British toymaker Hornby “suffered dire sales in their London 2012
merchandise this summer,” sending the company’s shares "tumbling by more
than a third,” according to James Thompson of the London INDEPENDENT. A
key problem is “understood to have been a distinct lack of demand at
big retail chains" for Hornby's figurines of official London Games
mascots Wenlock and Mandeville. A source said that “big retailers, such
as Tesco and Argos, got cold feet after sales of the mascot toys
disappointed, which led to them cancelling orders en masse from licensee
Hornby early in the summer.” The lower than expected sales of
merchandise “hit Hornby's profits" by $4.9M. Hornby
before the Olympics explained that it “had initially enjoyed ‘strong’
orders from retailers and ‘encouraging’ consumer purchases.” But the
problem was that retailers "had also purchased huge quantities of London
2012 merchandise from other licencees and [when] faced with a glut of
unsold stock they ‘resorted to deep discounting.’” The company said that
it “now only expects to ‘break even’ this year,” following a profit of
$7.3M in ‘11-12 (INDEPENDENT, 9/26).