The Teletubbies unlocked a new market. The show was one of the first to be aimed at very young children. The Hoobs, a TV series from Muppet creators the Jim Henson Company, is set to hit British screens in January - and Mr Baulch expects a wave of merchandising will follow. This may not be all bad for grown-ups, he says. Parents feel a bit safer buying replicas of characters their children already love, rather than buying a more generic toy.
People say licensed toys tend to be popular for a few years, then drop away, only to return.
However, I suspect that such toys will continue to be extremely popular in years to come. Tracy Island, a model of International Rescue HQ from the re-released 1960s Thunderbirds TV series, was 2000's surprise hit. But Mr Baulch warns that bringing out toys to link with any old retro TV show is not a foolproof formula for success. When Thunderbirds came back on TV, dads sat down for some nostalgia and the kids got hooked too. The toys sold because it is a brilliant programme that still stands up.