The toy industry of Pakistan is divided among organized and unorganized sector. There is no one manufacturer at national level, there are small mushrooms which produce toys often price at 20 to 50 Rs for lower end of market. As this industry is yet growing but there are no research or industry analysis is available from Government or other private agencies. There is no study on the value or the volume of domestic toy market. However estimates about demand and potential of market can be analyzed from the fact that according to Karachi Port Trust 15-16 containers of Chinese toys (worth $15,000-$20,000) found their way into the port city while 20-22 containers were procured by Lahore-based importers monthly. Similarly according to State Bank of Pakistan, in fiscal year 2007-08 total imports of toys, games etc were $ 30,286,000 that 2.5 billion rupee toys were imported in one year. By analyzing at the following table it can be witness that from fiscal year 2005-06 to 2007-08 the growth in imports was around 2 %. Table 4: Baby Carriages, Toys Games VALUE IN ‘000’ DOLLARS 2005-2006 28,889 2006-2007 30,736 2007-2008 30,286 2008-2009 30,891 2009-2010(P) 31,582 Source: State Bank of Pakistan 2008-09 The fads as in fashion industry are also present here for example recently series of Ben 10 toys are in demand, in past same was with Tom & Jerry figures. There is no manufacturer of toys in Pakistan hence whole demand is being fulfilled by imported toys. The wholesalers import directly from international market that distributes them to retail stores that spread over to all over the country. Now toys are starting to become lifestyle commodities, propelled by higher disposable incomes and affordable prices. Pakistan is collective society and in this society gift taking and giving is a tradition. The toy is considered a good gift for babies and often kids insist for the toys. The traditional purchase points are often considered for low price however if the unorganized sector rules in the smaller toy shops, malls have turned out to be undisguised blessings for toy makers since they offer better shelf space to exhibit products. In unorganized sector mostly toys are unbranded and these unbranded toys do not adhere to guidelines such as weights and measures mandatory for indigenous toy companies. Many do not print the addresses of manufacturers/importers, the maximum retail price (MRP) or manufacture date, making it impossible to check under-invoicing and dumping. For instance, in the small format toy shops, only top selling toys from a range get adequate display. These malls also help in better tracking of sales and allocating the required shelf space. These malls offer large product offerings like apparel, shoes, stationery, laptops, keyboards and a host of accessories, ranging from sunglasses and belts to perfumes. In Pakistan, toys aren’t seen as developmental. So pester power of kid’s works and impulse purchase becomes the most important vehicle for us to growth in market. According to survey conducted by Dawn, Chinese toys hold 98 per cent of local market as toys manufactured in the US and UK origin has negligible share. C grade quality of Chinese toys holds a major share in Pakistan while A & B qualities are destined for Europe and America. The strong presence of Chinese products in country provides a cheap option for consumers and thus it favors them to engage with the products. The Chinese toys are usually made from plastic thus they are produced at low cost that provide good look. In terms of prices, very low priced Chinese toys hold 70 per cent market share while medium and big price-range toys hold rest of the share. Recently due to devaluation of Rupee and increasing of dollar-rupee parity prices of Chinese toys have surged by 25-30 per cent in local market. There is also high taxation on the industry, currently there is 25 per cent import duty on import of toys followed by 16 per cent sales tax, four per cent income tax and one per cent federal excise duty. On the other hand import trade price (ITP), charged by the Customs, and ranges between $1.40 to $3.0 per kg. The famous brands are also presented in Pakistani market; famous brands are Hot Wheels, Lego, and Barbie dolls. The famous outlets offers wide range of variety and thus people are now becoming more brand conscious while shopping toys. Not just price but now other variable like safety is considered important in buying toys. That is brings implication for new ventures to craft differentiation. The famous toy retail brand “Early Learning Centre” came to Pakistan while opening their first retail outlet in Dolmen Mall, Karachi, on Friday 23rd November 2009. The Team A from Pakistan is their strategic partners in Pakistan. According to Team-A, they have a countrywide store opening plan in place with a second store in Karachi (Zamzama) and two stores in Lahore already confirmed. This opens the era of new branded stores coming to Pakistan.