Is your logistics company ready to handle an emergency recall? Ours is!

In a recently released a study titled “On The Trail To Traceability – New Legislation, New Complexity Lead To New Challenges”, RedPrarie polled supply chain and operation executives from close to 130 CPG, Life Sciences, and Food & Beverage companies, most of whom (~77%) represent companies greater than $500M in annual revenue. The results are shocking, over 51% said that it would take them days or weeks to recall a specific item/lot.

You can probably imagine how critical this could be to a companies bottom line. If the wrong product couldn’t be recalled in time, it could cause major problems, possibly even financial ruin. It’s critical that in this modern world that you have a company who can, in a matter of minutes, track all items and stop their progress in an emergency situation.

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Over 45% of those companies polled said they could not recall a specific item/lot without impacting other items/lots. This means that entire orders would have to be stopped from transit just to pull a few products from the load.

The average cost of a recall to participating food and consumer product companies is $10 million, in addition to brand damage and lost sales. That of course does not include the incalculable human costs associated with some of the recalls.

$10,000,000 is the average cost of a recall for food and consumer product companies participating in this study. That doesn’t even include lost sales, brand damage, or the possible loss of human life.

Almost 90% of all companies polled are somewhat to very concerned about financial liability if something goes wrong. This means that when choosing your company for Third Party Logistics, be sure to ask the important questions about their protocall if something should go wrong. You want to be sure that they will be around to service you no matter what, and in the case of a recall, they can act fast and be reliable.

93% of consumers believe recall handling indicated whether a company cares more about profits or customer safety.
– Princeton University/The Relational Capital Group, 2010

87% of consumers are more likely to purchase from companies that manage recalls “honestly and responsibly.
– Princeton University/The Relational Capital Group, 2010

Clearly this issue is one that needs to be debated when selecting the right logistics company for your products. Be sure to find out their gameplan if something should go awrry with one of your shipments, and see what type of inventory reporting they offer.

Source: Commerce In Motion
Report: Download From Commerce In MotionDirect Download Link

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