Hasbro, a US-based leader in the toy and games space, recently revealed its earnings for the third quarter of 2024. During a call addressing investors, Hasbro CFO Gina Goetter highlighted the work of the company’s supply chain team in overhauling its operations, delivering cost savings to the business.
Goetter explained: “Through the first nine months of the year, [Hasbro has] delivered US$240 million of gross cost savings and $177m of net savings.” It’s reported that of the $177m net cost savings, 60% came from action such as efforts to reduce inventory and improve productivity.
“Our supply chain team delivered once again finding additional productivity wins, while our inventory has remained at multi-year lows, down 40% year-over-year,” she elaborated.
She went on to say: “Our strategic decision to keep supply tight has resulted in a significant drop in closeout volume, which continues to be a gross margin benefit at the expense of consumer products revenue.
“This is a trade-off we are consciously making as we continue prioritising restoration of toy profitability while sharpening our innovation to drive premium offerings to our retail partners.
“Staying disciplined with our inventory across all our businesses is the right long-term decision for the company, but it also heightens the importance of accurate demand forecasting and supply chain agility.
“As we continue to upgrade our processes and systems, we are focused on strengthening that muscle to ensure we have adequate supply of the products our customers want.”
Goetter appeared to be positive about the remainder of the year and beyond, saying: “We remain on track towards our target of $750m of gross cost savings through 2025 and continue to expect $200m-$250m of net cost savings in 2024.”
