Every business should have plans to grow. For publicly traded companies, it’s expected, and investors choose whether or not to buy stock based on projected earnings. For small or medium-sized businesses, growth can keep the company healthy, competitive and profitable. For manufacturers, one hindrance to growth is a large recall.
Manufacturers more and more are opting for product insurance coverage for this reason. Consider what can happen to a business who makes food products. Salmonella, botulism or other toxins can make a processed food completely unfit for consumption. Even if investigators declare your facility safe and the problem is discovered higher up in the supply chain, the recall can cost your business dearly. If you stay on top of the press to ensure that any publicity is accurate and doesn’t needlessly harm your brand’s reputation, you can stabilize to grow further. But if the recall is large, and production is halted because of a lengthy regulatory investigation, the hit can take a long time to recover from. Product insurance helps to protect businesses from such losses so that they can move ahead quickly after a recall.
When managed well, the effects of an interruption or recall can short lived and just a small line on the balance sheet. Having the right coverage can ensure that your business is poised to continue innovating and stay profitable.