- UNSAFE FOR CHILDREN - MATTEL’S TOY RECALLS AND

Transcript:- UNSAFE FOR CHILDREN - MATTEL’S TOY RECALLS AND:
- UNSAFE FOR CHILDREN - MATTEL’S TOY RECALLS AND SUPPLY CHAIN MANAGEMENT ON AUGUST 2007 !!! RECALLED 83 PRODUCTS DUE TO LEAD PAINT ISSUE…!!! Dora The Explorer Big Bird Elmo characters from Sesame Street etc ON SEPTEMBER 2007 !!! 6 MORE RECALLS…!!! SAME REASON…!!! + RECALLED SMALL MAGNETS…!!! DUE TO DESIGN PROBLEMS…!!! ON OCTOBER 2007 !!! ANOTHER RECALL DUE TO LEAD PAINT…!!! ??? ALL HAVE BEEN MANUFACTURED IN CHINA OWNER OF THE FACTORY THAT HAVE USED LEAD PAINT COMMITTED SUICIDE ……………… ……………… Brand has been Hammered ……………… BUT… ONLY 15 % OF THE RECALLED TOYS DUE TO MANUFACTURING ERRORS MAIN REASON DEFECTIVE DESIGNS (mostly carried outside of China) SO… MATTEL & MANUFACTURING FACTORY & GOVERNMENTAL AGENCIES OF CHINA & TOY IMPORTING COUNTRIES MATTEL 1945…began as a manufacturer of dollhouse furniture 1955…first toy company to sponsor a TV program 1959…introduced Barbie 1960…went public 2007…largest toy maker at the time for RECALLS sales $ 6 billion After tax income $ 600 million TOY PRODUCTION IN CHINA 2000…world’s leading toy producer 2007…80% of world’s toy production …80% of toy coming to US were made in China …Toy Distribution was evolving towards Mass Market Companies like WalMart MATTEL SUPPLY CHAIN First experience with manufaturing in Asia Japan, 1959, Barbie Dolls… 2 types of Products: Core Products Non Core Products MATTEL SUPPLY CHAIN STRATEGY: Produce Core Products in Owned Factories Use Local Vendors to Produce Non Core Products MATTEL SUPPLY CHAIN Inspect Materials coming in Monitor Supplier closely (esp. for Lead Based Paint) Terminate some Vendors for violation Produce New Toys in Small Batches before approval Inspect Toys off the production line periodically, when full scale production began Contract Manufacturers MATTEL SUPPLY CHAIN Required Factories to work with Certified Suppliers Allowed its most Reliable Suppliers to do their own Routine Testing (Mattel’ll do quarterly Spot Tests) BUT, Vendors subcontracted… Prohibited Subcontractors from using multiple layers of Additional Suppliers AT THE TIME OF RECALL … !!! NOT CLEAR HOW WELL THESE RULES HAVE BEEN FOLLOWED…… MATTEL’S 200 EMPLOYEES RESPONSIBLE FOR TRAINING AND SUPERVISING CHINESE CONTRACTORS WERE BASED IN HONG KONG, NOT AT TOY PRODUCTION FACILITIES…… PRESSURES ON CHINESE TOY MANUFACTURERS WAL-MART-EFFECT…!!! Pressure on Suppliers to Cut their Costs Down MATTEL’S 2007 RECALL CRISIS PRIOR TO AUGUST 2007 Some Other Recalls for Chinese Made Products May 2007, 1.5 million Toys recalled by RC2 Corp. due to lead paint Contaminated Pet Food, Toothpaste, Cough Syrups, Defective Tires..etc REASONS