Chinese whispers over toy safety alert

Our shops are awash with products labelled "Made in China", but following the latest recall of toys by leading manufacturer Mattel, can we really feel confident in what we buy?

MORE favourite toys made in China by the world's largest toy manufacturer, Mattel, have been recalled, this time because they may have been painted with poisonous lead paint.

Thousands of Barbie doll accessories and toy trains made under the brand Fisher-Price, are being taken out of circulation because of dangerous levels of lead found during product tests.

The goods are disappearing from the shelves of shops, and consumers who have already bought the toys are also being encouraged to return them to the manufacturer.

US-based Mattel sub-contracts the production of the toys to manufacturers in China's Pearl River Delta, a densely industrial region where a third of all the country's exports are made.

This is the third recall of products by Mattel in recent weeks, and it affects about 800,000 items the company has already distributed across the globe. In the UK, 250,000 products on the new list have been recalled.

Mattel has admitted that some of its products do not meet safety standards.

On August 3 the company recalled almost 1.5m items, including some of the very popular Polly Pocket range, but two weeks later admitted the problem was much more extensive than originally thought.

In all, 18m toys were recalled because they contained small magnets that could fall out and pose a danger to a child.

Luckily, there have been no reports that any child actually has been injured by the toys in question.

However, the US Consumer Product Safety Commission says it is considering an investigation into whether Mattel notified authorities of the problems as promptly as it should have.

Western companies have flocked to outsource manufacturing to China in recent years, because cheap labour and low energy costs help them to maximise profits.

Factories in the Far East may produce goods at a fraction of the cost of the same item made in the UK or US, but they must still meet rigorous safety and quality standards laid down in destination countries.

Quality and safety scrutiny is supposed to be policed internally by manufacturers in China, using local laboratories to test samples from every batch of products. Ultimate responsibility for ensuring safety of products lies principally with retailers and their UK suppliers, in this case Mattel.

The company said faults had come to light because it had recently introduced enhanced levels of testing. These tests revealed that some sub-contractors had not met desired standards.

It is believed that approved paint supplied by Mattel to the Chinese factories producing the toys was substituted by other paint. Tests done later revealed lead present on product samples.

Fall-out from the recalls so far includes the closure of one factory with the loss of hundreds of jobs, and the suicide of a plant manager.

"I really don't have any sympathy for Mattel," says Christopher Devereux, managing director of ChinaSavvy, which helps foreign buyers to source manufacturers in China.

"They have 20,000 direct or indirect staff in that area of China, and yet they appear not to have checked these products thoroughly for lead, something that has been illegal for 30-odd years. And as for the items containing magnets, well that is a design problem as well as a safety one.

"I would say their quality control is extremely bad. The reason I am so angry is that the Chinese are being blamed for all of this, and I think it is Mattel's fault. In China you have to have the buyer or the buyer's representative checking everything.

"The Chinese are really good at manufacturing, but you have to keep an eye on things at every stage.

"This is bound to hit Mattel badly, but I doubt it will mean they move out of China."

A spokeswoman for the company said confidently yesterday that she didn't foresee the debacle affecting Christmas sales. "We produce millions of toys, there will still be plenty on the shelves."

But more rigorous tests are bound to affect the speed of shipping items ordered for the year's biggest toy-buying season.

And in terms of reputation Mattel will surely suffer, despite the spokeswoman's buoyant assertion that: "We have been in the toy industry for 75 years.

"We'll be judged on how we move on from this, and we have made it clear we will do the right thing."

Worries have been felt across the Yorkshire region by companies here who also outsource manufacturing to China.

"They've been coming to us for advice about how to limit potential risks to their business," says David Williams, a partner with the law firm Hammonds, and a specialist in public liability.

"They are rightly worried that something similar might happen to them.

"Sales and reputation are where such product recalls hit a company significantly. Smaller companies look at something like this with Mattel and think, 'if big companies are not getting it right, what chance have we?' They wonder if they can have confidence in quality reports they receive from tests done in Chinese factories."

Mr Williams says China has recently introduced its own tougher quality controls on the manufacture of goods.

However, in some cases where quality controls have been breached by suppliers manufacturing for British companies firms have had huge difficulties in pursuing the culprits. Some cases have ended with no result and no compensation.

"We aren't saying you shouldn't do business with Chinese companies," says Mr Williams.

"But it's wise to take steps to protect your business.

"For example, it might be worth inspecting the factory or products before they are shipped, as well as putting in place other measures to monitor the integrity of your supply chain."

A national newspaper poll in the wake of the third Mattel toy recall asked consumers if they were happy to trust Mattel's Barbie, Polly Pocket and Fisher-Price toys this Christmas.

Eighty-seven per cent of respondents said they were not.

"It's bound to have an impact when a company is repeatedly in the news for the wrong reasons," says Nick Gladding of retail research analysts Verdict.

He speculates that quality controls could perhaps be affected in some places by cost expectations on the part of companies buying goods made for them in the Far East.

"There is more pressure on manufacturing costs in China than there used to be, with energy and labour costs going up and buyers abroad expecting costs to stay low."

Items on the recall list

• Barbie Dream Puppy House Playset (J9485) sold since October 13, 2006.
• Barbie Dream Kitty Condo Playset (J9486) sold since October 13, 2006.
• Barbie Table & Chairs Kitchen Playset (K8606) sold since October 30, 2006.
• Barbie Bathtub & Toilet Bathroom Playset (K8607) sold since October 30, 2006.
• Barbie Futon & Table Living Room Playset (K8608) sold since October 30, 2006.
• Barbie Desk & Chair Bedroom Playset (K8609) sold since October 30, 2006.
• Barbie Couch & Table Living Room Playset (K8613) sold since October 30, 2006.
• H5705 GEOTRAX Rail and Road System Freightway Transport.
• K3013 Fisher-Price GEOTRAX Special Track Pack.
• K9343 Fisher-Price "It's a Big Big World" 6-in-1 Bongo Band.