Mattel, the home of Barbie and other childhood staples, is planning its next series of U.S. price hikes. This decision is a direct effort to mitigate the adverse financial effects of the trade war with China, now in its third year. CEO Ynon Kreiz pointed to inflation as a factor in why Mattel is increasing prices on certain products. Nonetheless, the company is heavily focused on ensuring that many of its toys remain within reach of consumers.
The ongoing trade war with tariffs on imports have severely impacted many industries – including toy manufacturing. Kreiz was clear that Mattel doesn’t expect a big effect from these trade tussles. One specific example is how the company is looking ahead to offset increased costs due to tariffs. He threw himself into making excellence the product. He’ll do his best to push them to deliver the best mix of price and value to consumers.
Independent contractors in today’s new economy that is undergoing rapid technological changes. In reaction, Mattel withdrew its full-year financial targets just one day before Kreiz made his remarks. In addition, the company has been diversifying its global manufacturing footprint for nearly the last 10 years, working to decrease its dependence on China. Today, everything from design to development, product engineering and branding all takes place in the United States. This critical strategic move allows Mattel to defend its strong historic base in American jobs.
As part of this diversification strategy, Kreiz indicated that no single country will account for more than 25% of Mattel’s sourcing within the next two years. Additionally, at the end of the year, Mattel will have less than 40% of its goods coming from China. This strategic change helps reduce the risks from sudden geopolitical shocks and tariff changes.
Despite these challenges, Kreiz reassured stakeholders of Mattel’s commitment to producing quality toys at affordable prices. Design, development, product engineering and brand management all occurs in the United States,” he touted. By control of manufacturing in foreign nations, we achieve the highest quality product providing the best price.
Mattel has made a pledge to price 40-50% of its products below $20. In doing so, it maintains a delicate balancing act that keeps many of its offerings affordable for consumers. Since the announcement of tariffs on April 2, Mattel’s stock has seen a decline of approximately 19%, reflecting investor concerns regarding the company’s ability to navigate these economic challenges.