Hobby, Toy and Game Stores NAICS 459120

Jun 25, 2025 - Retailers Curb Free Shipping

• According to a recent report in the Wall Street Journal, retailers are cutting back on free shipping to offset tariff costs. Some retailers are eliminating free shipping, while others are raising the amount that customers must spend to qualify for free shipping, as a way to pass along higher costs to consumers. One fashion lunchbox retailer has raised the threshold for shoppers to qualify for free shipping to $300 from $150. Retail-technology provider Narvar noted that the average minimum-order threshold for retailers to offer free shipping has increased from $82 in 2023 to $103 in 2025. Adjusting the shipping price is appealing to retailers since it does not change the front-facing shopping price to consumers, per Narvar CEO Anisa Kumar. Officials at toy seller Lovevery said customer research showed that removing free shipping was “one of the least objectionable things we could do,” noting they have not lost many customers as a result.
• Consumer sentiment, an indicator of discretionary spending, rose in June in large part due to a lull in the tariff war, according to a report in CFO Dive. The final index of consumer sentiment from the University of Michigan grew 15.9% in June 2025 from the previous month, as the Trump administration put some tariffs on hold against major US trade partners. Year over year, the index of consumer sentiment was down 11.3%. An index measuring consumers’ expectations for the future was up 21.9% from the previous month, but was down 16.1% year over year. According to survey director Joanne Hsu, “Consumers appear to have settled somewhat from the shock of the extremely high tariffs announced in April and the policy volatility seen in the weeks that followed.” Hsu noted that consumers’ views of business conditions, personal finances, buying conditions for big ticket items, labor markets and stock markets all remain below six months ago.

• The US hobby, toy, and game stores industry is projected to grow at a CAGR of 3.55% between 2025 and 2029, according to a forecast from Inforum and the Interindustry Economic Research Fund, Inc. The expected growth rate is slower than the overall economy‘s anticipated growth. The retail and wholesale sectors are driven by consumer spending, along with expenditure by businesses and government. A factor that may limit consumer spending is higher tariffs on consumer goods. On a positive note, lower inflation supports a moderate increase of real disposable income by about 2% in 2025 and 1.9% in 2026. Real income could suffer if prices rise due to tariff implementation. The forecast said retail spending could soften with the growth of spending on consumer services, but noted that consumers so far have maintained spending on goods even as travel and live entertainment spending has risen.
• According to a report in Retail Dive, the US toy industry may see devastating effects from tariffs, including the closure of many toy businesses. The Trump administration has raised duties on imports from China to a total of 145%; China accounts for about 80% of the toys imported into the US. A recent survey by The Toy Association showed that nearly half of small-and-medium-sized toy businesses said they may shutter due to the current tariff policies, which have frozen the toy production supply chain. Toys typically have a low price point, with over two-thirds of products priced under $25, and margins are typically thin. With the high tariffs, many toy companies cannot absorb the additional costs and are expected to pass the costs to consumers. “The costs of those goods are going to skyrocket,” according to Greg Ahearn, president and CEO of The Toy Association. According to the report, Isaac Larian, the CEO of MGA Entertainment, a large private toy maker which makes Bratz, L.O.L. Surprise, and Little Tikes, said he would have to lay off workers if the tariff situation does not improve. While the company does make goods at its US factories, about 65% of MGA Entertainment’s toys are imported.