Toys and games are timeless; every generation of children needs entertainment. The market is, however, very sensitive to trends as new products arrive, becomes hits, then fade off into obscurity. Running a toys and games shop requires a lot of business nous and commitment; you’ll need to be ahead of the curve and ensure that you can cater for both the ‘must-have’ product of the day and the traditional games that never seem to go out of fashion.

Why start a toy and games shop?

Entrepreneurs that want an exciting and evolving retail business should consider a toy and games shop. Children’s markets move rapidly so there’s unlikely to be a dull moment, and the combination of both classic and modern toys can help keep things fresh and appealing. There’s also the ability to build a solid relationship with your local community, something that appeals to many entrepreneurs who aren’t always keen to start a ‘global’-minded business.

The ability to specialise is also an appealing aspect of starting a toy and games shop; niche shops can attract business from far and wide and are less susceptible to market trends.

What skills will I need?

A passion for the industry will help you out immensely as you’ll need to stay abreast of market developments and new products. Good business sense is also important; your shop must be profitable, and this involves buying the right products at the right prices, at the right time, spending money on successful marketing, etc. Keeping on top of the financial side of the business is essential.

The ability to engage can also help – traditional toy and games shop are often seen as a part of the community, but it takes rapport with local residents to cement this view. Being friendly, approachable, and keen to help, will go a long way to helping build bridges with local families, who will make up the majority of your target demographic.


Keeping up with trends is essential, even if you position yourself as an ‘old-fashioned’ toy and games shop. Items and groups of items (e.g. board games) wax and wane in popularity; making sure you have the right toys and games in stock, and aligning your advertising efforts with current consumer desires, is key to surviving in a marketplace that is increasingly dominated by online retailers.

Local marketing

Developing relationships with locals is very important; families will need toys and games for each child for many years and this means that repeat business can make up the majority of your revenue. Make sure you take the time to understand and address your customers’ wishes, and develop local marketing strategies that connect you directly with the customer base.

Unless you are a specialist shop that sells very niche products, it’s unlikely you’ll get customers visiting you from far and wide.

Establishing a niche

Become specialists in niche products (such as remote control cars) will help ensure you get business from outside your local area, and can reduce your marketing spend as you rely more on word-of-mouth recommendations and advertising in key publications. However, you’ll need to be an expert in the subject area, with the tools and resources available to provide a full service to customers (including sales, repairs, advice). There’s also the chance that the niche could become less popular, and revenue would then dry up.

However, if you already have an expertise, establishing a niche can be a good way to go. Combining niche products with general toys and games allows you to hedge your bets and secure different revenue streams that are unrelated to each other, helping to insulate you against economic lulls and market trends.

Start-up costs

Start-up costs can be considerable – rent is likely to be high if you opt for a ‘traditional’ toys and game shop as you’ll need sufficient football, and therefore a relatively prime location, to turn a profit. You’ll also need a sufficient range and breadth of stock, which will be expensive in the first instance as you won’t have relationships with suppliers, and won’t be able to order too much as there’ll be no historical precedent of what sells and what doesn’t sell in your shop.

You’ll also need to dedicate a proportion of your start-up capital to marketing, to ensure that the local community (or trade magazines, clubs, etc, if you are starting a specialist shop) are aware of your existence. If no-one knows you exist, you won’t make any sales.

Insurance and compliance

Standard insurance policies are important when opening up a toy and games shop, including public liability insurance and professional indemnity insurance. If you take on staff, you’ll also need employer’s liability insurance.

You must also ensure that any products you sell comply with relevant legislation. For example, all products sold in the European Union must bear the CE mark along with the name and address of the manufacturer. This mark is sometimes called a ‘passport for product;’ it says that the product meets the safety regulations outlined by the EU and is therefore entitled to travel through the European Union. However, the CE mark is not a symbol of quality.

The commonly-seen Lion Mark, introduced by the British Toy and Hobby Association, is a symbol of toy safety and quality. Manufacturers using the mark must sign a strict Code of Practice which covers not only toy safety and quality but advertising and trading ethics.

If you have any concerns over health and safety or legislation, your first point of call should be the Toy Retailers Association or the British Toy and Hobby Association.