In an increasingly global marketplace, more and more recalls are global as well. Companies that encounter a safety issue may find a number of global complexities at play. Notification, transportation, disposal, and reporting requirements can vary drastically across borders. In many cases, a recall may not even be mandatory in certain markets.
Recently, two companies found themselves facing this situation. Their approaches were very different – and so were the consequences.
One company opted not to issue a recall in a country known for adopting more lenient regulations. The backlash was swift and severe. While some put the blame on the country’s leaders, others pointed the finger at the company itself, saying it should have put people ahead of profit. Many took to social media to vent their frustration with the situation. Some even called for boycotts. Eventually, the company was forced to expand the recall anyway.
The other company took a proactive stance, issuing the recall in multiple countries – even those with comparatively lax standards. The company received high praise from local media outlets and the public at large for going above and beyond what was required.
When faced with a widespread product recall, business leaders are understandably concerned about the financial impact and may be tempted to do the bare minimum. But as these cases demonstrate, the smarter play is to consider the long-term effects. Consumer trust and loyalty, once lost, are difficult to win back. Companies should consider expanding the scope of the recall to prevent the possibility of brand damage.
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