Mattel's China Experience

An elementary toy that is due to be shipped at the end of the week has failed quality control testing. A metal whistle has been shown to exceed the federal regulation guidelines for lead. The testing process showed the lead level for this particular toy tested at 103 parts per million. The federal guidelines dictate that toys cannot contain lead with more than 100 parts per million (OSHA, 2013). The projected cost to conform to federal guidelines and replace the whistle are

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.

recalls related to product quality problems. Observers felt the company would have lost even more

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.

The biggest environment force affected Mattel recently has been legal and regulatory with the high levels of lead paint found in their die-cast toys in 2007. This issue created a voluntary recall from Mattel for over 2 million toys and created doubt in customers to the quality of their Mattel toys. Mattel responded by immediately implementing a check system to accept paint only from certified suppliers, tightened controls throughout the production process and testing every production run to ensure compliance. Mattel said that it is working in cooperation with the U.S. Consumer Product Safety Commission and other regulatory agencies worldwide. Mattel is also working with retailers worldwide to identify and remove affected products from retail shelves.

After the inspection was completed, than that’s when everyone would have found out the truth. When it comes to issues such as this you want to make sure you are not taking the blame for someone else error. I give Schwan’s company credit for reacting so quickly. I feel they took it too far because they took the blame and did not know who was really at fault. The company assumed they were at fault, but nothing was proven at first. It was smart for them to do a recall on the ice cream and pull the ice cream off the shelves. Schwan’s company took the blame to find out Cliff Viessman, the tanker truck operator was responsible for the foodborne illness outbreak. Viessman hauled raw eggs on the truck but did not disinfect the truck properly. The company could have very well avoided a great financial lost. It was a learning experience for Schwan’s Sales Enterprises. They were able to rectify the situation successfully. Schwan’s company could have used the media to get the information out to more individuals quicker. Media coverage is the best way to get important information out in a short period of

Mattel is starting to take a step in the right direction, according to Renae Merle from The Washington Post, “Mattel said it was strengthening its process for preventing the use of lead based paint, it will only permit paint from certified suppliers and require every batch to be tested, company officials said” (Merle 1). 80% of toys in the United States are imported from China, according to Renae Merle, and 65% of those toys are created by Mattel. Although that is a step in the right direction, that still leaves 15% of the toys in the United States at a higher risk of having high traces of lead on them, going undetected. Stores like Toys ‘R’ Us that sell toys sold by companies other than Mattel, should be required to post the percentage of how much lead is in each toy directly next to or near the toy so that parents can be aware of this problem. If parents are not made aware of this problem, it is going to cause more concerns health wise. Michelle Albert, a stay at home mom of two children states that “I feel our country should be more careful about the things we import” (Albert 1). She fears that her children may have been exposed to these toys and has no way of knowing until it may be too late.

It also affects our dealers and distributers as well. Other companies may be eyed for replacement of like products by our customers, costing us millions in revenue. At the same time, our customers are smart and believing in a company that ensures our products meet Federal and State guidelines for the safety of their kids may bring in millions more.

With each new location found to be contaminated came additional product lines that were found to contain listeria. After further investigations were conducted, the possibility that this was an issue caused by neglect became greater, and the trust from consumers became smaller. Since the initial determination of the severity of contamination, Blue Bell used the internet to express their apologies and assure the public they were working on a plan to correct this issue and gain their trust once again. Blue Bell utilized modern technology to speak to their customers personally, posting a video in which they stated they were “heartbroken over the situation” and they promised to “get it right” for their loyal customers. (New York Times, 2015)

Recently, the company commissioned Chinese companies to produce some of its toys. These Chinese-made toys were suspected of containing harmful aspects for children such as magnets which could be swallowed by children, hazardous lead paint, and plastic ignition key that kids can sit on or fall.

1. The decision facing Mattel is whether to continue to produce their products internationally where cost are low, or produce them in the United States where costs are significantly higher but quality is better. Mattel might want to even reconsider going global if there sales are decreasing more internationally than in the United States. Mattel needs to determine how many of the products produced internationally were recalled versus the amount of products produced in the United States that were recalled. Mattel also needs to decide how they are going to advertise their products in a way that will convince consumers in the external environment to buy their products, without having any

Soon after, under pressure from the National Highway Traffic Safety Administration Toyota did recall some vehicles. Nevertheless, only one month later, four more lives were ended as a result of Toyotas quality plunge and failure to respond. Finally, one month after the death of its eighth victim, Toyota halted production to stop and fix the problem. On top of the oil sludge recalls, this quality failure resulted in another 8.8 million recalls, a $2 billion direct financial hit to Toyota plus another $16.8 million in fines, too many innocent lives, a strained relationship with the NHTSA, and further brand deterioration (Greto et al., 2010).

Maple Leaf did a great job on identifying a potential marketing crisis from the early warnings through one of their distributors. And after a series of investigation, and before announce the final products’ quality result, Maple Leaf was able to give the biggest attention on the potential crisis. Also, in order to avoid the helpless situation, and to minimize the risk to consumers and company due to the crisis, Maple Leaf had already worked internally to prepare and plan for the possibility of a recall. Identifying the crisis early enough and preparing an emergency plan can make a strong influence on the final outcome.

In 2007, the international toy manufacturer, Mattel, Inc. issued several recalls for millions of their products. These recalls were for safety reasons in that testing at the manufacturing sites and special test laboratories showed that millions of their toys were coated with dangerous amounts of lead in the paint. This lead based paint contains a potent neurotoxin that if ingested can cause serious harm to children. Mattel assured the public that the problem would be solved, the recalled products would be collected and replaced, and that the company would never let this type of incident happen again.

As we can see Mattel does a pretty good job of of managing risk within its own business. However, it is some of these large multi national companies that often overlook managing corporate integrity risk in there supply networks. Companies have inserted clauses into their standard contracts with suppliers requiring them to comply with the rules and regulations applicable and materials used must exactly that which has been stated in the contract.