So You Want to Make a Yoyo

The yoyo community is a relatively small one. With a niche hobby, the suppliers of hardware tend to be more closely connected to customers and as a result are more closely inspected and analyzed than in a bigger one. But for many people the process of running a yoyo company is a mystery.

This article is going to focus largely on where my experience sits. The ‘boutique’ yoyo brand. 

For those of you other than my 6 fans who may not know my history, over the last 8 years I’ve been involved with 3 yoyo brands. I started as a sponsored player with MonkeyfingeR Design out of Calgary (Canada) as a sponsored player. From there I moved onto quasi-manager of King Yo Star Canada. It was an weird position, it wasn’t my brand (It was owned by a toy store owner in China) but I had full authority on promotion, sales and sponsorship outside of China. By the end I had a lot of say over the design as well. Currently I’m running my own brand (Rain City Skills) as the full on head honcho. Between King Yo Star and Rain City skills I’ve now got 9 yoyo releases under my belt.

Let’s spend a moment at the top of the yoyo industry with the giants like Duncan, Yoyofactory and Magic Yoyo. These brands have the spending power to make large runs of yoyos and distribute them around the world. This allows them the option of lower costs and higher profit margins (when making anything, the more you buy the lower the per unit price). It also allows them to work with injection moulded plastics which have a really high initial investment rate but a really good return if you can move enough volume (I’m talking 10 000 units or more). This goes with their brand recognition and reach into actual retail stores. They have employees working for them (although it’s still yoyos, so not a huge number). With financial resources comes the ability to advertise more widely through sponsoring contests and sponsoring the top players, and particularly by advertising to beginners, creating lifelong customers.

Smaller brands are a different story. These are usually one-person operations run by someone who works a full time job to pay the bills and designs/makes/sells yoyos as a passion. They are often designing yoyos themselves and having batches of 50-100 made at a time, doing all of the assembly, packaging and advertising themselves. They don’t usually have the budget to hire people to do work for them, or to spend the big bucks to do google and Facebook ads, so it all comes down to making personal connections with individuals and with groups in the community through various social media outlets.

Having said all of that, in both cases the process of creating and selling yoyos is generally the same. There are a lot of half-truths about the costs of making yoyos that float around. I am not going to list off exact hard costs because every yoyo has a different price to make, based on difficulty of design (time on the machine), quantity made, the anodizing, where you have it made and so on. Below is a list of the costs that go into getting a yoyo to market that are a ballpark average based on my experiences and those of others I’ve talked to.


DIRECT COSTS

1. Design - most people don’t have the time and energy to learn the complex software required to design yoyos. The result is that you usually need to hire someone else to do the job. Some companies that machine yoyos will offer to take your drawing and convert it for you as part of the prototyping cost. One Drop is an example, and from what they told me they have received everything from detailed and accurate digital drawings to sketches on a napkin. Often times though you are looking at paying a professional for the design or at the very least trading a couple of the finished product in exchange.


Above: Various prototypes from my personal collection.

2. Prototype - This cost can range depending on where you are making the yoyos, but it is a key step. What the design looks like on paper is often drastically different than what it looks like in reality. As well there is no way to tell from a drawing how it’s going to feel on the string. Often makers have to do 2 or even 3 runs of prototypes to get that weight and balance right, and that adds to the overall cost of the yoyo run, especially if you are only making the minimum order (which is usually 100). If a prototype run costs $500, that’s $5 per yoyo. Cost aside, the #1 lesson I’ve learned being involved in over a dozen releases and designs over the years is that if you think you need to do another prototype, you really should. Every time I’ve decided not to because of cost I’ve regretted it.


3. Machining - This cost again varies based on where you are producing (China VS USA), complexity of design (simple is usually faster/cheaper) and quantity made in a run (500 vs 100). A lot of the cost involved is in setting up and programming the machine. Shops calculate costs by the machine hour. If your design is simple and they can pump out 10 parts in an hour it’ll be cheaper than if they can only do 4. Material can be a factor as well, Titanium takes a lot longer per part to create so combined with the cost of the raw materials it’s a lot more costly to create.

4. Finish and anodizing - Polished, blasted, tumbled or ? Again, it comes down to time. Polished is cheaper than blasted or any of the other alternatives because it takes less time. You have to clean and polish the parts before you anodize anyway. Adding a step to the process usually adds cost (again usually based on quantity)
Colour? Single colour anodizing is obviously cheaper than multiple colours. Anodizing is a post all to itself, but suffice to say it’s a time intensive process with a fair bit of materials and electricity cost (you can’t forget in all of this the shop is factoring power) If you are working with a Chinese manufacturer a single colour is often included or a very small cost because they do it in house. 
If you are machining in North America you are looking at significant additional costs ($20 per yoyo isn’t unreasonably for a 3-4 colour splash from a reputable shop). 
For the most part there is a minimum order as well, usually around 25 yoyos per colourway (although you can do less, the cost just goes up a lot).

HIDDEN COSTS

One of the challenges is that there are many costs that aren't directly about creating the parts of the yoyo.

1. Shipping.  This cost can’t be emphasized enough.  Here is a list of things that need to be shipped to get the yoyo run made.  Yoyos are heavy, and shipping is charged by weight, so shipping 100 yoyos around is expensive!
       -prototypes - to you from the shop, then to players to test.
       -anodizing - shipping from the machine shop to the anodizer back to you.  If you are making them in China those are usually hidden costs, you’ll             just pay the freight to you, but if the shop is incurring costs you are paying for them.
       -bearings, pads and axles - if you are machining in china you can usually get the shop to source them for you and include with your yoyos, but they               are added weight and you are paying either way.
       -boxes - you can avoid shipping on these if you go to a physical store near you, but it’s often cheaper to order bulk online and you have a better                      chance of finding something that will help your brand stick out.
       -stickers - same as with boxes.
       -throws to team members - The small brands main source of testing and advertising
       -throws to reviewers - Again, key piece of advertising
       -assorted accessories included (string, carry bag, etc)

2.  Packaging. Are you going to ship in a specialty box? Including a carry bag?  Smaller brands have to set this up for every different yoyo to help them stand out.  Bigger brands like YYF can afford to use the same box for most throws, cutting costs by buying 1000’s at a time.  If you are a smaller brand trying to make your mark, you might choose one of the more unique options to help sell the product.  If you are trying to make an extreme low budget throw, a clear plastic box that costs you pennies, hoping the price point is enough to sell the throw.

3. Stickers - You have design costs.  If you are like me and have no artistic talent, it costs money to get a sticker design.  I have found an artist whose style I like an who works with me until I’m happy, and he’s worth every penny of the ~$100 per piece of art I spend. The cost of the actual stickers can vary, again due to quantity made.  As with everything else cost of setup is the biggest piece once the printers are running the difference between 100 and 10000 is a fraction of the difference between 0 and 100.  You can usually get 1000 of a sticker printed for about $50

4. Advertising - This is the big one people don’t think about.  Out of a run of 100 yoyos, maybe 80 actually get sold.  The biggest way to advertise a yoyo is to have people play with it.  
-Your average small brand has around 5 players representing them, so you send them a minimum of 1 throw each (more if they are competing with it).  
-Next you have reviewers.  At least 1, sometimes more (I sent 4 gamers to reviewers).  
-Contest sponsorship.  Smaller contests will allow you to donate product or a combination of product and cash, so you are looking at 2-5 throws from each run, and at least 200-400 cash per year just to sponsor one or two contests.  You might pass up this advertising venue, but I’ve always received my biggest bump of ‘fans’ and the associated sales after I attend a contest, even if I don’t have a table.
-For the larger brands there is also the cost of direct advertising on youtube, Facebook or google ads.  

FINALLY: THE MATH

So lets throw some imaginary math at this to put it in a bit of perspective.  I’m going to pick some numbers that are a reasonable ‘average’ price for the various steps involved (Numbers in USD).  These will be based on a short run of 100 yoyos made in China, with a medium complicated design.  These are average costs, you can do all of this cheaper by cutting corners, and you can spend more for quality and branding.
1. Prototype run - $400 per run (shipped), we’ll assume only 1 prototype was needed = $4.00
2. Yoyo parts - $15 per yoyo.  $1500 for the run.
3. Axle - $0.20
4. Bearing -$1.50 (decent quality budget bearing)
5. Pads $1 per pair (sourced through an existing company, not custom made) 
6. Anodizing (in china) $4 per yoyo for 3 colour splash
7. String $0.15
8. Shipping to North America $120/100 = $1.2 (includes customs duties)
9. Simple boxes $0.50
10. Custom Sticker Art 100 = $1 each
11. Sticker printing (1000 is usually the best value) $50 (shipped) = $0.5 each yoyo
12. Carry Bag $1.5 (Incl shipping from China)

Total that up you get a cost of $30.75 per yoyo.

Lets account for 1 for the owner, 5 for the team, 1 for review and 3 for contest sponsorship.  That’s $321.
Divide by the remaining 90 adds $3.57 per yoyo, bumping costs up to
$34.32 per yoyo.  

OK.   Next bit of math - Finding a price.  If you are selling direct and not retailing at all you get to make a bit of money, but it’s more work to sell through the run.  If you choose to retail here is your math.

Most retailers ask for a minimum of wholesale x 1.7.  For some it’s closer to wholesale x2 (which is a standard minimum markup in any industry, yoyo retailers take a smaller cut than most businesses).  Going with the minimum.

34.32 x 1.7 = $58.34. 

That’s your retail price if you aren’t going to make a penny on the yoyo.  For retail stores I usually try to give myself $5 as a minimum, so new math:

40.7 x 1.7 = $66.84

If you have a look back up, we started with raw parts costing only $15, $20 anodized.  At the end of this adventure the brand owner earned $5 per yoyo on a maximum of 90 yoyos which gives you $450.  If you have ever tuned a yoyo you know how much time is involved in assembly of the 100 throws, add in packing them up, all of the design, testing, social media work and that’s peanuts.

Move to North America?  Add $20 per yoyo at least.  Have to do a 2nd or 3rd prototype?  $5-$10 more per yoyo.  Bi-metal or Titanium? Sponsoring a high level player or want a spot at the big kids table sponsoring nationals or worlds?  The costs keep going up.

Yes, you can get things made cheaper, the fact that there are metal throws on the market for under $40 tells you that.  If you can afford to make 1000 yoyos the price can drop as low as $5USD for the parts, that’s how you can find aluminum yoyos on EBay for under $10, but can you sell that many? What is displayed above is not an unreasonable set of numbers for a short run of made in China yoyos from a reputable, quality controlled shop.  

So there. One persons averaged numbers on how yoyos are made.  One of the wonderful things about the internet is that you can find just about any information.  If you are thinking of making your own yoyos, I wholeheartedly suggest you do some research and see if it’s something you want to pursue.  Companies like Magic Yoyo, Vosun and FPM all do yoyos on demand, or if you want to stay in North America hit up One Drop or Foxland Precision and get some prices.  

Feel free to comment or hit me up at mryoyothrower@gmail.com if you have questions on any of this!