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Another toy giant announces layoffs, signaling a potential wave of job cuts among foreign toy companies.

Toy industry 2025-03-21 11:20:36

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Yesterday, Mattel announced layoffs, with 120 people being laid off in the United States, including two vice presidents, multiple global brand marketing directors and management, as well as positions such as designers, engineers, and project managers. Following the closure of Dongguan Lideka and Foshan Sino-American Toy Factory, and the announcement of plans to move OEM factories to Southeast Asia, it is clear that Mattel China will not be spared from layoffs. In addition, Jazwares (Jizhi), which is invested by Buffett, has also carried out another round of layoffs, with dozens of employees in mainland China and Hong Kong being let go. Colleagues reported that there were no prior signs, and they were directly asked to process their departure, but all received a compensation of 2N times their salary.

As early as early April 2024, the toy and consumer goods company Jazwares laid off 60 employees at the Saint Laurent office. Jazwares LLC is a company known for its plush toy series, owned by the investment holding company Berkshire Hathaway.

In March 2023, Berkshire Hathaway acquired Alleghany Corp., the owner of Jazwares, for $11.6 billion. Jazwares is one of the fastest-growing toy manufacturers in the country, generating over $1 billion in sales from Squishmallows and other brands including Fortnite and Poksamon.

After Warren Buffett invested in Jazwares (primarily through the acquisition of Kellytoy, the parent company of Squishmallows), the company's revenue significantly increased. The report points out that Jazwares is a standout in Berkshire Hathaway's consumer goods division, mainly due to the popularity of Squishmallows.

Jazwares expanded the Squishmallows brand into different product categories, such as apparel, games, and more, through extended licensing agreements, further increasing the brand's influence.

Jazwares was named one of Time Magazine's 100 Most Influential Companies of 2024, maintaining continuous growth over more than a decade despite the overall decline in the toy industry in 2023 and the first half of 2024.

foreign toy company relocation plan

American toy giant Hasbro is reducing its dependence on Chinese manufacturing, aiming to decrease the proportion of products from China from 50% to below 40% within the next two years, and plans to shift production to Vietnam, India, and Indonesia.

Hasbro, known for brands such as "Monopoly," "Dungeons & Dragons," "Play-Doh," and "Mr. Potato Head," said that the company would lay off nearly 100 people by the end of last year. According to the Providence Business News list, Hasbro's full-time employees decreased from 1,400 in 2023 to 1,000 in 2024. In December 2023, the company announced in a corporate filing that it would cut 1,100 jobs, accounting for 20% of its workforce. These layoffs were in addition to the 800 layoffs made last year as part of an effort to save up to $200 million and reinvest in the business.

Yesterday, Wizards of the Coast, a subsidiary of Hasbro, has laid off 30 employees responsible for their recently released virtual tabletop experience game, Sigil. This layoff leaves only three people to support the application.

In October 2023, Spin Master announced the acquisition of Melissa & Doug, the world's largest wooden toy brand, for $950 million in cash. In March of last year, some employees of Melissa & Doug were laid off, marking the first personnel adjustment after the acquisition. Of course, Spin Master has fewer employees compared to Mattel and Hasbro, so the changes have not been significant, with no reports of large-scale layoffs. Spin Master plans to reduce its reliance on manufacturing in China from 50% to less than 40% by 2027, which may bring challenges during the transition period. Spin Master has been actively moving some of its toy production out of China, particularly shifting production focus to India, producing a variety of toys at a factory in Belgaum, India, through partnerships with companies like Aequs.

Mattel CEO Ynon Kreiz stated that the company is working to ensure that no country producing toys and games accounts for more than 25% of its global manufacturing. Currently, China accounts for less than 40%, and Mexico accounts for less than 10%.

MGA is taking steps to shift 40% of its manufacturing operations to India, Vietnam, and Indonesia, a proportion that will increase from the current approximately 10% to 15% within about six months, CEO Isaac Larian said in an interview.

After some foreign capital withdrew, OEM manufacturing shifted, the toy supply chain shrank, and naturally, the job demand from foreign toy companies decreased.

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Another toy giant announces layoffs, signaling a potential wave of job cuts among foreign toy companies.

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