The dangers of product recalls
Manufacturing mistakes happen – but the outcomes can be devastating. These historical examples show the dangers of selling faulty products.
Financial ruin: Samsung’s misfire
In 2016, Samsung faced an incredible
£4.3 billion loss after it was revealed that the Galaxy Note 7 smartphone posed a fire risk. The US Consumer Products Safety Commission recording 96 reports of batteries overheating and catching fire, just two months after its launch.
The company had no choice but to recall 2.5 million units – and put serious consideration into the forthcoming S8 device.
A time sink: Pfizer’s ‘life-threatening’ painkiller
The fallout of managing an arthritis painkiller with the potential to cause “life-threatening” skin reactions is bad enough. But for Pfizer, the trouble didn’t end there. While they were forced to recall their
Bextra drug at a cost of $3.3 billion, they would continue to fight legal battles long into 2009.
With money and human resource spent in the courts, everything from share price to reputation can be affected – not to mention hours of productivity lost.
Staff lay-offs: May Blue Bell Creameries’ Listeria outbreak
In 2015, US-based May Blue Bell Creameries had to lay off 1,450 staff after it was revealed that its ice cream products had been linked to a Listeria monocytogenes outbreak.
With falling sales, the brand had no choice but to let go 37% of its employees and severely slow down its production. Likewise, the public health dangers of product recalls are very real. Ten people were diagnosed with the condition after consuming May Blue Bell Creameries’ ice cream, while the Cadbury’s salmonella outbreak affected 40 consumers.