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Here's a snippet of a story currently running on Yahoo Business News
Hasbro does not own any toy plants in China and relies entirely on contractors for its production there. Mattel owns five Chinese toy factories, but not Lee Der Industrial Co., which made the 1.5 million preschool toys that were recalled across the globe earlier this month.
Most of Hasbro's toys are made in China; Wedbush Morgan Securities analyst Sean McGowan said this fact may actually help the maker of Transformers and Star Wars action figures prevent tainted toys from ever reaching a child's hands.
"Knowing that they are more vulnerable, they have put in layers of testing that they might not have if they weren't using contract manufacturers," McGowan said.
"It may happen at some point that Hasbro or some other company winds up with a manufacturing issue, but they feel pretty confident that they've got the kinds of systems in place that would catch anything."
Under its new "three-point" check system, Mattel said it would require every batch of paint at each of its vendors to be tested and said it would increase the number of random inspections of its factories. The toy maker also said it would test each production run of its toys.
Jim Silver, editor-in-chief of Toy Wishes magazine, said every major toy company is taking a hard look its manufacturing to ensure there are no problems for the holiday season, the most crucial selling period for toy companies.
"All the major companies are overseas right now looking at their factories and literally testing like they've never tested before," Silver said. "Everybody is over there checking. Nobody really wants an issue for the fourth quarter and they realize the importance of meeting all safety standards."
Shares of Hasbro rose 32 cents to close at $27.61 a share on the New York Stock Exchange, while Mattel slipped 45 cents to $22.55 following the recall.
An interesting side-note on this story is that some companies / stores are already starting to look at European made products as a replacement for Far Eastern goods. Naplenews suggests that as all European toys are stamped with the CE sticker, proving they have past stringent safety tests in Europe (which are far stricter than it's US counterparts), the shops / manufacturers feel safe that these goods would not have a similar problem.