NEW YORK — Concerns about toy safety since last summer's recalls, along with worries about the economy, have made shoppers more cautious and have resulted in generally sluggish toy sales. No retailer has as much at stake as Toys R Us Inc., the nation's largest specialty toy seller. In an interview, Chairman and CEO Gerald L. Storch discusses toy recalls and details what the retailer and the industry are doing to make toys safer.
Q: How has holiday business fared at Toys R Us?
A: It started off very strong, but it has been relatively erratic since then. ... We know we are not going to be immune from (economic challenges), but we do know that in good times and bad, parents want to buy toys for their children, and it is the last thing they are going to cut no matter how tough their budget is.
We are satisfied with where we are, but believe it or not, half the season is still in front of us. And the last week is going to be huge.
Q. How have the toy recalls affected consumer behavior? There doesn't seem to be a widespread rejection of Chinese-made toys.
A. We are not seeing a lot of difference in toy buying patterns this year versus prior years. I believe that it's because with all ... the scrutiny that toys have received, the consumers that we talk to believe the toys on the shelf now are safe. ... By and large, they are focused on the hot toys, and they want to get the right toy for the right child.
Q. Have all the toy recalls increased interest in eco-friendly toys?
A. The green products have been selling very well, but there haven't been a lot in the marketplace. Next year, we expect to see a dramatic expansion in green-based products. ... Next year will be the year of the green toy.
Q. What measures have you taken to ensure toy safety?
A. We took a leadership role with our vendors and we have been very aggressive ... to make sure that they understand our high safety standards, and we hold them accountable for achieving them. We have terminated two vendors already this year for failure to meet those standards, and we have had some tough conversations with many others. We have raised our safety standards to make sure that toys cannot pass through that didn't meet those standards.
Q. What's been most frustrating to you?
A. There have been many advocacy groups who have been out there testing products. We respect totally their right to test their products, but sometimes their tests aren't done properly. We've had many, many cases in which we have taken the products and retested them and found them to be totally safe.
Q. You have been working very closely with lawmakers in supporting legislation that would make toys safer. What do those bills entail?
A. The bills that are out there now will increase funding (for) the Consumer Product Safety Commission. ... We believe that it is the single most important step in not only improving the safety of toys but all consumer products. Additionally, the bills set prescribed limits for contaminants in toys such as lead. ... We support that change and those lower limits for the contaminants.
We hope there would be legislation this year but, it is getting later and later into December. If it doesn't pass this year, we are going to be very aggressive in ensuring that something happens early next year.
Q. What do you think about some analysts' predictions of increased prices on toys next year amid higher scrutiny?
A. We don't believe that any of these steps will have a significant impact on the price of the product. ... Most of the cost of the toy is labor.
Q. How can recalls run more smoothly?
A. Because in the past, the toys have not been batch stamped or date stamped, it had been impossible to know when a toy was manufactured. That's why you saw millions of toys recalled when in some cases, a small percentage of toys were actually contaminated. ... We are starting to require it going forward. It will make it much easier for both parents and retailers to identify which product is covered by a recall to make sure it is pulled from the shelves and from people's homes.
Q. Has the risk of lead exposure in toys been overblown? You have noted that the current lead standard for toys is one-tenth of the lead found in household paint sold until the mid-1970s.
A. As we sit here today, the No. 1 risk of lead exposure for children comes from house paint, primarily in substandard housing, but it can affect any older home where renovation work has been done and the lead is accessible.
I heard some people argue that the lead on the toys is so small that statistically it presents a very small risk to your child. That's probably true. Having said that, it is simply inexcusable for products not to meet the safety standards that have been established for them.
Q. You and other industry executives say that this is the safest toy season yet, because of increased testing, but just a few weeks ago there was a recall of a holiday toy called Aqua Dots, because it was tainted with a date-rape drug. How do you explain that?
A. There is no product made by man that is perfect, whether it is toys, medical instruments, medicines ... but products can always be made safer. And we are going to work aggressively and relentlessly to continue to increase toy safety. ... We are going to keep the pressure on.