2007 Mattel Recall Case Study
Briana Jones
John A. Caltagirone
OPMG 486
November 18, 2014
MATTEL TOY RECALLS
SUMMARY
Mattel Incorporated is now the second largest global toy manufacturing company after being the largest toy manufacturer for years (Soloman). Mattel Inc., headquartered in El Segundo, California, produces well-known toys such as Barbie, Hot Wheels, and Fisher-Price toys for children. Mattel is not only a leader in the toy industry with over $6 Billion in sales in 2013 (Soloman), Mattel also leads the industry in corporate responsibility as it receives regular audits by the International Center for Corporate Accountability, an independent body, which the results of are made public. Mattel gives to charity through the Mattel children’s foundation, and has received many other accolades indicating its position as a socially responsible corporation. Despite Mattel’s position as a top 100 corporate citizen in 2006, a year later Mattel had to issue massive recalls for children’s toys containing lead paint in addition to some recalls made in 2006 for lose magnets in toys that could be a swallowing hazard.The recalls were a result of Mattel’s operations strategy to manufacture its toys in China (Bapuji 5). In Mattel’s complex supply chain management failed to effectively monitor and ensure quality in each step of the supply chain especially at the lower level with its vendors. The 2007 recalls were a result of lead paint used in children’s toys and toys with magnetic parts that if swallowed could cause medical issues.
CHALLENGES IN OFFSHORING
In 2007, Mattel had to recall over 21 million toys due to lead pain and poorly designed magnets. Though this is only a portion of the 800 million toys Mattel produced in 2007, these recalls highlight existing supply chain issue and create new ones as Mattel must create a structure to collect the faulty toys, increase dependence on other suppliers to restock products, and provide increased customer service throughout the recall. In the
John A. Caltagirone
OPMG 486
November 18, 2014
MATTEL TOY RECALLS
SUMMARY
Mattel Incorporated is now the second largest global toy manufacturing company after being the largest toy manufacturer for years (Soloman). Mattel Inc., headquartered in El Segundo, California, produces well-known toys such as Barbie, Hot Wheels, and Fisher-Price toys for children. Mattel is not only a leader in the toy industry with over $6 Billion in sales in 2013 (Soloman), Mattel also leads the industry in corporate responsibility as it receives regular audits by the International Center for Corporate Accountability, an independent body, which the results of are made public. Mattel gives to charity through the Mattel children’s foundation, and has received many other accolades indicating its position as a socially responsible corporation. Despite Mattel’s position as a top 100 corporate citizen in 2006, a year later Mattel had to issue massive recalls for children’s toys containing lead paint in addition to some recalls made in 2006 for lose magnets in toys that could be a swallowing hazard.The recalls were a result of Mattel’s operations strategy to manufacture its toys in China (Bapuji 5). In Mattel’s complex supply chain management failed to effectively monitor and ensure quality in each step of the supply chain especially at the lower level with its vendors. The 2007 recalls were a result of lead paint used in children’s toys and toys with magnetic parts that if swallowed could cause medical issues.
CHALLENGES IN OFFSHORING
In 2007, Mattel had to recall over 21 million toys due to lead pain and poorly designed magnets. Though this is only a portion of the 800 million toys Mattel produced in 2007, these recalls highlight existing supply chain issue and create new ones as Mattel must create a structure to collect the faulty toys, increase dependence on other suppliers to restock products, and provide increased customer service throughout the recall. In the
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