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Bindeez Product Recall – 9 Lessons For Crisis Management
“Moose Enterprise has announced an immediate and voluntary Australia wide product recall for its Bindeez Beads toy after being informed that some children who had swallowed the beads required medical attention.
As a precaution, Moose Enterprise has advised that parents and carers of children should immediately remove the product. The company has advised that if the product has been swallowed, parents should seek immediate medical attention, even if the child is not showing any adverse symptoms.
Moose Enterprise, CEO, Manny Stul, says that the safety of children is the company’s first priority. In order to best protect the safety of children who have, or may, come into contact with the toy, the company has voluntarily recalled the product and is fully cooperating with health and consumer affairs organisations.
The company’s products, which are manufactured by internationally approved toy manufacturers in China, are subject to world standard independent testing. Moose Enterprise has not experienced any safety concerns with its products since the company was purchased by its current management team six years ago.
The product was immediately withdrawn from sale yesterday and parents can receive a refund by freecalling 1800 303 895 or email firstname.lastname@example.org. Further information will be made available as soon as possible.”
This was the official statement issued by Moose Toys on the 7th November 2007, one day after they were recalled from shelves.
Can Bindeez recover from its product recall?
The award-winning children’s toy has been recalled because it contains a chemical which turns into a dangerous party drug when metabolised in the body.
Bindeez are made in China and reported to contain hundreds of beads which can induce seizures, drowsiness or a coma if eaten.
It is a big blow for the company which has experienced great growth since winning the 2007 Australian Toy of the Year award at the Melbourne Toy and Hobby fair.
The announcement also made an impact on sharemarkets around the world.
Shares in the UK listed toy company, Character Group fell 22 per cent following an announcement to customers it would recall the colourful bead toy Bindeez.
The group is listed on the AIM market in London and distributes Bindeez in the UK and Ireland on behalf of Melbourne-based Moose Enterprise.
“Character Group believes that its stock of Bindeez products conforms to UK safety regulations.
“However, the group has, as a precautionary safety measure, instructed an independent test laboratory and a EU toxicologist to immediately test and analyse the chemical composition of representative samples of the group’s Bindeez stocks in order to fully satisfy as to their safety,” said a spokesperon.
Character Group’s shares fell 43 pence, to 146 pence.
This shows that a product recall, even by a supplier can have a negative impact on share prices.
It has not been a positive time for toy manufacturers or retailers. Parents can be rightly concerned because between the months of May and July of this year select lines of toys sold by US giant Mattel were found to have high levels of lead paint.
A third party manufacturer in China was found to be at fault but more than 19 million toys had to be recalled globally.
The Bindeez product recall only added fuel to the fire as these irate parents commented on the Media Motivators blog.
“Why is it that so many Companies that manufacture off-shore take so little responsibility in the quality of their products?” said one parent.
“Why is it someone always has to get ill or even die before action is taken? Why do I hear this statement from recalls over and over again “the manufacturer substituted an ingredient without our knowledge”?
In my opinion the final quality testing should always remain with the local distributor/importer and you should batch test your products in Australia to check if they meet the local safety requirements.
You are totally responsible for your products.
Please, I beg you, for the sake of our children, please check your products before releasing them for sale.”
Another parent also noted “After having to deal with my daughter’s disappointment at losing one of her favorite toys and unknowingly putting all three of my young children at risk, there is no way I would ever risk buying this product again.”
“I too have a stack of Bindeez in my home. I no longer have receipts and a lot of them have been used to “create” works of art. Where do I stand on getting my money back?” said another parent.
Media reports suggest the beads should contain a non-toxic glue but instead contain the chemical which the body metabolises into gamma-hydroxy butyrate (GHB), also known as fantasy or Grievous Bodily Harm.
All Bindeez products will be removed from sale and households with the toy were urged to get rid of it.
What can we learn from this case study?
There are nine actions Bindeez should now do to minimize the risk to their reputation:
1. Commit and engage
Accept responsibility, do not blame others, engage with stakeholders especially consumers.
2. Clear plan
Work to deadlines, work out differences & get any ‘dirt’ or negative actions out in the open.
Company leaders must show confidence, caring, and certainty in a time of uncertainty.
4. Currency & accuracy
Key messages – focus on human life – show empathy to those affected, accurate facts & figures, what is the company doing to help, and what is the call to action for concerned parents.
5. Control the media
Rehearse to stay on message, no speculation, no “off record”, no “ambush”.
Release information, make it to the point and timely.
Set up a crisis team, a crisis centre, hold a press conference so the action is a “one to many” communication activity.
Set up up to date distribution & lists and release information.
Evaluate, review & correct if necessary any misinformation.
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