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To print article, click Print on your browser's File menu. Go back Posted 3/16/2005 |
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Extra Barbie feels the pinch of $55 oil Toy maker Mattel warns that the crude used to make plastics and ship merchandise will force price increases on its dolls and toy cars. By Reuters Rising oil prices will be a top concern for the No. 1 toy maker in 2005, affecting everything from the price of plastic in Barbie dolls and packaging to the cost of trucking merchandise to the store, Mattel "If oil continues to be where it's at today, we're going to face a problem with resin and transportation costs,'' Eckert said during a presentation at the Banc of America consumer conference. The toy company, which makes Barbie dolls, Hot Wheels cars and dancing Elmo dolls, said in January it planned to raise prices across the board by 2% to 4% to offset raw material and labor costs.
"Retailers don't have a high appetite for price increases,'' Eckert said. "People recognize over time that as costs go up we are all going to have to pay for it, including gasoline at the pump.'' Eckert added he had recently paid $2.50 for a gallon of gasoline. Tough times for toy makers "The price of resin has been a problem, and a large number of manufacturers have notified retailers they need to raise prices anywhere in the 3% to 5% range just to cover costs,'' said Jim Silver, publisher of Toy Book and other industry magazines. "This won't affect consumers that much.'' Eckert also said in his presentation that the toy industry is still grappling with store closures and inventory management. In the past few years, hundreds of toy stores have closed, and toy makers have moved to selling toys in non-traditional retailers like video stores, sporting goods retailers and grocers. Toys R Us "It's quite possible there might be fewer Toys R Us stores so we're try to build contingency plans,'' Eckert said. "People are still going to buy toys. There will be winners and losers at retail and we want to make our toys available where people want to shop.'' |
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