Value Chain Toys

• PRODUCT DEVELOPMENT
• RAW MATERIAL PROCUREMENT
• PURCHASING
• PRODUCTION
• TRANSPORT
• MARKETING AND SALES

• • Environmental
    indicators
  • Emissions, effluent and waste

    As in all manufacturing sectors, toy production also poses risks to the environment. The situation is particularly critical in the Pearl River Delta, where most toy factories are located. Waste and effluent often flow into the rivers unfiltered. Paints, plastics, adhesives and solvents pollute the water and air because they are used improperly. Nevertheless, the toy industry as a whole accounts for only a small proportion of this environmental impact.

  • Resource consumption

    The sourcing of resources within the toy value chain involves few sector-specific risks. However, the production of plastic toys requires large quantities of plastic raw materials such as polyethylene, polypropylene and synthetic resins, some of which are derived from crude oil.

  • Biodiversity
  • Transport emissions
  • Animal welfare
  • Human rights
  • Discrimination

    Toy factories are predominantly staffed by young to middle-aged women, who often migrate from rural areas to industrial regions as migrant workers. Employers prefer young women because they are usually unaware of their rights and, due to their status or lack of a residence permit, are hardly in a position to negotiate. Religious or racial discrimination, on the other hand, is rare in these factories.

  • The interests of the local community
  • Child labour

    Child labour does occur in the toy industry, particularly during seasonal production peaks. However, it is not one of the most pressing problems. According to the ILO, the minimum age for employment may range from 14 to 16 years, depending on national legislation, and for light work it may even be as low as 12 years. In China, the minimum age is 16. It remains difficult to verify the ages of female workers. However, minors who gain access to factories using forged identity documents appear to be isolated cases.

  • Forced and compulsory labour
  • Freedom of association

    In addition to social security, the lack of a say in wages and working conditions poses a particular risk to workers. In China, there is only one state-run trade union, to which all provincial employee representative bodies must belong. This union is under the control of the Communist Party of China. Democratically elected staff representatives are rare and are often influenced by factory management. Furthermore, the high turnover of workers in most factories makes it difficult for independent interest groups to operate.

  • Work practices/
    -quality
  • Employment
    status

    Working conditions in the factories pose significant risks, particularly with regard to pay and working hours. The focus is on three main problems: excessively long working hours, a lack of employment contracts or contracts that are not honoured, and inadequate pay. Workers often do not receive the minimum wage, or can only reach it by working extreme amounts of overtime. In piecework, they are not paid by the hour, but according to the number of toy parts produced. In Chinese toy factories, workers often work 12 to 13 hours a day. This overtime is not paid in accordance with legal requirements.

  • Health and Safety at Work

    Excessive overtime increases the risk of injury. The long working hours are caused by companies’ seasonally driven purchasing policies. In many factories, operators flout safety standards. The machinery used to process the plastic raw material, which heats up to 300 degrees, and the lack of ventilation make the workspaces unbearably hot. Furthermore, the factories use toxic paints and adhesives. The workers’ accommodation is overcrowded, unhygienic and offers no privacy. Those who are absent due to illness or injury often receive neither pay nor compensation.

  • Discrimination / Diversity

    Toy factories are predominantly staffed by young to middle-aged women, who often migrate from rural areas to industrial regions as migrant workers. Employers prefer young women because they are usually unaware of their rights and, due to their status or lack of a residence permit, are hardly in a position to negotiate. Religious or racial discrimination, on the other hand, is rare in these factories.
  • Governance
  • Corruption, bribery, accepting benefits
  • Anti-competitive behaviour
  • Compliance

    Product development usually takes place in the brand companies’ home countries. Problems arise when decisions made at this stage make the product specifications too challenging for manufacturers in China. As a result, manufacturers accept orders even though they may not be able to meet the complex requirements. National working time laws or industry standards are not always adhered to in some supplier factories, despite certifications and audits.

  • Tax evasion
  • Poor governance
  • Product
    responsibility
  • Customer safety

    The safety of toys is crucial for end customers. On the one hand, it relates to the design: prescribed quality standards such as flammability or the stability of small parts. On the other hand, paints and varnishes may inadvertently contain problematic substances that pose a risk to children – often without this being noticed at first.

  • Labelling of products

    Product labelling poses a major risk at the final stage of the toy value chain – in marketing and sales – namely, false claims. Manufacturers often mislead consumers with inaccurate or deliberately misleading information. For example, stating the country of origin on toys is voluntary. Instead, some use the label ‘Designed in Germany’ to capitalise on the good reputation of German products, even though the toys are manufactured in China.

  • Marketing, Advertising
  • Protection of customer data