Crafters will be forced out of business next year

If you make craft items, toys or any kind of item that could be construed as a toy, this may be your last Christmas with an income. H.R. 4040, signed into law by President George Bush last August, has just put you out of business.

A friend of mine in the toy industry wrote to tell me that the next industry to go under is the toy industry - not because of any problems in the industry....but because of a new regulation!

The thing is, Rob tells me that the toy industry is in pretty good shape. They're one of the few industries NOT laying people off. People have jobs - for now. But if you are a crafter or in the toy industry, or in an industry that supplies craft stores, lumber, paint or items TO toy manufacturers....get ready to be laid off next year when this regulation goes into effect.

Danville's economy will be affected adversely too. eToys carries a lot of toys made by smaller manufacturers who will be out of work because of this regulation. The Danville Farmer's market - a lot of crafters there will be affected. How many local layoffs or jobs will be impacted? If you sell your items on ebay or esty....you'll have to show proof of testing....How will craft shows all over the country be affected? Or state fairs? Vendors won't be able to manufacture or make their items nor sell them.

As one crafter says:

"So as a crafter this has hit home for me, last night my DH and I, and my mom on the phone.. sat down and read the 68 pages line by line, to see where I and my business fit into this. This affects anyone who sells goods to children under the age of 12, anyone who HAS children under the age of 12, anyone who MAKES goods for children under the age of 12, and anyone who buys things for children under the age of 12."

Rob said,

"I, along with thousands of companies in my industry are hoping just to stay alive past February....and, no, I am not the CEO of Ford or GM. I am not even in the auto or banking industry.

My industry, particularly the niche that I am in is relatively healthy compared to the rest of the economy. However, recent changes in government regulations are putting our $100bn+ industry at risk of complete collapse. I am in the Children's Products business. In particular, I sell toys. Not mass marketed, Chinese toys. Not the ones you read about in the news. Let me explain.

First, let me stress that I have been an avid supporter of strict toy standards. When the new Consumer Product Safety Improvement Act was signed into law I was pleased to have a stronger federal standard. However, like anything else, the devil is in the details. In this case, there are a number of issues that threatens the thousands of businesses, and over 100,000 jobs.

1. Testing Methods: In the coming weeks companies will be required to have new products tested by 3rd parties. Reasonable, right? Unfortunately the method is not so reasonable. A reasonable method would be to test the materials then make the products. If I produce jeans....I should test the materials (denim, buttons, zippers) then make as many different styles as appropriate. If I am a woodworker, I test the wood, test the paints, then make little wooden cows, pigs, lions, and tigers. However, the law says that I am required to test each sku or style of the finished product. At a few hundred dollars to a few thousand dollars per test, this can add up fast, especially for (1) small, innovative companies that are trying to get introduce new products, (2) larger companies with thousands of skus, and (3) in general companies that specialize in niche markets.

2. Markings: In August 09 new products will be required to have permanent marking on the actual product, indicating where, when, and by what company the product was manufactured. Sounds okay, but do you know how expensive that is for small companies? Did you know that small companies have a pretty good grasp on where and when their products were made. Not only that, if a recall were needed in such a case, you would be dealing with very low numbers...(ie. tens, or may be a few hundred)...not the tens or hundreds of thousands required by companies like Mattel.

3. Complexity & Penalties: The new law is extremely complex. It contains many requirements (few. if any, of which increases the safety of a single toy), requiring certificates for each product to be shipped with each item in a shipment, confusing rules about how often testing is required, and more. The more complex a set of rules, the more difficult it is to do it perfectly, all the time. This is not to say the safety would be jeopardized, more likely a t won't be crossed or an i dotted...but this can cause big problems when the penalties for non-compliance have also been raised in this law (from $5,000 per infraction to up to $100,000), plus possible civil penalties. Who wants to be in a business like that?

That leads me to my next point. Assuming, the small, interesting companies can survive these issues, who wants to? I have better, more interesting things, to do than worry about incredibly complicated and cumbersome rules that do not make my toys any safer. I would move into other markets. So where does that leave the children's products industry? Full of the few mass market toy manufacturers that can survive. Hey! Aren't those the guys that got us into this mess in the first place?"



Educational toys, niche market toys, all kinds of items that you, your kids and the school system depends on - will be impacted because smaller manufacturers can't afford that kind of testing. So - will your job be affected? Better start finding out now. Go to this web site to learn more! http://cpsia-central.ning.com/