Mattel Lays Off Thousands After Toys ‘R’ Us Bankruptcy
Today, toy-maker Mattel is disclosing to reporters that it will be forced to reduce labor by approximately 2,200 jobs within the company.
This move comes in an effort to cut losses amid the historic Toys ‘R’ Us bankruptcy and ultimate closure, as the toy giant and maker of Barbie is seeing significant losses since the announcement of the toy store bankruptcy.
CNN Money reported that between April and June of this year, sales at Mattel have fallen by approximately 11 percent overall, a major loss for the company.
Mattel did, however, report an increase in sales of Hot Wheels toys, which shot up by 21 percent during the time period, while Barbie sales were up by 12 percent. Jurassic World toys also reportedly did well during those months, but the aforementioned localized growth was not enough to sustain Mattel as a whole and prevent layoffs of approximately 22 percent of its entire workforce.
Amid the Barbie, Hot Wheels, and Jurassic World toys growth, CNN Money also went on to report major losses for Fisher Price toys, as well as toys for the Disney and Pixar movie franchise Cars. Products for lines of toys including Monster High, Mega, Toy Box, and Thomas and Friends also suffered major losses.
One of the more significant losses during the period was that of the American Girl doll series, which was reporting drops of more than 30 percent between April and June of 2018.
Executives at Mattel went into further detail, explaining it would close most of its factories in Mexico as well, elaborating that they’re also dealing with significant rises in material costs, affecting production for the toy-maker.
The CEO of Mattel, Ynon Kriez, stated that the company performed an extensive review of their current numbers and overall performance and determined that the layoffs and factory closures would be in the best interest of the company overall.
“We see a lot of opportunities, but there has been a big discrepancy between our financial performance over the last few years and where the company should be.”
Ultimately, Mattel is blaming Toys ‘R’ Us for the vast majority of its problems in terms of competing with the stronger toy-maker Hasbro, which CNN Money called “much healthier.”
In cutting jobs and closing factories Mattel hopes to make up for losses and hopefully get the company where it needs to be in terms of financial growth for the current fiscal quarter.
Ynon Kriez took over the title of CEO last April for Mattel and hopes to push the company in a new direction following previous leadership.