The pain of tariffs puts pressure on the profits of American toy manufacturers

At the 2026 North American International Toy Fair held in New York, many industry insiders complained that the US government's tariff policies have squeezed the profit margins of toy companies, causing the entire industry chain, especially American businesses and consumers, to pay a price.

At the exhibition, several industry insiders told reporters that the current tariff rate imposed by the United States on toys imported from different countries is around 20%, while a year ago this product category still enjoyed tariff exemption treatment. The reporter found that a few toy giants in the United States have been able to reduce the impact of trade tensions on themselves through diversified supply, but many small and medium-sized toy companies are forced to absorb additional tariff costs on their own or simply raise prices to pass on to American consumers. In other words, the majority of the cost of the tariffs imposed by the United States will ultimately be borne by American toy companies and consumers.

5K Company, a toy dealer in Washington State, USA, recently started selling soccer player shaped toys as an agent for a Spanish brand. Justin King, the company's marketing representative, told reporters that the company's business was impacted by tariffs last year and had to raise prices to ensure profit margins. A year ago, a player shaped toy was priced at $29.99, but now it has risen to $39.99.

Ben Ibarra, the sales director of international brand Yumi Toys, said that tariffs not only caused a delay in the sales progress of the company's products last year, but also forced the company to raise prices to ensure profit margins and pass on additional costs to consumers.

Susie Brown, the representative of the American toy manufacturer Masterpiece, told reporters that tariffs have had an impact on the company's profits. "As tariffs push up costs, we as suppliers will have to raise product prices and cannot fully absorb them ourselves.

According to a research report released by Hillcana, a research firm specializing in consumer behavior and retail markets in the United States, in early February, although the sales of the toy industry in the United States have rebounded in 2025, the overall toy market is showing a "K-shaped differentiation" trend: high-end toy sales are increasing, while low-end and mid-range toy sales are declining, indicating that the price increase caused by tariffs is putting pressure on low - and middle-income families.

The report shows that sales of entry-level and mid-range toys weakened last year, with a significant decline in sales of products priced below $5 and between $15 and $19.99.

More and more research results show that high tariffs have caused far more harm to the US economy than benefits. A study released by the Federal Reserve Bank of New York in early February showed that about 90% of the additional costs incurred by the US government's tariffs in 2025 will be borne by American consumers and businesses. The US government has repeatedly claimed that "tariffs are borne by foreign exporters", bringing huge revenue to the United States.

The Kiel Institute for World Economy in Germany previously released a report stating that the US government's imposition of tariffs is actually a consumption tax on imported goods, with 96% of the tariffs borne by US importers and consumers, resulting in a significant reduction in the types and quantities of goods that consumers can choose from.