January 15, 2019 Industry news
Errors in product labelling can cause a raft of serious problems for brands and consumers alike, but there are straightforward fixes to this industry-wide concern
Ongoing turbulence in the retail industry has woken the sector to the potential advantages of better product data for commercial success.
While the monetary benefits have become clear for companies, recent tragic events related to incorrect labelling have helped to highlight the equal importance of precise information for consumers as well.
Hard truths and tough consequences
The ramifications of mislabelling have a huge variance in outcome, ranging from a loss in profits to the loss of life.
The EU Food Information for Consumers Regulation came into force in December 2014 mandating the provision of details regarding 14 specified allergens in unpackaged foodstuffs or food packaged onsite.
Since new sentencing was introduced in 2015, penalties for non-compliance with food safety legislation have included unlimited fines or imprisonment for a term not exceeding six months or both.
In the case of Paul Wilson, who died after a peanut-induced anaphylactic reaction in 2014, the proprietor of the restaurant involved in the case was jailed for six years under a charge of gross negligence manslaughter. The restaurant owner had substituted almond powder for groundnut powder, a cheaper alternative that contained peanuts.
The sum total of recall
In the UK, there were 109 product recalls due to undeclared ingredients or incorrect allergen labelling in 2018. Following a formula proposed in 2010 by academics Moises Resende-Filho and Brian Buhr (below), the estimated direct cost of a product recall for individual companies could mean a financial hit that runs into the millions of pounds, depending on the scope of several factors.
As well as the tangible monetary impact of a product recall, the indirect effects could be even more costly. Some experts suggest that as much as 80 per cent of cost are incurred after the physical recall process has ended due to:
Four strategies for success
The key to ensuring that your product information is correct on your packaging is a simple two-pronged approach that necessities both a change in behaviour and change in process. Simply, each area can be broken down into two further parts:
Behaviour
1. Greater collective responsibility
Making sure that products are correctly labelled is not the province of a single company, but of a whole industry.
While it should be incumbent upon every company to push for the highest possible operational standards – in relation to consumer safety, upholding of customer confidence, and the safeguarding of the environment – no single company can set an agenda for the industry it works in.
There needs to be collective agreement on how to tackle issues of corporate and social importance in order to make an impact.
Only as a collective can industry at large then lead the way on issues to ensure consumers have confidence in what they are purchasing.
2. More involved stakeholder collaboration
A cornerstone of collective responsibility is open and consultative dialogue.
As we have seen, product labelling errors could lead to a number of consequences with varying levels of severity.
Many of these could be halted by better collaboration throughout the supply chain. However, the default stance for a brand or retailer dealing with an internal issue is, in the main, to search for a solution in isolation.
Broadchurch problems are solved in communion, not seclusion, yet the willingness on the part of the wider business community to work together on a set of problems that affect the individual as well as the whole, is often lacking.
The need for an independent and neutral industry convenor and moderator like GS1 UK has been an essential in uniting industry members for a common cause.
Process
3. Automation
One of the many advantages of process automation is the freeing up of time to concentrate on other things.
Turning the collection and distribution of data through simple new line forms and integrated data management systems into an automatic process, suppliers and retailers will have more time to spend on other value-adding activities.
Such activities should include vetting the accuracy and consistency of data captured as well as concentrating on enhancing the customer experience.
4. A standardised and common approach to data collection
Currently, as much as 80 per cent of product data is represented inaccurately or inconsistently.
This includes anything from data that is incomplete or even totally missing from the outset, to information that varies in format from one product to another, such as discrepancies in the metric and imperial systems for the weighing and measurement of items.
While standardisation of the way product information is represented and disseminated is eminently desirable, it is far from the norm.
When there is a single, common methodology for data collection and entry, that draws on a shared language for presentation and distribution, the room for error when it comes to displaying product constituents is greatly reduced.
By diminishing the margins for error and communication of errors, the integrity of a product and brand can be safeguarded.
By the industry, for the industry
Since 2016, the retail grocery industry has been working together to activate this simple two-pronged approach through the development of industry-designed product data sharing platform, productDNA.
To find out more about productDNA and how you can join the retail revolution visit the link below:
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