Toy Industry Glossary: Sourcing, Retail, Licensing and Compliance Terms

Short, plain-English definitions written by TDmonthly for people who buy, sell and make toys. Regulatory terms link to the official source.

ASN (Advance Ship Notice): An electronic message telling the retailer what is in a shipment before it arrives. Missing or late ASNs often trigger chargebacks.
ASTM F963: The US toy safety standard. CPSC made it mandatory for toys under 16 CFR part 1250. Official source: cpsc.gov Related: US toy compliance checklist
Blind box: Packaging where the buyer does not know which item in a series is inside until opened.
CE marking: The mark a toy must carry to be sold in the EU, showing it meets EU toy safety rules.
Chargeback: A deduction a retailer takes from a supplier payment for breaking its rules, such as late shipments, wrong labels or a missing ASN.
Children's Product Certificate (CPC): The certificate a US manufacturer or importer issues to show a children's product passed required third-party tests. Official source: cpsc.gov Related: US toy compliance checklist
Closeout: Discontinued or excess stock sold at a deep discount, often to off-price retailers. Related: Wholesale suppliers
CPSC eFiling: Electronic filing of certificate data with CBP at import, required for most regulated products since July 8, 2026. Official source: cpsc.gov Related: US toy compliance checklist
CPSC-accepted lab: A testing lab whose accreditation CPSC has accepted for a specific children's product rule. Official source: cpsc.gov Related: US toy compliance checklist
CPSIA: The Consumer Product Safety Improvement Act of 2008, which set lead and phthalate limits and third-party testing for children's products. Official source: cpsc.gov Related: US toy compliance checklist
DDP (Delivered Duty Paid): A shipping term where the seller covers freight, import duties and delivery to the buyer's door. Easier for small retailers, but usually priced higher than FOB.
Drop-ship: The supplier ships directly to the retailer's end customer, so the retailer never holds the stock. Related: Wholesale suppliers
EDI: Electronic Data Interchange: the system big retailers use to send purchase orders and receive invoices and ship notices from suppliers.
Endcap: The display at the end of a store aisle. Paid or negotiated placement here usually lifts sales.
EXW (Ex Works): The buyer collects goods at the factory and handles all freight, export and import steps. Lowest quoted price, most work for the buyer.
FOB (Free On Board): A shipping term where the seller pays to get goods loaded at the named port and the buyer takes over cost and risk from there. "FOB Shenzhen" or "FOB Yantian" is common in toy price quotes.
General Certificate of Conformity (GCC): The certificate for regulated consumer products that are not children's products. Official source: cpsc.gov Related: US toy compliance checklist
Golden sample: The approved sample that mass production must match. Kept by buyer and factory for checks.
HS 9503: The international tariff heading for most toys (tricycles, dolls, puzzles, scale models and other toys). Your customs broker uses the full 10-digit HTS code to set duty. Official source: hts.usitc.gov
HTS code: The Harmonized Tariff Schedule of the United States code that sets the import duty rate for a product. Official source: hts.usitc.gov
Independent sales rep: A commissioned agent who sells several non-competing lines to retailers in a territory. Related: Sales rep finder
Keystone pricing: Setting the retail price at double the wholesale cost, a common starting point for specialty toy stores.
Kidult: An adult who buys toys for themselves, often collectibles, building sets or nostalgia brands. Related: Toy industry Data Hub
Landed cost: The full cost of a product once it reaches your warehouse: unit price plus freight, insurance, duties, tariffs, brokerage and handling. Related: Toy industry Data Hub
Licensee: The company that pays to make and sell products using a licensed brand or character. Related: Licensing Who's Who
Licensing agent: A company that finds licensees and manages deals for a brand owner in exchange for commission. Related: Licensing Who's Who
Licensor: The owner of a brand or character who grants another company the right to use it on products. Related: Licensing Who's Who
Line review: A scheduled meeting where a retailer reviews a supplier's whole assortment and decides which items to add, keep or drop. Related: Toy industry events
MAP (Minimum Advertised Price): The lowest price a brand allows retailers to advertise. It controls advertised price, not the final selling price.
Minimum guarantee (MG): The least amount of royalty a licensee commits to pay, even if sales fall short. Related: Licensing Who's Who
MOQ (Minimum Order Quantity): The smallest number of units a supplier will accept in one order. Toy factories often set MOQs per item or per color, and new brands can sometimes negotiate lower MOQs for a higher unit price. Related: Request a quote
MSRP: Manufacturer's suggested retail price.
ODM: Original design manufacturer: a factory that sells its own designs for the buyer to brand. Related: Request a quote
OEM: Original equipment manufacturer: a factory that makes products to the buyer's design and brand. Related: Request a quote
Open-to-buy (OTB): The budget a retail buyer still has available to spend for a season or month after current orders and stock are counted.
Peg-hook (peggable) packaging: Packaging with a hang tab so the item can hang on a store peg instead of sitting on a shelf.
Planogram: A diagram that shows exactly where each product sits on a store shelf or peg.
Pre-production (PP) sample: A sample made with production materials and tooling before mass production starts.
Pre-shipment inspection (PSI): A quality check of finished goods at the factory before they ship, usually by a third-party inspector.
Q4 / holiday season: October to December, the peak selling season for toys in the US. See the monthly sales trend in our Data Hub. Related: Toy industry Data Hub
Recall: A product withdrawal announced with CPSC (in the US) because of a safety hazard, with a remedy such as refund, repair or replacement. Official source: cpsc.gov Related: Recall Tracker
Rep group: A company of independent reps that covers a region and often runs showrooms at regional toy shows. Related: Sales rep finder
Royalty: The fee a licensee pays the licensor, usually a percentage of wholesale sales. Related: Licensing Who's Who
Sell-through: The share of inventory sold in a period. Buyers use it to decide on reorders.
SKU: Stock keeping unit: the internal code a seller or retailer uses for one specific item, size or color.
Small parts rule: A US rule that bans small parts in toys for children under 3, tested with a choke test cylinder. Official source: cpsc.gov Related: US toy compliance checklist
Toy fair: A trade show where toy companies show new lines to retail buyers and press. Related: Toy industry events
Tracking label: Permanent marks on a children's product and its packaging that identify the maker, where and when it was made, and the batch. Official source: cpsc.gov Related: US toy compliance checklist
UKCA marking: The UK conformity mark used for toys sold in Great Britain.
UPC / GTIN: The barcode number retailers scan. Brands license their company prefix from GS1. Official source: gs1us.org

Definitions are general explanations, not legal or financial advice. Corrections and questions: [email protected]