With the grandeur and pageantry of the Beijing Games in the rearview mirror, observers are once again fearing it’s back to business as usual in China. The U.S. State Department is blasting the nation’s lack of progress on human rights and environmental issues are once again in the news. Perhaps most disturbing for consumers, yet another product safety crisis of epic proportions is shaking the world’s confidence in China’s products.
The news that four infants have been killed and 53,000 have been sickened by tainted Chinese infant formula – as well as revelations that the first signs of adulteration in 2007 were not effectively responded to, or may have even been covered up – presents yet another major reputational challenge for global companies that maintain manufacturing bases in China.
When viewed in the context of the lead-paint-in-toys and melamine-in-pet-food scares of 2007, this latest product-safety blunder has the potential to drive public trust in Chinese-manufactured products to new lows. To protect their brands at a time of significant public anxiety, companies that depend on Chinese exports must take steps that include:
1. Ensuring that their own government is a business partner, or at least an ally, in their enterprises and is ready to quickly intercede. As the world learned in prior crises and in the current one, the Chinese government responds more readily to official government pressure than it does to corporate pleading.
2. Investing in on-the-ground inspectors and procedures that the Chinese government doesn’t yet require. Eventually, China’s regulatory system will improve, but for now, companies must shoulder more of that burden, as we learned from our experience with toys, toothpaste, and tires last year.
3. Informing consumers and retailers about the steps they have taken to safeguard their products. This transparency is vital. If companies fail to do this, the previous two steps won’t matter.
Business as usual in China means that some companies may need to apply extraordinary measures to assuage fears in the marketplace and keep customers coming back. While China is working to correct its problems, the public’s patience is wearing dangerously thin. With their children and their pets in the crosshairs, consumers want concern, commitment, and action when it comes to product safety in China. Anything less is a recipe for disaster.
Gene Grabowski, Senior Vice President of Levick Strategic Communications and manager of the firm’s Crisis, Litigation, Liability, and Recall Practice Group, is a distinguished crisis communications counselor who leads high-profile accounts for major law firms, Fortune 500 companies, trade associations, and government agencies. For his work during the spinach E. coli crisis, the industry-wide pet food recalls, and the lead paint toy recalls, Mr. Grabowski was honored by PRNews as their Crisis Manager of the Year for 2007.
