Kiwi toy company could lose millions as coronavirus causes factory delays in China

One of New Zealand's biggest toy companies is bracing to lose tens of millions as its factory in China is hit by the coronavirus outbreak. 

Now there are warnings Kiwi manufacturers will need to diversify where their products are made. 

The full effects of the Covid-19 outbreak on New Zealand's economy won't be known until next year but Kiwi companies who manufacture products in China are already feeling the pinch. 

Zuru toys, known for its hit product Bunch O Balloons, had its main factory in Shenzhen close for a week and has been running on a skeleton staff ever since. 

The company is projected to lose millions because of the outbreak, according to the company's director, Anna Mowbray. 

"It's very touch and go right now - it's a very difficult platform and foundation from a manufacturing perspective. And of course from a business perspective we want to be up and running, we want to be shipping product," she says. 

Ms Mowbray says last week she had to make the decision to drop one of the company's most important launches of the year as it isn't on track to hit its launch date because of the delays. 

Other companies which are manufacturing in other parts of Asia are feeling the effects, too, as clothing companies in Cambodia are waiting on important elements like clasps and zips from China. 

Economist Chirstina Leung says it is up to the businesses to ensure they have plans in place for production to adapt accordingly. 

Ms Leung says production delays could likely cause shortages of stock in New Zealand retailers. 

The impact the outbreak is having on retailers is causing uncertainty for both consumers and retailers alike.