COVER STORY : Recall rebound
Posted on Sunday, October 14, 2007
Retailers are about to find out if nearly a year’s worth of bad news in the toy business is going to foul up their make-orbreak Christmas shopping season.
They hope to entice shoppers with a combination of the latest play technology, time-tested names such as Elmo and Barbie and an old concept called physical exercise.
In Washington, Congress is holding hearings on what to do about dozens of toy recalls related to lead paint, magnets that can detach and be swallowed and other threats to children’s safety.
Wal-Mart Stores Inc., the world’s largest retailer and top toy seller, says it has stepped up toy inspections and is rechecking documentation of previous inspections.
“We think, really, the toys will be the safest this year” compared to previous years, said Laura Phillips, Wal-Mart’s chief of toy merchandising.
Consumer advocates aren’t convinced. They contend that the nation’s consumer protection apparatus has been weakened to the point of being meaningless.
“It’s ridiculous, it’s laughable, to think that they are going to make sure that all the toys that come into our country meet standards,” said Jean Halloran, director of food policy initiatives for Consumers Union.
“It’s my impression that the market is so swamped with products that cause problems that we really need a massive effort to clean it up,” she said.
Consumers Union is a nonprofit advocacy group headquartered in Yonkers, N. Y., and publisher of the magazine Consumer Reports.
From January through Oct. 4, the federal Consumer Product Safety Commission listed more than 50 toy recalls as a result of various defects.
In September and the first week of October alone, 20 toys were recalled.
Nineteen other nontoy products also were recalled during that period. Of the 39 recalled products, toy and nontoy, during that period, 32 were made in China and 20 involved lead in paint. In a recent video-conference address to a Hong Kong gathering of more than 600 Chinese toy manufacturers, the president of the U. S. Toy Industry Association said safety concerns and worries about the economy will be a challenge to toy retailers this year. “In the best of circumstances, this [Christmas ] season may be below last year,” association president Carter Keithley told the group.
THE HOT LISTS Two of the toys on three of the major “hot” lists this year may bring smiles to parents’ faces. The Smart Cycle from Mattel Inc. ’s Fisher Price division, aimed mainly at preschoolers, is a stationary bike that plugs into your TV. It requires youngsters accustomed to being entertained by a television or computer screen to get some exercise as they pedal through games, learning exercises and races.
“It really is right on trend,” Phillips said. Several of this year’s new offerings are designed to work with either television or computers.
The Aqua Dots Super Studio from Spin Master encourages artistic expression as children create their own designs or use templates that accompany the device.
Christopher Byrne, an independent New York consultant also known as The Toy Guy and a contributor to Toy Wishes magazine, picks the Smart Cycle as a sure winner for the 3- to 6-year-olds and music video game Guitar Hero III: Legends of Rock a top pick for teens. He doesn’t see parents scaling back on toys as a result of the recalls or of economic concerns surrounding the turmoil in the housing market. “Generally, toys tend to suffer less than other products during downturns because parents — Santa Claus still flies,” he said. “Despite everything that’s going on, parents want to provide that wonderful Christmas for their kids.” Other new toy options this year: Future duck hunters could get some early practice with the Nerf N-Strike Disc Shot from Hasbro Inc. A wireless remote device launches foam discs to be shot down with a blaster that fires soft darts. Hannah Montana, the everygirl TV character with a secret life as a pop star, comes in doll form with a pop-star stage. The Littlest Pet Shop Paws Off Electronic Diary barks at intruders who don’t know the password. Phillips expects it to be a big hit among young girls.
THE CHINA FACTOR Lead in paint has been banned in the United States for use in toys since 1978, the same year it was banned for use in house paint.
At high levels, lead in the body has been shown to cause seizures, abdominal pain, constipation and other ailments.
Even at lower levels, however, lead can interfere with the development of children’s brains, leading to learning disabilities.
The advantage of lead in paint: It’s cheaper than paint without lead.
Consumers Union faults retailers for putting pressure on Chinese manufacturers, the source of an estimated 80 percent of toys sold in the United States, to hold costs down.
“We believe that the pressure major retailers place on suppliers to cut costs often results in cut corners. The net effect can be seriously harmful or deadly products,” Donald Mays, the group’s senior director for product safety planning and technical administration, told the Interagency Working Group on Import Safety.
President Bush established the group in June after a series of toy and food recalls.
The issue also has provided fuel for critics of Bentonvillebased Wal-Mart. They also blame the retailer for relentless pressure on suppliers to curb costs.
“At this point, it’s the manufacturers that have been scapegoated,” said Nu Wexler, spokesman for Wal-Mart Watch, a group funded mostly by the Service Employees International Union.
A September poll by the Connecticut-based Sacred Heart University Polling Institute suggests shoppers are looking more closely at where their products originate.
The poll of 1, 000 U. S. residents found that 68. 6 percent said they check labels for country of origin, manufacturer or ingredients, up 15. 7 percent from 52. 9 percent a year earlier.
“I’m sure it’s due to the recalls and the front-page news nationwide. People are concerned,” said Jerry Lindsley, director of the Fairfield, Conn., school’s polling institute.
“I don’t know that it will slow spending, but it certainly will hurt particular manufacturers who are known to have imported goods that are unsafe, or food,” he said.
Bob Friedland, a spokesman for Toys "R" Us, was skeptical of the poll’s results.
“We’ve found that customers really don’t shop by country of origin,” he said.
George Whalin, a longtime retail consultant from Carlsbad, Calif., also had doubts.
“I don’t think people pay much attention to these recalls,” he said.
Steve Melody, who operates the Melody’s Choices toy stores in Fayetteville and Springdale with his wife, Paula, said he hears some concerns about China-made products.
“We have some customers come in and want to buy U. S. made,” he said.
Melody said he has been requesting letters from each of his vendors, seeking clarification on where their products are manufactured.
THE DEBATE Congress has responded to the recalls with a number of proposals. One co-sponsored by U. S. Sen. Mark Pryor, D-Ark., was the subject of recent hearings. It would increase funding for the federal Consumer Product Safety Commission over seven years at 10 percent a year, beef up the agency’s staff and laboratory capabilities, increase civil fines and criminal penalties for violating U. S. product safety laws and require independent, third-party certification on all children’s products entering the country.
The proposal also would require labels on children’s products that would expedite tracking in recall situations, allow state attorneys general to sue for damages and give whistle-blower protection to workers who bring safety issues to light.
Pryor said that the commission’s staffing has shrunk too much in recent years for it to be effective.
“In today’s world, because they’ve lost employees, they’ve lost ground on the budget, and with the dramatic increase in imports, they’re just not equipped to handle the challenges they face today,” Pryor said.
At the hearing, the bill drew high marks from the Consumer Federation of America, a Washington-based research and advocacy coalition made up of about 300 nonprofit organizations.
“We view it as the most important piece of consumer legislation to be offered in several years,” said Travis Plunkett, the group’s legislative director. The hearing was webcast live on the Internet.
Last month, the Toy Industry Association urged Congress to standardize testing procedures, establish criteria for testing labs and require all imported toys to be tested to U. S. standards.
Wal-Mart spokesman Melissa O’Brien said the company is actively involved in the regulatory discussions, but has not endorsed any specific proposal.
Byrne, The Toy Guy, said that because many of the bigger recalls happened early in the year, retailers should be well-stocked for the Christmas shopping season, barring any new, large-scale recall.
And Phillips, Wal-Mart’s toy chief, said the retailers’ toy shelves will not go empty.
“We have plenty of toys to sell. No fears on our part.”
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