Mattel - Are Bad Toys the Problem?
With the Toys R Us liquidation sales started across the nation it’s tempting to blame the brands end on bad management and a hostile sales environment. But what if the real problem is with the toys? Manufactures like Mattel, Inc. [MAT] have for decades been pushing toys that make noises and have lots of flashing lights – better to wake up grandma maybe.
Of course, if this is such a great strategy why has the stock fallen from its July 2013 high of about $47 to the current $13? Why has a major distributor of its product, Toys R Us, gone out of business? Why do more and more experts highlight these toys, which always seem to need batteries, as not being the best choice?
With modern manufacturing technology, there are lots of options to move beyond integrated circuits and batteries in every toy. Maybe it’s time for toy makers like Mattel to start looking at other options very carefully. If they don’t someone else certainly will.