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Cabbage Patch Kids were created by Xavier Roberts and Debbie Morehead in 1978 as one of the few long-running doll brands around. These dolls were all cloth and were initially sold at craft shows.
Coleco began mass producing them from 1982-1989. Coleco's design was initially of a hard plastic head which changed to an all vinyl head with soft fabric bodies. We all remember those famous "gotta have" Christmases in the United States where mothers would knock over other mothers for a chance to bring these rare hard-to-find dolls home to their little girls. Sales in 1983 alone generated over $2 billion and almost $5 billion total. The power of the Cabbage Patch Kids was never enough to keep Coleco (originally a shoe leather manufacturer in 1932) from filing bankruptcy and eventually being purchased by Hasbro.
Hasbro took over from 1989-1994 manufacturing gimmick doll lines such as Birthday, Pretty Crimp and Curl, and Splash 'n' Tan Kids, but were never able to regain the dolls' glory years. Next Mattel steps in and starts making not only cloth dolls but vinyl ones as well from 1994-2003. These included gimmick doll lines such as OlympiKids or Fairies.
Over the years, other manufacturers have bought and sold the rights to the dolls including Toys "R" Us, Play Along Kids, and even porcelain versions produced by the Danbury Mint.
Trivia: Named the official mascot of the 1992 US Olympic team as each member is given their very own doll to take to the games. Feel free to look around a bit.