China’s Got Low Prices…But It’ll Cost You
China sourcing safe, but with caveat [Reuters]
China has been chastised for selling shoddy and unsafe goods to the world, a criticism that foreign executives say does not reflect the vast majority of goods being produced in the country.
China became the world’s third-largest exporter by producing quality products cheaply, with Wal-Mart Stores Inc, the world’s largest retailer, buying about $18 billion worth of goods from China a year.
But foreign executives with long experience in the country know that quality in China means putting in place a comprehensive system of checks and monitoring, and taking the responsibility to constantly review those procedures.
“We remain just as committed to this market,” Ian Duffy, Asia Pacific president for furniture giant IKEA, told the Reuters China Century Summit.
“We feel as a retailer we are responsible for the quality of goods we offer to our customers,” he said. “It is our job.”
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Posted by Alex Goldschmidt on Friday, September 07 | 30 comments | Permalink
Toy Makers Seek Mandatory Standards
Toy makers have been handed a huge, steaming pile of trouble for recent recalls and are trying to figure out how to prevent similar situations in the future. The millions of recalled toys translates into billions of dollars in lost profit, and it’s in the toy companies’ best interest to avoid recalls in the future. But why are they seeking laws to mandate higher safety measures? Perhaps what toy makers are really seeking is protection from retailers like Wal-Mart. New laws would demand a certain level of safety precautions, regardless of what it would cost. If such laws were in place, toy companies would get some shelter from Wal-Mart’s ruthless price cutting - remember it’s Wal-Mart that drives prices (and quality) down, not toy makers.
Toy Makers Seek Standards for U.S. Safety [New York Times]
Acknowledging a growing crisis of public confidence caused by a series of recent recalls, the nation’s largest toy makers have taken the unusual step of asking the federal government to impose mandatory safety-testing standards for all toys sold in the United States.
Toy importers and retailers are already scrambling to recheck their vast inventory of merchandise to ensure that products already on the market are not contaminated with lead or have other safety flaws.
Facing broadening questions about the safety of toys sold in the United States — particularly those made in China — as the holiday season approaches, the industry is asking that these kinds of tests be required of toy companies, big and small.
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Posted by Alex Goldschmidt on Friday, September 07 | 7 comments | Permalink
New Report Calls Wal-Mart Environmental Initiatives “Smoke and Mirrors”
A new report jointing published by 23 organizations across the country calls on Wal-Mart to reframe its sustainability efforts so that workers, the environment and communities are all respected. The report examines several specific areas where Wal-Mart falls short of its claim of environmental-friendliness. Areas of focus include Wal-Mart’s organics, seafood, wood sourcing, product packaging, dangerous toys, contributions to global warming, energy use, and waste quantities. The report goes on to incorporate workers’ rights and community impact analyses, retaining a wholistic view of Wal-Mart’s business model overall. From the introduction:
Nearly two years ago, Wal-Mart CEO H. Lee Scott announced a bold initiative to turn the world’s largest company green. A long-anticipated fi rst progress report on these sustainability goals is expected to be released soon. In advance of the company’s report, 23 environmental, farm, labor, and other civil society groups have offered their own critiques of Wal-Mart’s approach to
sustainability.Some of these critiques focus on specific Wal-Mart commitments and offer recommendations for change. Others argue that even if Wal-Mart achieved all of its stated goals, the company’s
business model makes it inherently unsustainable. All of them remind us of what’s at stake by demonstrating Wal-Mart’s huge and often devastating impacts on real people and places in the
United States and around the world.
Click here to download the full report from the Big Box Collaborative.
Posted by Alex Goldschmidt on Thursday, September 06 | 2 comments | Permalink
Mattel Recall Affects Flagship Barbie Brand
Mattel discloses third recall of Chinese-made toys [MarketWatch]
Shares of Mattel Inc. fell in Wednesday morning trading after the world’s largest toymaker announced its third significant recall of toys made in China in just over a month, this time involving its flagship Barbie brand.
Late Tuesday, Mattel said it has recalled 11 toys globally, with 530,000 units affected in the U.S. and 318,000 elsewhere in the world, because lead-containing paints were used on the surfaces of the toys in violation of U.S. law.
Shares were down 4% at $21.09 in Wednesday morning trading.
In the U.S., in conjunction with the U.S. Consumer Product Safety Commission, El Segundo, Calif.-based Mattel said it is recalling these vendor-sourced toys:
- 675,000 Barbie Accessory Toys sold at U.S. retail outlets between October 2006 and August. Mattel said some of the accessories were produced by Holder Plastic Co., a contract vendor, which subcontracted the painting of miniature toy pets and small furniture pieces to Dong Lian Fa and Yip Sing. Mattel said those companies used uncertified paint and are no longer producing toys for Mattel.
- 90,000 Fisher-Price Geo Trax Locomotive Toys, sold in U.S. stores between September 2006 and August. The toys were manufactured by Apex Manufacturing Co. Ltd., a contract vendor, which outsourced paint work to Boyi Plastic Products Factory, Mattel said. Apex supplied Boyi with certified paint; but the toys were manufactured with uncertified paint, Mattel said, adding that Boyi is no longer in business.
- 8,900 Big Big World 6-in-1 Bongo Band toys sold by its Fisher-Price unit between July and August. The toy was manufactured by Shun On Factory, one of Mattel’s contract vendors, which outsourced the molding and painting of one plastic piece, Mattel said. A subcontractor, Jingying Tampo Printing Processing Factory, used uncertified paint on the affected piece, according to Mattel.
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Posted by Alex Goldschmidt on Wednesday, September 05 | 0 comments | Permalink
Mattell Anounces More Recalled Toys
Barbie, Fisher-Price toys in latest recall [Detroit Free Press]
Mattel Inc. announced its third product recall in the last five weeks, after finding 848,000 Chinese-made Barbie and Fisher-Price toys with excessive amounts of lead.
The toys that are being pulled from store shelves include Barbie kitchen and furniture items, Fisher-Price train toys and Bongo Band drums. Surface paints on the toys contain excessive levels of lead which is prohibited under federal law.
The Barbie recall involves about 675,000 accessories made between Sept. 30, 2006, and Aug. 20, 2007. The model names, product numbers and affected date code numbers can be found at the United States Consumer Product Safety Commission Web site:
http://www.cpsc.gov/cpscpub/prerel/prhtml07/07301.html.There were about 8,900 Big Big World 6-in-1 Bongo Band toys that sold for about $20 from July 2007 and August 2007 around the country that were part of the recall. The toys have product number K9343 inside the orange drum. A date code between 139-7SH and 232-7SH is printed on the drum’s orange ring surface.
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Posted by Alex Goldschmidt on Wednesday, September 05 | 0 comments | Permalink
Yet More Toys from China Recalled
Mattell has announced yet another recall of toys made in China. This time, the recall affects Mattel’s flagship brand, Barbie. For those who wonder how Wal-Mart fits in to Mattel’s latest toy recall, this quote from a Financial Times story yesterday points out the key:
“Wal-Mart and these other buyers keep pushing for better terms, regardless of the conditions we face,” adds the owner of a textiles plant in the Shanghai area, wishing not to be identified. “Everyone is facing higher costs, but they can get away with it because the orders are so large and because there are so many companies competing for the same business.”
Mattel Issues Third Recall of China-Made Toys [Forbes]
As if Big Bird, Elmo, and cartoon friends hadn’t proved hazardous enough, parents around the globe now need to watch out for Barbie-branded miniature dogs and cats, tables and chairs from a Barbie kitchen play set, GeoTrax’s rail and road system, and the Big Big World 6-in-1 Bongo Band, as Mattel on Tuesday recalled 848,000 Chinese-made toys that contain excessive amounts of lead paint.
The voluntary recall announced late Tuesday night covers 11 types of toys globally, including 675,000 units of accessories--pet figurines and furniture play sets--sold under the Barbie brand and 98,900 units of Fisher-Price toys because of impermissible levels of lead. More than 60% of them were sold in the United States. The recall results from Mattel’s ongoing investigation of its toys manufactured by vendors in China.
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Posted by Alex Goldschmidt on Wednesday, September 05 | 6 comments | Permalink
Foreign Industrial Countries Only One Part of the Dangerous Product Puzzle
This article from the Washington Post defends China and its role in recent product recalls. The author, Jeff Yang, makes an excellent point in explaining that Chinese culture has traditionally revered food, but Mr. Yang could have gone even further to point out that China is merely a pawn in the larger scheme of world economics, and only the latest in a long line of foreign scapegoats that global retailers point to when problems arise. As the author puts it towards the end of the article:
Companies want higher profits, and consumers want lower prices. If Chinese sources were stripped from the food-industry supply chain, corporations would simply turn to other low-cost exporters, with comparably poor safety records.
It is retailers like Wal-Mart that pressure manufacturers to cut costs, and this will be true no matter what country those products are coming from.
A Taste of Racism in the Chinese Food Scare [Washington Post]
The French delight in preparing food; the Italians adore eating it. But no people on Earth are so engrossed in food as the Chinese, for whom it is not just craft, pleasure and sustenance but the fundamental building block of society. In the West, acquaintances greet one another with “How are you?” The Chinese ask, “Have you eaten?” So for the Chinese, tainted food is more than a health hazard—it’s a kind of sacrilege. As one Chinese shopper told National Public Radio, “People here think food is as important as the sky. If there’s something wrong with the food, it’s as if the sky is falling.”
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Posted by Alex Goldschmidt on Tuesday, September 04 | 1 comments | Permalink
Price Cutting Pressure Leads to Dangers
Toy recall highlights rife corner-cutting in China [Reuters via The Washington Post]
Boxes stacked in the factory window are labeled clearly: “Fisher-Price,” “toys,” “preschool.” The future of the plant, though, is not so clear.
Guards say the workers have all “gone on vacation” at the Foshan Lee Der Toys Company Ltd, caught in early August in the middle of a major recall when client Mattel Inc found excessive amounts of lead in some of the toys it produced.
A senior factory official, who declined to meet in person, said by telephone that manufacturing had ceased. Asked if the company could survive, he replied: “I don’t know.”
The fate of Lee Der—the final chapter of which has yet to be written—highlights the hazards in a competitive industry with low barriers to entry, where price pressures are high and accountability is low, analysts say.
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Posted by Alex Goldschmidt on Wednesday, August 29 | 0 comments | Permalink
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