How To Start Soft Toy Making Business | SkillsAndTech

How To Start Soft Toy Making Business | SkillsAndTech

That industry, which has their specific and only targets as children and teenagers and develops products, customises them  in terms of colours, shapes, sizes, length etc  and are meant for mere comfort and decorative purposes has crawled its way up as one of the major contributors in building the Indian economy

Yes, it is the soft toy industry we are talking about. A soft toy is a toy which is made for children, typically a toy animal, made of fabric stuffed with a soft filling. It is usually used by infants, children for seeking comfort and by teenagers for decorative purposes.

The Indian toy industry was valued at 1.75 billion in 2017 out of which the organised and the unorganised soft/stuffed toy sector contributes roughly around ₹5000 crore.

Well, a soft toy industry isn’t so soft after all, isn’t it? Let’s see how you can get these toys to bring good business to you

    I.        Market potential and uses

The market for the soft toys has a specific niche of children and teenagers to cater to. These niches provide this soft toy industry with consistent demand as in as birthday gifts, as a decorative item, baby showers etc and also offers increased seasonal demands during festivals like : Diwali, Christmas, valentines days etc

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So the potential of a soft toy industry is moderately high but one has to understand the line of soft toys they want to enter into to save up on the cost of production.

It can be segmented on the basis of:

·        Product type : Cartoon character, animals, dolls, play sets etc

·        Material type: Pallets, fabric, bamboo etc

Now let’s see why is it that there’s a demand for a soft toy in the market


·        It’s used by children to seek comforts and play

·        It’s used as a decorative item in rooms

·        It is used as gifts to be given on occasions of birthdays, Valentine’s Day etc

  II.        Licenses required

The licenses required to run a soft toy making business would be:

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·        OPC Registration

·        Trade license

·        MSME Udyog Aadhar registration

·        GST Registration

·        PAN and Aadhar card

III.        Investment required

The investment required to set up a soft toy making business would be ₹200000-₹300000

IV.        Profits made

The profits made from setting up a soft toy making business would be ₹40000-₹50000 per month

 V.        Target consumers

The soft toys attracted the very specific of niches which are as follows:

·        Children and infants: Children and infants make use of soft toys for the purpose of seeking comfort, playing, passing their time and having fun. So, their parents are the target market who look out for quality and safety in these products

·        Teenagers: The teenagers make use of soft toys as a way to decorate their room and few because of nostalgia

·        Play schools: play schools are a target market because they have children coming in for admission and soft toys are a way to bring familiarity and friendliness in the environment.

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·        Gifting services : Gifting services like Oyehappy who make customisable gift packages for people to gift to their loved ones : mom, dad, spuds etc require soft toys as a part of their hampers and packages

·        Gifts and novelty stores : Who stock in birthday, anniversary, congratulation cards along with soft toys for occasions like birthdays, Valentine’s Day serve as a huge target market too.

VI.        Area required

The are required to set up a soft toy making business would be 500 sq ft

VII.        Raw materials required

The raw material required to set up a soft toy making business is

·        Scissors

·        Tapes

·        Needles

·        Racks

·        Cotton

VIII.        Machinery required

The soft toy making business requires the following machinery to set it up:

      Sewing machine

·        Packing machine

·        Moulding machine

·        Dyers

·        Coolers

IX.        Manpower required

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The manpower required to set up a soft toy making business is as follows :

·        3- unskilled labours

·        2-skilled labours

·        1-production manager

·        1-accountant

Moreover ample training to these workers in terms of equipment handling, machine usage, safety and precaution measures must be provided with

 X.        Business model and growth

The business model of a soft toy can be defined using 4 variants which is as follows

A.  Value proposition: The unique selling point (USP) and the value a soft toy making business is likely to get to you is:

·        Less production costs, low marketing efforts, word of mouth promotion and consistent demand

B.  Target consumers : The target consumers for this soft toy making business would be

·        Children and kids

·        Teenagers

·        Gifting services

·        Play schools

·        Gist and novelty stores

C.  Competitor review: Few key players in this soft toy making business would be :

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·        Build-A-bear workshop

·        The simba Dikie group

·        Lego system A/S

D.  Marketing strategy: The marketing strategy for a soft toy making business would be:

·        Highlighting the quality of raw material used and durability and ensuring word of mouth promotion


The soft toy making business has the potential and witnessed the following growth prospects :

·        The stuffed toy industry is expected to grow at the rate of 25% between (2020-2023)

·        The soft toy industry is likely to contribute ₹300 crore further by the end of this financial year.

·        Moreover rise in the demand for action figures we cause of the upcoming movie characteristics have increased the demand for these soft toys in need to possess a collection

XI.        Profit margin

A soft toy making business is likely to yield a profit margin of 15-20%

XII.        Suggestions

Are you still in a pickle ? Don’t worry we have a closure for you:

·        Firstly, the low investment and consistent demand and increased seasonal demand this is a profitable business to get into

·        Secondly, the investment in terms of manpower and machinery is less and comes with a reasonable profit margin

·        Lastly, the variety in soft toy in terms of material and type widens the target market.

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