Corporate Reputation at Stake with Product Recalls

There may come a time when manufacturers will have to recall a product. The laws of inevitability are on the side of the consumer, and each business along the supply chain needs to be prepared for this situation. How you handle the recall could be the difference between retaining good customer relations, or loss of confidence, when corporate reputation and profits are jeopardized.

Recalls are within the framework of reverse logistics, but are under the umbrella of unusual circumstances. Many businesses do not have a contingency plan in place. This is a big mistake.

Recalls are put in place to protect consumers, and immediate action is required. A smooth plan to handle the situation will impress the public with your compassion and desire to keep them from any further harm. It will also serve to protect you from further liability and possible fines.

A survey conducted in 1999 by Berman,“Planning the Inevitable Product Recall,” published in “Business Horizons,” found that of the 500 consumer products reviewed, nearly one-forth had experienced a product recall.

A manufacturer or seller could be held liable for failing to fulfill a recall in a proper manner. The recall can be voluntary, or forced by a regulatory agency or courts. This would happen if the product does not measure up to advertised claims for safety or effectiveness, a safety issue is triggered by a design flaw or production error, scientific evidence indicates the product holds potential health hazards to safety or contains toxic materials, product tampering, unforeseen uses for the product that could be potentially dangerous or failure to meet safety standards.

Reverse logistics industry experts say “product recall is a situation that nearly every manufacturer will probably face at some time or another, no matter how meticulous its quality control procedures.”

What product recall measures and policies do you have in place? Are you handling them yourself, and if so, are you up on all the latest regulations that will affect the success of your efforts? Is your public relations department up to the task? Are you confident they have the personnel and plan of action for a quick turnaround in case a recall should happen?

If not, who is your third-party service provider? There are reverse logistics firms that specialize in handling product recalls, from contacting the Consumer Product Safety Commission to handling the return flow of products.

According to, the following steps are essential to assure your product and brand integrity are preserved:

  1. Do your homework and locate a company that provides product recall management.
  2. Evaluate their recall process to ensure you are able to work with them.
  3. Select a product recall system that works for you, and can be implemented swiftly and efficiently.

For some, manufacturers’ product recall services start when the product is packaged. Software is available that allows them to quickly trace everything that goes into the product and then track shipments. This software can be integrated into your system.

Since product recall is an important aspect of the logistic process, many businesses conduct mock recall testing as a normal part of their operations. It’s better to be prepared and ready, and nothing happens, than to be caught unprepared.

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