Mattel Case Study Essay

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

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

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.

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

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

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).

Most manufacturers care about their consumers and subsequently, do not intentionally manufacture products that harm their users. However, injuries from defective products do occur, and they occur often. The United States Consumer Products Safety Commission (CPSC) estimates that in 2014, 78,906 product liability cases were filed in the US. Furthermore, product liability cases are second only to medical malpractice as having the highest median damage awards in all personal injury cases. Fortunately, the liability for these products and the injuries they cause lies on the individuals or companies individuals or companies responsible for manufacturing and distributing them. Product liability cases are often difficult, expensive, and time-consuming.

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,

Mattel sought out to maintain open communication with the media and their stakeholders during their crisis response, and it started with an apology from its CEO Robert Eckert via video. On August 16, 2007, Eckert issued a video apology direct at parents in efforts to sustain the parents’ trust in their products. In the video, Eckert emphasized that he is a parent as well and understands nothing is more important than the safety and well-being of children. He addressed the recalls and outlined specifically how the company already implemented stricter safety procedures. Also, Eckert pledged to address any future recalls quickly and candidly (CNN, 2007). Mattel continue to reach out to the media and the public by immediately notifying reporters, news outlets, and sent out press releases to inform the public of the recall. Mattel also placed ads about the recall in newspapers such as New York Times and Wall Street Journal (Briguet, 2013). Additional, Mattel composed an online campaign that consisted of a crisis response website with updated recall information. Consumers were fully informed and were given a link to information direct from the company (Briguet, 2013). Mattel’s efforts in communicating often and sincerely helped retailers and parents feel the company truly understood it had violated trust and that it was determined to make it right

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.

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.

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).

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.

The Mattel and the Toy Recalls integrative case poses six questions (four from the case and

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