In 1944, Ruth, Elliot and Harold Matson Handler founded the Mattel brand. Their first Mattel products were picture flames. After some time, they started producing dolls and toys that gave a hugely encouraging progress. By 1955, the Mattel Company was advertising its toys in the “Mickey Mouse” that was an extremely popular show. This step significantly changed how marketing of toys occurred in China (Teagarden, 2008). By 1965, sales of this company had reached 100 million dollars. The company was located in the off shore side of China. They used this opportunity to take advantage of the cheap production costs in these areas. This essay is a critical SWOT analysis of the Toyland Company in China.
With time, the Mattel CEO experienced a serious crisis, whereby some exported goods from China were recalled. This company suffered a serious loss when 19 million toys were returned and a lot of money was taken for recalls. Also, China was disadvantaged in the international market and this profoundly affected their performance in the international trade. In fact, consumers had threatened to boycott the products produced by the company (Herbert, 2001).
The Toyland Company had strengthened because they introduced a new good in the encouraging market. At the beginning, the toys had been fast selling and achieved international recognition. This explains the cause of the international advertisement. Their toys also had devoted fans all over the world. The company experienced a significant weakness in terms of management. The officials, especially the CEO, Robert Eckert was unable to regulate the cost of toys and the brands, produced by the company, to control the process in general, and all these resulted in total failure in the supply network, since they could not supply the consumers’ needs (Hussey, 2001). During the crisis the leaders failed to adopt the principle of efficient management strategies and this considerably contributed to their failure by offering substandard services to the people. Mr.Eckert was considered not to honor the commitment he had made to consumers; it was the first time when the company had experienced a recall. As the company matures, the CEO was supposed to grow more and more innovative, so that he could manage the company effectively without experiencing products recalls (Williamson, 2003).
Again, the company had so many opportunities, such as the attention from the whole country of China and the entire world. It had an opportunity to engage in strategic management of the premises for bigger achievements. Again, it was declared a publicly owned company in 1960, which was a terrific opportunity for the company. It happened because it had a wider market to supply to and it became widely known for the same reason (Coulter, 2009).
Finally, the company suffered a serious threat from the government of China. The CEO was forced to give a publicly recognized to the whole nation. This ideally affected the company’s reputation because it had previously been known to have a clean name. Now its chief executive officer had to apologize (Teagarden, 2007).
From the above essay, it is clear that such a SWOT analysis should have productively been used to solve the predicament faced by the Mattel land. The case helps to present challenges faced by the manufacturers in China and other largely producing companies all over the world. In this sense, we can argue that all companies with a strong internationally recognized reputation should be careful with their daily activities, if not then they may tarnish their names, which would result to poor performance at the international level. This case study demonstrates that a company’s decisions are influenced by several factors such as: social, political, economic and ecological factors.