Recall Readiness 101: What if you just found out that you need to recall 12,500 tumblers?

Consider this scenario:  For the past five years, your distributorship has been running a high volume online store for Appleton Digital, a global media firm that happens to be your largest client.   Last month, your office received an urgent message from Appleton that a popular item you import directly—a glass tea tumbler you’ve had in the program for three years—shattered when a user filled it with boiling water.  Glass shards were reportedly sent in all directions and the person suffered incisions and lacerations.  Your client is still following up on the details but wants the tumbler out of the program immediately.  He says that he heard there might have been a few other complaints with this product in the past that Appleton never passed on to you.  You’re concerned because in addition to the 2,500 tumblers you’ve sold through Appleton’s portal, you’ve also sold another 10,000 units to other customers as well.

After investigating, you discover that under certain circumstances the tumbler can indeed shatter unexpectedly.  In addition to filing a Section 15(b) report with the Consumer Products Safety Commission (CPSC)—a federal requirement when you learn that one of your items may present a substantial product hazard or unreasonable risk of serious injury—you send samples of the glass tumblers to a third party lab.   Their results indicate a manufacturing flaw—a weakness in the glass—and CPSC staff investigators come to the same conclusion.  The die is cast and within a few weeks you agree to initiate a voluntary product recall of all 12,500 tumblers that you sold.

Recalls are urgent, demanding and all-consuming of time and resources.  Within a tightly compressed timeframe, your team will need to complete a daunting list of complex and detail laden tasks.  In those tense first weeks you will need to make critical decisions at a frenetic pace.  Unless you’re recalling a rocket, none of it will be rocket science, but there is a lot to do and time will be of the essence.  Your company will be under intense pressure to design a comprehensive recall plan, get it approved by CPSC and implement the recall as soon as possible.  As CPSC tells it, the objectives of a recall are “to locate all defective product as quickly as possible, to remove defective products from the distribution chain and from the possession of consumers, and to communicate accurate and understanding information in a timely manner to the public about the product defect, the hazard and the corrective action.”  But accomplishing that and satisfying CPSC that your plan is aggressive enough to motivate consumers to act on the recall can be a challenge.  You will likely experience a nonstop whirlwind of conference calls, meetings and drafts as your team rushes to complete your recall agreement with CPSC, a reverse logistics plan, a joint press release, retail posters, a customer service script, FAQs for your websites, letters and notices to your distribution chain, collection and disposal procedures, launch plans, submission forms, a social media plan, and on and on.  How do you prepare for an urgent project like this?  What should a company do before any product hazard arises to be as well prepared as possible to implement a recall?

The answer can be boiled down to two words:  Prepare and practice.

First Steps

Prepare by learning the recall process, step by step.  CPSC publishes a Recall Handbook that lays out all the elements in plain English.  Study it carefully and plan for how you will handle each requirement.  Consider the information you would need to collect, evaluate and provide to CPSC.  Where is this information stored at your company?  What documents do you have? Who has access?  How easily could you accumulate everything you would need if you had an urgent need to do so?

Good Documentation Helps

If you don’t have a good system for storing all the quality, production and safety data related to your products, now would be a good time to consider one, before an urgent need arises.  It should consolidate access to all relevant production, quality, safety, sales and distribution documents for the products you manufacture, decorate, retail or distribute.  Typical items include sales orders, purchase orders, bills of material, technical files, test reports, risk assessments, inspection reports, customer complaints, return authorizations, warranty claims, corrective actions, and production issues.  The specific documents you will need may depend on your company’s role in the distribution chain – supplier or distributor, importer or retailer – but they are all similar in their purpose: to quickly understand how extensive the problem is, how many defective products you’ve distributed, where the defective products are, how you can identify them, why the problem occurred in the first place and so forth.

How efficient are your systems now?  Would you be able to easily identify which purchase orders or production runs involved the affected products?  Do the defective products have tracking labels, date codes, lot numbers or other distinguishing characteristics?  Could you identify the owners or recipients of these defective products?  Do you have shipping records for all the locations where you’ve shipped these products and production records for all the logos you’ve imprinted on the product?  These recordkeeping details might even be the key to negotiating the scope of the recall with the CPSC and limiting the recall to a smaller batch or lot.  CPSC will want you to be as specific as possible with each example of defective product and ideally have an image of each logoed version to help consumers identify whether the product they have is included in the recall.  You may even need to reach out to your clients to determine the specific dates and events at which the product was distributed to determine how you can reach that audience.

Who Will Manage?

Another consideration is your chain of command.  Who will be authorized to make decisions and approve agreements for your company?  Who will coordinate the recall and have overall management responsibility?  Which managers will be responsible for specific tasks?   Who will guide and advise these managers?  Who will be authorized to speak with customers, consumers and the media on your behalf?  What talking points will be used for those communications?  Will you use outside counsel to advise you in your communications and negotiations with CPSC regulators, in getting your recall plan written and approved, and in advising you throughout the recall?  If so—in my view, highly advisable—it is best to establish a relationship with an expert product safety attorney in advance so he or she understands your business and can respond to your situation immediately.  In the middle of a crisis is not the time to be vetting attorneys, comparing fees and waiting for law firms to conduct conflict checks.

Nothing is More Important than the Recall Agreement

One of the most critical milestones your team will need to accomplish is to successfully negotiate an agreement with CPSC staff over all the salient details of your recall:  How will consumers who have defective products be notified?   How soon and by what method?   Who distributed the product?  How will you notify those parties?  By when?  What will you offer to consumers who have defective products?  A replacement product?  A repair?   A refund?  Will the funds be escrowed?  How will you collect, account for and dispose of the defective products in coordination with CPSC?   All of this and more will be spelled out in your agreement with CPSC.  This agreement is the one item in particular where you would be well advised to work with a seasoned product safety attorney who has had many previous successes in negotiating these corrective action agreements with CPSC.  Its importance cannot be overstated.

By the time you actually announce the recall and put a well-designed plan into place, much of the heavy lifting will be done.  To be sure, there is still a great deal of work to do but it should largely be an operations and logistics issue at this point—work that your team is probably very good at already. Some companies choose to handle this “fulfillment” part of the recall with their own staff – collecting and disposing of the defective merchandise, processing refunds and claims forms, coordinating between all of the parties involved, reporting to CPSC – and some outsource the work to a recall management firm.  Either way, the important objective at this point is for your recall coordinator to make sure the trains run on time, that you do exactly what you told CPSC you would do, that every step is documented carefully and that you do it as quickly and expeditiously as possible.

What Went Wrong?  What Should You Do About It?

Once the crisis stage of the recall has passed, it is always prudent to conduct a post-mortem to determine what went wrong, who, if anyone, was at fault and what you should do better in the future to avoid similar defects.  Did you fail to test something thoroughly or fail to ask enough questions?  Did the manufacturer fail in some way or make a change without telling you?   Product safety experts have long advocated that the surest path to product safety is by designing defects out of products to begin with.   The more you understand about what went wrong with the defective product the better job you can do with future products.  The post-mortem is also the time to consider whether you may be able to recover some or all of your recall related costs.  Are you insured for any portion?  Do you have any indemnification agreements in place that may be applicable?  Should you consider litigation to recover your damages?  There are many such questions to ask at this point and you are wise to consider each one.

Product recalls can happen to any company of any size.  It doesn’t matter whether you are a supplier or distributor, whether you import directly or retail products that you buy from others.  Under the Consumer Products Safety Act, everyone who manufactures, distributes, or sells defective products can be held responsible. No company is immune no matter how expert its engineering or how vigilant its compliance.  If you need to be convinced, just type “BMW” or “Mercedes” and “Recall” into a Google search and see how many hits you get.  Do the same for the names Disney, McDonald’s, Fisher-Price, Lululemon, Nike, UnderArmour, Kellogg’s, General Mills, Schwinn, Cannondale – almost any respected brand you can think of – and you will discover recalls.  And so it could be with you.  But if you take steps in advance to prepare—even small steps—you can greatly diminish the pain and anguish a recall could cause your organization and you can reduce your costs significantly.  Keep in mind the two most important takeaways from this brief overview – prepare and practice – and they could make all the difference.

Recall Readiness Checklist

  • Plan For It.  Assume it will happen sooner or later.  Learn the recall process, step by step, and teach it to your key managers.  Go through CPSC’s Recall Handbook carefully and periodically review it with your management team.
  • Learn What The CPSC Requires.  Learn or review the Section 15(b) reporting requirements of the Consumer Products Safety Act.  Among other things, these well-establish consumer product safety rules require you to report to CPSC immediately whenever you learn of a substantial product hazard or a product that doesn’t meet a CPSC standard.  Late reporting can generate seven figure civil penalties.   While you’re at it, also learn about the Section 37 and Section 102 reports.  It’s all in CPSC’s Recall Handbook.
  • Centralize Incident Reporting.  To ensure you are aware of all incidents that could require a Section 15(b) report to CPSC, be sure to centralize the review of all customer complaints, product returns, defects, accidents, incidents and other leading indicators that may indicate a quality problem or a safety hazard.
  • Get The Product Back.  Whenever you receive a product-related complaint, claim or injury report, always ask for the product in question to be returned to you.  If the product is later deemed to be defective such that it leads to a recall, any batch, lot or tracking numbers on the product may help you limit the scope of the recall.
  • Distributor: You Report If Supplier Doesn’t.  What if you purchased the tumbler in this example through an industry supplier rather than importing it directly?   How would the scenario change?  When reporting the complaint and injury to the supplier you could request that the supplier immediately file the Section 15(b) report with CPSC.  If the supplier refuses or delays, you can file the Section 15(b) report as a “retailer or distributor report” and request that CPSC contact your supplier directly for more information.  Remember that under the Consumer Products Safety Act, everyone who manufactures, distributes, or sells defective products can be held responsible.
  • Notification Tools.  Study the material on CPSC’s website as examples of the posters, scripts, FAQs, social medial plans and other processes you’ll have to go through in a recall.
  • Get Documents In Order.  Review your systems for documenting and storing key product information you would need in a recall.  Be sure it is easily accessible.
  • Appoint Recall Coordinator.  Assign a manager to act as your recall coordinator.  Provide continuous training and stay abreast of best practices.
  • Line Up Outsider Experts.  Interview expert product safety lawyers about the role a lawyer would play in a real recall.  Establish a relationship in advance so you could move quickly in an actual recall.  Interview firms that provide recall management or consulting services to be aware of what’s available.  Speak to your insurance company about recall insurance.  Cover all the bases and decide what’s best for you based on your budget and risk tolerance.
  • Start At Product Development.  Review your product development and selection process to be sure you’re being as careful as you should in evaluating, testing and overseeing the production of the products you make or sell.   Perform a risk assessment for each product and consider what could go wrong.  Where applicable, enlist a third party lab to perform product integrity tests as well as use and abuse tests.
  • Put ID Marks On Your Products.  Mark your products whenever possible with lot, batch or tracking numbers that you can tie back to the production run.  If only a portion of your products have the defect these numbers may help you limit the scope of a future recall.
  • Use Mock Recalls For Training.  Periodically test your systems and management training by conducting a mock recall.

CPSC Recall Handbook:

This article also appears in the September 2013 issue of PPAI’s PPB Magazine.

Updated Toy Safety Standard takes Effect June 12. New Tests Required!

If you import children’s toys, or if you’re a promotional products supplier with children’s toys in your line, effective tomorrow you’ll need to comply with an update to the mandatory Federal Toy Safety Standard.  Among other changes, this revision (ASTM F963-11) adds limits for the soluble amount of eight metals (antimony, arsenic, lead, barium, cadmium, chromium, mercury, and selenium) permitted in toy substrates.  The change is effective for toys manufactured or imported after June 12, 2012 for children 14 years of age or younger.

The ASTM F963 Toy Safety Standard used to be voluntary.  But in 2008, the Consumer Product Safety Improvement Act (CPSIA) made ASTM F963 a mandatory standard.   At that time, the current version of the Toy Safety Standard was F963‑07 with the “07” signifying the year that the latest revision was adopted.  Since then, CPSC has voted to adopt two newer revisions – one issued in 2008 and the latest in December 2011.  In February 2012, the Commission announced in the Federal Register its decision to adopt ASTM F963-11 effective as of June 12, 2012.

For the moment, the law requires you to comply with every provision of the new standard – including the 2011 changes – but doesn’t require you to use a CPSC certified third-party lab to test for the 2011 changes.  The reason is that the Commission has not yet voted to adopt recently proposed rules for third party laboratories which it published in the Federal Register on May 24, 2012.  Comments on these proposed rules are not due until August 7, 2012.

If you have another reliable way to verify compliance for the F963-11 changes—perhaps by testing with an XRF instrument—you could avoid, until CPSC adopts the new rules, the cost of testing the 2011 updates at a third-party lab.  However, this waiver only applies to the F963-11 changes.  You’ll still need a test from a CPSC certified third-party laboratory for the portions of ASTM F963-11 that are “functionally equivalent” to F963-08.

The risk of third-party testing now for the new requirements of F963-11 is that when the proposed rules are finally adopted by CPSC, the lab you choose may not be accredited for the new requirements and you will have to retest at an approved lab.  In my opinion, this is a very minor risk compared to the risk of not having an independent test confirming that your toy complies with the new requirements.

CPSC addressed this in an FAQ on its website:

In the event that a manufacturer or importer wishes to have its products tested now – in the hope that testing to the -11 version eventually will be accepted by the CPSC – that manufacturer or importer should check with its current CPSC-accepted laboratory to see if they will be applying to the CPSC for acceptance of the -11 version. If so, and if the lab satisfies other conditions spelled out in the draft document, then the Commission likely will accept that testing upon its approval of the new Notice of Requirements. (This is not a guarantee of the Commission’s action, but the Commission traditionally has permitted acceptance of such testing, provided that all the other conditions are satisfied.)

It’s always a treacherous scenario in our industry when the law requires strict compliance with a set of standards but doesn’t require third-party testing.  For one thing, it places an extra burden on distributors – to verify that the toys they’re purchasing are compliant with the new standard if the supplier or factory does not have a third party lab report verifying compliance.

My advice is to not buy any toy that is imported or manufactured after June 12, 2012 unless you get a report from well-known third-party laboratory verifying compliance with all the provisions of ASTM F963-11.

For promotional products distributors who maintain test reports in their files of children’s toys they order frequently, or for those who have children’s toys in company stores or in other co-op programs, be sure to go back to your supplier for an updated test report.

The full text of the FAQ from the CPSC website can be found at

Time to Take a Closer Look at the Test Reports in Your Files

With the deadline for mandatory third party lead testing less than two months away, now would be a very good time to take a closer look at the third-party test reports in your files. There’s a good chance that upon closer inspection you might find that for certain products the reports you’re relying on for compliance might not be very reliable.

In the Consumer Products Safety Improvement Act (CPSIA), Congress mandated that an accredited third party laboratory must test children’s products before they can be distributed in commerce. Testing for lead in paint or surface coating has been required since December of 2008. Testing for lead in substrate will take effect on January 1, 2012.

So what are the reliability concerns I’m raising?

While some question the accuracy of the tests – by showing inconsistent results from one lab to the next—that isn’t the issue I see. My concern is more serious—that some of the test reports you receive may not even be for the same product that you’re selling. In those cases, the reports are not reliable and provide a false sense of security to you and to your customers.

Here’s one way that happens:  Instead of ordering tests for their own products, U.S. importers often turn to their overseas factories for testing. But some of these factories—particularly ones that supply similar versions of their products to multiple customers in the US—may try to mitigate the cost by testing only a small subset of their products—sometimes only one SKU out of a varied line of products. Instead of testing the actual products as produced for each of their customers, they send a generic version of their product to a lab and then they give these test results to every customer who requests a test report. I’ve seen tests like this more times than I can count.

So what’s the problem with this practice?

Well, there’s no problem with a U.S. importer having their overseas factory order the testing from an accredited lab as long as the tested version of the product is exactly the same in all material respects as the product they’re selling—same item, same finish, same color, same trim, same design, same paint and substrate materials, same raw material supplier, and the same factory. But that’s often not the case.

The more common scenario is that the generic version is similar but different from your product. It might be a different material or color, have different trim details or include additional features from the generic version.  Any of these differences requires a separate third party test.

Another possibility is that the report you have is for a completely different product from yours. Overseas factories don’t always test every product they produce.  I’ve seen cases where a factory will respond to a test request by sending any report they have in their files.  Unless the US firm receiving the report is trained in what to look for, these reports are often accepted as is and passed along to customers.

So how can you tell if your report is really for your product?

  1. Is the product named in the report exactly the same way as it is listed on the web or in the catalog where you found it?  If your product is a Bonzo HT-341 in midnight blue, does the test report say Bonzo HT-341 in midnight blue?  Be wary of reports with generic product descriptions like “Plastic Bottle” or “Tote Bag” and few product details.
  2. Does the test report include a picture of the product?  Is the picture exactly the same as your product and does it include your color?  The best test reports include detailed photographs of the actual products tested.
  3. Look for the name of the company who ordered the test. Is it the same as the company you are buying the product from or is it a company you’ve never heard of?  There’s no problem with tests ordered by overseas factories if they’re for your actual product but be wary of reports ordered by factories for generic versions of their products.

These tips are just a few of the basics in evaluating test reports. I’ve listed several others in my September 30th article If You Sell Promotional Products, Learn to Read a Test Report. And if you’re a PPAI member, check out the November 2nd webinar entitled How to Read a Test Report. It is archived on PPAI’s website.

Test reports are an important part of your due diligence to ensure that the products you’re selling comply with applicable law. Your customers are relying on the integrity of the reports you provide. Take this opportunity to go through your files to verify that you have current test reports for the products you’re selling and that the reports really are for your specific products.

Sell Your Strengths, Respect Your Competitors

Raise your hand if you like negative campaign ads.

No hands? I’m not surprised. It’s hard to imagine that anyone does. They’re ugly, depressing and usually twist truths out of context.

Sure, I know they’re designed to put doubts in voters heads – like crafty litigators who say something inadmissible in court even if the judge tells the jury to ignore what they just heard.

But isn’t the objective in sales to get our customers to vote for us, not against our competitors?

Your prospects and customers can buy many of the same products or services you sell from a million other people.  But they can only get you from you. That’s your differentiator. Your creativity. Your integrity. Your enthusiasm. Your reliablity. Your follow up. Your experience. In the precious few minutes of face time you get with your clients and prospects don’t you want them to fall in love with you, to learn how good you are, and all the ways that you can meet their needs? If you really are better than your competitor, if your product or service is truly a better value, that should come shining through without disparaging your competitor.

I’m not suggesting that you shouldn’t ever mention your competition.  If you’re being asked to meet a competitor’s price on a bag that’s half the weight or size or quality of yours, then of course you should do a point by point comparison.  Product and service comparisons are often part of any good buyer’s due diligence.  But respect your competitor and do it ethically and accurately.

There are lots of good examples of companies who have been able to effectively tout their strengths and their competitors weaknesses in a single message.  Think of Avis’ “We Try Harder” campaign against market leader Hertz.  Or the campaign of another number two, the spectacularly successful Apple  “I’m a Mac, I’m a PC” campaign showing how easily their cool guy got things done versus the nerdy and kludgy PC.   Classy.  Effective.  Respectful.

Both of these campaigns are actually complimenting their competition.  If Hertz and PCs weren’t beating the pants off of Avis and Apple in market share then neither one would have spent so many millions focusing on them.

Complimenting your competition is often a great way to win the respect and appreciation of your prospect.  You’re saying, “You did a good job in selecting that company.” Certainly you’ll want to point out what you do differently or product categories where your company shines against the competitor.  But you’ve respected your competitor in the process and your customer will appreciate it.

I recently had a conversation with the compliance manager of a major distributor who was surveying suppliers about their product safety programs.  She told me some information about a major competitor that I knew wasn’t true.  I could have just moved to the next subject but I didn’t.  I told her that I didn’t think the information she had was correct and I gave her the email address of the CEO of that supplier to get it clarified.  Then I emailed the CEO myself to give him an opportunity to get it fixed.  Crazy?  I don’t think so. First of all, it was the right thing to do.  Second, sooner or later this situation is going to pay dividends.  It’s a small world we live in, particularly in the promotional products industry, and to a borrow an old cliche, what goes around, comes around.  People appreciate honesty and especially when they know it is potentially to your disadvantage.  At that point you become a trusted advisor, which is the most coveted position you can have with a customer.

Sell your strengths. Respect your competitors. And remember this: The most successful among us got that way because they had the best value proposition for their customers. Focus on that and you’ll never have to worry about your competitors.

If You Sell Promotional Products, Learn to Read a Test Report

I know, I know. Boring technical jargon. It’s all true.

But unless you have someone else in your company to take care of this for you, you can’t afford not to know how to read a test report.

There’s an easy way and a hard way. I’ll show you the easy way.  The hard way is to find out that the product you thought was compliant isn’t compliant and that the official looking test report you’ve got in your file is out of date, not relevant to your specific product or doesn’t include all the tests you need.

I know. I learned the hard way.

Back in 2007, when the testing mania began and before we started ordering our own tests, we asked all of our factories to send us test reports for the products in our line. This was a year before CPSIA, before phthalate limits, before lead-in-substrate limits, and before mandatory ASTM F963. The only federal lead restriction was the 600 ppm limit for lead in paint or surface coating – the one that tripped up Mattel with their Barbie Doll recalls.

We received plenty of official looking reports and most of them from well-known testing labs. They referred to tests and codes like EN71, RoHS and 16 CFR 1303. Some included photographs, some did not. We dutifully filed them away and provided them on request to any distributor who asked – the ones doing business with corporations who have really knowledgable compliance people. And that’s when the education began – when those people saw the holes in some of the reports we provided.

“This report is dated 2005. Do you have a current one?”  “The product in this report is a tumbler but it doesn’t look anything like one than we’re buying.”  “EN71 is for Europe. Do you have a test report for the US standard ASTM F963?”

You get the idea. Almost none of the reports were for the actual products in our line. Most were outdated and covered mostly European standards.

Bullet point one: If the test isn’t for the exact product you’re purchasing, it doesn’t mean anything. Never mind that the factory says it’s made of the same material. If you’re purchasing Prime’s LT-3290 then the test report needs to say LT-3290. And it should have a picture so you know for sure that the test is for the same product you’re ordering.

Bullet point two:  The test should be current. The date is critical because the standards have changed. It doesn’t help you to have a lead test dated April 2011 if the bag you’re buying was manufactured in September. The lead standard in April was 300 ppm. After August 14 it changed to 100 ppm.

Speaking of ppm, that’s just a way of expressing a very dilute concentration of a substance. It means one out of a million the way percent means one of a hundred. So lead of 90 ppm means 90 parts out of a million. Bullet point three: Since the number is critical, make sure the test report shows the actual number – not just PASS or FAIL. Without that number you can’t tell if the product complies with the current standards in the law. In CPSIA particularly the lead standards have been continually phased down since August 2008.

Bullet point four: Don’t assume that the test covers everything. Last year we received a passing test report for a small battery powered stuffed toy. The test passed but the battery compartment wasn’t included in the sample tested. After 5,000 pieces were produced we learned that the battery compartment didn’t comply and required several thousand dollars of rework. Expensive mistake.

Labs only perform the tests that they’re asked to perform, just as in the stuffed toy example. So if you see a report with a passing lead test, look closely to see what it is covering. CPSIA requires two different lead tests. The first is for lead in the material itself – sometimes called total lead or lead-in-substrate. (The actual wording in CPSIA is “total lead content by weight for any part of the product”). That limit is currently 100 ppm for children’s products. The second requirement is for lead in any paint or surface coating. That could either be a painted surface of the product itself or the imprint/applique that the supplier or decorator applies. Normally ink used for printed material like books and catalogs is considered part of the material. But heat transfers, pad printing and silk screening inks – particularly if they can be scraped off – are usually considered surface coating. The lead limit for paint and surface coating is 90 ppm. So you need a test for the lead in the material and a separate test for lead in any surface coating.  The lead in material test is usually labeled on a test report as something like “CPSIA Lead in substrate.”  The lead in surface coating test is usually labeled 16 CFR 1303 for the section number of the Code of Federal Regulations (CFR) containing the regulation.

Bullet point five: European standards are for Europe. US standards are for the US. They aren’t the same. If you see a passing test report for EN71 – the European toy safety standard – don’t assume that the product will pass ASTM F963 – the US toy safety standard. They’re different.

Bullet point six:  If your product happens to be a toy, it needs to comply with the the Federal Toy Safety Standard usually referred to as ASTM F963. This used to be a voluntary standard but in CPSIA – the Consumer Product Safety Improvement Act – Congress made it mandatory. ASTM F963 isn’t one test – it’s 67 pages of various tests for which toys need to comply. If you drop the toy from three feet will it shatter?  Is it a choke hazard?  Does it have sharp edges? Lots of things like that. So if your product is a toy, be sure that the report states that it is fully compliant with all applicable tests from the current ASTM F963 standard. Most labs will do that automatically but remember our battery compartment experience.

Bullet point seven: Toys (and child care items) need to be tested for six phthalates: DEHP, DBP, and BBP, DINP, DIDP, and DnOP. These are plasticizers – chemicals added to make plastic more flexible like the strand that attaches the ear buds to your iPod. The maximum limit for each of these phthalates is .1 percent. Make sure the test report lists all six and indicates that there is no more than .1 percent of each one.

These are the basics for the tests required by CPSIA. There are certainly plenty of other possible tests if your product is subject to another Federal Act, ban or regulation. And there are state regulations too. But let’s save those for a future article.

Remember these seven bullets and you’re 90% of the way there.

Is it a toy? We may find out soon.

Think you know a toy when you see one?  We should soon find out if the Consumer Product Safety Commission agrees with you.

At last month’s PPAI Product Safety Summit in Denver, CPSC Director of Regulatory Enforcement Mary Toro told attendees that the Commission is working on new guidance regarding toys.   The implication for suppliers in the promotional products industry is significant – whether “executive toys” like stress relievers, puzzles and desktop games will fall under the CPSIA toy definition.  If these products do fall under CPSIA, the law requires that they undergo much more expensive testing than other children’s products.

Ever since the Consumer Product Safety Improvement Act (CPSIA) was signed into law by President Bush in August 2008 there has been controversy about the definitions that Congress wrote into the Act for children’s products and for toys.  For children’s products Congress said that the product had to be “intended primarily for children 12 years of age or younger.”   For toys, Congress left out the word primarily stating simply that “the term children’s toy means a consumer product designed or intended by the manufacturer for a child 12 years of age or younger for use by the child when the child plays.”

In September 2008, at the first public meeting CPSC held after the law was enacted, I posed a question to CPSC senior staffers about executive toys and specifically about stress relievers.  Another attendee asked about an executive basketball hoop that mounts on the back of an office door and is distributed as a free gift with Quervo tequila. Neither one of these examples is sold for  young kids, particularly the liquor promotion.   Cheryl Falvey, the chief legal counsel for CPSC, said that the staff would have to consider these questions carefully but noted that because Congress didn’t say they had to be primarily for 12 and under that it would be difficult question.  She also added, “ a mother I can tell you that it’s likely they’ll end up at home in the toy box.”

More than a year later, at an ICPHSO product safety conference in February 2010, I again posed the same question to Ms. Falvey. She noted that the Commission was working on a new guidance document to help clarify the ambiguities surrounding the term children’s product.  That document, entitled Final Interpretive Rule on Definition of Children’s Products, was released later that year and approved by the Commission in September 2010.  But while it provided guidance on how to determine if a product is a “children’s product” under CPSIA, it didn’t answer the open questions about toys – and particularly about executive toys.

What’s at stake?   Potentially tens of thousands of dollars per year in third party testing for suppliers who have executive toys in their line.   For children’s products, CPSIA requires third party lead testing – relatively inexpensive tests that are usually no more than $50 and sometimes much less.  But for children’s toys, the Act requires more. Toys must comply with the many provisions of a 67 page Toy Safety Standard known as ASTM F963.  This used to be a voluntary standard but in CPSIA Congress made it mandatory. In addition, toys cannot contain more than .1 percent of six different phthalates.   ASTM F963 testing and phthalate testing are not inexpensive like lead tests. F963 testing runs upwards of $500 for a single toy and phthalate testing can be even more.  We typically budget at least $1,500 per toy for testing.

To be sure, there are many suppliers who will commission ASTM F963 testing even if their executive toys are not covered by CPSIA, Prime included.  The toy safety standard includes many tests that confirm the quality and integrity of a product – drop tests, sharp edges, choke hazard, material quality, etc.  But for products marketed primarily to adults, it will give much more flexibility to the industry if suppliers have the choice on a product by product basis to conduct their own risk analysis and determine what to test rather than a government mandate.  Hopefully the Commission will feel the same way.

“Good morning. I’m calling from the Consumer Products Safety Commission.”

It isn’t hard to imagine how the call would go.

“Hello, Mr. XYZ Promotional Products Supplier?  I’d like to speak to the owner or president of your company.  I’m calling from the Consumer Products Safety Commission.”

“Yes, I’m the owner of XYZ.  How can I help you?”

“Good morning sir.  Well, sir, we received a complaint from one of the consumer advocacy groups we work with that you manufactured a children’s backpack that doesn’t comply with the law.  We sent a few samples to our lab here in Bethesda and they were right.  The handle of this bag tested at 1,700 ppm and the fabric was over 500.”

“Children’s backpack?”  We don’t sell children’s backpacks.”

“Hmm.  Well the label inside says XYZ.  Is that you?”

“Yes, but we don’t sell children’s products!  We sell business to business.”

“Well, it doesn’t really matter who you sold it to.  The one I’m looking at has a scene on the front of three little bears heading to a red schoolhouse.  The developmental psychologists over in our Department of Human Factors tell us this bag age grades from 6-9 years old.  That makes it a children’s product.”

“Bears, red schoolhouse?   We don’t sell any children’s products.

“Well, do you know how these bears got on this bag?”

“I don’t know about any bears.  We just print whatever art the customer sends us.  We only have a few hours to get these bags through the factory and into the UPS truck.  We’re focused on getting the registration correct, getting a crisp imprint, matching the customers colors and meeting the in-hands date.  We don’t pay attention to what the image is or what the slogan means.  Most of our workers don’t even speak English.”

“Well, you might want to rethink that process, Mr. XYZ.  As far as our agency is concerned you manufactured a children’s product that doesn’t comply with the law.   We’re referring this matter over to our recall folks.  You’ll want to have a discussion with them as soon as possible.”

This hypothetical story would be cute if it wasn’t so serious.  If that backpack order was for 10,000 bags and CPSC “suggested” a recall, the cost to everyone – supplier, distributor and end-buyer – could easily run into six figures.  The legal fees alone …well, you know that story.

So how did we get here and what is the solution?

The problem started because Congress didn’t have the promotional products industry in mind when they wrote the Consumer Product Safety Improvement Act (CPSIA).  They were targeting companies like Mattel and Hasbro – companies that produce children’s products and toys for a specific age range.  In fact, the very first criteria that Congress wrote into the law for determining whether a product is a children’s product is …”A statement by a manufacturer about the intended use of such product, including a label on such product if such statement is reasonable.”

Suppliers in the promotional products industry usually don’t have any idea how an end-buyer is going to use a product.   Many times the distributor doesn’t even know – particularly in a bid situation or when an order comes in over the Internet.   Yet, unless distributors and suppliers both know the intended use of a product, it’s difficult to be sure that the product will comply with CPSIA.  Distributors won’t know that they should select compliant product and suppliers have no indication other than the artwork.

Even if a supplier takes the time to evaluate the art, it can be challenging from the image or slogan to figure out who the product is intended for.  Winnie the Pooh is easy.  A less obvious but equally juvenile design is not.

So what are some possible solutions for our industry?   Together with colleagues and PPAI, I’ve met with CPSC senior staff and here are some solutions we’ve discussed.

1) Suppliers can identify in their lines each product that could possibly be regarded by CPSC as a children’s product, either because it innately fits the children’s product definition or because it could become a children’s product after being imprinted with a juvenile image.  Then, if each of these products is manufactured and tested to CPSIA children’s product standards, there is no issue.   No one would have to evaluate art or worry about who a particular order is intended for because EVERY product complies.

2)  Another option is for suppliers to indicate in their catalogs, website, on ESP and SAGE, the specific products in their line that have been manufactured and tested as meeting CPSIA children’s product standards.  This option is a little more risky than option 1 because it requires more vigilance by everyone.  If a distributor sends in a juvenile imprint order for one of the products that isn’t marked as compliant and the supplier produces and ships it, then liability for everyone is still an issue.  This option could work if distributors and suppliers have good communication and orders are clearly marked as “intended for children”.  eDistributors who receive orders over the Internet should require customers to answer a question about the intended use of the product – whether it is intended for young children – and the response should be included on the corresponding order to their supplier.

The one thing that none of us in the industry can afford to do is to ignore this issue or assume it’s someone else’s problem.   This is a case where it really does take a village – everyone working together – supplier, distributor and end-buyer – so we make sure we all get it right.   Who is the product intended for?  Are children involved?   If so, select only products which have been manufactured and tested as compliant with CPSIA standards.   On that issue, there is no other option.

The Problem with Test Reports

It was one of our hottest selling bags and we were flat out-of-stock.  At least a dozen backorders had already piled up by the time the container with 150,000 new pieces finally arrived at our receiving dock.

The product, a polyester backpack with a zippered pocket, came in four colors, each with a matching coated zipper pull.  The arriving pieces should have gone into production as fast as the container was unloaded.  Instead, I received a chilling email from my in-house testing lab:

Product failed XRF test upon receipt. Lead: 4,600 ppm in surface coating of zipper pull. Shipment quarantined.

4,600!  The legal limit was 600 ppm if those bags were decorated for children.  How could it be?  Didn’t we have a pristine test report from a major third party lab just weeks earlier?

Yes, it was true.  This shipment failed but weeks earlier we had received a current test report in which the same product from the same factory passed every test with flying colors, and from one of the most respected CPSC-certified labs in the world.   What could have gone wrong?

A lot went wrong, we learned.  To begin with, the sample that was sent to the testing lab was made from a different batch of material than the production pieces.   That’s not unusual.  As long as the product spec, bill of materials and factory doesn’t change you shouldn’t have to send every batch to be third party tested.

But that’s the point.  Something obviously did change but no one knew about it.   Maybe not even the factory.  It’s the same thing that happened to all those Barbie Dolls® back in 2007.  In this case it was the zipper pull.  The production pieces were sprayed with a different coating than the sample.

So what can we learn from this incident?   Does it mean you can’t rely on third party test reports?

No, the report was fine.   The sample that passed the test was fine.  The problem was the factory, not the testing lab.

Factories assemble products from raw materials and components that they buy from other suppliers.  A bag factory will buy fabric, lining, metal, paint, grommets, thread, handles, wheel assemblies, binding, and whatever else they need from a a variety of sources.   If they are required to make a product that complies with 100 ppm lead, that’s what they’ll specify to their suppliers.  But how many factories are equipped as we are to scan every incoming shipment to verify that it complies with the spec?  Very few, if any, in my experience.  They rely on the integrity of their supply chain and sometimes that supply chain lets them down.

The problem could be with just a portion of an order.  Maybe the factory runs out of a particular material and needs a little extra to complete the order.  But their main supplier is out of stock, or won’t accept orders for small quantities.  So the factory goes elsewhere to fill the need.  Maybe the extra material complies, maybe not.

It’s why Prime and other quality suppliers who buy from dozens of factories in China and elsewhere can’t rely on a once per year third party test report.  In our case, we’ve had our testing lab in-house since October 2007 – to check every incoming shipment, no matter what the previous test report says.   Other quality oriented suppliers in the industry do the same, either in China or in the US.

The most important lesson is to understand that compliance is not a destination.  It’s not something that you do once or periodically.  It’s a journey, day in and day out.  The process never stops.  Whatever you did yesterday means little for the product that is produced tomorrow unless you work as hard at being vigilant tomorrow as you did yesterday.

For distributors the lesson is to know your supplier well.  Understand that test reports are only one indication of a good compliance program.  There are many suppliers in the industry with rock solid compliance programs that you can rely on.   Visit with your suppliers whenever you can, either in person or at trade shows, ask to meet or speak with their compliance officer.  Ask what kinds of checks and balances the supplier uses to guarantee consistent, safe and compliant product.

Remember:  In a great compliance program third party test reports are just the tip of the iceberg.

Problem or Opportunity for Promotional Products Distributors?

At a Harvard program I enrolled in many years ago, the great Marty Marshall taught us the three most important words in the marketing lexicon: What’s going on?  Starting with those simple words we learned a disciplined process to identify problems and opportunities – issues or threats in the marketplace that might enable us to gain a competitive advantage.

In our industry, concern about product safety is an important thing that is going on and a problem that could easily become your opportunity. Ever since the summer of 2007 and those massive recalls of Chinese toys containing too much lead, the world of product safety and regulatory compliance has been turned on it ear. Complicated and sometimes ambiguous laws have been passed at the state and federal level, testing labs have been swamped with new business and corporate America has been put on notice that cheap products imported from China can be risky.

No shortage of problems here: Complex new product safety regulations sometimes different from state to state, uncertainty and confusion from buyers, an industry scrambling to learn compliance and even the experts trying to wrap their heads around this juggernaut.

But as Marty Marshall taught, problems can be golden opportunities for enterprising marketers.

Corporate America needs promotional products. And because of the risks, because of these problems, they need a knowledgable and conscientious distributor to guide them, protect them, to act as a fiduciary for their most valuable asset – their good name – to ensure that it only goes on quality products that are safe and compliant and is never put on a product that might cause risk or embarrassment. In short, they need a trusted advisor. You.

We’re a commodity industry. Many of our products can be obtained from a seemingly limitless number of suppliers and distributors. But as a trusted advisor you change the paradigm. Instead of price driven sales, yours are value driven sales. Now, instead of losing business to low-bid competitors your clients often select you without bidding, because they trust you. They understand that you’re selecting appropriate products from suppliers with rock solid compliance programs and that you’ll never risk putting their name in harms way.

You don’t have to be a product safety expert but you do need to learn the basics. PPAI has a broad range of educational materials and webinars to help you get started. If you have questions, send me an email or give me a call. Within a short time you’ll learn the issues and be well on your way to becoming a trusted product safety advisor and a very savvy promotional products marketer.

Author note: Sadly, in the course of researching this article, I found that my old professor had passed away. Marty was a brilliant marketer, a motivating teacher and his legacy will live on for many years.

Marty Marshall Article:
PPAI Product Safety page:

What Matters Most is Protecting Your Customer

It started with such a simple and noble objective – protecting children from lead and other toxins.

Remember the millions of Barbie® Dolls recalled in the summer of 2007 for too much lead in the paint?  That was the catalyst for the Federal law we all know of as CPSIA.  But what we ended up with is anything but simple.  Even CPSIA experts have a hard time agreeing about what is or isn’t a children’s product under Consumer Product Safety Commission (CPSC) guidelines.

At PPAI’s recent Product Safety Summit in Denver, I projected images of several products and asked attendees to raise their hand if they thought the product was a children’s product.  The first image was a simple water bottle for a first grade Little League team.  The imprint said “Meadowbrook Little League” in bold Helvetica type.  The second image was the same bottle with an imprint of Dora the Explorer.  One is considered a general use product, one is a children’s product.  Same bottle, same lead content, different imprint.  Both are going to be used by the same 6 year old kids.  One requires testing and must comply with CPSIA requirements.  One doesn’t.

These examples go on and on.  They make you scratch your head and wonder what happened to that simple noble objective.  At the Summit, our featured speaker was Mary Toro, head of regulatory enforcement at CPSC.  Even Mary wasn’t sure whether some of the products we showed would be considered children’s products.  It’s complicated even for the experts.

How did this happen?  Another noble objective gone awry.  In trying to please the varied constituencies, CPSC came up with a compromise:  If a product appeals mostly to young children, it’s a children’s product.  If the same product appeals equally to everyone, it’s a general use product.  Helvetica lettering apparently appeals to everyone, Dora doesn’t.

But is it a good thing that certain products can be sold for use by young children without having to comply with child safety laws?   Not for the promotional products industry.  The risk to our customers is too great.

Consider this:  If a product is going to be used by children – a general use product that is to be used by all ages – how would it play in the press if it was revealed that the product was full of lead or cadmium or phthalates?   What embarrassment could that cause your customer if it became viral on the web or, heaven forbid, the subject of a Keith Morrison exposé on Dateline?  Can you imagine the phone call you would get asking how you could have put the company in that position?

Two recent cases illustrate how toxins in products can have a devastating impact on a company’s reputation – even if the products are compliant.  The first is McDonald’s costly Shrek glass recall and the second involved reusable grocery bags containing lead from Publix, Safeway and others.  Each involves products that may have been technically compliant in a court of law but not in the court of public opinion.  Each involved millions of dollars in negative publicity in addition to the millions spent in recalling the glasses and bags.

The message is clear:  As fiduciaries of our customers’ most valuable asset – their good name – let’s make sure we’re selling products that meet the CPSIA limits for lead and phthalates regardless of whether the product is technically going to be considered a children’s product or not.  In addition to protecting our customers’ good name, we’ll be protecting our own future.  Remember: Large corporations are risk averse.  It wouldn’t take many high profile fiascos for these businesses to decide that promotional products are too risky.

Insist that all products you sell – and particularly those for which children may be involved – are compliant with the new 100 ppm lead standard and all other applicable provisions of CPSIA.