Mattel Case Analysis

1107 Words5 Pages
Mattel Case  Development of Major Issue Mattel was the world’s largest toy manufacturer with revenue over $5 billion. It had been doing business in China for 25 years. China was Mattel’s most important manufacturing country. 65% of Mattel’s toys were manufactured in China. It owned 5 factories in China and had a network of contract manufacturers for the remainder of production. In August and September, 2007, Mattel recalled for three times globally 21 million problematic toys that were made in China for the reason of containing excess level of lead. The toys recall issue in addition to the publicity of media drew public attention to the global toys inspection system and the products quality of ‘Made in China’, resulting in a trust…show more content…
And the plants are many decades away from the kinds of expertise, infrastructure and regulatory enforcement that the company could take for granted in the U.S., especially in terms of safety requirements.  Quality Control Due to the low entry barrier, high labor intensity as well as production without specialized technology or knowledge, many developed countries became more profitable and competitive by outsourcing manufacturing to some low resource cost area. Undoubtedly, it is difficult to deny this really help them earn a lucrative deal. However, from Mattel’s crisis we learned how tremendous results outsourcing in toy industry even the whole manufacture industries without necessary and systematic due-diligence, might bring about to us. On the one hand, it is hard for the parent company know for sure whether their production processes are strictly implemented under standard; on the other hand, in order to increase the little margin left, the manufacturers who are located in the bottom of the smile curve, might re-outsource deal to lower subcontractors, which has already jeopardized the whole quality control system of the toy company thoroughly. From Mattel’s falling, the up class company is supposed to know about how significant role that quality control system is playing and what they need to do with that system if outsourcing has become inevitable trend. First, they should keep an eye on the re-outsourcing behaviors of the

More about Mattel Case Analysis

Open Document