Sunday, November 7, 2010

CPSIA - Mania Update

Hey, did you ever wonder what it might take to satisfy a mass market retailer on safety in the post-CPSIA world? Here are the requirements of Costco - all 141 pages of fun. It's a huge file - you may have wait a little while for it to fully download.

These documents took us six man-hours to read - to assess whether or not we understood the rules and whether we knew what to do to comply. The breathtaking out-of-pocket testing costs are scattered throughout the document - see pages 40, 41, 51, 58 and 131-134.

Needless to say, compliance with these rules is an exceptionally expensive undertaking. This kind of duplicative testing (you have to use their testing vendor and cannot supply other independent tests you have already performed and paid for) has never revealed anything that I would call a "safety" issue, but has revealed numerous meaningless niggling issues that cost a ton to resolve. No one is made safer by all this expense but we are sure made poorer. All that matters these days is whether we comply with all 141 pages, every line and every word.

Sometimes, I think the debate over the CPSIA mania is too abstract. It's too theoretical and sides chosen by whether you "care" about safety or not. Few people bother themselves with the details. Even fewer people are willing to be accountable for what the law has unleashed.

Requirements like this 141-page document were rare before Congress took over safety administration. Now that the mania has been stoked, it is going to be hard to put the genie back in the bottle. People feel secure in a blizzard of new safety requirements. "Obviously" more requirements means more safety . . . .

Ahem, no. First of all, the more requirements, the more likely that focus shifts from safety to compliance. SAFETY AND COMPLIANCE ARE NOT THE SAME THING. Guys, here's more bad news - tests are not always right and rarely provide meaningful information. Our supply chain is where we build in safety and by running our business properly, tests are rarely useful (we get a LOT of repetitive passing test reports). The blind faith placed in stacks of new rules and "independent" testing as a means to create "safety" is unrealistic. I remember talking to a Whirlpool engineer who assured me that EVERY recent recall of Whirlpool products had been tested under federal and state standards and passed with flying colors. Hmmm. The CPSIA safety system is devolving into a faith-based system.

Even worse and much more profound is the commerce that this kind of mania extinguishes. How many companies can manage these requirements? How many companies will pass on making a deal to avoid the risk and hassle of these purposeless requirements?

Regulators like to stick their heads in the sand. These after-market requirements are "not their responsibility". Let the market decide, blah blah blah. Unfortunately, they can't get off the hook so easily - they started the mania and feed it regularly with their big fines and ridiculous recalls. Sorry, we don't live in a vacuum - yes, the actions of the regulators have an impact on the market.

To get a sense of it, read the 141 pages of Costco requirements. Welcome to my world!


Esther said...

I can remember when I worked on private label programs and Costco was considered one of the "easier" companies to work with. Of course, "easier" is a relative term in the world of private label. I can't imagine what the Big Box retailer requirements are like now as the requirements were already difficult back then. I can understand why they are doing it but I agree that it doesn't make any difference in safety.

halojones-fan said...

Hardly surprising that big sellers like Costco would be so sticky--they're big targets, they look like they've got lots of money, so regulators will want to stick it to them just as hard as they can manage. No leniency on violations and HUGE fines.

On the other hand, a retail giant like Costco can probably get pretty quick responses from the CPSC when it has a question.

Anonymous said...

don't forget to include the test labs in this plot. They are more than happy to see retailers set these artificial standards in their quest to be "safer than the competition". We had an item that was recently sold to Costco. 6 months ago, the cost to test at BV was $2000. The cost to test the same item in the same lab for the Costco program? $7000. Why so much? BV convinced Costco to start testing for phthalates in paint. Kaching!