The company’s management used buyers’ demographic data including whether they were English or Spanish Speakers, and which stores they bought from. This data was drawn from retail stores including US Wal-Mart, Target, Toys “R” Us and Kmart. This data was analyzed by the company and used to forecast the demand for the toys. LeapFrog communicated its decision to increase production of toys to Capable Toys within weeks; in the month of August. This was after the predictions were verified by the company’s management to be trustable.
When the demand for LittleTouch grew, Capable Toys had to increase it productivity to meet the rising need. However, there was no immediate way of increasing the company’s production. Capable Toys Ltd of Zhongshan, China had to hustle and try hard to get extra custom-designed electronics, plastic molds and baby-drool-proof paper. There was also need to hire more workers. Furthermore the company needed to make more production tools. The production problem was solved by ordering the production of two more sets of production tools which finally helped boost production. The tools were better designed – they were made such that they could produce unique toys while reducing their fail rates from 5% to 0.3%.
Capable Toy Company had problems getting a supplier for sensitive touch membrane but then they were able to get other suppliers. The company also needed a special material that was drool–resistant and ink absorbent called Tyvek. The only way to get this material was by getting it supplied by third party, not directly from the manufacturer, DuPont Co. LeapFrog approached a U.S. company that could get this material directly from DuPont Co and gave it the printing contract as well. This move however added 50 to 60 cents per book in production costs.
Leapfrog Company made a decision to use air shipping and fast boats to transport its products from Hong Kong to Los Angeles to respond to the shortage experienced. Using ...
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