0 Replies Latest reply: Aug 17, 2009 6:49 PM by David Oppenheim RSS

    Toy retailers hit with sudden regulation change – how will they respond?

    Newbie

      My wife Peggy and I recently became grand-parents for the first time.  It is a life-changing experience. She is about two months old now and the other day my wife said, “We need to get some infant toys”

      Sounded like an easy enough task. Baby rattles and such. I said, “OK let’s go to the obvious retail places and check out what’s there. We can fit it in before church.”

      There was a catch. We didn’t think about too hard at first. But when we got there it became an obstacle.

      You see my son told us as we were walking out the door: “Just don’t buy anything made in China!”. Him being a new Dad, and very consumer-oriented, we had to pay atention to his guidance. I said to my wife, let’s go back in the house and look online for keywords like handcrafted, made in US, etc. She said, no I’m sure there will be a selection. So off we went. To make a long story short, there is no such animal. Everything is made in China. 

       

      I checked into the issue and learned, that the GAO found in 2005 that the U.S. Environmental Protection Agency (EPA) has limited data on existing chemicals including toxicity and exposure information:

       

      • EPA lacks data to ensure that potential health and environmental risks of new chemicals are identified;
      • Chemical companies are not required to develop and submit toxicity information to EPA unless EPA issues a rule;
      • EPA has used its authority to require testing for fewer than 200 of the 62,000 chemicals in commerce since 1979;
      • For "new" chemicals, EPA estimates that...only about 15 percent include health or safety test data; and
      • For existing chemicals, only 5 chemical groups out of 62,000 have been restricted by EPA in 29 years.

      So there is lack of data  for not just consumers, but regulatory agencies as well. Here is where the rubber ducky meets the global sourcing road.  I also encountered this article from the Consumer Product Safety commission just released on 8/13/09 where they announced new requirements for children’s products effective immediately.

      In Summary:

      ·         Reduced the amount of lead content that was previously allowed by 50%

      ·         Reduced the allowable amount of lead in paint to 15% of the previous level

      ·         Penalties

      ·         Tracking labels

      ·         Restrictions on advertising

      These new regulations are already in effect : it became official last Friday.

      The new levels of lead allowed is now 300 parts per million (PPM) which is considered at the high end of the medium level risk according to healthytoys.org which state that “low risk” is 0 to 40 PPM. 

      The bar will continue to be raised.  In the interim, a key question for all those retailers, how will they track the entire inventory that is on order, in transit, in warehouses and store shelves?  How quickly will they be able to respond to cancel orders, and reorder goods that meet the new criteria?  How will they manage all the engineering change orders that are inevitable over the next several years?

      I would suggest being cautious looking at bargain/clearance toys in the upcoming Christmas season as retailers find a way to reduce inventories!