The Scots company that sparked the Loom band craze now sweeping the UK is considering relocating its toy manufacturing to Scotland following a massive boost in earnings from the runaway hit line.

Martin Grossman, chief executive of Rutherglen-based H Grossman, was the first UK toy importer to spot the potential of the elastic band-weaving hobby, and was the first to design and order friendship loom band kits from partner factories in China.

Although the £8.25 million-turnover firm declined to divulge its sales figures, the Sunday Herald has learned that, within a few months, H Grossman has to date sold between £3m-£4m worth of its 30-item range of Loom Twister products, which range from 99p refill bags of the brightly-coloured, latex-free bands, to gift box sets retailing at £35.

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"If the success continues it will allow me to open the toy factory in this country that has always been at the back of my mind, manufacturing certain toys in the UK again," Grossman said.

"That's my plan. I'd love it to be in Scotland, and the only reason it would not be here would be if something bad happened to the country that made it unstable financially."

He added: "I have two products I want to manufacture which I believe we could do big business with, that's my ambition. The success of Loom Twister has put us in the limelight, and forced the big boys to take notice of us, and we have been winning important new contracts such as with Arcadia and Next that were beyond our reach before.

"This means that we would probably be able to finance [new factory investment] ourselves without having to take on debt."

Founded in Glasgow in 1946 by Grossman's parents as a supplier of "pocket-money toys" to corner shops, the firm has - like the rest of the UK toy industry - been manufacturing in China for the past three decades, and owns another company in Hong Kong.

Loom Twister was developed by Grossman's team of designers in Scotland and manufactured in longstanding partner factories in China. The firm exports to seven different countries, including France, the US and the UAE.

Grossman - known in the industry as the "king of crazes", whose past hit lines include Alien Eggs (1999) and Yo balls (2002) - said that he had a consignment of 100,000 Loom Twister items arrive in the UK from China last week that were "sold already, we can't bring them in fast enough". He described Loom Twister as being in "a different class" to previous playground fads, in that it promoted more collaborative and sustained involvement by children, and was capable of adaptations equally attractive to boys and girls.

The Loom Twister craze took off in the UK in the spring. Although toy crazes are notoriously ephemeral, Grossman said that he expected this one to last for up to 18 months more as children's skills developed beyond bracelets to the more complex patterns for three dimensional artefacts such as the pet figurines now popular in East Asia.

Although easy to copy by larger firms - and susceptible to cheap imitations - Grossman claims to have capitalised on "first mover" advantage and has been able to stay ahead of the market with constant modifications.

Grossman said: "I think we will come out of it as a more professional company. We will come out of this more respected by the larger retailers who are normally dealing with the big £70m-£80m-turnover companies, and they don't always rate the smaller importers and distributors like us. It might allow us to be known more for who we are and what we do rather than just being a relatively small distributor from Scotland. I hope it will transform perceptions of the business."

Mark Huntly, area sales manager Scotland and Ireland for Basildon-based toy importer PMS international, said: "I've never seen a craze in the last 10-15 years that has taken off like this, the uptake has been phenomenal.

"It's got kids away from computer screens back to basics. In fact, the really big crazes are basic, from marbles and jacks; POGs, they were like discs. If the kids in this country start making hamsters and other 3D figures like they do in the US and the Far East that will keep it going."

Rainbow Loom was invented in 2011 by Cheong Choon Ng, a Malaysian-born former seatbelt technology developer from Michigan in the US, who noticed his daughters weaving elastic bands over their fingers to make bracelets. Ng then "invented" a loom - a technology known to the clothing trade since at least the 15th century - using pins and a wooden slab, allowing more intricate patterns to be developed.