If you run a business you know how much damaged goods can cost you. It doesn’t matter whether they are damaged on the shop floor, in the warehouse or on the way to the customer. It’s you that will need to pick up the bill for the damage. Of course, you might be able to claim the damages from your insurance or even deduct it as a business expense.
But, although this will help to save your profits it will not help you to keep your customers! They need to be satisfied.
Impact Assessments Are the Solution
An impact assessment can be applied to damaged goods; it can also be applied to nearly every process you have operating in your business.
The principle is simple; you take a look at everything that currently goes on in your business and look at the impact which the process has on your business.
Impact must be seen as the economic effect, social implication and even the environmental result. To assess the impact you’ll need to look at the damage indicators. This is the potential for damage or faults in any part of your process.
For instance, if you are sending a product to a customer it can be damaged by not being packed properly, the address might be entered incorrectly, the delivery man might throw it around. These are the damage indicators.
The solution is to have a set procedure for packing and for the person who packed it to sign it, so they can be traced if necessary. Random checks will enable you to make sure they are complying with your standards. The packing procedure will need to ensure it is well protected against bad delivery drivers, saving the cost of damage on route.
Is It Important?
In short, yes! Damage reduces profit as you will need to replace the item. Even if it is worth claiming on your insurance policy you are likely to pay for it indirectly as the price of your insurance rises.
But, there is a bigger impact than cost. With the rise of social media customers can instantly share their story. In fact, people are generally quicker to share a bad experience compared to a new one.
This means that just one damaged product can cause a huge amount of harm to your reputation, which can have a knock-on effect with future customers. How you deal with the complaint will be monitored closely, if others think it is easy to pull the wool over your eyes they’ll all start doing the same thing; costing you a small fortune.
Alternatively they might think you have handled it badly and will simply not use you!
While it is possible to deal with these situations gently to avoid upsetting your customers it is a much better idea to implement the impact assessment and stop it ever becoming an issue. This will also provide guidelines of how to deal with any complaint which ensures all your staff has the same approach.