¶ … Mattel Toy Company was "born" in 1945. Owners, Ruth and Elliot Handler and Harold (Matt) Matson began the company out of a garage workshop in Southern California. The name,"Mattel" was a joining of "Matt" for Matson and "Ell" for Handler, thus the name "Mattel." The first products made by this new company were picture frames, but Elliot, always the one on the lookout for new ideas, soon began manufacturing dollhouse furniture from the picture frame scraps. Mattson sold his share of the company later that year, thus leaving the Handlers sole proprietors of Mattel. The dollhouse furniture sold exceedingly well and convinced the Handlers that their new company should be one based on the needs and desires of children - a toy company (Mattel corporate website, 2001).
In 1955, Mattel Toys literally became a household word when they began to advertise on the new Mickey Mouse Club television program. Advertising in this way was a completely new concept for toy companies at that time, so again the Handlers made history just because they decided that targeting the viewers of the children's show might be better than targeting their parents in prime time (Mattel corporate website, 2001).
One of the most important innovations made by any toy manufacturer in the 20th century was done by Ruth Handler just because she was mindful of her daughter, Barbie's, fascination with changing the clothes of paper dolls. Ruth designed a female doll with a three dimensional figure of a well-developed teenager. History was made and Barbie dolls were born in 1959 (The World of Toys website, 2003).
The Mattel company was begun as a family business and remained one for many years (Mattel Corporate website, 2001). In 1960, Mattel sold its first shares of publicly-offered stock. After becoming publicly owned in 1960, Mattel had its common stock listed on the New York and Pacific Coast Stock Exchanges in 1963. By 1965, sales topped $100,000,000 and the company joined the elite ranks of the "Fortune 500" companies (Lukas, 2003). The Handlers began to be called the "founding mother and father of the promotional toy business as it exists today" (Stern & Schoenhaus, 1990). This certainly was too bad for a couple of young people who literally stumbled onto the toy business over a pile of wood shavings.
Mattel was a family run company for the first 30 years of its existence. In the middle 1970's, the Handlers were getting older and realized that after the success of their company going public, the best way to continue its success was to look for the brightest and hardest working business professionals who also shared a dream that toys could change the world. Needless to say, many were interviewed, but few were chosen.
After Barbie and all of her extended relatives and friends were introduced, Hot Wheels came along for the boys. Of course these small, matchbox size cars were an immediate hit in 1968 and the giant toy maker continued to roll along in profits. In fact, the largest privately owned Hot Wheels car collection is valued at more that one million dollars today (Mattel Corporate website, 2001).
After the Handlers gave up the day-to-day running of the business, they made sure that the close "family-like" atmosphere was maintained. Today, the CEO of Mattel is Bob Eckert, former head of Draft Foods. Eckert states Mattel's business philosophy this say, "We credit our success to our employees who never forget that they were once kids. Their integrity and their ownership of everything they work on make them responsible for the results of the business and the development of their fellow employees. As a result, Mattel is the largest toy company in the world and we strive to share this success with customers, vendors, shareholders, and communities.
Today, Mattel continues its leadership role in the toy industry by innovation, anticipation, and solid business practices. And along the way, we too are inspired...by the imagination of children.
The documents below show more exact details of the Mattel Company that were explained in the previous paragraphs. All of this material is taken from the Mattel Corporation Website: http://www.mattel.com
First Quarter Highlights
Worldwide net sales flat;
Domestic gross sales down by 5% and international gross sales up 13%; flat in local currency;
Worldwide gross sales for core brands: Barbie® down 1%; Hot Wheels® flat; core Fisher-Price® up 8% and American Girl® brands down 8%;
Gross margin improvement of 430 basis points of net sales; SG&A increased by 110 basis points of net sales;
Operating income up 56%;
Earnings per share, excluding charges, of $0.09 vs. prior year of $0.02; and GAAP earnings per share of $0.07 vs. prior year loss of $0.59.
MATTEL, INC. AND SUBSIDIARIES
EXHIBIT I
FINANCIAL HIGHLIGHTS PRO FORMA BEFORE CHARGES FOR THE QUARTER ENDED MARCH 31, 2003
Three Months Ended
In millions, except per share amounts) 3/31/2003 3/31/2002% Change Key P&L Data: Net Sales $
742.0-0% Gross Profit $ of Net Sales 49.6% 45.3% Advertising $ of Net Sales 11.3% 11.1% SG&A $ of Net Sales 29.7% 28.6% Operating Income (a) $ of Net Sales 8.6% 5.6% Income Before Charges $ of Net...
It is worth noting that like many companies, Mattel has grown since its inception largely on the basis of population growth. Not to take anything away from Mattel's products, but the population of the world and its wealth have increased substantially since 1945. The company now stands to benefit from a surge in growth as the baby boom echo generation enters child-bearing age. This massive demographic will likely have
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