Mattel Toys Made in China

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Submitted by:shawar shaikh.

Submitted to: Sir Naveed.

Class: MBA (Section:”B”).

Case: MATTEL toys Made in China.

1. What do you think of the issues raised in the case from MATTEL's point of view?

Ans: MATTEL’s was founded in 1945 well known for its quality toys and yearly produced 800 million toys worldwide. They produced their core products in their own factories found in different countries such as china, Indonesia, Thailand, Malaysia, and Mexico. And give orders for non core products to its 37 vendors. Factory were known for its best working condition despite this  In 1996 they face media exposure alleged to “sweatshop “ conditions in its Indonesian factory  to overcome this situation they appointed auditor for check and balance and they were allowed to post these report over the internet after that MATTEL recognized as “The Gold standard “ for the  industry.

After these kind of issue MATTEL become more strict for their quality control and each of the vendors facilities reviewed and audited under

 MATTELs GMP. Before any contract and they have to follow all the requirements and procedures to compliance with mettels standards .not only these before shipping the product MATTELs test all the products into their laboratories.

 Before the issue of lee der MATTEL recalled its products many times some due to designing fault and some of them due to manufacturing fault, and founds millions of write off into their balance sheet, and they were liable to compensate the losses to customers.

 In 2007 they face similar issue and found lead into the paint used by its vendor’s toys as written in contract they breach their contract with lee der because these issues damage its brand image and make them liable for millions of dollars.

MATTEL is right on its place because each and every thing were mentioned into the contract so contractor is liable to follow the company procedures and rules, breaching the promises causes to breach of contract legally and it was done in the case of mettel.

2. What do you think of Lee Der and its use of lead paint?

Ans: Lee Der was well reputed company founded in 1993 by co founders Mr.: cheung Shu- hung and Mr.: Xie with the investment of almost 4 million. In the city of  foshan, it was known for its best working environment. They always pay higher and also on time wages to their workers, owner of the business Mr.: cheung Shu-hung was very kind and having helping nature he cares about his workers and help them in their bad times.

 Lee der was working with mattle from previous 15 years their first order was small batch of educational toys , after that MATTEL orders increased so that lee der dropped other clients and staked with MATTEL.

Lee der product recall:

In June  2007 in laboratory of MATTEL there was routine testing ,before shipment and in that test they found that excess of  lead in paint on fisher-price branded products made by lee der. It is founded that toys did not comply with mattle’s standards of quality.

After investigation it is found that product have lead levels to yellow pigment in paint which was supplied to lee der from an unauthorized sources, after few weeks it is clearly revealed that they intentionally using lead in the paint , lee der bought its paint from Dongxing New Energy Co since four years, on June 2007 Dongxing New Energy Co have shortage of yellow pigment powder so lee der purchased that 330 of pounds of powder for 1250 dollars from nearby Dongguan Zhongxin toner which were found through internet the owner factory were have fake certificate and during the product recall they were vanished.

 Owner of the lee der xie said that in late April most of the paint was contained little lead pigment and it was not detected by the routine tests, then he said that “under the deadline pressure we became slack on quality control. And they accept their responsibility to use lead in the paint. After that MATTEL recalled its previously 1.5 million shipped toys from US and Europe and announced that it’s our vendor’s mistake that have worked with us from 15 years and also send report to CPSC.

In the case of lee der they are on mistake because for any vendor it’s their liability to follow the company contract and to overcome the situation of order fulfillment they should arrange backup plan to purchase their resources because small mistake can causes big and hazardous losses