demonstrate, however, is how hard it can be for licensing agencies to survive in response to the licensors demands and the balance needed to be struck working with licensees.

Certainly in our experience licensors, agencies, retailers and toy licensees will have to work increasingly closer together on margin issues as costs of production in China are rising and set to rise further.