Question

1.What advice would you give to a company that is looking to replace multiple 3PL relationships with a single 4PL® solution?

2.What elements of risk are there in terms of sourcing and procuring goods from a Western source versus a low-cost country source such as Vietnam?

3.What actions could Mattel take to minimize product recalls in the future?

Answer 1

1.

LSPs that provide multiple logistics services, often in an integrated fashion, are referred to as 3PLs. 4PLs offer companies total outsourcing supply chain solutions. They will handle the entire companies logistics operating process. Some things to consider if wanting to switch to a 4PL solution is

• costs
• speed
• performance levels
• security
• company background and history

2.

Risk in terms of sourcing and procuring goods from a Western source versus a low-cost country source such as Vietnam

• Characteristics of the Raw Materials and Components
• Monetary risk: Unaticipated & rising shipping cost,Exchange fluctuations, Cost of delays, Lost of goods in transit,
• Quality issues
• IP related issues

3.

Reasons for Product recall

Design Problems

– Detachment of loose small parts

– Small powerful magnets dislodged from toys & swallowed by children

Manufacturing Problems

– Use of paint with lead levels exceeding 0.06 %

Product Misuse

– Children often find creative ways to play causing detachment of parts and misuse of swallowing

Actions to be taken By Mattel to minimize product recalls

Prototype Testing to counter design failures

• Would this toy be safe— does it have small parts, sharp edges, long strings, holes/gaps, uses or chemicals that may be harmful?
• Would the toy hold up in use, abuse, and misuse situations?
• Does this toy break easily? If so, does it generate small parts, sharp edges, long strings, etc.?
• What are the most unexpected ways a child can play with this?
• Does the fact that testers’ colleagues made the design and prototype influence the error reporting?

Ensure Multi level Supply chain meets the quality standards

As the supply chain adds levels, it becomes increasingly impossible to inspect the lower tiers. These companies work on thin margins, and lack the size and financial resources to invest in quality improvements

It is essential that Mattel‘s first tier suppliers recognize the importance of product safety and integrity, and that their performance is consistent with Mattel‘s expectations. This recognition, would then need to be passed on to each successive tier of the supply chain

A third party supply chain monitor may also be considered