Grimm’s Wooden Toys & Geo-Fencing: Building a Wall to Keep Americans Out

Geo fence: A geofence is a virtual perimeter for a real-world geographic area.

“Geo-Fence”, Wikipedia.org, 2020 May 16

It started off as a rumor back in the Fall of 2019. You’d see it mentioned in passing by store owners. “Well, Grimm’s eventually wants us to stick with our own region.” No one pressed any further. Just like when you were twelve and your mom said, “I’ll think about it”, you knew further pressure for answers won’t yield positive results.

Then the e-newsletter from 100 Toys broke the story. On February 23, 2020, their e-newsletter had a tiny blurb that went unnoticed by most:

“If you are one of our international customers, today is your last chance to buy Grimm’s from us. Grimm’s have asked all retailers, worldwide, to only sell within their geographical location. That means that if you’re in Australia, for example, you’ll have to buy from an Australian seller. I’m not sure how this rule will work in practice as I suspect it will simply push the sales onto third-party platforms, like eBay and Amazon (at higher cost to you), but we have to respect their decision.”

A list of the 100 toys I recommend for under 5s. (2020 Feb 23) 100 Toys e-newsletter

The backlash was immediate and the confusion was evident. Across the wooden toy forums, the debate raged about the fairness of Grimm’s new policy. Once I had a firm grasp on the ramifications of this, I started reaching out to my contacts in the wooden toy world. To me, it felt like a very poorly planned decision.

My source remains anonymous, as no one wants to anger the megalith known as Grimm’s Spiel und Holz. However, the source was adamant about one very particular point: The retailers didn’t know beforehand.

The implication of that is enormous. Most retailers were advised the same day their customers found out and scrambled to create workarounds for their e-commerce sites. While American customers raged at their surprise cut off from Babipur, Canadian companies like Nest worked on creating mirror sites for their businesses – one for the Canadians and one for the Yanks. In addition, most American stores did not have enough Grimm’s in stock to manage the panic buying that ensued. My source advised that had they been warned, they would have significantly ramped up their previous Grimm’s order to help quell the fervor.

And then of course, there was COVID-19 and suddenly everyone was inside with their children and looking to get their hands on new toys to entertain them. Most stores were out of all their Grimm’s stock by Saint Patrick’s Day. Throughout the months of March and April, the resale value of all Grimm’s items in the Facebook Buy/Sell/Trade groups began to rise. I spoke with several well-respected moderators of the biggest wooden toy Buy/Sell/Trade group on Facebook (link here). Erin Fortin, the creator of the group advised “I have relationships with other shops because they have great customer service. Many of the shops here [USA] are more ‘cold’.” Forrest Tompkins, one of Ms. Fortin’s administrators /moderators agreed: “It’s only creating another problem and taking away business from international retailers many of us have grown to love or even accumulated rewards with which we can no longer use for the items we had intended”. She continued, “If it’s truly about protecting American retailers, then they need to be provided more stock and price more competitively. If it’s about the carbon footprint, I think Grimm’s can do better than wrapping their rainbows in plastic. Grimm’s isn’t the only toy company. Many moms and families are already stretching their dollars to afford these toys. People are selling these for profit now because the American retailers are out of stock. Moms are sitting by their phones desperately awaiting restock”, or in the author’s observation, falling prey to the inflated price determined by “resellers”. At publication, there was at least one listing pricing Grimm’s pebbles at 200% retail price.

So why do this? Our anonymous source had a suspicion:

“Grimm’s wants to expand their brick and mortar presence in the US. There are huge regions of the country that don’t have a brick and mortar store. When it is possible for US customers to get things cheaper (including shipping) from other countries, there is less motivation for new brick and mortar stores to carry the brand.”

Geofencing has existed ever since international trade began. When the first caveman traded outside his village and got a better deal, his village elders started creating things like export taxing, customs, and duties. There have always been people in power creating a system that limits who can buy what from where. Grimm’s doesn’t have the monopoly on that. However, it seems to this author, that geo-fencing is a practice more applicable to software and marketing, not necessarily children’s toys and puzzles. It’s a very not fun decision to make, in a market that’s sole purpose is to delight children.

It does remain to be seen how the regional retailers, especially in the United States, will adjust to the new reality. Several mail forwarders have already indicated that the costs of their package forwarding is going up exponentially to keep up with increased demand. I don’t think the novice customer or wood toy beginner will know how to sign up for and plan for international restocks and package forwarding. The bulk of new customers will, more than likely, buy from who they are told they can. I do anticipate a burgeoning overseas market in package forwarding for the veterans in our industry.

The basis of this article evolved over several weeks. I was going to conclude with a little bit of introspection. Any reader of my blog knows that I won’t stop buying Grimm’s for a good bit, but it definitely has soured me a bit on the brand. I don’t like being treated as a point on a graph, a statistic to be herded where I am most profitable. A lot of Grimm’s buyers in the US fit a particular demographic: a mindful consumer who doesn’t just like to go with what the advertising tells them to do. These types of buyers don’t take well to heavy bureaucratic decisions. I was going to finish by saying something snarky, about how perhaps they would be an example of how not to go about these types of business decisions.

And then in the bottom of a thread of comments, buried in an obscure post on a Facebook message board, I saw a little comment from an overseas retailer about the new upcoming limited edition Grapat sets: “Grapat wants us all to remain fair to all the local stockists because the release might be delayed outside Europe a little bit, so we are only allowed to sell within our own region”.

Behold the domino effect. We are silly to think geo-fencing is limited to Grimm’s. The heyday of buying wooden toys from the big makers across Europe is at an end. We are soon to be limited to our own borders for wooden toys, and I don’t see the consumer coming out a winner here. Why shouldn’t everyone else jump on the bandwagon?

Cut the lights, Chris – Cue up R.E.M.’s “It’s the End of the World”

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