Product disposal definition is the process by which the goods a company produces are destroyed or disposed of.
It is critical that if a company must dispose of its products that it does so through a certified product disposal process. This ensures that they will not be resold or utilized illegally. In fact, the best certified product disposal companies will provide authentication so that you have peace of mind and proof that your products are being disposed of properly.
While there are several reasons a company may require the services of certified product disposal, some of the most common include:
- Products that have expired
- Goods that have been replaced by a newer version or product line
- Packaging no longer used
- Confiscated products
- Products that have been recalled
- Defective products
Simply throwing away these goods, attempting to discard these goods on your own or placing your trust in the wrong product disposal company can have disastrous consequences. Here is what certified product disposal means for the future of your brand and why this process is critical to ensuring your company’s quality standards and reputation.
What Improper Disposal Can Cost You
The improper disposal of your product can significantly cost you. One of the most detrimental things that can happen is if your products land on the grey market. This can occur if an employee or unscrupulous disposal company steals your damaged or unwanted goods and sells them on sites like eBay, Craigslist, Facebook Marketplace or other online websites.
What is the grey market? The grey market is the trade of a commodity through distribution channels unintended or unauthorized by the original manufacturer. While to consumers, it may seem like they are getting a good deal, in reality, they often get damaged or expired products. This tarnishes your brand’s identity and reputation.
Here is what else can go wrong:
Your Liability Increases
If you do not properly destroy and dispose of defective or expired products, your liability can increase. This includes recalled products and those that no longer meet industry and government compliance.
Your liability can also increase in the eyes of the courts. If patent and copyright infringement has occurred, or imported goods have been seized, you may be legally required to dispose of these goods. Not satisfying a court order to destroy these products can land your company in hot water, resulting in substantial fines and penalties.
You May Give Your Competitors An Advantage
If prototypes and product test runs are not properly destroyed, you may inadvertently leak your proprietary information to competitors. In addition to your actual products, you will want to make sure electronics that are disposed of are properly cleaned off and disposed of. That’s because electronics can contain the memory of files and software.
Your Brand Will Degrade
In addition to losing significant profits if your items land on the grey market, your brand also may degrade in value.
When your discarded products appear in places that offer substantial discounts, consumer expectations change. Consumers will not be willing to pay for the real thing at the real retail price. This will lead to the devaluation of your brand and product, impacting your bottom line in the long-term.
What Happens When Disposal Is Completed Properly
When a company’s goods are properly disposed of, there is little to no risk that they will end up on the grey market. A company can also be rest assured that its liability will decrease, your competitors do not get an advantage and the quality of your product will remain at its highest value.
Proper disposal will also guarantee that your company is able to remove any obsolete products, setting your business up for a better long-term financial outlook.
A company may have an obsolete inventory if:
- Its sales department over-forecasts the appeal of a product
- Products were too technical for mass consumption
- Products required sales and marketing investments that exceeded their margins
- A product had a defective design that led to heavy returns
Often, extra space is needed to store these obsolete items. This can carry additional costs through rental fees or associated costs like insurance and utilities.
Finally, it can be impossible to put a cost on peace of mind. Proper certified destruction services maintain tracking and security throughout the disposal process. This chain of custody includes photographic and video evidence of the destruction and ensures the highest level of professionalism.
How To Ensure Disposal Goes Right
Partnering with a disposal company that is certified in product disposal will help ensure the above scenarios do not happen.
One of the most common mistakes manufacturers make when searching for a product disposal company, however, is looking for one that offers the lowest price or is located the closest distance from the company’s manufacturing location.
Instead, a company should look for the following:
- Make sure the company is certified, licensed, bonded and has experience disposing of your particular products.
- Ensure the company you choose maintains tracking and security throughout the entire disposal process.
- Make sure the company will provide references from other companies that produce similar products.
Finally, remember, if something is too good to be true, it likely is. Placing your trust in a product disposal company can be difficult, but with the right partner, you can be assured your company’s reputation is in the right hands.
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