Printing News serves the entire Printing Industry with targeted content for the large commercial print segment.
Issue link: https://foodlogistics.epubxp.com/i/110983
INMAR RECALL MANAGEMENT PROTECTING CONSUMERS. PROTECTING BRANDS. PROTECTING THE ENVIRONMENT SM . CONSULTING ��� StrategyDevelopment ��� RiskMitigation ��� ReadinessAssessment EVENT EXECUTION ��� Multi-ChannelSolutions ��� End-to-EndManagement ��� InternationalField&FacilitiesNetwork; ��� BrandProtection ��� BrandRecovery www.inmar.com ��� 866.440.6917 ��� solutions@inmar.com ���Recalls demand significant pre-planning and ongoing support to ensure that companies facing potential recall situations can efficiently and effectively mitigate the risk to public safety as well as to their brand,��� adds Dollase. ���A mishandled recall can be devastating to a brand.��� Furthermore, ���Increased consumer awareness of and sensitivity to recalls, and increased regulatory scrutiny, are also driving shifts in recall focus and management.��� Regulatory and compliance issues are also raising awareness about reverse logistics. Dollase points out that: ���With the Food Safety Modernization Act (FSMA), the FDA has expanded its reach and regulatory powers, with more responsibility being placed on manufacturers and retailers. There are also new controls on imports, enhanced enforcement powers and new fees that can be levied. An appropriate recall plan for manufacturers will address traceability of product distribution, offer a solution to quickly contact customers, remove product from the market expediently, and maintain records to meet FDA requirements. Companies rarely have the internal resources or the systems to manage a recall event effectively as manufacturers��� recalls aren���t a normal course of business.��� Dollase asserts that ���one of the best times to think about a product in the reverse supply chain is actually in the design phase.��� Start by asking questions such as, ���Are the components made of recyclable materials? Are there hazardous materials involved?��� he advises. ���Often the best reverse logistics solutions can come from the concept and design aspects of a product���if you know what can be done with a product at the end of its lifecycle, you can make better decisions at the beginning���including an exit strategy for new products. Retailers want to have exit strategies for products with an unproven track record in the marketplace and this is a consideration for manufacturers as they sell their products to retailers.��� Gene Bodenheimer, senior vice president at GENCO ATC and practice leader for the com- www.foodlogistics.com pany���s unsaleables management services, agrees that proper planning is always recommended to ���prevent merchandise having to be returned in the first place.��� Naturally, some returns are unavoidable, he acknowledges, but the focus should be on prevention. Unsaleables alone cost manufacturers $2.6 billion annually. ���On average, a company needs to sell seven new items to cover the cost of one unsaleable product coming back,��� says Bodenheimer. GENCO ATC estimates that it has saved companies between 5 to 15 percent annually in costs related to unsaleables. The company even offers a free online unsaleables calculator that can be used to estimate the savings potential with this service. The e-commerce twist E-commerce is putting a unique twist on reverse logistics. Surveys indicate that customers care quite a bit about the returns process when shopping online. Simply put, if it���s not fast and easy, the retailer will lose them as a customer. Returns are a significant part of the holiday shopping season. And for retailers, ���January and February are the busiest months for holiday returns, equal to about 10 percent of overall sales,��� says Steve Sensing, vice president for hi-tech/electronics at Ryder Supply Chain Solutions. Meanwhile, ���As more consumers make purchases online, product return rates post-holiday have significantly increased. In fact, returned goods from online sales now make up 20 to 30 percent of all returned merchandise for retailers. All of this activity means that retailers need to find a fast, cost effective and sustainable means for disposing, recycling or reselling the products that are reentering their supply chains,��� he says. From Sensing���s perspective, ���It���s all about speed. When a product is returned, it is basically a lost sale. So, retailers have to maximize the value of that returned asset, and they have to do it really fast in order to not take a hit to their bottom lines.��� For example, ���More than 70 percent of the products returned in the consumer electronics and hi-tech industry have nothing wrong with them. The quicker those products can be repackaged, put back into inventory and made available for sale, the quicker those companies can recover their value.��� It���s understandable why some companies balk at first when it comes to reverse logistics, says Sensing, because to do it ���really effectively can be complex, costly and labor intensive. ���The returns process generally includes logistics and transportation, depot repair, sales and marketing of refurbished products, finance (validating warranty repairs), customer service and channel management.��� And that���s not all, he adds. ���There���s also a great deal of physical handling of the returned goods to determine the product���s disposition (should it be repaired, refurbished, scrapped, recycled, or repackaged) and employees need specialized training depending on the types of goods they are dealing with,��� whether it���s consumer electronics, appliances or apparel, for instance. Inmar���s Dollase also emphasizes the importance of reverse logistics in e-commerce. ���Consumers are starting to look at returns policies before deciding on a purchase. A difficult or stringent returns policy could turn away a potential customer. Companies are simplifying returns to combat the potential loss of sales and are using the ease of returns as a selling point for their stores. As a result, reverse logistics has taken a new place of prominence in the sales cycle with a focus on the consumer.��� Sustainability and social responsibility There are many ways that companies benefit from implementing a comprehensive reverse logistics program, including enhanced sustainability and social responsibility. ���Effective handing of returned goods isn���t just good for the business, it���s also very good for the planet,��� emphasizes Ryder���s Sensing. FOOD LOGISTICS ��� JANUARY/FEBRUARY 2013 35