Mattel’s CEO is trying to keep up with an early holiday surge

Mattel Inc., the second-largest US toy company behind Hasbro Inc., is seeing early shopping in a holiday season jolted by robust demand and supply-chain constraints.

“People are buying toys earlier,” Ynon Kreiz, Mattel’s chief executive officer, said in an interview Friday at Bloomberg’s Los Angeles bureau. “We believe we’re in a very good position to do our best to meet all of the demand. We may not be able to meet all of it.”

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For the toy industry, the holidays are accentuating a sharp turnaround: sales fell early in the pandemic, but have surged back and are now facing clogged supply channels and jammed ports.

Mattel anticipated some of the supply-chain issues. The company sped procurement of raw materials and lined up ocean-freight capacity and access to additional ports and shipping lanes.

“We’re not immune,” Kreiz said of the constraints that have bogged many industries. “It’s not that we’re not impacted, but we are able to manage and work through it.”

Mattel last month upgraded its full-year guidance, an indication that it expects to meet more demand than it thought it could.

Online shopping accounted for more than 35% of sales in last year’s fourth quarter. Now, it’s about 25%, Kreiz said, with brick-and-mortar stores also seeing growth. Mattel serves 470 000 stores worldwide.

“Some of the retailers that got out of toys are now looking to come back in,” he said. “Retailers are leaning in.”

Some of the El Segundo, California-based company’s most-popular toys this season include Barbie, Hot Wheels Monster Trucks, Masters of the Universe and American Girl.

“Physical play is here to stay,” Kreiz said.

© 2021 Bloomberg