Mega Brands Inc. Business History
The mission of Mega Brands Inc. is to nurture creativity in every child and every family. Their construction toys and play sets are popular with preschool children and boys aged 5-12. Mega also offers a broad assortment of craft and activity products mainly for girls of all ages. Their games and puzzles entertain the whole family and our extensive offering of stationery, pens, pencils, markers and crayons addresses every need, whether for school, work or play. Their global ambition is to make MEGA Brands the choice of every family around the world. They have an outstanding product development team and, every year, 3-4% of sales are invested to drive innovation, resulting in their products winning critical acclaim for their contribution to child development and play value.
History – In 1967, Victor Bertrand and his wife Rita founded the company as Ritvik Toys, Inc. Ritvik was amalgamated with Ritvik Holdings Inc. on June 30, 1998. On March 19, 2002, the name was changed from Ritvik Holdings Inc. to Mega Bloks, Inc. Currently, the founders' sons Vic Bertrand Jr. and Marc Bertrand are CIO and CEO, respectively. On June 15, 2006, following the acquisition of several brand names not associated with construction brick toys, the company again changed its name, this time from Mega Bloks, Inc. to Mega Brands, Inc.
Business Growth – Mega Brands Inc. saw steady growth in net sales from 1999 through to 2006. The acquisition of Rose Art Industries Inc. in 2005 lead to lawsuits by the former owners and a lawsuit due to a death involving the acquired magnetic construction toy line from Rose Art Industries Inc. contributing to a $300 million dollar accounting loss in 2008. The global recession also hit the toy industry hard through 2008 and 2009. After a financial restructuring action, Mega Brands Inc. has returned to profitability and has significantly increased net sales and earnings (Fig.1).
Current Management
| Marc Bertrand | President and Chief Executive Officer |
| Vic Bertrand | Chief Innovation Officer |
| Peter Ferrante | Vice President and Chief Financial Officer |
| Geneviève LeBrun | Vice President, Marketing and Business Development |
| Jean-François Albert | Vice President, Operations and Human Resources |
| Mark Girgis | Vice President, Legal Affairs and Corporate Secretary |
| Michel Moggio | Vice President, International |
| Michel Bendayan | Vice President, Americas |
| Lucie Desjardins | Senior Legal Counsel and Assistant Corporate Secretary |
Production
Main products – Megabloks construction toys, Mega puzzles, Board Dudes organization boards, Rose Art stationary and activity products.
Main Market – Mega Brands competes in a highly competitive market with several large businesses (Hasbro and Mattel) as well as many smaller businesses (LeapFrog and Lego). Its most direct competitor, particularly in the construction toy market, is LEGO. Mega has a good reputation in the preschool building block market with their Mega Blocks products, but has until recently struggled in the 8 and over market. With the acquisition of some high profile licensing agreements (Halo, Power Rangers, and Marvel) they have been able to increase their market share and shelf space in retailers such as Walmart.
Supply and Demand of one product – Mega Brands has been able to increase the demand for their products over their competitors by keeping prices low. In particular LEGO has maintained their higher prices in an effort to cash in on the perceived higher quality and by being synonymous with construction toys. LEGO also has several very popular licenses such as Star Wars and Harry Potter, which gives them a rather inelastic demand.
Competition
Strongest Competitors – Lego, Hasbro, Inc., Mattel, Inc., Leap Frog Enterprises, Inc.,
Competitive Advantage – Low cost.
Summary
Mega Brands has slowly established itself in the educational toy industry over the past 40 years, entering a highly competitive market, but has switched gears in the last 5 – 10 years and has really pushed to become a major player, increasing market share. It is a very innovative company and with the recent restructuring has shown that it is a very resilient and flexible company that can adapt to challenging situations.
Sources
Wikipedia entryhttp://en.wikipedia.org/wiki/Mega_Brands
Corporate information
Official Home Page
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