I firmly believe that is important to define your personal goals before determining what your product or industry you want target. After reviewing both industries, and based on my own personal goals as an entrepreneur, I would like to target my business on creating a developmental toy for the infant/preschool target market. This venture addresses two important aspects of my business strategy.
The first, due to limited financial resources my risk tolerance is low. While other entrepreneurs max out their credit lines and teeter on bankruptcy, I personally am not willing to take that big of a risk. I have a family that I ultimately must take care of and I don’t want to risk our financial future if my business venture falls through.
The second, it provides me a more flexible and growing industry that enables and supports being creative and innovative in developing new toys for young children. My goal is to maximize my profits in the niche specialty market. Long term, given the low number of major competitors, I do believe that there is the potential to position myself to be acquired by Fisher Price.
Due to limited resources I will not invest in licensing fees. I believe them to not be as big of a concern in preschool/infant industry due to the buyer not being the child. This also helps to remove the entry barrier of the need for expensive cost of advertising to children. But in doing so, it also removes the positive effects of the nag effect. I believe that this will be ok given that in this niche industry, gift givers tend to be more brand conscious in the teen market and less effected or swayed at having a name brand item in the infant/preschool market. And in this case, the child is not the actual purchaser of the toy.
Furthermore, in this industry, it will not take a lot of time to get in to the specialty stores, but it will take a lot of time to manage the relationships. These relationships will also be much more high maintenance and require excellent...