What is Product
Recall & Withdrawal
As
a whole, businesses place their best efforts in the design, production, and the
selling of a safe product. According to various consumer safety organizations, the
possibility of a defective product reaching a customer still exists. If you look
at the current product liability climate for manufacturing, distribution and sales
environment, a product recall plan is a necessity for all businesses. Today, consumers
believe they enjoy safer, better products as a result of a companies’ willingness
to conduct a product recall when necessary. With millions of products being recalled over the years, consumers no longer view product recalls
in a negative light. How well a company conducts a timely, reasonable recall of
a product can have a strong influence on consumers’ attitude about the company.
Successful product recalls in the past have rewarded companies with continuing consumer
support and demand for the products.
A product recall removes
products from distribution, sale or consumption that present a significant
health or safety threat because of a product defect or contamination. This can
either be at trade or consumer level. Recalling food products can happen
because of a report or complaint from manufacturers, wholesalers, retailers,
government or consumers. It can also occur after the business itself has run
internal tests and audits.
A product withdrawal, on
the other hand, is where product is removed from the supply chain, but not
for health and safety reasons. For example, if something has been labeled with
the wrong weight, the manufacturer may want to withdraw it. But if the same
product was labeled with the wrong ingredients and allergens, this would then
be a recall. Manufacturers sometimes also withdraw products as a precaution,
waiting further investigation of a potential public health risk. If that risk
is established, the food must be recalled.
For
an example, let’s say the unthinkable has happened where you’ve discovered a
problem in your manufacturing line that affects a whole batch of products.
Worse still, a full supply has already left the plant and hit the store
shelves. What now? Is it a “recall” or a “withdrawal”? Does it matter? Yes, it
really does and this is why: if you issue a recall notification but it’s
actually a product withdrawal, you could find yourself paying out for media
notices and other recall costs for no reason. On the other hand, if it’s a recall
and you treat it as a withdrawal, the ramifications could extend to legal
action. Knowing the difference between a recall and withdrawal means you can
handle the situation quickly and correctly, saving you valuable time, money and
stress. Here’s a guide we’ve put together on the key differences between a
“product recall” and a “product withdrawal” that every manufacturer and brand
owner should know.
Thus
primary goal of a food recall is to protect public health by removing products from
commerce that have been determined to be unsafe. A recall plan can aid in the execution
of a recall by apportioning duties, centralizing current contact information, and
providing pre-written templates for communications. Key Individuals that will be
participating in a company recall should review the recall plan and be familiar
with the execution of the plan.
Definitions
Class I Recall – A
situation in which there is a reasonable probability that the use of, or exposure
to, a violative product will cause serious adverse health consequences or death.
Class II Recall –
A situation in which use of, or exposure to, a violative product may cause temporary
or medically reversible adverse health consequences or where the probability of
serious adverse health consequences is remote.
Class III Recall –
A situation in which use of, or exposure to, a violative product is not likely to
cause adverse health consequences.
Depth of Recall –
The level of product distribution for the recall (consumer, retail, institutional,
wholesale).
Distribution List –
A product specific distribution list, which identifies accounts of customers or
wholesalers, who purchased the recalled product. Requested information includes
type of business, account name, addresses, and contact information.
Market Withdrawal –
A firm's removal or correction of a distributed product which involves a minor violation
that would not be subject to legal action by the regulatory agency or which involves
no violation, e.g., normal stock rotation practices, routine equipment adjustments
and repairs, etc.
Press Release –
A notice that alerts the public (including regulators, retailers, consignees, other
distributors, processors, and consumers) that a product presents a serious hazard
to health. Not all recalls require a press release; the regulatory agency will
advise the firm when a press release is necessary.
Recall –
A firm's removal or correction of a marketed product that the regulatory agency
considers to be in violation of the laws it administers and against which the agency
would initiate legal action, e.g., seizure. Recall does not include a market withdrawal
or a stock recovery.
Recall Committee –
The group comprised of key staff with the expertise, authority, and responsibility
to manage the recall.
Recall Plan –
A written contingency plan for use in initiating and implementing a recall in accordance
with stipulated law in the concerned country. The Recall Plan should be reviewed
annually and revised as necessary when personnel, procedures, processes, suppliers,
or as other factors change.
Recall Strategy –
A planned specific course of action to be taken in conducting a specific recall,
which addresses the depth and scope of recall, need for public warnings, and extent
of effectiveness checks for the recall.
Scope of Recall –
Defines the amount and kind of product in question.
Stock Recovery –
A firm's removal or correction of a product that has not been marketed or that has
not left the direct control of the firm, i.e., the product is located on premises
owned by, or under the control of, the firm and no portion of the lot has been released
for sale or use.
Preparing For a Product
Recall
It
is rare that any two recall programs will ever be identical. Therefore, companies
should be prepared to address issues that invariably arise. For instance:
What is the defect that causes the product hazard?
What caused the product defect to occur in the
first place?
Where are the unsafe products? How many are
there?
Did the product fail to comply with government
safety regulations? How?
Was the government
or the appropriate regulatory body informed about the defect or lack of compliance
has the company discontinued production and shipments of these products to distributors?
Has the company notified
retailers to stop selling the product and asked them to help identify consumers
who own the product?
Has the company started
reviewing existing databases to identify potential product owners, e.g., product
registration and customer service records?
Has a press release
been prepared announcing the recall? What other forms of public notice are needed?
Is the firm utilizing social media and digital and mobile communication platforms
to get its message out? If so, how will it
do so? If not, why not?
Has a toll-free telephone
service been set up that will be able to handle the number of calls expected after
the recall is announced?
Has the firm’s website
been modified to announce the recall and accept email requests to participate?
What is the company's estimate of the cost
of the product recall campaign?
Is the company prepared
to deploy manpower and/or fund an effort to provide replacement parts for defective
products or to exchange them for new products that do not have the problem?
Has a plan been developed
to ship replacement parts or new units to distributors participating in the product
recall, or otherwise repair units in their inventory?
Has a plan been developed regarding the disposition
of returned product?
How will the product
be reworked, broken down for reclamation of critical components, or destroyed? Are
procedures in-place to ensure proper control and tracking of all defective materials
returned in the recall?
Is the company prepared
to monitor the product recall and provide timely reports to the Commission on the
progress of the recall?
How is the company upgrading
its quality control or risk analysis procedures to prevent a similar product recall
in the future?
This list addresses
administrative and operational functions of a company involved in a product recall.
Even if a product recall is merely potential, a company should be prepared to respond
to the questions listed above.
When
it comes to recalls, companies are legally required to communicate recall
information to state and territory government agencies and industry groups. The
business is also responsible for ensuring that the public is notified of the
recall.
To be continued
Reference:
Recall
Handbook: http://www.cpsc.gov//PageFiles/106141/8002.pdf
Sample
Recall Plan: http://www.cdph.ca.gov/pubsforms/Documents/fdbRIgde23.pdf
Product
Recall Guide: https://s0.hfdstatic.com/p/losscontrol/files/private/1287778604098.pdf
Regulatory
Procedures Manual: http://www.fda.gov/ICECI/ComplianceManuals/RegulatoryProceduresManual/ucm177304.htm
http://blog.matthews.com.au/index.php/product-recall-withdrawal-7-facts-every-manufacturer-know/
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