Richard Sieg, Regulatory Counsel, Inmar
Sustainability has become a major centerpiece of the retail industry strategy. The Retail Industry Leaders Association (RILA) published its first sustainability report in 2012, highlighting the major trends and best practices in the industry.
Meanwhile, shareholder activism for the pursuit of sustainability programs has become a driver in publicly traded companies. As RILA pointed out in its 2015 Retail Sustainability Management Report, the business case for sustainability is only solidified further as more retailers build their sustainability strategies and report on their successes. Private companies are also joining the sustainability wave, especially in retail.
While waste is only one piece of sustainability, it is an important one, and an opportunity to make a tangible difference very quickly. Liquidation and donation of viable consumer products is a great solution to help minimize waste and deliver products to the secondary market in a compliant manner. Besides, donation has positive impacts in a great many other ways beyond sustainability.
There are still some regulatory compliance considerations for liquidation and donation activities, but retailers following industry best practices can maintain compliance in these areas relatively easily. For example, the same rules apply to wastes, broken and leaking products and products otherwise being managed as wastes are subject to the same restrictions.
Compliance expertise and/or training, or scanner-based decision support technology are necessary tools for proper waste characterization, regardless. For example, over-the-counter drugs are considered wastes by the federal government unless an expert evaluation deems the drugs still safe and effective. In practical terms, for retailers, this means that expired OTC drugs are wastes when they are expired.
Some states have passed laws prohibiting sale of expired drugs (New York, among others). That makes it important for retailers to track date-sensitivity so they can remove them from the shelves with enough time left to liquidate or donate them before expiration.
Housekeeping matters when dealing with consumer products in retail. The Environmental Protection Agency (EPA) published “Checklist to Assist in Evaluating Whether Commercial Chemical Products (CCPs) Are Solid and Hazardous Waste Under the Resource Conservation and Recovery Act,” for inspectors’ use in evaluating whether certain products are being managed properly. You can avoid regulatory headaches by using the checklist to guide applicable product-management processes for moving product from primary retail through donation or liquidation.
The proper management of safety recalls is also important for the shipping of consumer products for liquidation and donation. Rules for removal of items on safety recall also apply to liquidation and donation streams. Inevitably, mistakes do happen and a consumer product on safety recall may inadvertently be sent to the reverse distributor.
Inmar uses its proprietary system notifies scanners when such items are found in consumer returns. When Inmar is notified of a safety recall, the UPC is entered into our system. Once in the system, a scanned item with that UPC prompts instruction to remove that product from the client’s returns to keep it out of commerce streams. This provides an extra layer of protection for our clients who inadvertently ship such items to our facilities.
Following best practices for liquidation and donation of consumer product can significantly reduce the amount of waste generated. When done in a compliant manner, liquidation and donation are terrific end-of-life solutions that prevent viable consumer products from becoming wastes. This can mean great results for retailers, secondary-market purchasers, donation recipients, and society in general.
Do you have a regulatory question for Richard? Contact him at Richard.Sieg@inmar.com.
This article is solely for informational purposes and does not constitute legal advice regarding any specific situation. Inmar disclaims all liability resulting from any use or reliance on this information.