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Deutsche Welle

The reasons for the decision are problems with quality, high transport costs and long delivery times. The situation became critical when it took two months to deliver the soft toy version of polar bear Knut. Steiff's move raises one question: is globalization going in reverse? Germany's Association of Toy Manufacturers believes Steiff is not the only toy company thinking of making the move back to Europe as producing in China involves big risks - especially for high quality manufacturers like Steiff.

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The new management team in the traditional Steiff soft toy company has decide to end production in China. The decision taken by their predecessor was very controversial; the idea was that cheaper cuddly toys would increase turnover. But now this course has been abandoned.

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Nevertheless, the move to China was not a mistake for managing director Martin Frechen: I wouldn't call it a mistake. We're 128 years old - or young, as it were; of course we try various things, and at the time, the old management probably said this was the step to take us forward, that will put us in a position where we could offer the brand globally at different prices. Now, four years later, we've gathered a lot of experience and we conclude that for what we make, the complexity of our articles, the stability and continuity that we need for the entire process, it wasn't exactly the right route."

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There were multiple problems: delivery times, logistics and quality. Both managing directors agree that the highest level of quality is absolutely crucial. Martin Frechen: "The fact is that with this product, it's extremely important for the face to be right, if the eyes were moved slightly, if they were a little lower down, the expression would be weakened. The symmetry of the face has to be right, the whiskers must be sewn in exactly in the right place. We can better achieve this perfection, which is sometimes a matter of millimeters, in our own finishing workshops than if they're sent to outside manufacturers."

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Both men hope that the changeover to their own production will not affect costs. Although the sewing work is more expensive in Europe, they will be more flexible again in future. On the other hand, this traditional manufacturer will still have to serve the mass market in future, with small affordable soft toys.

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Here at headquarters in Giengen, south-west Germany, they want to build up the design department. This is the heart of the company. They don't know whether they are starting a trend in the toy industry, but it is entirely possible that other quality manufacturers will follow suit. Wilfried Blömeke-Trox, the other managing director explains: "I think that people who have their own skills, their own production factories in Europe, they are likely to do this. Other toy manufacturers are really only sales representatives, they no longer have the opportunity."

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Steiff has almost completed the changeover; now the characteristic 'button in ear' only says 'Made in Germany'. These pandas are leaving the European production line for the Olympics in China.