Little Tikes growing after shifting production from China to US

By Rachel Abbey McCafferty
CRAIN'S CLEVELAND BUSINESS

Published: August 27, 2013 3:35 pm ET
Updated: August 27, 2013 3:50 pm ET

Image By: Janet Century Little Tikes executive Thomas Richmond and his son, Enzo, play at the company's plant in Hudson, Ohio.

Related to this story

Topics Rotomolding, Reshoring, Toys, Industry Trends

Hudson, Ohio, toy maker Little Tikes Co. has seen growth in recent years, and it's growth that Executive Vice President and worldwide General Manager Thomas Richmond attributes in large part to the company's decision to manufacture more of its toys at its northeast Ohio plant instead of overseas.

When Little Tikes started out more than 40 years ago making toys for young children, everything was made in the U.S. However, some production was moved to China in the '80s and '90s when that country's manufacturing sector began to take off, he said.

"Now, the wheel is kind of coming full circle," Richmond said.

The company in recent years started to bring production of some of its toys, like the 2-in-1 Snug 'n Secure swing, back to the Hudson plant. It has also been creating new toys, like a low-cost slide for toddlers, which the firm has intended from the start to produce in northeast Ohio.

The Made-in-the-USA initiative makes economic sense, because it's not just about salaries in China vs. salaries in the U.S., Richmond said.

Indeed, energy costs are up globally, input costs for materials like plastic resin and natural gas are lower in the United States, and the cost of shipping from China back to the U.S. is high.

Not to mention, there is an "enormous amount" of logistics costs in Little Tikes production when it's done overseas, he said.

To account for the moves, as well as an improving economy, Little Tikes has added nearly 50 permanent employees and some temporary employees in the past two years, Richmond said.

The company currently has about 800 permanent and temporary employees in Hudson, which is its only U.S. manufacturing site, he said.

And those employees have been kept as busy as ever, as the company has continued to introduce new products into the market, at a rate of about 60 new toys per year.

"We are constantly refreshing and adding and changing and adapting," Richmond said.

Scott Paul, president of the Washington-based Alliance for American Manufacturing, said while it's relatively easy to find U.S.-made artisan toys, it's more of a struggle to find mass-produced toys like those from Little Tikes made in the United States.

Paul said in addition to a "surge in interest" in favor of U.S.-made products, recent recalls of toys made overseas have created a perception problem. Both are developments that have made Little Tikes' work shift back to the Hudson plant even more effective, he said.

Little Tikes has invested regularly in the Hudson plant, Richmond said, including $3 million spent recently on new injection molding technology. The machinery should start to arrive in September and be ready by mid-2014.

And while Richmond declined to share annual revenue, he said it has steadily gone up since the recession hit in 2008.

Hudson pride

Little Tikes is one of the larger companies in Hudson, said Chuck Wiedie, economic development director for the city, and it has been a good corporate citizen for decades.

Wiedie said the city and the state worked hard to keep Little Tikes in Hudson when the company was purchased by Van Nuys, Calif.-based MGA Entertainment Inc. in 2006, a decision that Richmond said had value.

The biggest benefit to staying in Hudson was retaining the decades of experience its senior-most employees had, Richmond said.

"You just don't find that in America, not these days anyway," he said.

He said he also appreciated being in a technology and plastics-rich area, noting that he had recently met with someone pitching a new kind of material. That sort of spontaneous interaction wouldn't happen as easily if the company's headquarters was 1,500 miles away.

The region's shale gas boom also could eventually offer a long-term competitive advantage for the U.S., he said, as the long-term prospect for natural gas and the plastic produced from it are on a downward cost trend. The company hasn't seen a direct benefit from the shale play, but Richmond said it bodes well for the future of the economy and the region.


Comments

Little Tikes growing after shifting production from China to US

By Rachel Abbey McCafferty
CRAIN'S CLEVELAND BUSINESS

Published: August 27, 2013 3:35 pm ET
Updated: August 27, 2013 3:50 pm ET

Post Your Comments


Back to story


More stories

Image

Plastics News Now: Arburg's 3-D printing machine hitting the market

October 23, 2014 9:03 am ET

Chrysler is hiding design elements in parts, Amcor teams up with Method for a molding and filling plant and Arburg's Freeformer attracts attention at ...    More

Image

Sales, orders climbing for Wittmann Battenfeld

October 22, 2014 4:04 pm ET

Equipment maker Wittmann Battenfeld GmbH expects sales this year to increase 7 percent, to 295 million euros, as it said some key markets, including...    More

Image

Plastic particles showing up in Germany's Lake Constance

October 21, 2014 1:16 pm ET

While Fakuma 2014 exhibitors and visitors occupied themselves with topics like molding of micro-sized plastic parts during the show, the presence of...    More

Image

Material Insights: Fakuma puts the spotlight on medical and automotive-related materials news

October 20, 2014 10:13 am ET

Editor Don Loepp and senior reporter Frank Esposito break down all the materials-related news from the Fakuma trade fair in Friedrichshafen, Germany.    More

Image

Little sports figures get big backing

October 17, 2014 11:55 am ET

OYO Sportstoys Inc. is gearing up to produce and sell more plastic mini-figures after gaining $11 million in equity financing from a group led by spor...    More

Market Reports

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Plastics in Mexico - State of the Industry Report

This report analyzes the $20 million dollar plastics industry in Mexico including sales of machinery & equipment, resins and finished products.

Our analysts provide insight on business trends, foreign investment, top end markets and plastics processing activity. The report also provides important data on exports, production, employment and value of plastics products manufactured.

Learn more

Plastics Caps & Closures Market Report

The annual recap of top trends and future outlook for the plastics caps & closures market features interviews with industry thought leaders and Bill Wood’s economic forecast of trends in growing end markets. You will also gain insight on trends in caps design, materials, machinery, molds & tooling and reviews of mergers & acquisitions.

Learn more

Upcoming Plastics News Events

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 16, 2015 - September 18, 2015Plastics Caps & Closures - September 2015

More Events