Ben Glickman and Natasha Khan of The Wall Street Journal report that Trump’s potential tariffs add urgency for Hasbro to find new factories for toys and games. They write:
Nerf guns. Monopoly board games. G.I. Joes. Some of Hasbro’s bestselling toys could get pricier if President-elect Donald Trump implements stiff tariffs on Chinese imports.
One of America’s largest toy makers says it is negotiating with suppliers and considering design changes ahead of potential new levies. “We’ve been preparing for many months for any contingency,” Chris Cocks, Hasbro’s chief executive, said in an interview.
The threat of new taxes on toy imports comes amid a long-term shift in the industry away from China, spurred by rising labor costs in that country. Hasbro, Barbie maker Mattel and others have spent years trying to make fewer toys and games in China by relocating to factories in other countries, including Vietnam and India. […]
Hasbro’s shift away from China is part of a $750 million cost-cutting push that includes negotiating lower prices from suppliers or changing designs to make them cheaper to build, such as Jenga blocks that now use a single type of wood. The change lowered costs and had the added benefit of making the pieces slide more smoothly out of a Jenga tower, Cocks said.
In addition to supply-chain improvements, the company is cutting its head count. Layoffs announced late last year affected nearly 20% of its workforce, and the company has discontinued unprofitable or redundant toy variants. […]
“The $64,000 question is what level any of Trump’s tariffs are actually set at—he’s indicated a fairly wide range in different comments, so it’s still a bit of an X-factor,” Olson said.
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