Every year, hundreds of thousands of defective and contaminated products land up on store shelves, and in our homes.
Pharmaceutical companies, food manufacturers, and appliance and toy brands are among a host of industries dealing with the logistical and reputational nightmare of product recalls in 2019.
Products recalls in 2019
- US toy manufacturer, Mattel, is in the process of recalling 4,7 million Fisher Price Rock ‘n Play infant sleepers. The move follows the deaths, by suffocation, of more than 30 babies.
- Perdue Foods, a chicken, turkey and pork processing company based in Maryland, recalled 68,000 pounds of ready-to-eat chicken nuggets from stores nationwide. The problem? Possible wood contamination.
- Swiss multinational pharmaceutical company Novartis had to recall 600,000 bottles of prescription drugs due to packaging that failed to comply with safety standards.
- Global consumer goods manufacturer, Newell Brands was forced to take 5,9 million Contigo water bottles off the shelves in the USA, Canada and Mexico. The reason for the recall? A detachable spout deemed a potential choking hazard.
Effects of product recalls on companies
Along with the obvious financial implications of product recalls, the damage to the long-term sustainability of the brand can be significant.
If not handled properly, recalls can undermine trust, weaken customer loyalty and increase compliance expenses.
What is the potential impact of a product recall in terms of dollars and cents?
According to a report in Market Watch, the Fisher Price debacle is expected to cost Mattel up to $60 million in product refunds. The reputational risk, however, is far greater, as retailer and customer confidence has almost certainly taken a knock.
In South Africa, the country’s largest food producer, Tiger Brands, is still feeling the adverse effects caused by the recall of contaminated processed meat products.
Business Tech reports that the 2017-18 Listeriosis outbreak, which led to the recall of all Enterprise Polony products nationwide, cost the parent company an estimated R415 million ($28,5 million).
The losses, along with a R425 million ($29,3 million) class action law suit, resulted in a four percent decline in revenue, and an eight percent decline in operating income, over a six-month period.
Leading causes of product recalls
What are the leading causes of product recalls? Quality defects and safety-related issues are behind the bulk of recalls worldwide – and that ultimately means the end-to-end manufacturing process was not adequately monitored.
Steps for avoiding product recalls
How can companies ensure only the best products – in terms of quality, safety and compliance – always reach the end user? In two words; ‘proper oversight’.
Proper oversight means implementing thorough product inspections that span the manufacturing process and supply chain. It also entails paying close attention to regulatory standards and safety regulations.
Key to quality management is efficient document control. Testing results, audit trails, and where and how ingredients and components are sourced, should be instantly accessible, and retrievable.
Avoidance means being prepared for a worst-case scenario. Despite a company’s best efforts, mistakes and errors do occur.
When that happens, a crisis response team, which knows exactly how to identify problems, and determine an appropriate response to the problems, is an invaluable asset.
Rebuilding trust after a product recall
Speed, transparency and a commitment to change are central to rebuilding a brand, and regaining the trust and loyalty of the consumer.
By taking responsibility for a problem, acting on it immediately and communicating a viable resolution via multiple online and digital channels, companies can mitigate the reputational risk caused by product recalls.
What consumers ultimately want is a responsive brand that is prepared to investigate the cause of the crisis, and implement changes, quickly and efficiently.
How the right QMS software can protect your company against product recalls
The right QMS software is capable of forewarning and forearming companies against product recalls.
By connecting quality documentation with audit, risk and quality event management activities, it can root out and repair errors long before the product reaches the end user.
When a recall does occur, effective QMS facilitates rapid and reliable access to all the required data and records, from an archived and centralized repository.
Additionally, the right QMS software allows you to:
- assign document accessibility rights to key members of the crisis response team
- enter testing and operational data via uniform templates
- receive automated notifications and alerts that can instantly be relayed to designated recipients.
With effective quality management software, product recalls can be managed seamlessly, or even avoided altogether.
About isoTracker’s quality management software
isoTracker is a leading supplier of modular, subscription-based quality management software.
Our software helps companies of all sizes avoid product recalls and other potentially disastrous consequences of quality issues.
It does this by providing centralized data storage; workflows and automated notifications for ensuring no complaints, defects or issues are overlooked; and easy, accurate recordkeeping.