16 Imperatives for Product Safety and Compliance

Yikes!  We’re barely past the halfway point of 2016 and already a whopping $25 million in civil penalties have been assessed against businesses this year for product safety violations.  A civil penalty is a fine levied by a regulatory agency of the federal government – in this case, by the U.S. Consumer Product Safety Commission (CPSC), the agency charged with protecting consumers against unsafe products.

The magnitude of these penalties should not be a surprise to PPAI members.  In his keynote address at PPAI’s 2015 Product Responsibility Summit. CPSC Chairman Elliot Kaye told our attendees that we should expect to see the Commission assess significantly higher civil penalties in 2016 than in the past because, as Kaye sees it, it is the only way some companies will get the message that the agency is serious about protecting consumers.  CPSC has shown the same enforcement resolve in the constant stream of recalls it announces each week, many relating to lithium ion batteries, a component found in dozens of promotional products.  Just this past week, on July 6, 2016, the Commission ordered ten companies to recall 500,000 lithium-ion powered hoverboards because of the risk of overheating, fire and explosion.  If the companies involved had to refund the retail price of all those hoverboards, the total cost could be more than $100 million!  Yikes, indeed!

In this challenging regulatory environment, it is prudent for all suppliers and distributors to redouble their efforts to educate their employees on safety and compliance basics and to verify that their company has a sensible compliance program in place for all of its supply chain activities, whether you are a direct importer or simply a sales rep selecting products from your favorite supplier.  If you sell promotional products, the rules apply to you no matter what your role is in the stream of commerce.

Here is a glossary of definitions, tips, guidelines and best practices to use in your review and training.  Treat it like a checklist to evaluate your own practices and to identify areas for improvement.

Definition 1
Product Safety vs. Regulatory Compliance – Both are equally important.  Regulatory compliance refers to meeting (and ideally, exceeding) standards required by regulators –the rules, laws and standards that apply to the products we manufacture, decorate and sell.  Standards can either be mandatory, such as those referenced in state and federal law, or they can be voluntary standards developed by industry consensus at organizations like UL and ASTM International.  Both types are important and both are used by regulators in their enforcement efforts.  The Consumer Product Safety Improvement Act of 2008 (CPSIA) is an example of a federal law that contains many regulations.  For example, it mandates that children’s products be tested annually at a recognized third party laboratory and that children’s toys must comply with the ASTM F963 Toy Safety Standard.  The law makes it illegal to sell children’s products and children’s toys that do not meet these requirements.

Product safety goes beyond regulatory compliance in dealing with whether a product is safe to use, even if it meets every applicable rule or even if it is one of the many products for which there are no mandatory or voluntary rules.  The hoverboard recall is an example of a product for which no safety regulations were violated but the product was deemed by CPSC to be unsafe anyway.  The Commission has statutory authority to recall any product it deems unsafe, no matter what.  Period.

Definition 2

Mandatory vs Voluntary Standards – Both are equally important.  Whenever a standard or rule is incorporated into a law, that standard is mandatory.  The Toy Safety Standard F963 is a good example.  Originally a voluntary standard, after the Mattel Barbie Doll recalls in the summer of 2007 an angry Congress chastised industry for not policing itself so it made the standard mandatory.  There are thousands more voluntary standards than mandatory standards as it is benefits everyone – consumers, business and government – when business and industry polices itself.  At PPAI’s 2015 Product Responsibility Summit, Marc Schoem, then CPSC’s long-term Deputy Director of Compliance (now retired) stated unequivocally that the Agency considers voluntary standards to be the minimum acceptable – the least a company should comply with.  So be sure to always find out – usually by speaking to an expert at a testing lab – if there are voluntary standards applicable to the product you are selecting and then verify that the product complies.

Best Practice #1
You are responsible!  No matter who you buy from, no matter how long you have done business with that supplier or factory, no matter what, you are ultimately responsible for the quality, safety and compliance of every product you sell.  Your customers don’t know your factory or supplier.  They’re doing business with you because they trust you.  Of course you will entrust a great deal of faith in your, reliable, high-quality suppliers.  But remember, even the largest and most trustworthy brands on the planet – Apple, Sony, Disney, Fisher Price, Johnson & Johnson to name a few – all have had major product recalls and serious quality gaffes, so you can be sure that even the most reliable companies in our industry have quality and compliance issues.   Don’t take anything for granted and don’t assume anything.  Suppliers have hundreds and, in some cases, even thousands of products on their websites.  No one has the resources to be an expert in everything.

Best Practice #2
Nurture a product safety culture in every aspect of your work so that you’re automatically thinking of safety and compliance with each project you work on, with each product you select, with each order you take, with each supplier or factory you work with and with each client presentation you make.

Always assume responsibility for the safety, compliance and appropriateness of the product that you are selling.  You are 100% responsible for making the right product decisions for your clients.

Best Practice #3
Learn the products in the industry that are subject to compliance requirements.   Anything used by a child heads the list since the major focus of the Consumer Product Safety Improvement Act (CPSIA) is children’s products and children’s toys.  Children’s apparel and sleepwear are both regulated by CPSC as are art materials like such as highlighters.  Food and all products that come into contact with food, are regulated by the U.S. Food and Drug Administration (FDA).  In addition to mints, chocolate and other common promotional foods, this category includes all types of promotional water bottles, tumblers, lip balms, hand sanitizers, sunscreens, lotions and cosmetics, sunglasses, first aid kids and more.   Learn the key considerations for each of these products.  For example, food containers like drinkware need to be tested to verify that chemicals from the container will not “leach” into the food or drink.  This list is just an overview.  You can get a more complete list, category by category from any of the major testing labs.

Best Practice #4
Develop a standard checklist of questions to ask every client for every project you work on.  What kind of event is the product for?  How will it be used?  Who is the intended audience?  If there are children, what are their ages?  In which states or countries will the product be distributed?   Does the client have any compliance requirements that exceed mandatory requirements?  Then, use the information you learn to help you select the most appropriate products and to properly advise your supplier.

Best Practice #5
If you find out that the intended audience includes children, make sure the products you select are age appropriate, even if there are no specific compliance requirements.  There is no mandatory regulation to prevent you from selecting a string backpack for a pre-school camp event, but a corded product for very young children is probably not the most prudent choice.  Similarly, don’t select a product that would break into shards if a six-year old threw it on a cement floor because sooner or later that’s probably going to happen.  Common sense is the best rule here.

Best Practice #6
If children are involved, always require CPSIA compliance no matter the age.  CPSIA is a complicated law that doesn’t always make common sense.  For the most part, as noted earlier, CPSIA focuses on children’s products, which it defines as products primarily intended for children 12 years of age or younger.  CPSC has issued guidance as to what “primarily intended” means but you should ignore it.  If children are involved, don’t try to figure out if the law technically applies – just make sure your product complies.

Let’s say you pick a product like a sports water bottle for a PTA fund raiser and that the imprint is not something obviously juvenile like Elmo or Winney the Pooh.  Since the product has equal appeal to all ages, including young children, CPSC might say that the bottle is a general use item not subject to CPSIA requirements.  Now assume that bottle is decorated with a lead-containing ink, that a well-meaning consumer advocacy group finds out about it and that group issues a press release criticizing your client for distributing leaded products to children. Is your client going to want to stand up at a press conference and say, “well, our vendor told us that the bottle isn’t technically covered by the lead rules.”  Of course not.  At that point it is a public relations nightmare for your client and the damage has been done, regardless of whether the product is technically compliant.

If you think this example is far-fetched, search Google for the Wegman’s grocery bag recall after a consumer group found lead in their reusable grocery bags or a similar expose by a Tampa TV station which led to millions of these bags being recalled.  In both cases, no compliance violations were involved – only the common sense fear about putting your family’s food in a container containing harmful lead – and the fiascos resulted in millions of bags being recalled.

Best Practice #7
Don’t assume that product you select for children has been tested to CPSIA requirements.  If you learn that the intended audience includes children, you should always select products that are fully CPSIA compliant.  In the promotional industry, that can be a challenge.  Most items used for children’s events are imported as general use items, appropriate for all ages and not subject to children’s product regulations.  They only become “children’s products” subject to CPSIA after they are decorated with juvenile art.   So it’s very possible that the supplier may not have incurred the expense to have the general use product tested to children’s product standards.  As a best practice, whenever selecting products for children or family audiences, always verify that the products have been tested to full CPSIA compliance at a CPSC-certified third party laboratory within the past 12 months.  If the supplier claims that the product has been tested, ask for the test report and see for yourself.

Similarly, you should personally verify that the item is manufactured with the level of fit, finish and quality that a safe children’s product requires.  Always devote your highest degree of scrutiny when children are involved.

Best Practice #8

Always ask where the products you sell are going to be distributed.   Why is this important?  Many states have laws that layer on top of federal law, and most countries have different product safety requirements than here in the U.S.A.   Chemical regulations are a good example.  In recent years, many states have passed chemical legislation regulating children’s products and children’s jewelry and some have rules that apply to all consumer products. California, for example, has a chemical labeling law commonly known as Proposition 65 which is intended to warn consumers about products that contain carcinogens.  Because of high testing costs, most companies opt to comply with Proposition 65 by affixing a warning label to each product stating that the product contains chemicals known to the State of California to cause cancer.  But since it’s not generally desirable in the promotional industry for companies to hand out free gifts with a warning about cancer, some choose to avoid the warning labels by testing for the most common carcinogens.  It’s not a fail-safe strategy and it’s not inexpensive.  California’s carcinogen list exceeds 900 chemicals so there is no affordable testing protocol to test for all of them.  When selecting products for California, work closely with your suppliers to learn their practices and to determine the best strategy – testing, labeling, or a combination of both – that works for your risk tolerance and that of your clients.  Illinois, Maine, Washington, Massachusetts, Vermont, and Connecticut are among the other states that have passed chemical regulations in recent years.

Speaking of chemical legislation, you should be aware that Congress has just passed and President Obama has just signed into law the Lautenberg Chemical Safety Act – a major revision to the existing Toxic Substances Control Act of 1976.  Over the next several years this updated law could impose significant new chemical restrictions for products in our industry.

The best strategy for complying with chemical regulation is to develop a relationship with one of the nationally recognized labs.  PPAI members can take advantage of discounted testing rates with our affiliate partner UL as well as having access to a trove of educational materials and webinars through PPAI’s product safety department.

Best Practice #9
Learn the questions to ask your supplier or test lab for every product you sell, until the answers are second nature to you.  What voluntary and mandatory standards apply to the product?  When and where was it tested?  Tested for what?  CPSIA?  Prop 65?  Phthalates?  Toy Safety?  UL2056 (for lithium ion)?   Is it UL certified or certified by another Nationally Recognized Testing Lab (NRTL)?  Ask to see the full copies of test reports and give them to a person qualified to understand what they say.  Are they current?  Are they thorough?  Were all seven phthalates tested?  Which toy safety (ASTM F963) tests were conducted?  Does the test report include color photos of the products tested?  Do the photos match exactly with the product you plan to buy?  Get an actual sample of the product and hold it in your hand.  Does it seem well-made?  Is the fit and finish that of a quality product?  Can you easily pull it apart?  Are there sharp edges?  Is it a product you have experience with and knowledge of its material, design and construction?  Are you aware of the technology used and the key quality differentiators with that product?  Would you be able to differentiate between a high quality, well-made safe product and one with lesser quality?  Sometimes the differences are hidden inside, especially with electronics where the protective circuits need the highest quality components that won’t fail under stress.

These are just some of the questions you should be asking yourself for every product you sell.  Remember that when you select a product for your customer – particularly one that will be decorated with your client’s brand or logo—your client is trusting that you have the professional skills, knowledge and experience not to put their brand and logo in harm’s way, by selecting an inappropriate, unsafe or non-compliant product.  Of course you wouldn’t do that intentionally, but once you develop a true product safety culture you will begin thinking of that responsibility differently, as if you were deciding on a toy for your own new born infant.  That’s the level of caring and diligence your clients deserve.

Buy from the most reliable factories and suppliers you can find but don’t put blind faith in anyone.

Best Practice #10
When you speak to your supplier about safety and compliance, speak to the person in charge of safety and compliance – not a customer service rep or a sales person.  Compliance can be complex and nuanced based on the particular circumstances even for those us of who deal with it every day.  Over the past nine years, I have conducted dozens of workshops and training classes throughout the industry to educate and raise awareness on the basics of product safety and compliance in the promotional industry.  But merely attending a class like mine or reading from a website description or an FAQ doesn’t qualify anyone to give advice.  Always speak to an expert when seeking actionable information about product safety and compliance.

Best Practice #11
Regardless of the job title of the person you speak to, do not rely solely on what that person tells you or what you may read on their website.  As noted, you are ultimately responsible.

Best Practice #12
Learn How to Read a Test Report.  Speaking about test reports, this would be a good time to reiterate a topic that has caused more misunderstandings and “gotcha’s” than anything else in the promotional world – worthless test reports.  Here’s what happens:  You ask for a test report and your supplier or factory sends you what they have.  It might be for the product you are considering and it might be for a similar one or for a different product altogether.  The test may be from a CPSC certified lab or not.  The report may be complete or not – with some tests covered and other ones not.  Or it could be for European standards instead of ours.  It may include a photo and may not.  The point is, tests are expensive and most of the people handling these reports are not experts.  So buyer beware.  Learn how to read a test report and know what you’re looking for.  Or find someone in your company who is an expert and verify that that the tests are complete, in date and applicable to the specific product and color you’re purchasing.  PPAI has presented webinars on this topic which are available online to members.  There’s also a monograph to accompany the webinar that explains step-by-step how to read a test report.

Best Practice #13
Adopt a sensible risk management strategy.  Quality and compliance is critical but it isn’t your only job.  You have to find a way to manage this risk within the context of your time available.  You already do this in your everyday family life without thinking about it as a formal strategy.  You probably devote much more time selecting healthy foods for your children than you might spend deciding what outfit to wear in the morning.  One has a much higher risk factor than the other.  Similarly, when you don’t have extensive time to research a particular purchase, you probably pick the brand you’ve had the best experience with.  So you already know a lot about risk management.   How does that translate to our industry?  Devote the most time to the highest risk products and the highest risk situations.  Children’s products, children’s jewelry and children’s toys all have significant compliance and safety implications, so you should naturally devote greater scrutiny to these products.  Food products, food containers, hand sanitizers, lip balms, sun screens, skin lotions, and sun glasses are all regulated products with significant safety and compliance implications.  And, of course, the single most dangerous product in our industry – lithium ion – which powers portable phone chargers, Bluetooth speakers and a wide range of other electronic products, deserves your greatest scrutiny.  Learn the key safety and quality differentiators for each of these high risk products and then choose carefully.  Very carefully.

Best Practice #14
Include safety and compliance requirements on your purchase orders. 
Compliance and product safety in the promotional industry requires clear communication and a strong partnership between the distributor and supplier.  All the information you learn in your client meeting – the intended audience for the promotion, the ages of any children involved, the states or countries where the product will be distributed – should all be written on your purchase order.  Don’t assume anything!  It doesn’t matter if you mentioned your requirements to a customer service agent or wrote them in the email with your PO attached.  Suppliers get many hundreds of calls every day and thousands of emails.  The only document that is certain to travel with your order from start to finish is your purchase order and it is also the contract between you and the supplier.  If the product must comply with CPSIA, or Prop 65, or the Illinois Cadmium-Safe Kids Act, include that as a special instruction on your purchase order.  It’s also a smart idea to ask the supplier to specifically confirm that they can comply with these instructions.

Best Practice #15
If you hear of any safety or compliance incidents, report them to your company immediately. 
If your client emails you about an incident – perhaps that a glass tumbler broke and someone’s hand was cut – report it to your company and investigate immediately.  Do the same for a compliance violation, if you find out after the fact that a product your company shipped was not compliant.  CPSIA contains strict reporting requirements that start the moment you learn of an incident.  The single biggest reason for the civil penalties I mentioned at the start of this article was failure of these companies to notify CPSC in a timely manner. Always let your compliance team know of any incidents reported to you.

Best Practice Tip 16
Find a compliance/product safety advisor or mentor to help you learn and make the right decisions.  Even the most knowledgeable and experienced compliance practitioners have colleagues and consultants they rely on for expert advice and second opinions.  No one is an expert at everything, especially in a field as broad and complicated as compliance.  There are notable experts in our industry – at PPAI and its Product Responsibility Action Group – but the most reliable sources of compliance expertise are major testing labs, professional consultants and experienced product safety attorneys.

So there you have it – sixteen ways you can protect your clients and your business.  Post them on your refrigerator.  Pass them around your office.   Make them part of your DNA.  They will make you more valuable to your clients and to your employer and they will help distinguish you in an industry of commodities. They are the essence of PPAI’s Product Safety Aware initiative and they will make you a worthy product safety ambassador.  But most of all, they’re the right thing to do.

*                *                *                *                *                *                *                *                *                *

Rick Brenner is president of RFBrenner LLC, a management consulting firm.  He coaches CEOs and advises industry firms on growth, strategy, finance, acquisitions, operations, product development, supply chain, improving profitability and developing wealth.   Mr. Brenner also heads Product Safety Advisors LLC which helps firms and implement product safety, compliance and social responsibility programs.  He is the immediate past chair of PPAI, president elect of ICPHSO – the International Consumer Product Health and Safety Organization, and an 18 year industry veteran, 12 as CEO of Prime Line. 

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:        www.cpsc.gov/PageFiles/106141/8002.pdf

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

What the Promotional Products Industry Can Learn from Williams-Sonoma

Staying Silent Can Cost You

In the Fall of 2002, Ann Brown, head of the U.S. Consumer Products Safety Commission (CPSC), proclaimed that San Francisco-based Williams-Sonoma was “leading the way on recall effectiveness” as she honored the company with her prestigious Chairman’s Commendation.  “Williams-Sonoma has demonstrated their commitment to consumer safety, by ensuring that customers were properly notified of a dangerous recalled product.”  Unfortunately for this upscale retailer, Ms. Brown is no longer at the Commission and it is not 2002.  This May, in a stunning reversal of fortune, CPSC has smacked Williams-Sonoma with a whopping $987,500 civil penalty for failure to timely report a product defect. Draconian as it seems, this stunning and eye-popping penalty may soon seem modest.  Well-informed sources predict it is only a precursor of much larger penalties in the works.  The message of the 2013 Commission is clear: Follow the letter of the law or be prepared to pay an astronomical penalty and then be compelled to follow the law with a costly CPSC-imposed mandatory compliance program.

So what can distributors and suppliers in the promotional industry learn from this case that they can use to protect their businesses?

Williams-Sonoma ran afoul of the critical Section 15(b) reporting requirements of the Consumer Product Safety Act.  Among other obligations, Section 15 requires manufacturers, importers, distributors and retailers of consumer products to notify the Commission immediately whenever the company has information that one of its products contains a defect which could create a substantial hazard or creates an unreasonable risk of serious injury or death.   Strategy #1: Assign a senior person in your company to learn the Section 15 reporting requirements.

Change a few details and the story of what happened to Williams-Sonoma could have happened to any company in our industry – promotional products suppliers who import product and distributors who sell it.  In this case, William-Sonoma did both.  In 2003 they began importing wooden hammock stands to sell through their Pottery Barn division.  From 2003–2008, Pottery Barn sold 30,000 units.  According to CPSC, when the hammock stand is used outdoors its metal brackets can trap moisture causing the wooden beams to rot over time behind the bracket and giving no outward sign until someone sits in the hammock and the beam breaks.   During this five-year span the company received 45 complaints of which 12 incidents required some medical attention.  The Commission claims that Williams-Sonoma knew by late 2006 – after it had received eight complaints – that the product had a defect which created a substantial product hazard, however Williams-Sonoma did not file a Section 15 report with CPSC until September 2008 – two years later!

If this case was typical, Williams-Sonoma most likely learned about the defective hammocks through a variety of customer interactions that may not have been passed on to one central repository.  Some customers might have placed warranty claims and only mentioned the bumps and bruises in passing.  Others might have come in to a store for a refund, written a letter, called an 800 number, complained via a Web contact form or even posted on CPSC’s new “Safer Products” site.  Whether a company is large or small, information – even bad news – can permanently reside in silos when the people receiving the information don’t appreciate its implication or aren’t aware of related incidents.  Without specific training and a robust initiative, employees in the field might receive a customer complaint—perhaps over the phone or in passing during an unrelated conversation—and dismiss it as insignificant, not their responsibility or not serious enough to report.   Teach your team that every product complaint is potentially significant.  Every complaint, claim, or incident report should be relayed to a central repository, logged and followed-up on thoroughly.  Be sure to have a trained individual call the consumer to discuss what happened and to make sure your incident report is accurate and that no details have been sugarcoated.  Ask for the product to be returned so you can see for yourself what went wrong and determine whether the issue constitutes a substantial product hazard.   Strategy #2: Educate employees to communicate every product related complaint to one person or department knowledgeable about Section 15 requirements, who has the authority to report to CPSC or to quickly raise the reporting issue to someone who does.  Investigate every incident thoroughly and get first-hand information about what happened whenever you can.  Ask for the product back to carefully evaluate what went wrong and whether further action is required. 

A common myth, and why some companies may not report, is the fear that Section 15 reports will automatically result in a costly “corrective action”, a term CPSC uses to refer to any remedial action taken by a firm, including recalls.  CPSC denies this myth in an FAQ on its website:  “Reporting a product to the Commission under section 15 of the CPSA does not mean that the Commission automatically will conclude that the product creates a substantial product hazard or that corrective action is necessary.”  Instead, CPSC contends that aside from helping the Commission to identify substantial product hazards that Congress established the Section 15 reporting requirements to encourage “widespread reporting…. to help identify risks that the Commission could address through voluntary or mandatory standards, or information and education.”   I posed this myth question to a prominent product safety attorney who regularly practices before the Commission.  He confirmed that many Section 15 reports result in no action and advised that companies should err on the side of “over-reporting.”   Indeed, the risks inherent in a Williams-Sonoma-sized civil penalty alone should inform any company’s consideration of whether or not to report.  Strategy #3: Err on the side of “over-reporting” when you learn of a product defect that could create a substantial hazard.  If the risk is not substantial, CPSC will not likely take action.  If the risk is substantial and you do not report, the potential civil penalties can be massive.  This Commission has already shown in the Williams-Sonoma and Kolcraft [1]matters that it will not hesitate to invoke stiff penalties for late reporting.

CPSC allows Section 15 reports to be filed through it’s SaferProducts.gov website, by mail, or by telephone, and can be submitted by the reporting company or its attorney.  The most important thing is to file the report timely, however it is always advisable when dealing with regulatory agencies to do so with the advice of an experienced attorney who specializes in that area of the law.  Reporting companies should be prepared with the information that CPSC staff will need to evaluate the product hazard and determine if further action is required.   The more organized and complete a company’s records are, the easier time it will have responding to Commission staff queries.  The initial questions are what you would expect: What is the product?  Who is the manufacturer or importer?  Where is the product sold?  What is the defect, injury or risk?   How many units have been sold?  How many complaints or incidents involving the product have been reported?  Were there any injuries reported?  If the investigation continues beyond an initial stage, the information requested by CPSC can get much more detailed.  Strategy #4: Keep complete and accurate records about the products you sell.  This should include such product related items as sales and purchasing records, test reports, history of complaints, warranty claims, returns, and any other relevant information you may have.  The information should be stored in a database and easily searchable by the individual you empower to evaluate product defects and make Section 15 reports.

It is very easy – actually tempting – to read about someone else’s misfortune and assume for one reason or another that it can’t happen to you.  But if you sell consumer products – and our entire industry does – it can happen to you and maybe easier than you think.  Product defects that that have the potential to cause injury can happen to any company that makes or sells products.  Consider this: Williams-Sonoma has a long history of managing recalls – so much so that CPSC recognized its outstanding systems a decade ago.  Yet even with a compliance staff, a sophisticated database tracking system and a history of managing recalls effectively, a serious product defect fell through the cracks and cost the company dearly.  Take the time to evaluate your company’s system for evaluating products, for logging and monitoring complaints, returns and claims, and for determining whether any product related issue has the potential to create a product hazard substantial enough to warrant a Section 15 report.  Strategy #5: Just as you would monitor any other Key Performance Indicator, establish KPIs for monitoring your systems for tracking product related issues to ensure that no potential product hazard falls through the cracks to later become an albatross for your company.

[1] In March 2013, two months before the Williams-Sonoma civil penalty, Kolcraft Enterprises Inc. of Chicago agreed to pay a $400,000 civil penalty for failure to timely report defects involving faulty latches on the sides of several of the play yard products it manufactured for Carter’s, Sesame Street and others.  In both the Kolcraft and Williams-Sonoma Settlement Agreements CPSC imposed mandatory compliance programs.

This article appears in the August 2013 issue of PPB Magazine

CPSC Press Release – Williams Sonoma Civil Penalty and Links to Commissioner Statements

Settlement Agreement Between CPSC and Williams-Sonoma


Ten Ways to Protect Your Clients and Build Your Business

When you consult with your customers about their promotions or inquire of your suppliers about their products, do you ask questions about product safety and compliance?  For your customer – Who will the products be given to? Where will they be distributed?  For your supplier – What third-party tests have been performed for these products?  If you’re not asking basic questions like these, you’re missing valuable opportunities to distinguish yourself from your competitors.  More importantly, you could be putting your customers, your distributorship, your suppliers and even the industry at risk.  Yet, putting yourself in a position where you are confident enough to ask the right questions that will protect everyone in the supply chain is a cinch for promotional products professionals.  Here’s a list of ten guidelines that that every responsible member of the industry should master.

Learn the basic product safety laws and regulations that affect the promotional products industry.  The main one is CPSIA, an acronym for the Consumer Product Safety Improvement Act.  It’s the federal law that regulates children’s products and toys.  If one of your clients has a promotion that involves young children, you must understand how CPSIA applies and what you must verify with your supplier to ensure compliance.  There are other federal laws to consider as well, such as those that apply to industry products that come into contact with food, like water bottles, tumblers, coolers and lunch bags.  Together with hand sanitizer, sunglasses, and first aid kits, these promotional items are governed by U.S. Food and Drug Administration (FDA) regulations.  Certain states have regulations as well, such as California’s Proposition 65 and Illinois’ lead law.  There are industry resources to help you learn these basics – educational sessions at industry events and webinars through trade associations to name a few.  You don’t need to know all the technicalities of these laws but you do need to know enough to ask the right questions so you can make informed decisions.  A few hours of product safety training is a great start.

Know your products.  If you’re a supplier, you should know everything you can about each product in your line.  Importers and manufacturers should have technical drawings, a bill of materials (BOM) and performance requirements for each of their products.  These documents comprise the basis of quality control and compliance testing.  Suppliers should perform risk analyses and use and abuse testing when evaluating new products.  Are the products suitable for children?  What ages?  Distributors should ask related questions when selecting products from suppliers.  Has the product been tested by a third-party lab?  Which tests have been conducted?  Does it comply with each state’s safety laws?  What age is it designed for?  Is it a child’s toy?  The more we know about the products we sell the better job we do to protect our clients.

Know your suppliers.  How much do you really know about each of your suppliers?  You can learn a lot from a catalog and website but marketing materials don’t tell you the extent of what goes on behind the scenes.  Does the supplier have a knowledgeable head of compliance?  How does the supplier evaluate new products and vet its factories?  What third-party tests does the supplier commission, how often and for which products?  Does the supplier have an XRF instrument to test products in-house?  What about ink testing?  Are some or all of the supplier’s products compliant as children’s products?  What is the supplier’s policy on Prop 65 compliance?  How will you be indemnified?  These are only examples of the kinds of questions you should be asking each of your suppliers in addition to visiting their headquarters and seeing their operations first hand.

Know your clients.  Each of your clients is unique.  Learn about their differences so you can meet their specific requirements and expectations.  Some companies have testing requirements that exceed applicable regulations.  Others have written social accountability policies for any factory producing a product with their logo.  Companies differ in risk tolerance and rely on you to guide them.  Case in point:  Federal law permits general use products to be sold for use by young children even if the products are not tested, not certified, and even if they contain more lead than allowed for children’s products.  But how would your client feel about handing out a product to children that doesn’t meet children’s product standards?  The more you know about each client’s policies and expectations, the better job you can do to meet their individual needs.

Know the intended audience. When you speak to a client about a promotion, always ask about the target audience – who the products are intended for – and the U.S. states where the products will be distributed.  If the target audience includes children, this should influence your product selection.  Children’s products and toys must meet stringent lead and phthalate requirements, be certified by a third-party lab and carry permanent tracking labels.  Certain U.S. states have additional requirements.  Illinois, for example, has a lead law that exceeds the federal standard.  A best practice for distributors is to highlight on purchase orders to suppliers whether the products are for children and where the products will be distributed.  This will help your supplier verify that your products will be compliant with all applicable regulations.

Know the risks.  Risk is inherent in all that we do whether we are trying a restaurant for the first time, taking advantage of a bargain price, or selecting products blindly from a catalog.  In the promotional products industry, there are product safety risks (will the product hurt anyone), regulatory compliance risks (does the product comply with applicable laws and safety standards), and social accountability risks (could the manufacturing of the product embarrass your client), among others.  No matter what you do, no matter how careful you are, no one can eliminate risk entirely.  Even the most prestigious brands have product failures, recalls and production gaffes.  But you can mitigate risk to a great degree by being aware of risks and making appropriate product and supplier decisions.  Your clients put their most valuable asset in your care—their name and logo—­when they entrust you to select the products that will bear that name.  Treat this responsibility with the care and diligence it deserves.  Brand protection is one of your most sacred responsibilities.

Educate the team.  For most distributors and suppliers, servicing major customers requires a well-organized team effort.  Unless everyone on the team is on the same page, it isn’t likely that you will deliver consistent service, let alone excel.  The same principal applies to product safety and compliance.  The quality of your safety and compliance initiatives will only be as strong as the weakest link.  Take the time to educate everyone on your team in the basics of responsible sourcing.

Stay current.  Even though the Consumer Products Safety Improvement Act (CPSIA) became effective in August 2008, many of its provisions were phased in gradually and some became progressively more stringent.  At first, third party testing was not required and later it became mandatory.  Originally 600 parts per million (ppm) was the maximum lead allowed in children’s products, then 300 ppm and now 100 ppm.  In addition to phase in rules, the U.S. Consumer Products Safety Commission (CPSC) continually develops new rules that either modify existing regulations or introduce new ones altogether.  For example, CPSC is currently developing a rulemaking to establish a new federal standard for small, powerful magnet sets which have been sold in the promotional industry as puzzles, sculptures and stress relievers.  To help stay current about CPSC changes, go to http://www.cpsc.gov and sign up for email alerts about rule changes, recalls and other product safety news.  And, in addition to CPSC, there are other federal and state laws to stay abreast of.  For updated news on the entire range of product safety regulation affecting the industry, trade associations and testing labs can be great sources of information.

Instill a Product Safety Culture.  Imagine that one day you decide to start eating nothing but 100% organically grown food.  Think of the challenges you would have at least three times a day for the rest of your life.  What are you going to eat?  Where are you going to buy your food?  Where does that food come from?  How is it grown?  How can you be sure?  Solve that problem for breakfast today and it starts over again at lunch.  Whatever you might have done yesterday to ensure your food supply when you were in Chicago won’t help you at all tomorrow when you’re off to New York.  For you to be successful in this new eating habit, planning in advance for the organic food you are going to eat each day and where you are going to obtain it reliably will have to become second nature, as if it were embedded in your DNA.  And so it is with product safety and compliance.  The kinds of food and ingredient questions you would have to ask every day if you drastically changed your eating habits are the same kinds of questions you should be asking every day to ensure safe and compliant product.  What’s in this product?  Who is going to use it?  Where will it be distributed?  How carefully was it made?  What was it tested for?  Was this shipment tested?  How can I be sure?  Ensuring safe and compliant product is a daily journey, not a destination.  Just like my food example, it requires continuous vigilance and attention, order by order, promotion by promotion.

The more that product safety and compliance becomes second nature and an automatic consideration no matter what client or promotion you’re working on, the more you’ll protect your clients, protect your business and ultimately protect the industry, a responsibility we all have to each other.

This article is scheduled for the October 2013 issue of Wearables Magazine

CPSC General Counsel Clarifies Distributor Responsibilities for Children’s Apparel

Ever since the early years of our industry there aren’t many promotional products distributors who would describe themselves as manufacturers.  But under the Consumer Product Safety Improvement Act (CPSIA), the majority of promotional products distributors –at least those who buy blank apparel from a wholesaler and then send it out to have it decorated—are just that, manufacturers in the eyes of the law.  Now for the first time, as a follow-up to questions posed at PPAI’s Product Safety Summit this past August in New Orleans, the General Counsel of the U.S. Consumer Products Safety Commission (CPSC) has put in writing exactly how the senior staff at the Commission regards the responsibilities of distributors who decorate.  This written guidance doesn’t change anything from the Commission’s perspective but it might surprise many distributors to learn of the extent of their responsibilities under the law.

The issue we’re discussing is related to children’s apparel – tee shirts, baseball uniforms or sweat shirts, among others – and the amount of lead that might become part of these garments through the inks or other surface coating materials that are used in the decoration process.  Current law limits this lead content to no more than 90 parts per million (ppm) for any “articles intended for use by children.”

So how does a distributor become a manufacturer when they don’t manufacture the garment?   According to discussions with the Commission, the original manufacturer of the garment is responsible for compliance of the garment as they sell it, whether blank or decorated.  If it is a children’s product – often obvious with apparel because of children’s sizes – the garment manufacturer must comply with all the provisions of CPSIA for lead in the substrate of the product (100 ppm) and lead in any paint or surface coating (90 ppm).  This manufacturer must include a permanent tracking label on the garment as well.

But according to a 2009 meeting between PPAI and CPSC, the Commission has made clear that if a promotional products distributor buys a blank and compliant garment and then performs an operation that transforms the garment in any way before the garment is sold to the end buyer, then that distributor is responsible as a manufacturer for whatever “transforming” operation it may have performed itself or contracted to have done – such as tie-dyeing, stain proofing, embroidering, adding a press-on applique or simply silk screening the garment.  The distributor’s “manufacturer” responsibilities include obtaining a test from a CPSC approved third party laboratory confirming the lead content of the surface coating and applying a permanent tracking label to the garment to cover the decoration.  This tracking label is in addition to any tracking label that may have been applied by the blank garment manufacturer such as Gildan, Hanes or Champion.

Some promotional products distributors have wondered why they should be held responsible for ink applied by their decorator.   We posed this question to Ms. Falvey who explained that the responsible party depends on how the transaction is structured between the distributor and the decorator.  If a decorator buys a blank garment from an apparel wholesaler, decorates it and then sells the final decorated product to a distributor, then the decorator is responsible as the manufacturer.   But if a distributor buys a blank garment from an apparel wholesaler and then sends it to a decorator to be personalized, the distributor is the manufacturer.  The decorator in the latter case is simply a subcontractor to the distributor.

So what is the new guidance that Ms. Falvey has written to help distributor “manufacturers” understand their obligations under CPSIA?  It has to do with third party testing and the extent of the distributors’ responsibility to verify that their decorator is using compliant ink.   A question was posed to Ms. Falvey as to whether or not a distributor could rely on a decorator’s certification that their inks were compliant without having to personally test the inks or the finished garments, as long as the decorator indicated that the inks were tested once per year.

Ms. Falvey writes: “The short answer to that question is yes. The certificate from the imprinter (or firm applying the ink) can cover multiple batches or lots of production.  The only caveat is that the firm selling the imprinted item (distributor) must have exercised an appropriate level of due care to ensure that the ink being used by the imprinter is the same that is covered in the certificate such that each additional batch or lot of production will continue to comply with all applicable children’s product safety rules.”

For promotional products distributors, the CPSC guidance is a bit of a good news/bad news scenario.  The good news is that distributors can rely on a decorator’s certification without having to test every garment order at a third party lab.  The bad news is that the Commission has set a very high bar of responsibility for the distributor to independently verify that the inks that the decorator is using for every order are the same as what is covered by the certificate and that each additional batch is compliant as well.   Each distributor will have to determine how to fulfill these responsibilities but it is clear that the distributor will have to go far beyond keeping a current certificate on file.  If a recall or non-compliant garment issue arises, Ms. Falvey’s letter makes clear that the distributor will need to prove to the Commission that it exercised “an appropriate level of due care.”

From a common sense perspective, a distributor could and should visit their decorators periodically, learn about their ink procurement and testing procedures, review their third-party test documentation and do whatever they would normally do if they had their own factory or decorating operation to ensure that the operation is compliant.   If a distributor does not want to do this, or doesn’t have the expertise, he or she should discuss with their legal counsel whether or not it is worth the risk to continue to be responsible for decorating children’s apparel.   There is already one case in the past few months of a John Deere tee shirt recall in Canada for high lead in the decoration.  Recalls are very expensive not to speak of other costs and penalties possible under CPSIA.  In addition, ink is only one of the materials that may need to be tested.  If the decoration involves an applique, the glue and other material in the applique must also be third party tested as it all constitutes a surface coating.

Another strategy is for distributors to continue to sell children’s apparel but to purchase it as a finished product from a compliant apparel decorator.  Distributors would still want to exercise due diligence that the decorator is compliant – just as they would in purchasing children’s products from any supplier – but they wouldn’t have the manufacturer’s responsibility under CPSIA for testing and tracking labels.

Finally, as with all regulatory matters, in addition to the practical and common sense aspects, the matters discussed in Ms. Falvey’s letter are legal issues and I am not a lawyer.  Nothing that I have written in this or any other article should be construed as legal advice.  All industry participants – suppliers and distributors – would be well served by consulting with a product safety attorney who regularly practices before the Consumer Product Safety Commission and is an expert in CPSIA matters.

Falvey Letter Re Decorating and Tracking Labels

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 http://www.cpsc.gov/info/toysafety/plain.html

Tracking Label Requirement Still Vexes Suppliers and Distributors

In the four years since the Consumer Product Safety Improvement Act (CPSIA) was signed into law, the promotional products industry has struggled mightily to figure out how to apply it to what we do every day.  Nothing has come easily.  Perhaps because most promotional products don’t start out as children’s products and perhaps because the “toys” we sell are mostly for adults, there always seems to be a “yes, but” when we try to understand CPSIA in the context of the world we live in.

Permanent tracking labels – a CPSIA requirement for children’s products – provides a good example.  The requirement sounds simple but in practice the details aren’t so simple.  Depending on what you sell, where you buy it, who makes it and how you decorate it, the tracking label requirement can be a complex burden.  One thing is certain: each distributor and supplier should develop a rock-solid process for their tracking labels.  This is one provision of CPSIA that could cost you a lot if you get it wrong.

Who is responsible for tracking labels?  The manufacturer of the children’s product.   CPSIA uses the definition for manufacturer from the Consumer Product Safety Act which is “any person who manufacturers or imports a consumer product.”  But it can be more complicated than that.  The way the promotional products business works sometimes there are two manufacturers of a children’s product and both have responsibilities for tracking labels.  If a distributor buys children’s-sized tee-shirts from an apparel wholesaler and then contracts with a local silk screener to personalize them, even though the blank tee shirts have a tracking label from the shirt manufacturer, the distributor, by adding an imprinting process, has taken on the responsibilities of a manufacturer under CPSIA, including the responsibility for a second tracking label.   The first tracking label applies only to the blank tee shirt.  The second tracking label applies to the decoration.  Again, not so simple.

So how do you get it right with tracking labels?  Let’s start by looking at the most straightforward case.  This first example applies primarily to suppliers but also to distributors who import directly:  You contract with one of your overseas factories to produce a fully decorated, CPSIA-compliant children’s product, including a detailed tracking label with all of the required information.  As the order is being produced, your on-site inspector at the factory sends representative samples from the production run to a CPSC-certified laboratory to test for CPSIA compliance.  Then, once you verify compliance, you ship the products to your customer.

So why is this example the most straightforward case?   The example product is a children’s product from day one so there’s no ambiguity there.  The product is produced and decorated by the same manufacturer and then tested as a finished product.  There’s only one company responsible – the importer who contracted for the product – and you have a third party test that applies specifically to the order.  Very clear, very clean.

Next let’s consider a more typical case.  You’re a supplier who imports hundreds of products and stocks them in your warehouse.  You carry an undecorated string backpack that you’ve had tested annually as compliant with CPSIA children’s product standards.  Each time you produce a new batch you include a tracking label inside each bag that ties back to its production run.  You stock thousands of these bags and decorate them in your U.S. factory as you receive orders from distributors. These bags are in dozens of distributor co-op programs, including a large federal program with a child-oriented cartoon imprint that promotes healthy eating habits for first graders.  Since you already have a tracking label in the blank bag do you need a second tracking label each time you decorate an order for that federal program?  No.  Your company imported the bag so the tracking label you attached overseas when the bag was manufactured still applies.   However, when working with pre-applied tracking labels like this CPSC has advised that you should add a date code in a discrete location on the product each time you decorate a new order.  It’s also a good idea to flag in your computer system the orders that are specifically for children.  That will save you money if the product is later involved in a recall by enabling you to narrow down the problem and identify the specific products to be recalled.

Consider this scenario:  You produce and import 150,000 bags in January, all in the same production run and all with the same tracking label.  The bags arrive by ocean freight in March and you stock them in your U.S. warehouse.  You decorate them over the next several months as you receive orders and by October you’ve shipped the last of them.   The following April you receive a call from an investigator at the U.S. Consumer Product Safety Commission (CPSC) about that federal healthy food program.  It turns out that a consumer advocacy group tested a few of the bags and found high levels of lead in the decoration.  Your lawyer confers with the Commission and ultimately recommends that you initiate a “voluntary” recall.  But how many bags do you have to include in the recall?  You decorated and shipped 10,000 children’s bags per month for the federal program in May, June, July, August and September.  They all have the same imprint and the same tracking label.  Do you have to recall all 50,000?  What if the faulty ink arrived at your factory in September and was only involved in the final 500 pieces you produced?  It would be a painful remedy to have to recall 50,000 if the problem was limited to 500.  In the end, the final tally will depend largely on your labeling, documentation, testing and record keeping.   If you have date codes for each production lot of bags and samples of each lot of ink you place into production it could significantly cut your exposure.  The more you know, the more you can document, the better off you’ll be.  If all you have is one tracking number covering five months of production you will have no way to tell consumers how to differentiate the high-lead bags from the earlier ones.

In this example, the high lead came from the decoration.  That raises an important and related issue – developing a system to test and document the decorating materials you use.  In this example, we noted that the factory received a batch of high lead ink in September.  But if you do not have a system for testing or saving samples from each batch of ink, how could you later narrow down the problem to the ink you received in September?

The final example is one that is extremely common for distributors – the case I referred to earlier where a tee shirt is manufactured by one company and decorated by another.  Say that the children’s-sized tee shirts were manufactured by Gildan.   Gildan has no responsibility for imprinting done later so the original tracking label has no relevance if the problem is in the decoration.  A second tracking label is the only way you can trace those tee shirts if there turned out to be high lead in the imprint.   What about the unique combination of the original tracking label and the imprint?  Could that substitute for a second tracking label?  By itself, no, because it doesn’t identify the “manufacturer” (in this case, the distributor who contracted for the imprinting) or any of the other date and batch information that CPSIA requires of tracking labels.  Just like suppliers, distributors who decorate product should set up a good in-house system to verify that their subcontractors have current third-party tests for the inks and other materials they use (heat transfers might contain glue or other materials), to assign tracking numbers, to verify compliance and most important, keep good documentation for all of this.

As for the tracking label, there is no one specific required layout.  The law requires that the label include enough information for the purchaser or recipient of the product to trace back to the manufacturer, to identify when and where the product was produced and to “ascertain” production information including as the batch or lot.  Some manufacturer/importers provide this information on a detailed tracking label.  Others include a web site and a code that reveals the tracking information.  The way you format your tracking label will of course be dependent on the space available on each product.  Regardless of how you do the label, it’s a good idea to develop an internal system to maintain records for each production run of children’s products, of the tracking numbers you issue and the related testing documentation. That information will be enormously valuable if the product is ever involved in a recall.   The law doesn’t specifically require you to create such a system but an August 2009 policy statement by CPSC regarding the tracking label section of CPSIA states “the Commission believes that compliance with this Section generally will require that manufacturers have in place a reasonable means to ascertain detailed production information, including the means to distinguish products made from different factories, made with different components, at different times or have other material differences that make the product non-identical from products.”

Like it or not, CPSIA has thrust many new responsibilities upon companies in our industry who produce children’s products.  The more that distributors and suppliers integrate these new responsibilities into the culture and daily practices of their companies, the better job they will do in complying with the law and the less they will risk an expensive and embarrassing fiasco.   And beyond pure compliance, conscientious and high quality business practices like these have a major impact on maintaining the confidence of major corporations in our industry, something that none of us can afford to take for granted.

Key Points and Suggested Best Practices to Consider

For Suppliers

  • Flag in your computer system the children’s product orders you produce.  If any non-compliant product or decorating material slips into your supply chain or factory, being able to identify the children’s products orders you produced will help you limit the scope of any potential recall.
  • When you produce or decorate a children’s product order, include a permanent tracking label on the product that complies with CPSIA.  Store the tracking numbers in your computer with a link to the order you’re producing.
  • If you include a tracking label on blank but CPSIA-compliant product when it is manufactured be sure to record those tracking numbers in your computer system with a link to the particular order you’re producing.  One way is to develop a system for your warehouse team to scan the tracking labels when they pick product for each order.  The better your documentation the easier time you will have if there is a recall.  And when you use that blank stock for a children’s order, print a date code in a discrete location on the product to help you later limit the scope of decoration-related recalls.
  • If you purchase a children’s product from another importer or manufacturer and it bears their tracking label, and then you decorate the product, you will need to print a second tracking label on the product that applies to your decoration.
  • Consider keeping a sample of each completed children’s product order to help you test and narrow the scope of any future recall.
  • Develop a system to test and document the lots of ink and other materials you use for decorating.  Consider keeping samples of each lot.  If there’s a problem later the documentation will help you narrow the scope of a recall.

For Distributors

  • If you purchase a blank children’s product and contract to have it decorated be sure your decorator has current third party tests to prove CPSIA compliance of all the inks and other materials used in the decoration.   Then instruct the printer to print tracking information including your company name, production date, production location and batch information.  The label must enable end buyers and/or recipient of the promotional product to track back to you.  Store the tracking numbers and all testing documentation in your file for each children’s product order you produce.

CPSC Policy Statement – Tracking Labels

Would You Risk a $10,000 Order to Raise Product Safety Questions?

You get a call one morning from a marketing manager referred to you by one of your customers.  She desperately needs 7,500 tote bags for an event the following week and wants to know if you can deliver.  You do some quick math and realize you could be talking about an order approaching $10,000.  Now what questions are you going to ask?

Of course you’re going to ask about budget, about the particular bag and imprint she has in mind, and where the bags are to be shipped, but are you willing to raise the product safety and compliance questions?  Could there be a regulatory issue involved?   Who is the intended audience for the product?  Will children be recipients?  What does the art look like?  Is it a juvenile imprint?   Will the bags be distributed in California?  Does the end-buyer company have any policies regarding lead, phthalates, or cadmium in the bag or the imprint?

With a plum order in hand—especially a $10,000 order—even veteran distributors might shy away from questions like these if the client hasn’t mentioned the issue first.

The same dilemma exists for suppliers.  You receive a quote request for 2,500 custom-shaped flashlights and the client doesn’t provide many details. What testing are you going to include?  If the flashlights are for a boy scout jamboree you have different considerations than if the flashlights are for a Mr. Goodwrench promotion.  What should you build into your quote for testing and what specifications will you require of your factory when you ask for a quote?  Every lab test you include and every product safety specification you require of your factory is likely to increase your cost.   If you specify that the material must be lead or cadmium free, or that the inks must be phthalate free, there will likely be an associated cost that your competitor might not be including.  These are difficult questions, particularly when you are quoting blindly without knowing the whole story.

Let’s frame the discussion between mandatory standards – what’s required by law – and voluntary standards – what may be required by your customer’s own policies, by market pressure or by some other non-legal reason.

The word “mandatory” should guide you when it comes to asking questions.  In both of the examples – the tote bags and the flashlight – if the final decorated product is determined to be a children’s product and it doesn’t comply with applicable regulations, then you could be risking an expensive recall and a public embarrassment.  Best practice is to learn the mandatory compliance regulations for products in our industry and then ask enough questions of your customer to enable you to quote properly – to know what to ask of your testing lab and what to require of your supplier or factory.  As the law is currently written and enforced, ignorance of the intended audience does not appear to be a defense.  You will not likely get much sympathy from CPSC by saying, “I didn’t know it was a children’s product and I didn’t know they were going to hand it out to kids.”  It could be a very expensive discussion.

Voluntary standards are a different matter.  McDonald’s recalled millions of Shrek glasses because of cadmium in the decoration even though there was no mandatory regulation that applied.  A few years ago, when the Today Show created a frenzy about the chemical BPA in polycarbonate bottles, hundreds of corporations stopped buying them. Yet BPA is still perfectly legal, even today.  Many corporations have policies about toxins like these that go beyond regulation.  Some, like Nintendo, borrow standards from ASTM F963 – the toy safety standard – and apply those requirements to products that are not toys.  The Consumer Product Safety Improvement Act (CPSIA) bans children’s toys if any of six phthalates measure more than .1% but Nintendo applies this standard to every promotional product it purchases, not just children’s toys.  Other companies require the fabric in products like tote bags and string backpacks to comply with the Flammable Fabrics Act even though that law applies primarily to apparel and not to tote bags or string backpacks.

So what is the best practice when it comes to quoting?  While each distributor or supplier needs to consider his or her own situation, here are some things to take into consideration:

Since mandatory standards are not optional, you have to deal with them no matter what.   If you are knowledgeable about the law, you may be able to make a determination from the product or an image and not have to query the client about the intended audience.  While this approach has risk for borderline products, there are hundreds of products in the industry that are obviously not toys or children’s products.  As a general rule, however, it is safer to evaluate the art and ask the client who the intended audience is before quoting.  Then you can determine the required standards and build them into your price – material specification and testing.

There are those who would argue that including product testing in a quote may make your product appear more expensive than competitive quotes that do not include testing.  To me, that’s a sales issue, not a pricing issue.  At a minimum, your quote and presentation should highlight the mandatory regulations that apply to the product and indicate the amount you have included for third party testing.  Your salesmanship should enable the client to appreciate your understanding of compliance and that you are protecting her and her company.  It seems more professional to me to openly provide the distributor or end-buyer all the facts she will need to approve the sale.   Once a price has been approved, it puts everyone in a difficult position if you to go back and say, “We need to add $1,000 for mandatory testing.”  These are hard conversations that sometimes do not have happy endings.

What about voluntary tests – the ones that aren’t required by law?   You might be tempted to disregard them as unnecessary costs that could price you out of a sale, but that would be too simplistic an approach and not necessarily in your best interest or your customer’s.   Because of the odd nuances of CPSIA, there are numerous products that can be distributed to young children that are not considered “children’s products” and therefore not subject to mandatory testing requirements.  These products are considered by CPSC to be “general use products” for children of all ages, not the “primarily 12 years of age or younger” crowd covered by CPSIA.  But if you sell a general use product for seven year olds, isn’t it likely that your client will expect it to be tested to children’s product standards?  And won’t you be embarrassed if the client calls you one day to say that he just found out that one of these products was chock full of lead?  Do you think the client will be sympathetic if you explain that product didn’t fit the technical definition of a children’s product so you decided not to test it?  Not likely, especially if some news outlet is asking for a statement about why her company is distributing lead-filled products to kids.

So just because a test is voluntary doesn’t mean you shouldn’t think about it.   Some may want executive toys to comply with ASTM F963, the toy safety standard, even if they’re not children’s toys.  Or they may want the imprint or transfer to comply with the CPSIA phthalate standard.  My suggestion for a best practice is to list on your quote each voluntary test your client may want to consider and provide a place for the client to check off yes or no for each test.   If the client checks off “no” for every voluntary test, then there could be no embarrassing phone call later.  You would be covered.

Product safety and regulatory compliance has transformed the competitive landscape in the promotional products industry.  While the rules can seem daunting at first, they provide an outstanding opportunity for promotional products professionals to distinguish themselves as trusted advisors.  Dealing with product regulation and testing in a quote document is one such golden opportunity for those who choose to embrace it.

Compliance is Not Enough for Safe Promotional Products

If attendance at ICPHSO’s 2012 Annual Meeting and Training Symposium is any indication, then the promotional products industry should feel proud of the strides it is making in product safety awareness.  From scant industry attendance just four years ago, this year’s symposium, held earlier this month in Orlando, had strong participation by PPAI, by QCA, and by at least a dozen major promotional products suppliers and distributors.  But while progress is encouraging, the workshops at ICPHSO made clear that product safety is much more than test reports and CPSIA compliance.

ICPHSO is an acronym for the International Consumer Product Health and Safety Organization.  It is the preeminent International product safety organization and is comprised of accomplished compliance professionals from all over the world – manufacturers, retailers, government regulators, attorneys, testing labs, standards developers, academia and consumer advocates.  Chances are, if you’re selling promotional products to a major corporation, its product safety team participates in ICPHSO.  More than 600 attendees made the pilgrimage to Orlando this year to share their knowledge, to learn from their peers, to network with like-minded colleagues and to mingle with government regulators from countries around the globe.

This year’s major topic was manufacturing and the challenges of producing safe and compliant products consistently in factories all over the world.  Traceability and supply chain transparency was a common theme in several presentations.  It was comforting to hear that even the largest companies struggle with this issue just as many importers do in our industry.  Jennifer Weaver, Director of Quality Assurance at Under Armour, noted that while she closely supervises Under Armour’s factories, her company does not even attempt to trace production from suppliers of items such as buttons, zippers and seams.  The consensus seemed to be that each manufacturer/importer must develop a plan based on a risk assessment of its own particular products.

While most product safety initiatives in the promotional industry are focused on compliance – CPSIA, FDA, Prop 65 and similar regulations – ICPHSO has always taken a deeper approach to consumer product safety.  Several experts spoke of the importance of avoiding product related injuries by building in safety from the beginning – by designing out safety defects at the product development stage and by considering the foreseeable abuse and misuse of a product as well as its intended use.   Another important topic focused on the importance of recall preparedness – having a well-practiced plan in place for the inevitable situations where unsafe products are discovered after a product goes to market.  Time is always of the essence in such cases, including the obligation to report to CPSC.  One of the most impressive presentations of the week was by Jennifer Thompson of Costco who explained the sophistication, speed and effectiveness with which Costco implements recalls and notifies customers who have purchased recalled products.

So while we should be proud as an industry of the product safety strides we are making – through PPAI’s Product Responsibility Action Group (PRAG), through QCA, and through individual company initiatives – the ICPHSO presentations illustrate how product safety has to become part of the culture of all industry participants if we’re truly to protect our industry.  For example, how many promotional products are imported without a formal risk assessment or without evaluation for product safety hazards?  In some cases these tests can seem unaffordable but the risk of not testing can be even more expensive.  A few years ago our product development team was considering a spa kit for our line – one that contained a variety of aloe-type skin creams and lotions.  The kit would have sold for less than $10.  In performing our risk assessment we asked a well-known cosmetics lab to verify that the lotions were of the quality that the Asian factory contended and that they did not contain any harmful ingredients or toxins.  The lab quoted $28,000 for the tests.  This may be a normal cost for a major cosmetics company but for most of our industry it isn’t a reasonable value proposition, particularly when the supplier has no idea if the product will even sell.  Accordingly, we did not add the spa kit to our line.  Now this week, in an unrelated case, the FDA has issued a dire warning about dangerous levels of poisonous mercury found in a variety of imported skin creams and antiseptic soaps or lotions found in at least seven states.  Just imagine how this could have impacted our industry if these poisonous lotions had been purchased through a promotional products distributor and given away in a spa kit by a major corporation.

So given the practical and realistic resources of most companies in the promotional products industry what can importers do to ensure that the products we are selling are not only compliant but also truly safe?  Here is a good starting list:

1)     Appoint someone in your company as product safety lead.  Send that person to product safety training such as a class offered by a major testing lab or the Certificate in Product Safety Management program offered by Saint Louis University.   Your designee should develop and implement a risk assessment process, maintain your product safety documentation and act as the point person if your company is ever involved in a recall.  Once these basic processes are in place, take the initiative to the next level.  Develop a comprehensive quality manual for all of your supply chain standard operating procedures and also develop a recall preparedness plan.

2)     As a supplier, manufacturer or importer, perform a basic risk assessment before adding any product to your line or before ordering it for your customer.  Even without independent testing, much can be done to minimize risk and promote safety.  Evaluate how well the product is constructed, the quality of materials, whether it will shatter when dropped, if it has sharp edges, choke or bite hazards as well as other foreseeable risks. Obtain a bill of materials for the product and identify any potentially hazardous materials or components.  Subject the product to reasonable use and abuse testing even if you have to test it yourself and be sure to consider the foreseeable misuse of the product, particularly by children.

3)     Test the product to simulate how well it performs.  If it is a bag, for example, how much weight will it bear reliably before the fabric, seams or straps give way.   Are there embellishments like buttons, grommets, labels, labels or hooks?  If so, how securely are they fastened?  If they break off will any sharp edges remain?  Is there any chrome or electroplating?  Is the quality high enough that it won’t peel or curl leaving knife like edges?

4)     Investigate whether the product, its components or its packaging is subject to any state or Federal regulation.   In addition to CPSC regulation, many promotional products are also regulated by the FDA, including hand sanitizer, first aid kits, sunglasses and food contact materials such as drinkware.  If the product is regulated be sure you have current (within a year) third party tests showing that the product complies with all of the regulatory requirements of current law.

5)     Consider identifying products in your line that contain toxins.  BPA, lead, phthalates and cadmium have all come under scrutiny by Congress, by CPSC, and by FDA but are still allowed by law for most products.  Some of your customers or your customer’s customer may have policies against purchasing products containing these substances.  An alternate idea is to identify the products in your line that are lead free, phthalate free, cadmium free and BPA free and note this in your catalog, advertisements and on your web site.

6)     Determine if any special labeling is required to warn against any hazards, to note any stress limits and to identify the appropriate age for the product.

This is certainly not a comprehensive list but it’s a good start and would go a long way to raising the bar for product safety in the promotional products industry. In the months ahead, PRAG will be working towards proposing a similar suite of “best practices” for product safety that all industry participants can rally around.  The more that all of us do to promote product safety – compliant products and safe products – the more we do to protect our clients and our livelihood.

(To learn more about ICPHSO and its programs, visit www.ICPHSO.org)

Could Your Promotional Products Business Withstand a Recall?

Just for a moment try to imagine that a promotional product you sold to your largest customer has suddenly become the subject of a government recall.  Hundreds or even thousands of consumers have to be notified immediately that it may be dangerous to use the item that was given to them as a gift.  And to be sure there’s no confusion, pictures have to be posted in multiple locations and on the Internet showing the ill-fated product with your customers logo displayed next to the danger warnings.  The product you chose is now a public albatross for everyone involved.  The recall and legal costs are almost certainly going to be enormous, as is the liability exposure.  And to top it off, the incident is a colossal embarrassment for you and for your client.

Try to imagine the pain of what that would feel like, especially if you could have avoided it all – including the potential loss of a prized customer – with just an ounce of prevention.

Recalls happen for a variety of reasons but most of them revolve around the risk of injury to consumers.  Government regulations are established to ensure safe products so violation of any regulation can trigger a recall.  If your promotion includes a food product that isn’t properly labeled with allergens the FDA can mandate a recall.  CPSC can do the same for products that contain more lead than allowed by CPSIA or toys that fail to pass the toy safety standard.

Recalls come about in a lot of different ways.  It could start with something as simple as a call from your client that someone reported an injury or that the product shattered when it fell on the floor.  Sometimes a consumer advocacy group will test a product and report to CPSC that it contains excessive lead, phthalates or fails some other mandatory test.

For consumer products, the law requires immediate notification of the Consumer Products Safety Commission (CPSC) when a company obtains information that supports a conclusion that a product distributed in commerce fails to meet a product standard or contains a defect that can create a substantial risk or injury to consumers. If CPSC staff concludes that a recall is warranted, they will usually suggest a “voluntary recall” although the Commission has the right to enforce a mandatory recall.  FDA has similar procedures for the products it regulates.  Promotional products that fall within FDA oversight include hand sanitizer, sunglasses, first aid kits as well as food and food contact items.

As painful as a recall can be, failure to report can be even worse.  Sometimes a company will find out about an injury or that a product it distributed has failed a test, and will try to handle it on its own, without involving the governmental agency, perhaps by notifying customers to return the item.  CPSC is particularly unforgiving in these instances no matter how sincere or thorough a company may be in its attempt to self-resolve the issue.  Public Citizen, a watchdog group, reports that between 2002 and 2007 CPSC fined companies an average of $452,000 for failure to report, filing late reports or withholding key details from the agency such as information about customer complaints.  In more recent cases the agency has become even more aggressive with some fines in excess of $1 million.

So what about that ounce of prevention?  What are some things you can do to prevent a product safety nightmare?  The answers may seem obvious or common sense but you’d be surprised how easy they can be to overlook when you’re stressed or rushing to complete a last minute promotion.

  1. Slow down.  Take the time to understand the promotion and how the client is going to use the product.  Who is the intended audience? Are children involved?  How old are the children?
  2. How well do you know the supplier and the supplier’s products?  What do you know about the supplier’s processes to ensure safe and compliant products?  What tests are conducted, by whom and how often?
  3. Did you obtain an actual sample of the product?   How well is it constructed?  Does it have any sharp edges?  Could the material shatter?  Can you foresee any safety issues?
  4. Is the product a potential choke hazard for children?  If so, does it have proper warnings?
  5. Is the product an electric product?  If so, does it have an independent lab safety rating, such as by Underwriters Laboratory?
  6. Have you researched whether there any state or Federal regulations that apply to the product or its packaging?  If so, have you received current test reports from the supplier and had a qualified person confirm that the test reports are thorough and that the product meets all required standards.  (PPAI has a very good tool on its website called Turbo Test which can help identify any applicable regulations.)
  7. Does your client have any testing requirements that go beyond the state and Federal requirements?  Some companies require a product to pass children’s product or toy standards even if they aren’t children’s products.

Most of us have owned a product that was involved in a recall sometime during our lives.  Maybe it was a car or a coffee pot, a battery or a crib.   Mistakes happen even to the most sterling and trustworthy brands.  Search “product recall” on Google and your hits will include Mercedes Benz, BMW, GE, Apple Computer, and Fisher Price.

But while you can’t guarantee immunity from every problem, if you’re a savvy shopper, learn the risk factors and always do your homework, you’ll exponentially reduce the risk of a product safety fiasco.