Case 7: Mattel: Overcoming Marketing and Manufacturing Challenges

3287 Words Dec 13th, 2012 14 Pages
Case 7: Mattel: Overcoming Marketing and Manufacturing Challenges
The Problem:
The problem surrounding Mattel Inc., one of the world’s largest toy companies, is their mismanagement of international subcontractors and vendors and the production of certain toys (the manufacturing process), as well as their inability to adapt their marketing strategy or product to the constantly changing “demographic and socioeconomic trends” (Ferrell, et. all 466). This is supported by Mattel’s legal battle with Carter Bryant and MGA, their forced recall of certain toys that were manufactured overseas, and the increasing rate at which traditional toys are becoming less appealing to today’s young audience. Essentially, Mattel’s mismanagement and oversight
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International Supply Chain Issues:
Because Mattel has a powerful presence on the international scene, they “must be aware that the international environment often complicates business transactions” (Ferrell, et. all 463). However, it is clear that Mattel did not properly manage its global manufacturing process. In 2007, Mattel was forced to recall “1.5 million Chinese-made toys” containing lead paint and powerful magnets that posed a choking hazard for children (http://www.nytimes.com/2007/08/28/business/worldbusiness/28iht-mattel.4.7289869.html). These unsafe products are the result of overseas manufacturers not adhering to Mattel’s high ethical and safety standards, as well as Mattel’s negligence in investigating its international contractors and auditing the “entire supply chain, including subcontractors” (Ferrell, et. all 463).
In fact, Mattel became “overconfident about its ability to operate in China without major problems” and failed to recognize that the toy recalls were “more of systemic problem” (http://www.nytimes.com/2007/08/28/business/worldbusiness/28iht-mattel.4.7289869.html). These oversights left room for certain violations to occur. The violations and problems began when subcontractors used unauthorized third-party suppliers. Early Light Industrial Co., “a subcontractor for Mattel, subcontracted the painting of parts of Cars…