Unlike the majority of Europe, which has imposed strict closures of non-essential retail, shopping remains relatively unaffected in The Netherlands. The government has allowed retailers, including toy shops, to keep their doors open under a partial lockdown, with new guidelines in place to help protect staff and customers against coronavirus. Nico Blauw, CEO of Dutch toy company BOTI International, shares his first-hand account of how the toy trade is operating in a rare pocket of relative normality - and whether keeping toy shops open will help in the long run.
"Like any other European market, the coronavirus has an unprecedent impact on the economy in The Netherlands. The Dutch authorities have chosen for a partial lockdown. Essentially this means that there is limited freedom of movement for the families to take a stroll, do an outdoor work out and some (limited) shopping. All schools are closed. Same for restaurants, pubs, clubs and cinemas. Events and parties are not allowed. Gatherings of more than three people are forbidden, and obviously all other standard regulations like social distancing apply as in any other country.
"However, in contradiction to many other markets retail is allowed to continue operaterating, but under strict guidelines. This is a big difference with most other European countries. For the toy industry this means we can continue to operate which is a positive. However the reality is that traffic in stores is low and that primarily online sales are seeing the ‘benefits’ of the current situation.
Obviously categories like games, puzzles and construction are seeing an uplift in sales, but for other categories some toy retailers have been forced to cancel orders, especially in the impulse and collectibles category. Where toy retail continues to operate, several other retail chains have decided to close their operations to protect their staff – but in reality, this is more likely due to significant decrease in traffic in the high streets.
"The Dutch government is doing what they can to prevent instant bankruptcies and employees losing their jobs. The financial support package is very impressive, but our government can afford it because of a significant surplus in budget. Nevertheless my opinion is that the current lockdown in The Netherlands cannot last beyond mid-May. This for two reasons. First of all, the economic impact: we have to be realistic when it comes our toy industry. The Dutch toy retail landscape has been rather fragile the past couple of years, especially with [major toy specialty chains] Intertoys and Blokker going through rough financial times. Secondly, from a psychological point of view, I don’t see how the authorities can keep the Dutch locked up at home for more than four weeks.
"The other headache is: how and what do we plan for autumn? Since we don’t know how long this situation is going to last and more importantly who will survive it, planning for fall is an almost impossible job. Factories, distributors and retailers, the entire supply chain is affected. This means to maximise autumn business and to minimise risk, the entire supply chain together will need to take a flexible approach. That is an added challenge within these challenging times, but also a must, and it means we need to break with the modus operandi. In doing so we may not maximise the business, but at least we are going to make the best out of it.