Coleco Reduces Headquarters Staff By 10 Percent
WEST HARTFORD, Conn. (AP) _ Citing sluggish sales and expectations of a slow holiday season, Coleco Industries Inc. has laid off 60 workers, or about 10 percent of the work force, at its West Hartford headquarters.
The toy company, in announcing the layoffs Tuesday, said employees from vice presidents to clerical workers were let go. The reduction, which was effective immediately, brings the employment at Coleco headquarters to about 550 people.
″This is in response to an anticipated decline in consumer spending during the holidays and the first half of 1988,″ said Barbara Wruck, Coleco’s vice president of corporate communications.
″Coleco is intensifying its its cost reduction efforts throughout the company.″
In the past two years, Coleco has laid off about 560 people at facilities in West Hartford, New York and Montreal.
In Tuesday’s layoff, it joins other U.S. toy companies forced to cut staff in response to sluggish sales. Layoffs have already been made this year by Worlds of Wonder Inc., Lewis Galoob Toys Inc., and Mattel Inc., all in California.
Industry analysts said they expect layoffs soon from Kenner Parker Inc. in Massachusetts and perhaps from Hasbro Inc. in Rhode Island.
In 1986, Coleco lost $111.2 million, or $6.52 per share, on sales of $501 million in 1986.
It has been plagued by cash flow problems, high debt levels and slow sales of many of its products throughout 1987. Gary Jacobson, an analyst with Kidder Peabody Inc. in New York City, predicted the company would post a loss of 35 cents per share this year, while analyst Sean McGowan of Balis Zorn Gerard Inc. in New York estimated losses could reach 50 cents to $1 per share.
Coleco markets, among other toys, the Cabbage Patch Kids dolls and a line of stuffed toys based on the prime-time television character Alf.