Consumer protection is the undisputed top priority in any recall, says Recall InfoLink CEO Roger Hancock.
Food companies must also consider brand protection as they put in place processes to prepare for potential food safety recalls, he said. Within that context, Hancock said cost control measures are an important part of business considerations in a recall.
Food businesses need to do everything possible to minimize the direct and indirect economic fallout from recalls, he said.
Focused entirely on recalls, Recall InfoLink helps brands become recall ready by standardizing data, collaborating with their supply chains and practicing recall simulations, according to a news release.
Hancock recommends that food companies:
- Understand the risk — The cost of recalls is usually overlooked and unanticipated, and the company said sometimes industry members don’t take time to consider possible costs associated with a recall, including investigations, research, transportation, disposal, legal costs and more. “Conducting an economic deconstruction of a recall helps companies better understand the risks so they can reconstruct recall processes in a way that helps contain costs,” the release said. Companies should consider costs that may be incurred post-recall to rebuild the brand and trust with trading partners.
- Prepare — The company said a food brand’s recent multistate recall didn’t go as smoothly and efficiently as it could have because all contaminated products weren’t initially identified, which led the company to significantly expand its recall later.
“A company that’s well-prepared to process a recall efficiently will spend less money on the process than a company that’s less prepared,” the release said. “Additionally, ineffective or inefficient recalls can be extremely damaging in terms of lost consumer trust, reputational damage, litigation, etc.” - Have proper protections in place — Recall insurance helps mitigate financial losses, the company said. “Work with insurance professionals to ensure that your company has product recall insurance in place before a recall happens,” the release said. “General liability insurance often does not cover recall costs.”
- Use proper preventive measures — Even if an organization has the most stringent food safety protocols in place, a recall could still happen. Just like an airbag is a preventive measure to protect in an auto accident, recall preparation is preventive for a product defect event. Conduct recall simulations with trading partners, and invest in technology for traceability and recall management. These are the best preventive steps companies can take, the release said.
- Recognize the potential damage from indirect costs — While recalls can be extremely expensive — in terms of replacing contaminated products, providing consumer refunds, paying for third-party audits, funding complex logistics and more — significant damage often comes from indirect costs. Consider the potential long-term effects of a food recall on the company’s brand image, the negative impact on consumer trust and loyalty, harmful media coverage and social media comments and more. These indirect costs can cause long-term, potentially irrevocable, damage to a company, the release said.
In a recent interview with The Packer, Hancock talked about how food recalls have changed in the past 20 years.
“I think, in general, there’s been a growth of what’s called a mock recall,” he said. “I think there have been more companies doing mock recalls today than they did 20 years ago. Companies are thinking, ‘How do I get prepared? What steps do I need to take?’ And they’re doing a lot of good things in that regard, in terms of recall preparedness within their company.”
Recall InfoLink provides a platform that enables companies to collaborate with their supply chain, to remove products from the supply chain and to protect consumers and protect their brands, Hancock said.
“We do that by guiding people through standard practices, standard processes, putting together the right information so that it gets to the right people, so that they can do the right thing,” he said. “And if the right thing for them is to let more people know, then they just iterate that message across our platform to additional points in the supply chain. That process can be practiced as well as implemented.”
Hancock said it is important for the industry to not just know where it sends its produce, but also to have accurate contact information for customers.
“Having a channel to get a hold of somebody, to get a hold of the right person with the right information, is essential,” he said.
Another area that needs improvement is data associated with produce, Hancock said.
“The traditional method of processing recalls was product-centric, and the use of technology is transferring that to a data-centric model,” he said. “You can efficiently cover your supply chain if you’re all describing that product with the same data.”
Hancock said Recall InfoLink is helping companies implement recall processes using the GS1 data standard because the GS1 standard is reputable and well recognized.
