(1) Establishing a recall management organization and clarifying the responsibilities of each department.
To carry out recall management, an enterprise must set up a recall committee (or recall management team), which is fully responsible for the whole process of recall. Members of the committee should include heads of logistics, production, quality, customer service, finance, legal, public **** relations, product development, marketing and information systems, and sometimes the company's first officer should also be involved. The recall committee should designate a recall coordinator from among them as the head. Larger companies must also define the centralized elements of the recall committee to decide on a centralized, decentralized, or combination of centralized and decentralized organizational form. (The recall committee must define the tasks and responsibilities of employees in each department of the recall operation.)
(2) Strengthening safety management.
Safety management and quality management are interrelated and distinct. Safety management is not about setting higher quality standards, but about taking all measures to anticipate and minimize the risk of hazards that could potentially cause product defects during the design, manufacture and distribution of new products. One of the measures to strengthen safety management is to develop effective safety testing procedures, such as Hazard Control Critical Point Analysis (HACCP) used in the food industry, which can help companies to discover the critical points where biological, physical and chemical hazards may occur in the process of manufacturing and distributing food products, and then to take precautions at each of these critical points to reduce the probability of hazards occurring. Rigorous pre-factory testing of products is another important measure to strengthen safety management. It gives companies the first opportunity to identify defects in the actual use of their products, and the cost of correcting defects at this stage is relatively low because the products are not yet in mass circulation.
(3) Developing and maintaining effective communication channels with consumers, intermediaries and others.
Enterprises need to develop and maintain effective communication channels with final consumers, intermediaries, repair stations and customer service departments, so that on the one hand, they can get in touch with them in a timely manner when needed; on the other hand, they can obtain information on product use, product maintenance, product returns, consumer opinions, etc. through communication. Ford Motor Company, for example, uses this information as an important element of its recall warning system to help it identify safety problems.
(4) Establish a product and customer database.
An effective product database enables product lot tracking so that product models, production lots, serial numbers and production dates can be used to determine in a timely manner which products should be recalled and whether these products have been sold; a good customer database enables companies to quickly locate current users of defective products. Information about product defects is mainly obtained through the following ways: the enterprise's quality management records, consumer complaints, media reports, announcements by governmental management departments, and maintenance records of repair stations. When an enterprise believes that there may be a product defect, it must make a decision about whether to recall.
A key procedure in the recall decision-making process is to assess the risk of harm from the product defect, which is the basis for deciding the speed of the recall and the method of recall (labeling the product with a warning, repair, replacement, or refund). In countries where the defective product management system is more complete, the government management departments have classified and graded the related hazard risks, such as the U.S. Consumer Product Safety Commission (CPSC) hazard rating standards, the product may cause harm is divided into three levels: A-level hazards - means that the product has a great likelihood of causing death or Serious injury, disease; B-level hazards - refers to the product caused by death or serious injury, disease is unlikely, but still may cause death or serious injury, disease; C-level hazards - refers to the product caused by death or serious injury, disease, the possibility of very small. The likelihood of causing poisoning injury, disease is also unlikely, but the possibility is not completely non-existent. The U.S. Food and Drug Administration (FDA) categorizes recalls into similar three classes. These hazard risk classification methods provide a reference for companies to conduct a hazard risk of product defects. When a company decides to conduct a recall of a defective product, it should follow a developed recall plan. The recall plan should give the following instructions on how to implement the recall.
(1) Recall budget.
Companies must budget for all costs resulting from a recall event, which are categorized into direct and indirect costs.
(2) Informing about the recall.
Companies conducting recalls need to inform wholesalers, retailers, service centers and consumers about the recall. The information should include: the recall procedure, how to identify defective products, the nature of the defect, the severity of the harm, the number of defective products, the users of defective products and the company's contact information, the time and place of the recall. In addition to the methods of notification, which include the publication of recall notices in the newspapers and websites specified by the government administration, letters and telegrams can also be used.
(3) Recall of defective products.
Enterprises to recover defective products, in different parts of the product recovery difficulty is different. Work in progress, manufacturer's products, finished goods inventory, products in transit to intermediaries (wholesalers, retailers), intermediaries (wholesalers, retailers) inventory products, products sold by the manufacturer through direct sales are easier to recover; products sold within the last few years and for which the manufacturer has a record are relatively more difficult to recover; products sold within the last few years but for which the manufacturer has no record, or products for which there is a record, but the period of sale has been more than five years, Products sold to wholesalers and retailers of other businesses, products that have been resold, and products that have been exported abroad are the most difficult to recover.
(4) Ensure timely repair or replacement.
Companies conducting recalls should establish clear procedures for repairing or replacing recalled products. Consumers have the option of mailing the product directly to the repair department or giving it to the seller of the piece. If the product is modular or has easy-to-assemble parts, the company can send the parts that need to be replaced to the consumer with detailed installation instructions. Regardless of the procedure adopted, companies should improve the ability of their service and repair teams to handle defective products. When the number of defective products to be handled is large, a business may outsource this work or temporarily call on employees from other departments. Companies should recognize that the end of product repairs does not mean the end of a recall, and that saving the company's reputation and evaluating the effectiveness of the recall are two important tasks in managing the recall results.
(1) Saving the company's reputation.
To salvage a company's reputation, it should: analyze the cause of the defect and take steps to ensure that the same defect does not lead to a new recall; assign new serial numbers, model numbers, styles of packaging, and colors to new products to prevent confusion between the product subject to recall, the repaired product, and the new product, which has already met the safety standards; and increase the amount of advertising to tell consumers that the product defects have been corrected.
(2) Evaluate the effectiveness of the recall.
The effectiveness of a product recall can be measured by recall completion rates and customer satisfaction.
Recall completion rate is the most commonly used indicator for evaluating the effectiveness of recall, which refers to the percentage of the number of defective products recovered to the number of defective products still in use. Relevant foreign data show that the recall completion rate in most recalls is very low, such as the CPSC said the recall completion rate is usually 2% to 50%, and the average completion rate of the 176 recalls that the CPSC was involved in in 1993 was only 11%. Recall completion rate can be broken down into two indicators: seller recall completion rate and final consumer recall completion rate, which are collectively referred to as the sales channel recall completion rate, the relationship between the above indicators is: recall completion rate: seller recall completion rate × final consumer recall completion rate.
Customer satisfaction is also one of the indicators to measure the effectiveness of the recall, and the factors to be considered in examining this indicator are: the waiting time for the hotline, the time for replacement of parts, the customer's satisfaction with the recall process, and the customer's satisfaction with the completion of the repaired product.
Finally, companies can evaluate their recall program through a recall review form. The review form lists questions related to the recall program, and by answering these questions, the purpose of identifying areas for improvement, evaluating the work of recall participants, and evaluating a company's recall capabilities can be achieved. A recall review can be completed by a recall coordinator, recall committee or independent consultant. China's Recall System
Since the birth of China's first product recall system, the Administrative Regulations on the Recall of Defective Automobile Products, in 2004, many companies have recalled a large number of various defective products from the market and consumers every year. This move is conducive to protecting the legitimate interests of consumers.
China's current consumer protection system is mainly the "Chinese People's **** and State Product Quality Law", "Consumer Protection Law", civil compensation system in the Civil Law and 1988 through administrative means to implement the product "three packages" system.
While the above laws and regulations in China provide a weapon for consumers to protect their rights, the content of the recall of defective products is general, and too general, lack of operability. For example, Article 26 of the Chinese People's **** and State Product Quality Law clearly states: "Producers shall be responsible for the quality of the products they produce." Article 18 of the Law of the People's Republic of China on the Protection of Consumers' Rights and Interests clearly stipulates: "Where an operator finds that there are serious defects in the goods or services provided by the operator, and that even if the correct use of the goods or acceptance of the services may still cause harm to the safety of persons or property, he or she shall immediately report the defects to the relevant administrative department and inform the consumer, and shall take measures to prevent the harm from occurring. "
While these regulations and systems in China are as much about protecting consumers' personal and property interests as the product recall system, they are markedly different. According to our regulations and systems, a product is dealt with only after it has caused harm. Domestic treatment of defective products such as those with quality problems or failures is still mainly taken by the damaged consumer of the product on the grounds of breach of contract or infringement of rights, through the judicial process to the seller or manufacturer to file a claim. For the mass production of defective products, resulting in a large number of consumers, property damage, how the administrative authorities to manage, discipline, and promote enterprises to improve, make up for product defects and other management is still weak. After the implementation of the defective product recall system, as long as a large number of products are found to have quality problems and may cause harm to consumers, the enterprise is obliged to recall the product remediation or destruction. Obviously, the product recall system has the function of "preventing problems before they occur", compared with the passive protection of the "Consumer Protection Act" and so on, has obvious superiority. The United States has at least a dozen bills and "product recall system" related to the details of the product recall made strict provisions. China has not yet a national bill to make provisions, only the Shanghai Municipality in October 2002 through the "Shanghai Municipal Consumer Protection Regulations". Article 33 of Chapter III of the Regulations clearly stipulates: "If the operator finds that the goods or services provided by the operator are seriously defective, and even if the correct use of the goods or the acceptance of the services may still jeopardize the safety of the consumers' person and property, the operator shall immediately suspend the sale of the goods or the provision of the service; if the goods have been sold, the operator shall take urgent measures to inform the consumers and to Recall the goods for repair and replacement or destruction, and at the same time shall report to the relevant administrative departments and industry associations." The regulations also provide that "the relevant administrative department shall, in accordance with the law, require the operator to immediately suspend the sale of goods or services with serious defects that may cause harm to the safety of consumers' persons and property, and to take recall measures for the goods that have been sold." This is an extremely useful attempt to fill the gaps in domestic legislation in this regard.
In 2003, the State Administration of Quality Supervision, Inspection and Quarantine decided to the second quarter of the national supervision and sampling of plugs and sockets with serious quality problems to be mandatory recall. In accordance with the requirements, where the purchase of the relevant unqualified plugs and sockets consumers can be returned to the shopping malls or manufacturers. This is the first time in China in the name of the state mandatory withdrawal of a product, marking the relevant administrative departments of China on products involving personal and property safety, especially for poor quality products to increase market supervision. State supervision is very necessary, but this supervision is limited by manpower, material resources and other conditions, the scope of its supervision after all, to be affected to a certain extent.
After four years and ten seminars, the "Defective Automotive Product Recall Regulations" finally surfaced on March 15, 2004, the Consumer Rights Day, by the General Administration of Quality Supervision, Inspection and Quarantine, the National Development and Reform Commission, the Ministry of Commerce and the General Administration of Customs *** with the development of the provisions of this regulation, is China's defective cars for the first time as the pilot implementation of the product recall system, which marks the China The automobile consumer market is further moving towards standardization and maturity.
However, there are still many problems with this regulation, which need to be improved, such as; the main body of law enforcement is unknown, the supporting regulations are too few, and the penalties are not heavy enough. In addition, in some countries where the automobile industry is mature, the automobile recall system is often in the form of a major national law with high authority and strong binding force, such as the National Traffic and Motor Vehicle Safety Act in the United States and the Road Transportation Vehicle Act in Japan. And China's "Defective Automotive Product Recall Regulations" as a national organ department of the regulations, not strictly the law, can not produce legal effect on other sectors, also makes the relevant certification system lack of legal basis.
U.S. Recall System
The U.S. is the earliest country in the world to implement product recall, and has established a set of relatively mature product recall system.
The product recall in the United States began in 1966. At that time, the U.S. auto industry under the National Traffic and Motor Vehicle Safety Act, clearly stipulates that automakers have the obligation to recall defective cars. 1972, the United States enacted the Consumer Product Safety Act, which authorizes the U.S. Consumer Product Safety Commission to carry out recalls of defective products, marking the formal establishment of the defective product recall system. Since then, the U.S. has introduced the defective product recall system in a number of product safety and public health legislation, and the scope of the recall has expanded to include almost all products that may cause harm to consumers. The defective product recall system has become a common tool for product quality management and economic regulation by the U.S. government.
The U.S. government agencies in charge of product recalls **** there are six, respectively, responsible for different areas of the product. They are: (1) the U.S. Consumer Product Safety Commission, mainly responsible for general consumer product recalls; (2) Food and Drug Administration, mainly responsible for meat, poultry and egg products in addition to food, drugs, cosmetics, medical devices, such as recall; (3) Department of Agriculture, Food Safety and Inspection Service, mainly responsible for meat, poultry and egg products recall; (4) the U.S. Environmental Protection Agency, is responsible for the environment may be damaged or pollution of products such as motor vehicles, pesticides and other recalls; (5) the National Highway Traffic Safety Administration, mainly responsible for regulating the recall of automobiles, child safety seats, motorcycles and related equipment, tires and other products; (6) the U.S. Coast Guard, mainly responsible for regulating the recreational boats, boats and their supporting products recall.
U.S. Consumer Product Safety Commission Recall Overview
The U.S. Consumer Product Safety Commission (CPSC) is an independent government agency empowered by law to answer directly to Congress and is responsible for monitoring and recalling consumer products in general to protect consumers and their families from fire, electrical, chemical, and mechanical hazards caused by consumer products, as well as hazards that may be posed to children. The CPSC monitors more than 15,000 products, including six categories: toys, children's products (excluding toys) (which are often combined into a single category), household products, outdoor products, sports and recreational products, and professional products. Key monitoring objects include toys, cribs, clothing, household appliances, power tools, lights and lamps, furniture and other daily necessities. To date, the CPSC has issued recalls for more than 4,000 products. The CPSC works directly with businesses and consumers to receive consumer complaints and, based on the complaints, advises and assists manufacturers and distributors in recalling defective products.
The CPSC's main legal bases for recalls are the Consumer Product Safety Act (CPSA) and the Children's Safety and Protection Act (CSPA), in addition to the Federal Hazardous Substances Act (FHSA), the Toxic Substances Protective Packaging Act (PPPA), the Flammable Fabrics Act (FFA), and the Refrigerator Safety Act (RSA), all of which are often cited by the CPSC. The CPSC estimates that injuries, deaths and property damage caused by consumer product accidents in the U.S. cost the nation more than $700 billion annually, and that such accidents can be reduced by more than 30% annually through CPSC recalls and other measures.
What is the CPSC recall process?
The general steps in a U.S. consumer product recall include: defect report or complaint, preliminary hazard assessment, product defect identification, recall confirmation and recall plan development, recall information release, implementation of the recall, acceptance and termination of the recall. In addition, in the case of an enterprise taking the initiative to report, summary procedures can also be initiated.
1. Report or Complaint of Product Defects
In most cases, an enterprise's report or a consumer's complaint is the first step in initiating the recall procedure. Of course, only some of these reports or complaints can proceed to the next step in the process. Under Part 15(b) of the Consumer Product Safety Act (CPSA), a manufacturer, importer, distributor, or retailer who becomes aware that a consumer product that it manufactures or handles does not meet the requirements of a consumer product safety regulation or a mandatory standard, or that it is defective and poses an unreasonable risk of substantial injury to consumers, and that it does not comply with certain CPSA-enumerated voluntary standards, is required to submit the problem to the U.S. Consumer Product Safety Commission (CPSC) within 24 hours of obtaining knowledge of the problem, or to file a complaint with the CPSC. A problem report should be filed with the CPSC within 24 hours of becoming aware of the situation. The CPSC also encourages companies to report potential hazards or defects to the CPSC's local agency at the earliest possible time if the company is still investigating the potential hazards or defects. In addition, if a company is involved in a lawsuit over the quality of a product, the company is obligated to provide a written explanation to the CPSC before the lawsuit is concluded. The CPSC may also require companies to provide a written explanation and report to the CPSC when a consumer complains about a product. The CPSC offers a variety of channels for consumers to file product complaints, such as the Internet, letters, phone calls, and faxes. In addition, the U.S. Consumer Product Safety Commission will from time to time market sampling, when the detection of substandard products can also enter the next program.
2. Preliminary Hazard Assessment
After receiving the report or complaint, the CPSC will initially assess whether there is a "substantial product hazard" as the basis for the next step in the identification process.
3. Identification of Product Defects
The identification of product defects is the key to determining whether a product needs to be recalled. The CPSC's product defect identification experts not only to identify whether the product meets the requirements of relevant regulations and standards, but also focus on weighing the following factors:
(1) the type of defect. Product defects may exist in various aspects of product design, manufacturing, materials, product structure, contents, coatings, packaging, warning labels, product descriptions, etc. Experts first determine the type of product defects in order to analyze whether they are likely to materially harm consumers;
(2) The volume of defective products sold. The greater the number of products in circulation, the greater the chance that they will cause an injury, while a smaller number of defective products is somewhat less likely to result in an injury;
(3) the severity of the hazard;
(4) the chance of an injury occurring and others. Includes analysis of accidents that have occurred and predictions of possible accidents, etc.
Based on the degree of product hazards, the U.S. Consumer Product Safety Commission categorizes hazards into 3 levels, A, B, and C. The hazards are classified as A, B, or C, depending on the level of hazard. Regardless of the level of hazard, it is considered a "substantial product hazard" that requires corrective action and some remediation.
4. Recall Confirmation and Recall Plan Development
Once a recall is confirmed, the CPSC immediately notifies the company and requires it to promptly develop a comprehensive, informative, and feasible written plan for the recall. Its staff will directly guide the company through every detail of the recall plan, such as how the recall information will be disseminated and what remedial measures will be taken.
5. Recall Information Release
There are various ways to release recall information, the most commonly used is the Internet notice, in addition, television news, posters, radio and newspaper announcements, distributors/retailers/consumers direct notification and other ways of information release are also often used. The CPSC also has certain requirements for the content and format of recall notices, such as the name of the product, quantity, description of its appearance and possible hazards, and posters with the words "Recall" or "Safety Warning" and pictures of the product. In general, companies should submit their posters to CPSC staff for review. Notices posted on the CPSC Web site are generally written by CPSC staff and published in the names of both CPSC and the company***.
6. Implementing a Recall
The specifics of implementing a recall include product recalls, corrective and remedial measures. Recall implementation by the enterprise specific implementation, the U.S. Consumer Product Safety Commission supervision. The detailed record of the recall is an important basis for the acceptance of the recall.
7. Acceptance and Termination of Recalls
In general, a recall does not mean that all products will be recalled. The CPSC can confirm the end of a recall when it believes that the company has taken positive and effective measures and that the risk of harm to the public from defective consumer products has been minimized.
In addition to the normal recall process, the CPSC has also launched a recall fast track, which means that if a company takes the initiative to report a potential defect in its product to the CPSC and voluntarily cooperates with the CPSC by submitting and executing a recall plan that meets the requirements of the CPSC within 20 business days thereafter, CPSC staff may not make a "recall" decision. CPSC staff can then confirm the recall, release information, and initiate remedial action without making a finding of "substantial product endangerment," greatly simplifying the recall process and allowing companies and the CPSC to initiate "corrective action" plans earlier. It also allows companies and the CPSC to initiate a "corrective action" program earlier, reducing the potential for harm. The Recall Fast Track is a way for the CPSC to encourage business integrity and efficiency.
Characteristics of CPSC Recalls
1. Recalls are formally "voluntary," but in fact are mandatory. In the recall announcement, the U.S. Consumer Product Safety Commission and manufacturers of the same recall behavior of the subject, * declared "voluntary" recall. In fact, "voluntary certification, mandatory recall" is the principle, that is, before the product enters the market by independent non-governmental organizations to test the product certification, the responsibility is borne entirely by the enterprise. The threshold of entry is not too high, but the control after entry is extremely strict, once it is confirmed that the products in the market do not comply with the relevant regulations or standards, it will be immediately blocked and recalled, but it is just a "loose first and then tighten".
2. Product recall is not premised on the occurrence of damage. The U.S. Consumer Product Safety Commission relies on its own technical staff and third-party laboratories to conduct a variety of product testing and identification, market sampling, or testing of designated commodities due to consumer complaints. Products from companies or places of origin that have previously experienced problems are easy targets for spot checks. As long as the quality of the product is detected to be not in compliance with the relevant regulations and standards, the product may be notified of the recall, in order to "prevent the occurrence of injuries". The U.S. safety regulations and standards are detailed and strict, such as the aforementioned Federal Hazardous Substances Act, the Flammable Fabrics Act, the Refrigerator Safety Act and still in the development of the lighter safety standards. For Chinese enterprises that want to firmly occupy the U.S. market, not because the product has been certified by the U.S. side of the relevant negligence, to ensure that the quality of products in line with the requirements of these technical regulations and standards is the safety policy. Many of the recalled Chinese products were notified before any damage occurred. In other words, these products are only considered to have the potential for damage/injury, and whether these U.S. regulations and standards are fair and reasonable as a basis for judgment is another matter. For example, the child lock requirement for Chinese lighters is discriminatory. The U.S. Consumer Product Safety Commission also had to recognize that the installation of child locks to the lighter is not a cure, so that children away from the lighter is the safe way.
3. Once a product is recalled, the recall is retroactive to the point at which the defective product was first sold, and all defective products in circulation are included in the recall. When developing a recall program, an important task is to identify the market distribution of the defective product and the consumer population (including the number, group, geographical distribution), in order to determine the recall information dissemination methods, to ensure that all consumers can be the fastest possible information about the recall, so that the defective product can be recalled as soon as possible.
4. A recall means that certain remedial measures must be taken. Generally, the CPSC requires that the recall notice specifically tell consumers to stop using the product to prevent damage. Consumers are also required to contact the seller or the CPSC's local agency to receive a refund, exchange or make appropriate repairs to the product. For companies, a recall can mean a lot of money.
Summary
The U.S. product recall system, centered on ensuring product quality and safeguarding consumer rights and interests, is regulated by a large number of legislation and related technical standards, and the system is complex and the procedures are rigorous, as evidenced by the recall of general consumer products. In order to ensure the operation of the recall system (such as a large number of reviews, frequent market sampling, etc.), the U.S. government has also invested a lot of human and material resources. In addition, the strong self-protection awareness of U.S. consumers and the quality awareness of manufacturers and their recall mechanism are mutually reinforcing, which is also one of the reasons for the efficient operation of the system.
The U.S. recall system has at least a few aspects that we should learn from: (1) a perfect system of laws and regulations, with comprehensive product coverage; (2) a diversified management organization that is linked to the existing administrative agencies, as well as a specialized management organization, which makes it easy to manage the recall system according to the product categories; (3) informative and operational regulations, especially the provision of a fast-track system, which can simplify the procedures and improve efficiency; (4) the recall system is closely related to consumers' awareness of quality, as well as to manufacturers' awareness of quality. (4) Recall system and consumer quality awareness and rights awareness complement each other, is conducive to the construction of the whole society's quality awareness and consumer rights environment; (5) Recall system is a "post facto" remedies, the United States is also aware of its shortcomings, and therefore advocate self-discipline of enterprises, to prevent the problem before it occurs.
The full implementation of the recall system is imperative to maintain market order and protect consumer rights in China. China since March 2004, the introduction of automotive recall regulations, has been more than two years, but the recall system has not yet been fully established, the recall of the product coverage needs to be broadened, the system's operational efficiency needs to be improved.
It is worth noting that, due to the U.S. standards are more demanding than the domestic (such as the safety requirements for toys), the recall system also creates obstacles for developing countries such as China to export their products to the U.S. In 2004, the U.S. Consumer Product Safety Commission (CPSC) issued 118 recalls of products from China, which accounted for about one-third of the total number of recalls. For us, the study of the U.S. recall system, on the one hand, to build China's product recall system has a strong reference role, on the other hand, for us to deal with trade barriers, to ensure the smooth export of products also has a strong guiding significance.