As for your second point, the law provides no basis for certifying process flows, at least not so far as I can tell.

And again, you seem to keep ignoring the fact that this bill applies to dozens and dozens of industries that have little or nothing to do with the manufacture of toys. Do these industries deserve to “pay the price” for Mattel’s actions as well?

Not much disagreement with the above except two points:

1. “As for the issue of self-policing……involving only one factory of that company, located in China..”

I understand manufacturing in Asia and I travel there frequently. I’ve been in dozens of factories and been responsible for production in them. All manufacturer’s, not just toy manufacturer’s, have a responsibility to ensure product safety. When toy manufacturer’s transferred their production to China for cost savings, without doing their homework and verifying product safety, they were irresponsible. Assuming the industrial fledgling China has the same safety concerns or safety systems in place as either the US or EU (both of which have over 100 years of industrial experience) is irresponsible. Cost reduction (money) was the motivation without regard to quality (safety).

This bill may be flawed, but the toy manufacturer’s chased pennies down the rabbit hole and are now paying the price.

2. “Since the results of those tests can theoretically vary depending on the combination of components used, you probably have to test the end product rather than just the components.”

Certify the raw materials and process flow used. Control the product process flow with basic control plans and basic change control methods. These are not cost drivers and it is not rocket science. It is done all the time for products with lower profit margin than toys.

First off, I have to remind you – we are not just talking about the toy industry here. We are talking about anyone who makes or distributes anything that “is primarily designed for use by a child under the age of 12.” That fact simply cannot be emphasized enough. The law hits literally dozens of industries that have never been accused of any kind of wrongdoing.

Second, the issue of component testing is very much up in the air; for the most part, the view is that component testing is probably not going to be acceptable because of the way that the law defines a manufacturer.

You say that costs will eventually drop dramatically; this is entirely possible (although remember that the testing companies have to be certified by an understaffed agency…given the huge swath of the economy that the requirements cover, I’m very skeptical that enough labs will get approved to drive costs down significantly within less than four or five years). But this ignores a major problem – initial costs are going to be sky-high no matter what; small and medium-sized businesses are going to have to bear those costs for some unknown period of time before prices can come down. How many of those small businesses will be able to last that period of time, and how many will fail?

As for the issue of self-policing, I have a big problem with the assumption underlying that argument. This was not the sort of thing where there were frequent problems that kept recurring over the course of years across the entire toy industry (much less across all of the dozens of industries covered by this law). It was a result of one series of scares involving one particularly large company (and, IIRC, involving only one factory of that company, located in China). As a result of those scares, the products involved were recalled and the company was punished. Not one actual injury has ever been alleged as a result of that scare (although there was one death due to a child’s swallowing of a piece of jewelry designed for adults, and therefore not something that this act even attempts to prevent). In other words, the system actually worked in that scare.

No one has ever once alleged that products made by smaller companies or made in the US or Europe were unsafe in a manner that this law seeks to prevent. So it’s difficult to see how a lack of self-policing was really at issue here. And even if there were a lack of self-policing specific to the toy industry, that doesn’t justify going after the apparel industry, the children’s publishing industry, thrift stores, secondhand book dealers, school supply manufacturers, or even toy manufacturers who sell to children who are too old to “mouth” a product.

One more thing that bears emphasizing (and this is one reason why its unclear whether component testing is permissible): the testing and certification requirements apply to ALL “applicable” consumer safety standards, not just lead limits. Of course, no guidance is provided as to when a safety standard is sufficiently “applicable” as to require testing. This means that the products will often have to be lab-tested for things like flammability and a whole host of other potential standards that have long existed without testing requirements and without any complaints about inadequate enforcement. Since the results of those tests can theoretically vary depending on the combination of components used, you probably have to test the end product rather than just the components. But moreover, there’s really no simple way of doing those tests, which is why testing quotes have been so high. And, of course, in the process of running a lot of those tests, the tested inventory will of necessity get destroyed, which adds a little more cost to the test.

Your points on the requiring these tests on existing products is well taken and I agree with you. The requirements should only apply to products moving forward, with a reasonable timeframe allotted to allow implementation.

As for the point of batch testing small production lots, the testing could be done at the manufacturer’s raw material and the product can be certified by use of certified materials and processes. Manufacturer’s could define and test standardized bill of materials, which would certify the end product. Of course I assume the law allows for this option. If it does not, then I agree with you on that point also.

As for costs, once the law is defined appropriately and the industry is forced to comply, the costs for tests will drop dramatically. Although more often than not, there are larger economies of scale in electronics companies than toy companies, as a whole the toy industry is very large. Once the industry moves, so will the costs.

But as a final point….it would have been better if the industry had a precedent of policing itself before some of these unfortunate incidents occurred. There is a good chance that lawmakers would have used that testing procedure as a baseline, rather than trying to invent one from scratch – which is never a good thing when it comes to lawmakers….

You use the example of testing for electronics, but that’s not really relevant here. So far as I’m aware, that regulation did not impose the certification requirements imposed by this law. So far as I’m aware, that regulation did not apply retroactively to items manufactured before the enactment of the law. So far as I’m aware, electronics companies are generally larger and have greater economies of scale and do not need to sell dozens of varieties of a given type of product. So far as I’m aware, electronics testing requirements did not mandate the kind of frequency of testing that is required by this law. Nor did it mandate the vastly different types of testing required by this law; if you look around, you will find that not one business has been able to get a quote for compliance testing that is less than a few hundred dollars per batch; you will also find that in many, many instances, depending on the complexity of the product, testing quotes amount to between $3000 and $30,000 per batch. When your batch consists of a few hundred items with a retail value of only $50 or $60, well, you’re not going to be able to sell that product anymore.

Look, the bottom line is that no one is really opposed to lowering the lead limit or banning phthalates. To be sure, there are many who think it unnecessary, but even they don’t consider such restrictions to be problematic in and of themselves. But what is problematic is the way this law is written, which both imposes enormous burdens on small and medium-sized businesses (and my line of work gives me a first-hand look at just how high those burdens actually are) and probably hurts rather than helps safety.

Basically, the law is written as if it assumed that the only businesses who would be affected by it would be massive multi-national corporations with huge economies of scale; for those companies, this law is somewhat burdensome, but completely tolerable. Indeed, the proponents of this law effectively admit this when they say that the law is not intended to affect most of the small and medium sized businesses, and that the CPSC should grant exemptions to a lot of these businesses. The problem is that the proponents don’t understand just how little flexibility this law provides the CPSC to grant those exemptions.

And that’s the reason proponents of the law so frequently focus on CPSC Commissioner Nord as the villain – they say that all the bad effects that this law is having are because she has dragged her feet on creating rules that would exempt most of the smaller businesses. But if they actually read the law, they would realize just how limited the supposed exemption authority actually is.

“Does anyone have any idea how you are going to comply with this law when it goes completely into effect without going out of business?”

I don’t have familiarity with the Toy Fair, but I am very familiar of the electronics industry. In July 2006 the electronics industry adopted RoHS (Restriction of Hazardous Substances) act out of the EU. This act put limits (1000 ppm) of 6 known hazardous materials in electronic components: lead, mercury, cadmium, hexavalent chromium (Cr6+), polybrominated biphenyls (PBB), polybrominated diphenyl ether (PBDE). Although the law was passed for EU, as it related to both domestic and imported electronics, the industry as a whole adopted the law. Needless to say the industry cried foul with this new requirement and claims of financial ruin were common.

Methods of testing were targeted (ICP-MS, ICP-OES, GC-MS, GC-ECD, FTIR), labs certified and, due to the size of the market, competition flourished to satisfy this new requirement. The industry successfully made the transition at NO HIGHER COSTS to the products. These same methods and labs can be used for any industry.

Now, given that the electronic business model relies on always being smaller, faster and cheaper with each successive (very short) generation, AND the razor-thin margins of electronic components I have no sympathy for the toy industry dragging it’s feet and crying about the financial ruin.

And if the complaint is the law is unclear, this is the risk when an industry does not self-regulate. If you don’t lead, you may be forced to follow.

As Oscar Rogers on SNL states – “Take it one step at a time. Identify a problem – FIX IT! Identify another and FIX IT! Repeat as necessary!”