THAT CHART RIGHT THERE.
SO WE ASK, WHAT IS MGA DOING
DIFFERENTLY?
IZAAC LARIAN IS THE CEO JOINING
US NOW.
IS THIS SHRINK-FLATION, OR
SOMETHING A LITTLE BIT
DIFFERENT?
>> HI, GOOD MORNING.
LAUREN: GOOD MORNING.
DID YOU JUST SAY GOOD MORNING?
>> SOMEWHERE IN THE WORLD IT’S
GOOD MORNING.
LAUREN: GOOD AFTERNOON HERE.
>> SO THANK YOU, THANK YOU FOR
HAVING ME.
AT MGA WE NOTICED THE INFLATION
COMING EARLY ON SO WE HAVE
DEVELOPED OVER 200 TOYS BELOW $
10.
THIS IS ONE OF THEM.
THIS IS GOING TO BE ONE OF THE
HOTTEST TOYS EVER.
LAUREN: IS THAT, WHAT IS THAT?
>> OKAY, SO THIS IS BASICALLY,
I DON’T KNOW IF YOU KNOW ABOUT
THE FOOD CRAZE THAT GOES ON.
I DON’T KNOW IF YOU CAN SEE
THESE IN THE CAMERA, AND YOU
CAN MAKE DIFFERENT FOODS,
MINIATURE FOODS AND DRY IN THE
SUN AND COLLECT THEM.
THIS IS A BIG CRAZE, IT’S GOING
TO BE AT WALMART ON DECEMBER 5.
LAUREN: HOW MUCH?
>> UNDER $10.
WE HAVE THIS ONE HERE WHICH IS $
10.
LAUREN: YUP.
THIS ONE HERE IS $7.
LAUREN: OKAY.
>> SO IT’S A BIG DEAL.
SO YES, MINI IS THE WAY TO GO
BECAUSE KIDS AND ADULTS ARE
BUYING THEM.
OUR ICONIC BRATZ, WE HAVE
LITERALLY REPLICATED THE
ORIGINALS TO MANY BRATZ AND
THESE ARE $10 AND WE EVEN HAVE
MINI CROSS COSMETICS.
SO I DON’T KNOW IF YOU CAN SEE
IT.
THEY ARE REAL.
I PUT MY EYE SHADOW ON.
LAUREN: [LAUGHTER]
WHEN DID YOU SAY OR YOU SAID
EARLY ON YOU THOUGHT MINI
WAS THE ANSWER TO INFLATION
DEFINE EARLY ON?
BECAUSE I’M IMAGINING THE SUPPLY
CHAIN IS STILL DIFFICULT, YOU
GOT TO GET THE ITEMS HERE.
WHAT’S EARLY ON AND DID YOU MAKE
IT?
>> OKAY, SO WE NOTICED THIS
TREND EARLY IN JANUARY,
WITH THE INFLATION 23% OUR COSTS
WENT UP 23%, SO WE SAID OKAY,
THERE’S GOING TO BE AN INFLATION
, THERE’S GOING TO
BE A RECESSION, BECAUSE CONSUMER
S ARE GOING TO BE
STRETCHED BUT EVERY PARENT AND
GRANDPARENT, GIFT-GIVER NEEDS TO
PUT A TOY UNDER THE CHRISTMAS
TREE, SO WHY DON’T WE COME UP
WITH A WHOLE LINE OF TOYS BELOW
$10, AND GIVE THEM THE
OPPORTUNITY TO BRING THAT
GIFT HOME, AND WE HAVE SEEN
EARLY SUCCESS.
I MEAN, THIS MINI SURPRISE,
WHICH IS IN COLLABORATION WITH
HERSHEYS AND PEZ, AND OTHER
COMPANIES, IS SELLING OUT, IF
YOU GO TO WALMART, TARGET,
AMAZON, IT’S SELLING OUT LIKE
CRAZY, SO WE HAVE NOTICED A
CRAZE AND THE CONSUMER WHO IS
STRETCHED AND THESE TOYS I THINK
IS GOING TO HELP THEM.
OVER 200 TOYS UNDER $10.
LAUREN: YOU SHOULD MAKE A
CRYSTAL BALL BECAUSE IF YOU
PREDICTED THIS , BACK IN JANUARY
, I’D BUY YOUR CRYSTAL
BALL.
YOU WERE RIGHT ON, SIR, BUT I
GUESS YOU SAW IT.
YOU SAID YOUR OWN COSTS WERE UP
23%.
I REMEMBER, IT WAS A FEW HOLIDAY
S AGO, THE JOY OR THE
SURPRISE OF THE LOL
SURPRISE DOLL WITH THE
PHYSICAL UNWRAPPING OF ALL
THE PARTS.
AS A PARENT I THOUGHT IT WAS THE
MOST ANNOYING THING BECAUSE
I HAD TO HELP AND THEN CLEAN-UP
BUT THAT’S WHAT THE KIDS LOVED.
WHAT DO THEY LOVE ABOUT THE MINI
TOYS?
>> ON THE MINI FOOD, THE BEAUTY
OF IT IS ALL FIRST OF ALL THE
ELEMENT OF SURPRISE IS STILL
THERE, BUT YOU MAKE BASICALLY AN
ACTIVITY TOY, LETS YOU CREATE
YOUR OWN TOY, WHEN YOU MAKE A
PIZZA AND I MAKE A PIZZA, IT
LOOKS VERY DIFFERENT, WHEN IT’S
DONE AND OVER WITH, SO IT ALSO
TAKES CARE OF FIDGETING BECAUSE
A LOT OF KIDS ARE FIDGETING.
IT’S A GREAT TOY.
IT TAKES 20-25 MINUTES OF PLAY
FOR A LITTLE KID TO DO THAT.
BELIEVE IT OR NOT, ADULTS ARE
DOING IT.
ONE OF OUR BUYER’S MOTHER WHOSE
80 YEARS OLD WE SENT HER SOME
SAMPLES AND SHE GOT ADDICTED TO
THESE AND SHE’S COOKING ALL OF
THESE MINI FOODS ON A DAILY
BASIS.
LAUREN: THAT’S SO CUTE.
I DON’T THINK MY KIDS COULD SIT
FOR 20 MINUTES THOUGH, MAYBE 10,
MAYBE.
>> THEY WILL TRY IT.
LAUREN: WHERE ARE YOUR FACTORIES
>> WE ARE IN CHINA, AND WE HAVE
THE LARGEST TOY FACTORY IN THE
USA THAT MAKES L’IL TYKES,
AND WE HAVE THOSE MINIS ALSO SO
YOU OPEN THESE AND YOU DECIDE.
LAUREN: HOW IS IT GOING IN CHINA
NOW THOUGH?
THEY ARE STILL DOING COVID-ZERO,
A FIFTH OF THE CHINESE ECONOMY
IS CURRENTLY IMPACTED BY
LOCKDOWN, AND COVID-ZERO
POLICIES.
HAS THAT IMPACTED YOUR ABILITY
TO GET THINGS THERE, TO HERE,
WHEN YOU WANT THEM, FOR THE COST
THAT YOU WANT THEM?
>> WELL TWO THINGS.
FIRST OF ALL, YES, COVID, ZERO-
COVID POLICY IN CHINA IS
FRANKLY VERY ANNOYING, AND
BECAUSE COVID IS COMING TO CHINA
AFTER EVERYTHING THAT THEY HAVE
DONE, BUT THE SUPPLY CHAIN HAD
GOTTEN A LOT BETTER.
LAST YEAR, THIS TIME, WE WERE
PAYING $22,000 FOR CONTAINERS TO
L.A. AND IT WOULD TAKE 60 DAYS
TO GET HERE.
NOW WE’RE BACK TO THE LEVELS OF
$2,500 PER CONTAINER AND IT
TAKES ABOUT 20 DAYS TO GET HERE
SO THINGS ARE GETTING BETTER IN
THE SUPPLY CHAIN BUT DEFINITELY
THE RECESSION, THE INFLATION, IS
GOING TO BE HERE FOR A WHILE.
IT’S NOT TRANSITORY.
IT’S GOING TO BE HERE EVEN
THOUGH THE INTERESTS IS GOING UP
MY PREDICTION IS THAT THE
INFLATION IS GOING TO BE
WITH US FOR THE NEXT FIVE OR
SIX YEARS.
LAUREN: THAT’S YOUR CRYSTAL BALL
, INFLATION IS GOING TO BE
WITH US FOR FIVE-TO-SIX YEARS
EVEN THOUGH IF I’M QUOTING YOU
CORRECT, THE COST FOR YOU TO GET
A CONTAINER WENT FROM
$20,000 LAST CHRISTMAS TO $2,500
THIS CHRISTMAS?
>> YES, THAT’S CORRECT.
BUT THAT’S ONLY ONE ELEMENT.
THE COST OF LABOR IS UP.
THE COST OF, YOU SEE THE OIL
PRICES UP THROUGH THE ROOF AND
WE BUY REZIN, THE COST OF
PLASTIC IS UP, THE COST OF
ENERGY IS UP, THANKS TO RUSSIAN
WAR.
EVERYTHING ELSE IS UP, SO YES.
IT’S NEVER GOING TO, I DON’T
THINK IT’S GOING TO GO TO 2% FOR
THE NEXT FIVE OR SIX YEARS.
IT’LL MAYBE DROP TO SIX OR 7%.
LAUREN: IZAAC THAT’S THE MUSIC