Retailing Advice

Product Recalls

Make sure you know how to handle a product recall. True or false: When there's a product recall, you can be held liable if you don't get the products off your shelves within 24 hours?

There's nothing retail businesses hate to hear more than the word "recall".

Product Recalls

When a manufacturer issues a recall of its products, retailers are usually the ones left to clean up the mess. And unless you know what you're doing, a recall mess can turn into a recall disaster in the blink of an eye.

In the U.S., product recalls are regulated by the Consumer Product Safety Commission (CPSC). The CPSC's main priority is to protect the American public from unsafe, unsanitary, and unseemly products that are the result of glitches or negligence in the manufacturing process. Although retailers don't cause recalls, they do bear a certain amount of responsibility for assisting the CPSC in its efforts to protect consumers.

Inform CPSC of Potentially Dangerous Products

If you suspect that one of the products you sell is potentially hazardous, you are responsible for reporting it to the CPSC at once. Your suspicions can be based on any number of things from your personal experience with the product to reports from your customers. It's better to be safe than sorry, so if you have any doubts contact the CPSC immediately.

Read & Post Recall Notices

Once the CPSC is made aware of a possible problem, they will assess whether or not consumer safety is at risk and issue a product recall if necessary. Ideally, retailers are notified of the recall before it is made known to the general public to give stores time to prepare their response. Your responsibility is to remain alert for the recalls when they occur and to post recall posters (provided by the CPSC) in your store.

Remove Recalled Products from Shelves

After you have received notice of a product recall, the CPSC expects your store to remove the product from its shelves as quickly as possible. To prevent the possibility of contamination or accidental restocking, carefully segregate recalled inventory from the other products in your storage facility. From there, it's simply a matter of carrying out the disposal instructions in the recall notice, which may or may not include returning the product to the manufacturer.

Assist Customers with Returns

In a perfect world, the manufacturer who is responsible for the recall should have to deal with irritated and concerned customers. But in the real world, that responsibility usual falls to the store where the product was purchased. Instructions about how to handle customer returns can usually be found in the recall notice, but it's not unusual for customers to receive replacement merchandise or a full refund.

Other Considerations

Even though your business probably bears no responsibility for the cause of the recall, the manner in which you handle the recall will have an impact on your store's reputation so it pays to go the extra mile. That might mean posting recall information on your company's website, especially if your store actively sells the product online.

Share this article

Additional Resources for Entrepreneurs

Lists of Venture Capital and Private Equity Firms

Franchise Opportunities


Business Glossary


Conversation Board

We greatly appreciate any advice you can provide on this topic. Please contribute your insights on this topic so others can benefit.

Leave a Reply

Questions, Comments, Tips, and Advice

Email will not be posted or shared
Code Image - Please contact webmaster if you have problems seeing this image code

Problem Viewing Image? Load New Code