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Readers have been becoming increasingly concerned by the silence coming from Palisades Toys, and given recent rumors have wondered what is happening with the company...

A lot of people checking out our UK ToyFair coverage are asking us, what’s happened to Palisades.

Palisades did not have a presence at the UK ToyFair. Typically they have had a large presence in the past, sending prototypes and personel to the show, but this year, no Palisades products were on show. When quizzed about it, their distributor said that they had assumed Palisades had gone under.

And that may very well be the case. A large number of staff were let go before Xmas. Note that this wasn’t just about reducing the workforce and restructing the company, but letting key people go in product design and sales & marketing. Those we have managed to track down, have thankfully managed to find employment with other companies in the industry.

We know that Palisades will not be showing at the US ToyFair this year. For the past couple of years they’ve been sharing the old McFarlane showroom with Diamond, Kotobukiya, Gentle Giant and a few companies but we can confirm that have not renewed that space for this coming US ToyFair. Whilst a number of companies have decided this year there is little economical worth in attending ToyFair, this appears to be more on the grounds of necessity for Palisades and not on the grounds of choice.

If any employees remain, it’s no more than a handful of people, and by all accounts it sounds like they are simply winding the company up. There may be money to be gained from their intellectual property and physical assets (indeed we have heard that that they have been selling off all their office furniture) but from discussions we have had from a number of individuals in the toy industry it seems at least some of this will only go to cover existing debts in Asia, rather than put the company on a firm footing for the future. Whilst there’s a large part of me that wants to believe they can claw back from this, the realist in me sees that this is highly unlikely as whatever company is left, is currently little more than a shell.

It saddens me no end to see a company like Palisades go. There’s unlikely to be much more we hear about the company, these types of events don’t tend to be accompanied with press releases. It’s also extremely unlikely that any products as yet unmanufactured by the company will see the light of day (although stuff already produced and in transit may still hit stores). There’s a chance some other company might buy some of the assets and release product under their own name, but from speaking to a company that was progressing this idea for an existing Palisades product, this isn’t as easy as it at first sounds.

Palisades was one of the first companies that ever really took us seriously here at A-F, and for that I will be eternally grateful. There products always used to get me excited, and even when I think things took a downturn after their Muppets line ended, there was always something exciting about a Palisades release. I had the good fortune to visit their studios last year (driving all the way from New Jersey to Maryland for a day). Upon arriving there, it felt more like a family reunion than a business visit, and anyone who tells you that they were the nicest bunch of people in the industry isn’t just paying lip service.

I’m sure everyone will have their own theories and reasons for the company’s demise, but the simple fact remains that the industry has taken a terrible tumble in the past year, more than most of you realise. Other than the mass market players, there’s not one company that really looks 100% safe (and let’s not forget what’s happened with ToyBiz - all because the market was so volitile). "Are we heading for a crash?" some people have asked. My answer is that the crash is well and truly here and has been with us for sometime now, though we’re only just beginning to see the fall out. You’ll probably see a lot of companies scale right back, with more diversifying into other areas or getting out of the collectible toy industry altogether.

Whilst it isn’t the first time something like this has happened (regular readers will remember the end of the popular Resaurus in 2001 that spawned Plan-B Toys and saw Palisades go from being a distributor into a manufacturer) and the industry isn’t going to entirely disappear, the industry has now entered the darkest period it’s probably ever faced. It’s probably going to get a lot worse before it gets any better, but that doesn’t mean it’s all doom and gloom, and there should be lots of new products at the US ToyFair in 2 weeks for everyone to get excited about.