Working prototype · public freight indices + Mattel's own disclosures · ocean-freight margin early warning
Mattel builds inventory through Q3 to feed the holiday quarter, and locks ocean-freight rates months ahead of knowing the bill. Freight Bridge takes a public container-rate shock and reads it straight onto next year's landed cost and gross margin, in operator terms: a 1-99 severity score, a colour band, and the basis points at risk.
A Mattel supply leader put the 2021 shock on the record as "just a shipping tax." Fair, so let's compute the tax. Pick a scenario: Freight Bridge moves a freight index against Mattel's disclosed sourcing and cost structure, separates the temporary freight tax from the structural margin question, and reports one number you can take into an order-pacing meeting. Every anchor is cited; the monthly curve between anchors is synthetic and labelled as such.
01 · Run a freight scenario
Each preset moves the ocean-freight index Mattel pays on its Asia-to-US holiday inventory. The verdict is computed live against Mattel's disclosed China-sourcing share and the disclosed weight of ocean freight + resin in its cost base. Sliders are optional: open them only if you want to tune the assumptions.
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Mattel · holiday landed cost
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Operator moves at this band
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Where the basis points come from, and which part is temporary
Drewry WCI composite, $/40ft · ▲ = scenario shock
Presets set these for you. Move a slider and the verdict, bridge, and decomposition all recompute. Defaults are Mattel's disclosed values where one exists; the elasticity and freight-cost share are labelled assumptions.
02 · The brief
It is a landed-cost bridge, not a forecast model. A freight-index shock raises the per-unit ocean-freight cost on the Asia-sourced share of goods; that lands as a cost-of-goods increase; price and mix recover part of it within the year; the residual hits gross margin in basis points. The math is deliberately legible: you could redo it on a napkin, and the "Tune" panel lets you.
| Input | Default | Where it comes from |
|---|---|---|
| Freight-index shock | per scenario | Drewry WCI composite anchors: 2019 avg $1,420/40ft, Sept-2021 peak $10,377 (≈ +630% vs 2019), 2026 ≈ $3,433. The "2021 again" preset uses the cited peak; others scale off it. |
| Asia-sourced share | 50% | Mattel disclosed China sourcing ≈ 50% in 2024, targeted under 40% (2025) and under 15% (2026); the slider lets you walk the rebalance. |
| Ocean freight share of landed cost | 7% | Assumption. Mattel disclosed ocean freight and resin together at ≈ 15-20% of cost base in Q3 2021; ocean alone is not separately disclosed, so 7% is a labelled mid-point, not a quote. |
| Price/mix recovery | 35% | Assumption. Pricing elasticity is not public; shown as a labelled lever. Production replaces it with Mattel's realised price/mix. |
Bands: green / CLEAR (severity 1-33, <~80bp at risk) · amber / WATCH (34-66) · red / ACT (67-99, a 2021-scale hit). The score is a monotone map of the basis points at risk; the band thresholds are fixed, the inputs are yours.
Mattel's own 10-K says it builds inventory through the first three quarters for the holiday peak, and that it contracts ocean-freight capacity and rates well in advance. So the freight bill on the holiday build is committed months before the margin shows up, which is exactly the window where a cheap public-index read buys operator lead time. This sits one layer over an inventory-glut radar: inventory tells you how much you over-ordered; freight tells you what the boat cost to bring it, and the two compound in the same quarter.
03 · Sources & method