The magnet crisis that occurred in the middle of August 2007 was another disaster where children swallowed small magnet pieces on many of Mattel’s toys which caused one death and 19 injuries. With both crises combined, Mattel recalled over 19 million toys; 1.5 million from the lead paint incident. On June 8, 2007, Mattel was told that there was lead in the toys’ paint that violated the Lead Poisoning Prevention Act of 1971. The CEO ordered an investigation in China which lead to the cancellation of the licenses of two Guandong-based companies to export which were linked to the recalls. After the investigation concluded by August 2nd, Eckert took to the stand to apologize to the consumers and parents and began the $30 million recall. By mid-August, Eckert was recorded saying he blames China’s subcontractors for violating the company’s policies and “utilized paint from non-authorized third-party …show more content…
After a survey was administered by the company, 75% of their consumers felt they handled the recall appropriately. (Financial Times, January 2012) The benefits for how they reacted is their reputation would be intact because of the immediacy in investigating the manufacturers, apologizing to the parents first, and calling for a recall rather than focusing on the costs of the incident. The costs for the Chinese manufacturing companies losing their exporting license and having the companies shut down. There were no benefits for the Chinese supplying companies. The costs of the consumers were their health and safety. Being exposed to lead is poisonous and possibly fatal. The benefit here for the children and parents would be their ability to still place trust in the company since they reacted quickly and efficiently with recalling over a million