Toys and Triumphs – Bridging supply chains, companies, and families
Author Roald Dahl once said, “Life is more fun if you play games.” Toys and games play a critical role in the physical, cognitive, and emotional development of children, they help foster creativity, hand-eye coordination, problem-solving skills, and imagination. This sentiment is likely shared among manufacturers distributing toys for children throughout Latin America.
Despite economic challenges in 2020 and 2021 impacting toy distribution and supply chains, the global toy market revenue remains worth over 107 billion USD[1]. Although the pandemic disrupted operations, it also heightened demand for toys from suppliers. However, disturbances in international trade created significant challenges for the industry, hindering its distribution. While facing these challenges, companies like Dima Juguetes had to adapt in order to continue playing a crucial role in positively impacting children in Colombia.
Dima Juguetes, a family-owned business, has been operating for nearly 50 years in Bogota, Colombia. As a company first started by their parents, the sibling-led team, Ivan and his sister are doing their part to help elicit hopes and dreams for children. ‘’At Dima Toys we know what it means to a child to receive a toy, and we live for it,’’ shares company owner Ivan Moncada. By sourcing products for sale in Colombia and maintaining good relationships with international suppliers, they are the main importer and distributor of toys in the country. Dima Toys uses a mechanised and computerised distribution centre of more than 70,000 cubic metres, with more than 6,000 storage locations to operate 24 hours a day.
Even though they manage their robust operations and licences with top brands such as Hasbro, Disney, and Mattel, like many small businesses, they faced the long-term hardships and funding challenges the pandemic is responsible for. Funding for companies experienced cutbacks from banks with inflexible lending practices between 2020 and 2021, which ultimately diminished significantly during the crisis[2]. This left companies with few resources to maintain their business operations. In countries like Colombia, the impact of bank lending practices and bank funding dried up, leaving businesses concerned and doubtful about the reliability of supply chain operations.
‘’What I like most about Dima is its innovative new process, which gives employees at our company the option to choose the gift for their children.
– Martha Estupinan.
Through AGC’s partner, Dima Toys has been able to innovate their business model. Describing how the funding was a complete lifeline for them, prior to 2020, the company did not use factoring as a funding option. However, they now see the value in how it enables them to navigate hindrances and facilitate business growth. With a 50-person staff, including ten distribution employees, Dima Toys has been sourcing toy products in Colombia since 1974. The family business has been able to expand its supply channels across e-commerce and retail. Serving market segments like large chains, companies, and online platforms, they’ve grown into Colombia’s main importer and distributor of toys. ‘’What I like most about Dima is its innovative new process, which gives employees at our company the option to choose the gift for their children,’’ shares Martha Estupinan, a compensation and benefits manager at one of Dima’s corporate clients.
AGC’s funding has ultimately enabled Dima Toys to overcome supply chain issues and the setbacks caused by the reduction in bank funding during the 2020-2021 period. Currently, however, Ivan notes, ‘‘Our main challenge is smuggling. For example, four shipments can come in; they only declare two freights, and the other two have toys that can be sold in the local market for cheap, thereby undercutting traditional sellers like Monkey Market, their e-commerce sales arm.’’
In Colombia, the World Supply Chain Finance Report predicted economic disruption would continue to impact Latin America throughout 2023. The WSCFR notes that while unrest, inflation, and the cost-of-living crisis fluctuate and influence consumer behaviour, companies in the Latin American region have sought out new opportunities to alleviate supply chain challenges. The WSCFR also shares that Colombia has been at the forefront of the fight for governments to ensure checks and balances create better trading conditions[3].
Ultimately, with help from AGC’s financing facility, Dima Toys hopes to continue to triumph over tough economic dynamics with plans to reduce the time needed for product checks, which currently take up to two years. They are still prioritising distribution to retail stores, specifically in rural areas, where the digital toy market isn’t as large. Dima Toys’ presence in these smaller communities helps to maintain their mission of bridging companies with families to achieve unique experiences for customers and children.
[1] 2022 Global Toy Market Report. Circana/The Toy Association. Accessed Dec. 8, 2023. https://www.toyassociation.org/ta/research/data/global/toys/research-and-data/data/global-sales-data.aspx
[2] After Surviving the Pandemic, Companies in Latin America, Caribbean Need Help. Inter-American Development Bank. Accessed Dec. 8, 2023.https://www.iadb.org/en/news/after-surviving-pandemic-companies-latin-america-caribbean-need-help-report
[3] World Supply Chain Finance Report. BCR Publishing. Accessed Dec. 8, 2023. https://bcrpub.com/world-supply-chain-finance-report-2023
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