Mattel Case Study Essay

According to FDA.gov 2009, the definition of recalls is, an action taken by a company to remove a product from shelves. There are three classes of recalls and two other types of recalls mentioned on FDA.gov. Class I recall involves a situation in which there is a probability that the use of or exposure to a product will cause adverse health effects or death. (FDA, 2009) Class II recall involves a situation in which use of or exposure to a product can cause temporary or medically reversible adverse health consequences or where the probability of serious adverse health effects is remote. (FDA, 2009) Class III recall involves a situation in which use of or exposure to a product is not likely to cause adverse health consequences. (FDA, 2009) Market

Mattel has been criticized heavily for having to recall not once but thrice in 5 weeks 20 million toys manufactured in China with lead paint and/or loose, potentially dangerous magnets. Clearly Mattel does not have sufficiently tight quality control procedures in its supply chain to compensate for the extra risks of outsourcing to Chinese subcontractors and clearly there are design flaws in the toys with the magnets that could come loose. Although many observers give the company credit for responding to the crisis quickly with an apology from the CEO and pledges to institute more rigorous product safety checks, Mattel still faces a number of problems, including significant costs associated with the recalls and new

a) Competing directly with Hasbro's Playskool core products, Mattel's Fisher-Price and Sesame Street brands focus on developmental and educational toys targeted toward parents of infant and preschool-aged children.

claims in the past even though none had surpassed $8 million dollars. CID supported $325 million dollars. Basically, the company could not rationally approximate the array of loss if any, which caused from the substance (“Edgar Filing Documents,” 2016). Clearly these types of problems are portions of business within an extreme controlled industry; There is no extra lawsuit problems known of.

3. What environmental forces have created challenges for Mattel as it continues expansion into global markets? Which markets have created opportunities?

In 2007, Mattel a California based toy company shockingly recalled 19 million toys that had been manufactured in China. Mattel was founded in 1944, and has produced iconic toys such as Barbie and Hot Wheels. The company had a long established trust with their consumers that had been forged from decades of reliability. However, when the company recalled 19 million toys due to health and safety violations, consumer confusion and outrage soared. The public wanted to know how such an established company’s safety regulations could fail, how Mattel was addressing the issue, and whether consumers could trust Mattel to produce reliable toys in the future.

In my opinion recalls are issues brought on by under testing and companies reacting to pressure from shareholders to release a new product. Bobcat and John deer are two major farm equipment manufacturing companies who both have had recalls in this last year. John deer has alerted a recall due to faulty hand brake which can lead to injury or even death among users. In addition, Bobcat has issued a recall on their prowlers because of fuel leaks on their throttle which may lead to fire hazards. Both of these problems can lead to serious injury or even death (CPSC, 2015). In both of these recalls each company have encouraged buyers to stop use immediately and return to them for free repairs. I believe that this is a good first step for the company

The problem surrounding Mattel Inc. 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.” 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 lead to violations in terms of ethical and social responsibilities and safety standards.

As the makers of children’s toys, Mattel has the ultimate responsibility to ensure that every toy is made within the tightest of safety standards. With the case of the Mattel toy recall, the company acted within the spectrum of their code of conduct that was titled Global Manufacturing Principles. Once the problem was identified, Mattel quickly addressed the issue, by automatically issuing the product recall and conducted a special investigation. The findings from the investigation led to other issues being found in Mattel toys. Once again, Mattel quickly responded with more product recalls, and a deeper investigation into the reasoning behind the faults. Through these actions Mattel did act in a socially responsible and ethical manner.

Product recall is defined as a form of consumer protection aimed at removing unsafe products from the hands of consumers. A product recall typically deal with a safety issue that could potentially make somebody ill, injure, or even kill them (Flynn, B., & Zhao, X., 2015). Product recalls can affect any element of our markets, most often occurring in automobiles, food, medicines, and toys. When a company first discovers a flaw in a product, they have two options open to them. They could chose to withdraw their product from the market until they can work out the issues, or they can leave the product available for purchase and hope the situation works out for the best.

Product recalls are issued when a product is found to be potentially defective and dangerous. Sometimes the product manufacturer discovers a potential problem with a product after selling it. When they do,

Down to the fact that Disney’s major competitors in the Media Network/Broadcasting are also big conglomerates, this creates a tough competitive environment, because when consumers have a range of option to choose it from, automatically the power of buyer increases (Boddy, 2011), and the only way companies managed to compete is via dropping the price and attempt to persuade consumers to switch from one company to another. This conflict is noticeable when looking into the average number of audience between the most popular network televisions, where Disney is in the 3rd rank with 5.4million viewers per night (see page 11, 2nd paragraph).

In addition to increased sales, the company sets out to enhance the number of the overall customer share that they have.

Products recalled include Toys, Cribs, tools, Cigarettes lighter and household chemicals, the product safety have to make sure that there is a decline in death and injuries that has been associated with bad products (http://www.cpsc.gov/index.html). The federal law has made sure that people do not sell products that are subject to voluntary recall by manufactures or mandatory recall, which is ordered by the commission. In the final analysis everything is based on making sure the consumer is protected, it is all based on safety (http://www.cpsc.gov/index.html).

In 2007, the US Consumer Product Safety Commission CPSC announced five different recalls of Mattel’s toy because of the below two issues: