How Karmel Games Leveraged Made in America Into Corporate Success

¶ … Decision to Outsource or Manufacture in-House

Today, a growing companies of all sizes and types are confronted with the decision concerning whether it is in their best interests to manufacture their products in-house or outsource the various functions of the supply chain. One such company is Karmel Games which is headquartered in La Jolla, California. Founded in 2006 by Geoffrey Moran (current CEO) and Kim Treffinger (current sales director), Karmel Games has introduced a line of educational games and toys under the brand Evolving Toys over the years that are all manufactured by the company in the United States that have won numerous awards from educational organizations for their innovative design that makes learning fun and contributed to its success. To gain some new insights into the rationale behind the company's decision to retain the manufacturing of its line of games and toys in-house, this paper reviews the relevant literature concerning these issues to include a strengths, weaknesses, threats and opportunities (SWOT) analysis of the company and an analysis concerning the potential impact that would result from alternative sourcing strategies such as offshoring or outsourcing this function. Finally, a summary of the research and important findings concerning Karmel Games' decision to retain the manufacturing function in-house are presented in the conclusion.

Review and Analysis

SWOT Analysis of Karmel Games

The SWOT analysis is intended to identify relevant strengths, weaknesses, opportunities, and threats related to an enterprise of interest (Cravens, 2000). In this context, strengths and weaknesses are regarded as being internal aspects of the enterprise while threats and opportunities are external aspects of the competitive environment in which the enterprise competes (Cravens, 2000). An application of these SWOT elements to the company is provided below.

Strengths. Both company founders have extensive international entrepreneurial and professional management experience. In fact, CEO Moran was a Fulbright Fellow in Applied Ethics who earned a master's degree from the University of British Columbia. Likewise, the company's co-founder and sales director Treffinger has an educational background in early childhood development and is the author of best-selling books on pregnancy and early childhood education (Karmel management, 2016). The company's line of branded Evolving Toys games and toys have consistently won awards for their playability and educational value, beginning with the company's flagship game, "Play Civil, America!" introduced in 2007. Other award-winning products that followed include "Ingenious Inventions" (a technology trading game) and "Small Boxes, Big Play" (a series of educational card games), both of which were introduced in 2009 (Karmel press, 2016).

Weaknesses. The company's Web site's ecommerce function has been disabled and there is no indication when service will be restored.

Opportunities. While the company's currently maintains a Facebook presence, the opportunity exists to expand this presence to other social media platforms in a cost-effective fashion. In addition, the company's current line of American-themed games and toys could easily be replicated for other cultures, creating an export market for countries such as China where learning the English language is currently a high priority.

Threats. The company's line of award-winning card games, board games and toys do not include any computer-based versions.

Analysis of the company's decisions and strategy regarding site selection, outsourcing, and offshoring operations

The decision to retain manufacturing in-house or to outsource or offshore this function depends primarily on costs and quality (Manning & Lewin, 2011). While the company does not publish details concerning this decision, it is reasonable to conclude that based on the co-founders' analysis of their market and the availability of viable alternatives elsewhere, their emphasis on producing the highest-quality educational products possible resulted in the retention of this function in-house despite the potentially higher costs of this alternative.

Examination of the impacts of offshoring or outsourcing on quality and the supply chain

At present, the company manufactures its branded games in-house and markets them online through Amazon as well as through brick-and-mortar retailers based in museums as well as retail toy stores and bookstores across the country that specialize in educational games and toys (Karmel retailers, 2016). This strategy allows the company to enter into strategic partnerships and alliances with various American museum gift shops and feature the "Made in America" seal on its products, features that would not be possible if the company had made the decision to offshore or otherwise outsource this supply chain function.