Handling a food recall is a very challenging task. At its bare minimum, customers are inconvenienced while a company’s bottom line takes a hit from having to fix the problem and compensate irate consumers. If the Food and Drug Administration or Department of Homeland Security mandates the recall, however, the stakes are far greater . With this in mind, enterprise resource planning software can have a helpful impact on the steps involved in identifying the need for, planning and executing a product recall.
Recently, Sage expert Mark Pinard of consulting firm NexTec Group hosted a webinar explaining the steps involved in a product recall. During this time, he talked about the reasons why it’s important to have a management strategy in place when food is being recalled. He also explained a useful strategy in the event a recall needs to happen, from the first customer complaint to the last defective product returned. With ERP software, though, there are ways that the process can be simplified.
1. Consumer Issue Management is made easier
The two cornerstones of ERP are automation and database accessibility. This works incredibly well in a Consumer Issue Management module, which is a critical part of the CRM tools needed to handle a product recall. For example, the moment a call is received, a representative can determine if the person has a prior history, and if not add him or her on the fly. Instead of having to work out some complex details in the system, the support rep can record customized input boxes based on the way products are labeled and assigned. This staffer can then designate a recall or support category based on the scale of the problem automatically. Finally, any notes and issues are easily logged and are accessible to key members of the company that may need to handle the recall.
2. Fast resolutions
In product recalls, time is of the essence. The fewer people that have access to the defective product, the better off the company will be. This is especially the case in mandatory recalls where lives and well-being may be on the line. With ERP software, resolutions at any level can be executed quickly. Once a lot number with the defective ingredient is identified, the database can determine what products have that ingredient, as well as how many were made and where it has been shipped, instantly. Notification letters can be generated and sent to distributors and retailers to remove the product off of store shelves. Call lists and CRM records can also be made to establish a paper trail for compliance.
3. Make notes in the aftermath
When the recall is resolved, a company will need to take steps to recover from the situation. Along with the disposal of the materials, there is a need to adjust finances and accounting to effectively address this problem. Having notes to mark changes to policy as a result of a recall can be an effective solution in this regard. For example, the sales prices of shipments of particular products can be changed to reflect the fluctuating events that resulted from the recall, and delivery dates can be altered so that new products can receive added scrutiny. Matters revolving around credit can be addressed as well, including extending the credit line to take into account losses of sales. For accountants, memos can be made to write off specific lots that contained the defective product as well as making a note to accept short payments in the future, so as to ease retailer concerns.
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