Troubled Times for The Chinese Toy Industry
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ICMR HOME | Case Studies Collection
Case Details:
Case Code : BENV013
Case Length : 18 Pages
Period : 2005-2007
Pub Date : 2008
Teaching Note :Not Available
Organization : -
Industry : Toy
Countries : China, USA
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Please note:
This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
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Introduction Contd...
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The October 2007 recall was the latest in a series of Chinese toy recalls by toy
companies and retailers in developed countries. Among the reasons given for the
recalls were excessive levels of lead paint, loose magnets that could be
swallowed by children, or other potentially serious problems.
The recalls had a limited impact on toy sales in the US and the EU but they
severely dented the Chinese toy industry's image in international markets.
The possible long-term impact on its reputation, however, was only one of the
many issues confronting the toy industry in China.
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With costs of raw materials and labor increasing, the toy
companies were seeing an erosion in margins. Also, the growing popularity of
high-tech electronic toys was a challenge to Chinese toy companies as they were
not very strong in this field. Furthermore, even in the traditional toy markets,
Vietnam and Thailand were beginning to pose a threat.
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Background Note
Toys have had a prime place in Chinese society since ancient times. Folk
toys made of wood, clay, and paper have always been very popular with
Chinese children. Masks and clay figurines in the shape of animals have
been found in the ruins of ancient Chinese habitations.
The history of
modern Chinese toys, however, dates back to the early 1900s. Around
1910, the first factories that made toys from tin were set up. Toy
making in China started gaining momentum after the May Fourth movement8
in 1919... |
Excerpts >>
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