Dive Brief:
- Toy and school supply manufacturer Cra-Z-Art last week announced plans to grow its U.S. manufacturing network by 50%, up to 1.5 million square feet. The move comes as more companies double down on U.S. operations amid the Trump administration's widespread tariffs.
- The expansion will add to Cra-Z-Art's manufacturing facilities in Lewisburg, Tennessee, and Jacksonville, Florida, though the company did not specify where the additional operations would be located.
- The RoseArt manufacturer cited rising global trade tensions as a factor in its decision. "Based on the current economic climate, we are taking decisive action to expand and invest in American manufacturing," Chairman Lawrence Rosen said in a statement.
Dive Insight:
Cra-Z-Art isn't the only toy manufacturer growing U.S. operations as tariffs mount.
On Thursday, California-based MGA Entertainment, known for its Bratz doll products, said it plans to accelerate its push out of China. The company plans to shift 40% of its manufacturing to India, Vietnam and Indonesia, up from a previously disclosed 10% to 15%, according to a Reuters report.
Other major manufacturers in the industry have also opted to shift away from China-based supply chains. Months before the Trump administration’s tariff regime kicked off, Barbie parent company Mattel shuttered one of its tier 1 supplier plants in China last year and plans to close another in 2025 in a bid to diversify its footprint.
This year, the company plans to produce less than 40% of its stock in China, Mattel CFO Anthony DiSilvestro said at the UBS Global consumer and Retail Conference on Thursday. The CFO added that it does not have any operations in Canada, and less than 10% of its operations are in Mexico.
"As we continue to evolve by 2027, we do not expect any single country to represent more than 25% of our global production," DiSilvestro said. "So this gives us a competitive advantage and a good position when it comes to managing the tariff exposure."
Cra-Z-Art's expansion comes as the company says it's digging more into the U.S. market at large, building on its 2021 investment in 1 million square feet of domestic manufacturing space.
It’s also leveraging M&A as a means to expand operations. In February, Cra-Z-Art acquired toy manufacturer Joker AG, which bases its manufacturing in China. The deal was its third acquisition in six months.
The company could not immediately be reached for comment on what percentage of its supply chain will now be based in the U.S.
"Based on the current economic climate, we are taking decisive action to expand and invest in American manufacturing," Rosen said in the March 13 release. "We are fortunate to have the infrastructure and capabilities in place to rapidly increase toy and school supply production as well as manufacturing space right here in the USA.”
