If there’s one thing consumers, investors and companies can agree on, they hate recalls.
In the least of cases, faulty products or contaminated foods are an inconvenience for the unlucky buyers. At worst, recalled products are linked to injuries, illnesses and even deaths. For manufacturers, recalls batter brand reputations, bottom lines and share prices.
It’s a nightmare for all involved.
“Defective products not only pose a serious safety risk to the public but can also cause significant financial and reputational damage to the companies concerned,” says global insurance company Allianz. “We are now seeing and experiencing recalls on a scale not seen before, bringing record levels of activity and costs.”
Food and product recalls in perspective, are some of the biggest recalls in history by cost. It should come as no surprise dominated by the automotive industry. Allianz notes that the sector accounts for more than 70% of the value of all recall-related insurance losses in a given year. The pharmaceutical industry also has the dubious distinction of making multiple appearances. Mass production gone outa control with lack of quality for profit-not headed in the proper direction. You can still make hefty profits and consumers protection a prority.
Article credit: Kiplinger
Photo credit: Food Safety Magazine