Relabeling: Where does the buck stops?!!!!
"There are 3 pillars of a product, the consumer (end-user), company (manufacturer and distributor), and the government."
There are 3 pillars of a product, the consumer (end-user), company (manufacturer and distributor) and the government.
The consumer is the one who pays for the usage of the product and has the highest stake. They pay for the products and services they use. The brands which are in talks for unworthy reasons are the brand made with a lot of precision at work for centuries, Horlicks is a 70-year-old brand, Oreo is a 108 years old brand. Generations in the family have seen and used these brands, we are emotionally attached to these brands and we are hurt when these brands are negatively talked about. One of my friends said he has always munched pringles and snickers and now he fondly buys it for his son.
This is the emotional aspect of the brand and now the health hazards of eating this when best before date is passed are tremendous and can lead to serious issues besides the bad taste it leaves in your mouth. As a consumer, it’s our responsibility to read the label before we buy and refuse to take any product which has surpassed the date of best before or has proof of tampering. We also need to put it to the outlet notice to not /avoid putting these on the shelf. Not to forget lots of our consumers can’t read English labels.
The Nepali companies which distribute any product in the market in the FMCG sector including these prestigious brands work on meagre margin and the no. of product required to realize the cost of 1 damaged/expired/lost products is 25-30 units of the same product completing its sales cycle. The parent company has a cap on the percentage of damaged and expired reimbursement. This puts these local companies into a tight spot, in a country like Nepal where uncertainties are high, any food products come with a less than a year best before and 2- 3 months is the time period for the transit of products from factory to outlet.
In the case of lockdown and bandh, this adds to the no. of days. There is a lack of FIFO maintenance from the importer warehouse to the outlet and aggravates as it goes down the funnel. Sales forecast has to go through well, in countries like Nepal there are other/grey sources of getting the products that tamper the sales forecast of the first company. We need to bring more precision to the above.
Government is the main gate which can close the flow of best before products reaching the outlet and finally to our end consumer.
Govt. needs to be strict with the transit of products which have less than 3-4 months of best before. There is a coup in the market whose job is to buy such products at a lower rate and inflow the market with huge quantity and damage public health and brand reputation.
The second important measure Govt. can initiate in discouraging the expired products from reaching the product is by reimbursing the taxes paid on such products. For every food product, you buy one 3rd of the cost goes as tax to Govt. which unnecessarily inflates the cost of the product and rips consumer pocket. Levying zero or minimum tax can help the public eat good food at a lower rate and the lower cost of importing products can encourage local companies to destroy the damage since the loss will be minimal.
Govt should immediately put a notice of reimbursement of taxes on the expired and damaged products which will encourage companies to come out and destroy the damage and restore public health. Levy high penalty to companies that indulge in wrongdoing and this raid should happen not just around Dashain for unscrupulous reasons but throughout the year.
Written by: Abhisekh Kumar, Senior FMCG Marketer, and Expert
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