Core Viewpoint - The article highlights the rise of the潮玩 (trendy toy) industry in Shipaizhen, Dongguan, emphasizing the shift from being mere OEM factories for brands like Pop Mart to developing original IPs, reflecting a broader trend in the toy manufacturing sector in China [3][4][15]. Group 1: Industry Overview - Shipaizhen is a significant hub for潮玩 production, with over 400 toy manufacturers and a total output value of 132.2 billion yuan in 2024, marking a 12.3% year-on-year increase [3][4]. - Dongguan, known as the "world's factory," produces 1/4 of global anime derivatives, with Shipaizhen accounting for 50% of潮玩 products in Dongguan [9][10]. - The潮玩 industry in Shipaizhen has evolved from a focus on OEM production to a growing emphasis on original IP development, with the number of original IPs increasing from over 30 in 2021 to over 100 in 2024 [20][24]. Group 2: Company Dynamics - Many toy factory owners in Shipaizhen aspire to create their own original IPs, moving away from low-margin OEM work, which typically yields profits of only 3-10% [11][15]. - Pop Mart's collaboration with local factories has raised industry standards and introduced higher craftsmanship requirements, prompting factories to seek their own IPs for better profit margins [15][16]. - ToyCity, founded by a former OEM factory owner, has successfully developed around 20 original IPs, demonstrating the potential for local companies to transition from OEM to original content creation [18][19]. Group 3: Challenges and Opportunities - The transition to original IP development is fraught with challenges, including high costs and the need for effective marketing strategies, as many companies lack experience in market promotion [29][30]. - The investment required for IP development can be substantial, with companies often needing to cultivate a loyal fan base to ensure profitability [31][33]. - Despite the difficulties, the potential for success in the潮玩 market drives companies to explore various paths for IP development, including licensing and content creation [33][34].

Core Insights - TOP TOY, a潮玩 brand under Miniso, plans to open over 1,000 stores globally in the next five years, with more than 50% of sales expected to come from overseas markets [3][5] - The company has allocated a reserve fund of 10 billion RMB to support its expansion, with a focus on flagship stores in major global shopping districts [3][4] - TOP TOY aims to position itself as a "super factory" for IP-related products, collaborating with various global and local IPs [4][5] Expansion Plans - The company plans to open 150 new stores in China by 2025, with 100 of those in major cities [3][5] - Currently, TOP TOY operates nearly 280 stores across over 80 cities in China, with plans to expand to 500-700 stores in the country [3][5] - TOP TOY has already opened five stores in Southeast Asia, with some achieving rapid profitability [6] Financial Performance - In the first three quarters of 2024, TOP TOY generated 700 million RMB in revenue, a 42.5% increase year-on-year, contributing approximately 5.7% to Miniso's total revenue [5][6] - The company's revenue for 2023 was 680 million RMB, up from 429 million RMB in 2022 [5][6] - TOP TOY's growth rate is significantly higher than Miniso's overall performance, with a revenue growth rate 2.5 times that of the parent company [5] Market Positioning - TOP TOY's strategy closely mirrors that of Bubble Mart, aiming to capture market share in the潮玩 sector [5][6] - The brand's primary products include blind boxes, building blocks, and plush toys, with a focus on leveraging popular IPs for product development [7][10] - The company has seen a 55%-60% compound annual growth rate over the past four years, with self-owned products experiencing a 150% growth rate this year [7][10] IP Strategy - TOP TOY relies heavily on external IPs for its product offerings, which poses risks related to licensing costs and renewal uncertainties [10][11] - The brand has a limited number of original IPs, with current self-owned IPs accounting for only a small percentage of sales [10][11] - The company is exploring collaborations with designers to enhance its product offerings, but remains focused on leveraging existing major IPs for growth [8][9] Competitive Landscape - TOP TOY faces challenges in differentiating itself from competitors like Bubble Mart, which has a strong portfolio of exclusive designer IPs [10][11] - The brand's reliance on external IPs may hinder its ability to create standout products in a crowded market [11][12] - The company is aware of the difficulties in attracting consumers in unfamiliar markets, particularly in Europe and North America [13] Store Location Strategy - TOP TOY's store location strategy has evolved to include not just first and second-tier cities but also lower-tier cities, reflecting a shift to capture a broader consumer base [15] - The company's same-store sales growth has slowed, indicating a need for strategic adjustments in its expansion approach [15]