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Unsaleable product costs reach $4.2 billion in '98

Packaging is often the problem when products and packages are diverted from retailers to reclamation centers. Credits issued are a growing cost for distributors and manufacturers, says a new report.

More than 1% of the gross sales of manufacturers is now being issued as credits for unsaleable merchandise, says a 1999 report published by Grocery Manufacturers of America, Washington, DC. Developed by a GMA task force, “Unsaleable Products” is a compilation of data from 58 manufacturers that represent more than $130 billion in annual gross sales.

Although a lot of factors share responsibility for “unsaleables,” packaging deficiencies are most often cited by companies that study the issue. The trend toward reducing the weight of packaging materials is specifically cited as a cause for damage that results in unsaleable merchandise. Another factor that was frequently cited was the inability of retailers to understand date codes on individual packages and on shipping containers.

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