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Chinese toymakers in trouble amid crisis

By Liu Jie (China Daily)
Updated: 2008-12-22 07:53

Technology development

Quanzhou Gladpoint Co Ltd is Lin's neighbor. Compared with Jianmin Toy Co Ltd, the toymaker with 50 million yuan assets and 780 workers seemed as busy as usual - all production lines are in full operation - during August to November.

"Orders this year are stable and we are optimistic," says Huang Rongfu, manager with export department of Gladpoint, adding that he believes the economic slowdown and the stricter safety regulations are rather opportunities for the company to stand tall amongst its competitors.

"Amid the financial crisis, everybody becomes frugal and selective as well. They turn to established brands for safe and reliable products, those are our advantages," stresses Huang.

Though orders from the long-term buyers have fallen, many purchasers have shifted their orders from smaller workshops to Gladpoint, which manufactures plastic toys, plush dolls and wooden building blocks and exports them to US, Europe, Middle East and South East Asia.

The company has been able to promote its brand overseas successfully by participating in several toy events along with its self-developed designs for clients.

Huang adds that the company's strong focus on research and development would help it to overcome the new "technological barriers" and avoid safety disputes.

"Though the developed markets constantly issue new technological criteria, which are tougher and tougher, we are always well prepared in advance," says Huang. The company says it puts 10 percent of its sales into professional study and technology development every year.

A special team is also engaged in investigating and studying technology standards of various nations and international trends, while a group of professional staff is devoted to self-development, he says.

"We manage to make our own safety standards higher than the general or keep it ahead of the criteria of the exporting marketplaces," says Huang, citing lead content in toys as an example.

The new US standards set the maximum permissible lead content at 600 ppm (parts per million), effective February 2009 onwards. Gladpoint's internal benchmark, however, was set at 500 ppm since early this year." The technological advance helps us reduce costs and enhance safety reputation," says Huang.

The manufacturer provides self-development products or designs for clients to choose, which not only showcases their research and development capabilities but also reduces design flaw risks, says China Toy Association's Liang.

From last August, Mattel Inc recalled about 21 million toys in a span of five weeks, many because of the excessive levels of lead paint.

However, the largest US toymaker had in last September admitted that the recall was the result of a design flaw in Mattel's design and apologized for damaging China's reputation.

Qin, at the same conference, wanted Chinese toy manufacturers to check the designs provided by foreign buyers for flaws that may lead to quality or safety problems later.

"We require Chinese toy-makers to not only pay attention to the manufacturing process, but also to check strictly for foreign companies' design failures," he says, "Chinese toy-makers should not accept orders with bad designs from foreign companies nor produce them."

"Design flaws in products that foreign companies bring to Chinese manufacturers to produce, account for a lot of the recall problems," says Bruce McLaughlin, chief executive of Sinogie Consulting, which helps foreign companies investigate the reliability of Chinese manufacturers. He points out that Chinese toymakers have made good improvements on safety issues and "reliability in general has been getting steadily better".

According to statistics from the China Customs, during August to November, the busiest season for Christmas toy trade, China's toy export volumes rose 3 percent to $3.86 billion from $3.74 billion in the same period last year.

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