Top 10 Failure Points for Christmas Products
All too often we have seen companies rushing to get their product out in time for Christmas. This can lead to some costly—even embarrassing— errors.
Although Santa won’t be sliding down your chimney for another few months, now is the right time to start planning for the seasonal Christmas hike.
Here are ten common failure points for Christmas products.
Overstocking
Poor demand forecasting and a failure to coordinate effectively with your suppliers can lead to excess inventory. As a case in point, the last few winters in Hong Kong have been both shorter and warmer than their historical averages. A failure to account for changing weather patterns has forced down-filled winter jacket producers to sell their goods at heavy discounts in order to free up inventory in their warehouses.
Even if you can transport your surplus stock to other markets around the globe, poor supply chain management will impact your cost structure and shrink your bottom line.
Understocking
On the other hand, if the supply of your products is not enough to keep up with demand, this can have both immediate and long-term impacts on your bottom line. Not only will you lose out on business in the short-term, but your consumers could also lose confidence in your brand and flock to your competitors. Poor demand forecasting, delayed delivery, and defective goods resulting from inadequate quality control can all lead to understocked warehouses.
Incorrect Labeling on Packages
A quick Google search will reveal the countless number of times packaging has been mislabeled. From the incorrect color being indicated to the incorrect quantity, these simple yet common errors can erode consumer confidence in your otherwise great product. It does not help your company’s reputation either.
Product that is not fit for Purpose
Perhaps the scariest nightmare for any company is a product that is so defective that it does not sell at all.
A chain of gift stores once had to recall its Santa Claus-themed gift-wrap over a comical yet expensive error. The idea was to have an image of Father Christmas checkered across the wrapping paper along with the phrase “Ho Ho Ho.”
Unfortunately, a miscommunication with their supplier combined with inadequate product inspections led to the phrase “Oh Oh Oh” being plastered all over their product
Needless to say, the gift-wrap barely sold and was taken off the shelves by distributors.
A Handful of Suppliers
You’re not the only one excited by the prospect of increased spending during the holiday season; your competitors are also aware of this. In a crowded marketplace, you need to be proactive in securing your supplier of choice before they run out of parts and raw materials. Failing to do so may force you to consider more expensive or inferior substitutes. Worse still, much of the work you put into R&D and product design could be wasted.
Child Safety Issues
If your product is unsafe, it has to be recalled, which is both costly and bad for your reputation. This is especially true in the case of children. For example, a manufacturer of alphabet-shaped chocolates in the UK had to recall its product after discovering it contained pieces of plastic that carried a choking hazard. In the event that a child was to choke on one of these alphabets, a product recall would have been the least of the chocolatier’s worries.
General Public Safety
In addition to children, poorly tested products can also harm the general public. A few years ago, a large chain of gift shops had to pull their Christmas-themed snow globes off their shelves as they carried a fire hazard. When exposed to sunlight, the large body of the snow globe acted as a magnifying glass, reflecting rays of sunshine onto combustible materials inside homes.
Weak Packaging
How often have you gone to a supermarket and been put off by a product with a dent or blemish in its packaging? Not all consumers are picky about this, but it depends on what you are selling. It can be a real deal-breaker in the case of high-end goods and luxury items. Artisanal cooking oils, for example, may struggle to command a high price-point if they come in shabby, weak packaging.
Regulatory Compliance Issues
You’ve done all the hard work and your product is ready to go. Perhaps you’ve decided to expand into other international markets and are excited by the potential for growth. However, if your products do not comply with the latest laws, standards, and regulations, you may have nothing to show for your hard work in the off-season. Frequently shifting standards can make compliance all the more complicated.
Ignoring IPI and DUPRO
Every company conducts a Pre-Shipment Inspection (PSI) right before their products are shipped to warehouses, retail outlets, or directly to their consumers. This is a standard bare minimum.
However, Third Party Inspection (TPI) services also provide Initial Production Check (IPI) and During Production Check (DUPRO) services.
An IPI is conducted when 10-20% of your inventory has been produced. This is especially useful when you have a new factory or when you are dealing in high-risk products such as toys. Verifying first run quality requirements can help ensure that your product is fit for purpose, save you time, minimize your scrap product, and reduce both reworks and shipping delays.
A DUPRO is conducted later in the production process when 40-50% of your inventory has been produced. The purpose of DUPRO is to ensure that goods being produced continue to meet quality benchmarks.
Ignoring these two types of inspections can lead to a lot of the problems identified earlier in this article and is arguably the biggest failure point for Christmas products.
Ensuring that your goods are compliant and that they have gone through the necessary tests and inspections can be a confusing and painstaking process. With its testing, inspection, and certification services, Bureau Veritas is perfectly positioned to ensure that you don’t fall into the bear traps highlighted in this article. For more details, head to our Bureau Veritas website.