Mattel - Unsafe for Children: Mattel’s Toy Recalls and Supply Chain Management

SASA, ARVIE FARIZAH B.

BSBA-FM 3E

UNSAFE FOR CHILDREN: MATTEL’S TOY RECALLS AND SUPPLY CHAIN MANAGEMENT

PROBLEM:

Mattel’s recall problems were caused by three primary issues: The first and most crucial factor leading to recall was rooted from manufacturing error of Mattel’s vendors. This happened because those vendors used the materials from unapproved suppliers with falsified certification documents in order to cut cost to meet with low-cost requirements from those powerful retailers such as Wal-Mart. However, outsourcing could not be a direct cause of these recalls problems.

The second problem was designing problems. Analyzing the Mattel’s voluntary recall history in U.S and Canada from 2000 to 2007 in the Exhibit 3 Mattel recalls in the U.S. and Canada, 2000 to 2007, most of the recalls resulted from defective designing products that could cause injury to children. More than 80 percent of the voluntary recalls was due to designing problems of its toys using small magnets that could become loose and swallowed by kids.

Third problem resulted from misuse of the products by the customers. This happened because Mattel could not spot the problem until their products sold to customers (children) who always find ways to play with their toys in the way that could result injury. This requires Mattel to conduct testing studies on its products before making orders to its vendors.

CASE FACTS:

Manufacturing Problems:

Use of paint with lead levels exceeding 0.06 %

Design Problems:

Detachment of loose small parts and could break off can cause choking in infants.

Use of small, powerful magnets in children’s toys: Magnets not encased properly due to deficient designs could become dislodged and swallowed by children. The ingested magnets could bind together across intestinal folds, eventually perforating the intestine causing serious injury or death. First death for this cause was reported in 2005.

Product Misuse:

Children often find creative ways to play causing detachment of parts and misuse of swallowing.

ANALYSIS/HYPOTHESIS:

I think the reason for toy recalls were the use of lead paint, paint with lead costs 30-60 % less than paint without lead. Use of unapproved suppliers and falsified certification documents by suppliers.  Another is children often found creative ways to play that were not anticipated by the designers, cords that could wrap around a child's neck and features in which a child's head could get stuck and potentially cause strangulation.

ALTERNATIVE CAUSES OF ACTION:

Mattel must ensure that its Multi-Tier Supply Chain meets its Standards. As the supply chain adds levels, it becomes increasingly impossible to inspect the lower tiers. These companies work on thin margins, and lack the size and financial resources to invest in quality improvements. It is essential that Mattel’s first tier suppliers recognize the importance of product safety and integrity, and that their performance is consistent with Mattel’s expectations. This recognition, would then need to be passed on to each successive tier of the supply chain. A third-party supply chain monitor may also be considered.