Bowton Case study

regeneration= Regeneration is an holistic process which aims to reverse the economic, social and physical decline of places where market forces alone will not suffice. 

This implies that Bowton is an area suffering from economic, social and physicakl decline.

• Between 2008-11, unemployment rose by 6000 and 80,000 were out of work. Incomes fell by 8%
• The regeneration plan started in 2012, the plan was to last 10 years.
• The council offered grants to new business, and by 2018 over 7000 jobs had been created
• A new cinema complex had been built, 3 new housing developments and a shopping development had been built.
• Critics have complined about rising council tax, business rates and the cost of the grant.

The case study provides a summary of the key findings from a research report about the state of the Uk toy market. The report was published in 2014.

• Overall, sales continue to grow.
• There is a significant rise in computer games
• There has been a growth in online sales for traditional toys.
• There has also been an increase in the number of specialist shops selling computer games.

This report is 4 years old so it doesn't show the current state of the UK toy market 

Tom's Toy's is a small shop located in Bowton. The shop sells a range of toys including:

• Train sets
• construction models
• dolls 
• games.

It imports 40% of the toys from countries in the EU, 30% from non-EU countries and 30% are bought in the UK. 

Tom has considered setting up a website to export toys to other EU countries and in USA, Canada, Australia and New Zealand. Brexit will have an impact on Tom's Toy's 

GG toys is a large cpmpany which produces a range of traditional toys such as:

• Train sets
• Construction models
• Dolls 

GG used to manufacture in Bowton. In 2010, it moved production to China. This means that a lot of low or unskilled production workers will lose there jobs. The head office of GG toys will remain in Bowton.

GG toys sells through specialist toy shops and through larger toy retailers, supermarket chains and department stores. 30% of its output of toys is exported to other EU countries.

Georgie doll is the best selling doll for GG toys in the years 2015 and 2016, the doll comes from a successful childs film.

The production is in China. Sales and production Of the Georgie Girl doll grew by 120% when a second film came out. production was moved to a newly- constructed building on the site of the Chinese factory.

Cost of producing 1 doll in 2015 £5:    Cost of producing 1 doll in 2016:

• Promotional costs- 30%                           30%
• Transportation costs -20%                       24%
• Fixed costs- 10%                                        08%
• Labour- 16%                                               20%
• Materials- 24%                                           18% 

In early 2017, the Financial Director of GG toys brought some issues to the attention of the Board of Directors. He said that these issues could effect the business in the next 2-3 years, the issues were:

• In 2016 the Chinese goverment devalued its currency, the yuan, the fall might be £1=10Y at the start of 2016to £1=12Y by the end of 2018.
• In 2016 the value of the £ fell against other currencies including the €. The forecast is that the new rate will be £1= €1.1 from the current value £1= €1.2
• Inflation is to rise in the Uk in 2018 where it is expected to be 3%.
• Newspapers have raised environmental issues about businesses manufactoring in China.

Sales for GG toys fell by 8% per year during the period 2014-21016.

Year         Net Profit £s millions      

2014        620  

2015        472

2016        320

In 2016 a new Chief Executive (Isobel Liu) was appointed and was told by the Board of Directors to turn around the declining performance of GG toys. The plan presented by Isobel in January 2017):

• To reduce cost of production of the toys.
• The rangeof products sold to GG Toys pla will focus on the increased production and sales of the Georgie Doll.
• Production will continue in China
• Online selling will be developed as a prorit. Online selling is very competitive  but it should lead to a reduction of retail price. This will be based on the Colliery Chase industrial Park in Bowton, this will be leased. The purchase of machinery used in the warehouse, including robots will be finianced by a bank loan.