MATTEL TOYS INDIA LTD.

-GROUP 8
ANKIT JOSHI
MEGHA DAHIYA

NAMAN AGRAWAL
SNEHIL SARASWAT
TULIKA PRIYA

ABOUT MATTEL TOYS INDIA LTD

MATTEL INC., USA IS WORLDS LARGEST TOY MAKER
LEO BRAND NAME OF KEMP & CO. LTD OF DGP GROUP. FIRST QUALITY BRANDED TOY
IN INDIAN MARKET

MATTEL ENTERED IN JV WITH DGP GROUP IN 1987 TO EXPLORE INDIAN MARKET

BY 1999 MATTEL INCREASED THEIR STAKE TO 100% FROM 405
STRONGER SEGMENTS DOLLS, HOT WHEELS TOY CARS

MATTEL TOYS SEGMENTS & PRODUCTS (225 SKUS)

Product type

Brand

Infant Toys, Pre school Toys

Fisher Price (Disney Charachterstics)

Dolls & Dolls accessories

Barbie

Battery operated & electronic toys

Tyco

Soft toys

Disney Characters

Toy cars

Hot wheels

MARKET DYNAMICS

Annual Sales(in crores)

TOTAL MARKET SIZE IN 1999 RS 700 CRORES

TOY MARKET THRIVED ON NEW PRODUCTS
DOMINATED BY UNORGANIZED MANUFACTURERS

Shadilal

United Toys

Leo-Mattel

Funskool

CHEAP IMITATION, HIGHER MARGINS TO RETAILERS

CHINESE HIGH QUALITY TOYS @ REASONABLE PRICES MADE INDIAN
PRODUCTS UNCOMPETITIVE

INITIAL YEARS (1987-1996)

Manufacturing Plant
Problems Faced
C & F Agents
Dispatched goods to distributors
Distributors
100 retails outlet
Stock of 4 weeks, disc of 10.5%
7 day credit, 400 SKUs
Retailers
Schemes varied, margin 20%
5000 retail outlets, 50% toy
shops

Inventory pile up
Focus was completely on distributors
Retailers discounts varied in different territories
Higher margin by unorganized sectors
Retailers not retaining their full margin
In toy shops, the space was shared with cheap and low
quality products
Retailers may not push items because of lower margins

BLOW PLASTS NEW SYSTEM(1997-98)

FOCUS MOVED TO COST SAVINGS
SAVINGS ACCOUNTED TO BE RS 18 LACS FOR DELHI

Dual distribution policy

SAME SAVINGS MAY NOT BE ACHIEVABLE ACROSS OTHER CITIES

ADDED BURDEN ON C&F AGENTS TO CATER BOTH
RETAILERS AND DISTRIBUTORS
FOCUS ON SALES VOLUMES

Large Retailer
Own Sales
Officer

Smaller Retailer
Distributors

MATTEL STORY(1999-2000)
DISCONTINUED DIRECT DEALERS POLICY
SALES OFFICERS RE-DESIGNATED AS TERRITORY SALES EXECUTIVES
FOCUS ON TERRITORY MANAGEMENT RATHER THAN SALES VOLUMES
CHANGE IN JOB RESPONSIBILITY LEAD TO HIGHER MOTIVATION
INTRODUCED NEW PRODUCTS IN MARKETS SUPPORTED WITH EFFECTIVE
ADVERTISING
CHANGE IN SALARY STRUCTURE. DISTRIBUTORS MARGIN REDUCED TO 8%.
MTIL SHARED SALARY OF ISO

INCREASED RETAILERS MARGIN

REASONS FOR UNEASINESS

LOYALTY OF BLOW PLAST SALES OFFICERS MAY NOT BE SAME TOWARDS
MATTEL
TOO MUCH RESPONSIBILITY ON ISO
CUT ON DISTRIBUTORS MARGIN MAY DECREASE THE MOTIVATION TO PUSH
THEIR PRODUCTS TO RETAILERS
COMPANYS INTRODUCED NEW REPORTS TO BE FILLED MAY BE AN OVERHEAD
FOR TSE
EXPECTATION IN GROWTH OF RETAIL OUTLETS MAY HAVE A NEGATIVE EFFECT
ON BRAND IMAGE
50-50 SALARY SHARING MAY LEAD TO DUAL REPORTING WHICH MAY BE A
CAUSE OF DISCOMFORT TO ISOS

RECOMMENDATIONS
EXPANSION PLANS SHOULD BE IN LINE WITH BRAND IMAGE
RETAILERS STOCKING LOW QUALITY TOYS SHOULD BE AVOIDED
ONLINE CHANNELS SHOULD BE CONSIDERED(Y2K)
MARGINS SHOULD BE KEPT CONSTANT TO KEEP UP THE MOTIVATIONAL LEVEL.
POLICIES SHOULD NOT BE CHANGED NOW AND THEN
NOT ALL THE SALES OFFICERS SHOULD BE CONVERTED TO TSE. PROPER
COMPETENCY MAPPING SHOULD BE DONE