Managing Your Risks

Retailers discuss risk, liabilities at forum

NEWPORT, R.I. -- Though it may not seem like it, there are some potentially dangerous products on your shelves and foodservice make-tables right this moment. As you read this, it is very possible to sell one of these productsa lighter, for examplethat will be involved in a deadly accident, such as a fire. Likewise, contaminated food products could harm or even kill. If such tragic events were to happen, is your company prepared?

The world of product-liability law is amazingly complex and fraught with peril. Many retailers do not give proper consideration [image-nocss] to their exposure to such risks. Protecting your company from such events was the topic of discussion at the Liability & Risk Management Forum held by CSP Information Group July 25-27 in Newport, R.I. More than two dozen retailers and consultants attended the forum, sponsored by BIC Consumer Products with support from Patco Food Safety Consultants, Tidel Engineering and Westec Interactive.

Experts at the forum recommended that retailers know who manufactures products such as novelty lighters in your stores, and whether their products are compliant with safety standards. Steve Burkhart, vice president and assistant general counsel for BIC, told retailers at the conference, So much of what you sell is regulated that manufacturers should be able to document that their products are compliant. And you are within your rights to ask about it.

Also, knowing whether you are covered by your vendor's insurance if something terrible were to happen and exactly how much coverage they have can go a long way toward helping your case, Burkhart said.

In addition to product liability cases, attendees discussed ways to protect yourself from other types of liabilities, including criminal cases, such as if an employee or a customer injures or even kills someone in your store. Having proper security procedures in place can make the difference between whether or not your chain is held responsible for damages.

Speakers and attendees recommend the following keys to protecting yourself from potentially catastrophic lawsuits:

Know your vendors and suppliers. Understand your suppliers' insurance coverage and ask to be added to their policies. Ask suppliers to show you proof that their products meet government and industry safety standards. Develop highly detailed foodservice plans for storing and preparing food and execute them consistently. Understand what your own insurance covers and make necessary changes if it is not adequate. Get the help of an expert in developing detailed hiring and firing policies.