CPSIA Retail

Another product line falls to CPSIA

Learn more here: 

How many small businesses have to fail or see their revenue fall before it impacts your business? I’ve only listed 2 so far, but there are many more.

Pick up the phone and call your Senators, House rep and the CPSC.

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Forging ahead despite the CPSIA

metalworking weekend
Creative Commons License photo credit: hans s

This week, a series of #CPSIA posts about what to do next and how to get the word out to other manufacturers, retailers, the media in your area and perhaps most importantly – to your elected officials. If you want to forge ahead with your homemade products business despite CPSIA, then read on.

If you don’t have any direct reason to care about dealing with the CPSIA (you should have an indirect reason to care), don’t worry – there are other posts this week that will help you with your business. I haven’t forgotten about the rest of you, it’s simply that this CPSIA issue is very time-bound and it’s important to deal with a number of issues relating to it before Feb 10 arrives.

If you’ve given up, read on anyway. You might develop enough hope to get back in the game. 

Surviving the February 10th deadline

I’m assuming that you got this far because you haven’t given up and you’re wondering what to do in the next few weeks before the CPSIA kicks in.

Before Feb 10th gets here, you’ll need a few things in your quiver.

If you’re a retailer, you’ll need a CPSIA General Compliance Certificate (GCC) for every item (or every lot of items) that you sell. The manufacturer of the items should provide these, it is not your responsibility as a retailer to test and create the certificates (sort of).

Why “sort of”? Because it IS your responsibility after Feb 10 to sell only those things for which you have GCC coverage. A nice catch-22. If you buy items from the same lot, each item is covered by the GCC for that lot. Still, each lot must have a GCC.

Yes, you’re right – there is a significant paperwork tracking issue here: You get to keep track of a form for every lot of every item you sell or have sold. We’ll get to that later in the week.

As for the items that won’t comply as of Feb 10, big retail (Wal-Mart, etc) is handling this by demanding that manufacturers accept returns on unsold merchandise that doesn’t comply. You may not have that option with your suppliers, but it is worth checking into. 

CRITICAL: You should be sure that all future contracts to purchase from your distributors and wholesale suppliers include a clause that allows you to return the items at the manufacturer’s cost (and for a full refund) if they are not CPSIA compliant.

What if my manufacturers say that providing the GCC isn’t their responsibility? Or what if they say they haven’t tested. Obviously, your actions here will depend on how bad you want their merchandise, but the bottom line is that while they do have to provide you with a GCC, finger pointing will do you no good if a CPSC inspector walks in your door.

You either need to get the manufacturer’s GCC, have the items tested yourself, or simply don’t buy from that manufacturer. If you sell those items, you’ve got the ultimate responsibility to have a GCC for each item or lot of items. 

What about my existing inventory?

For retailers, the choices here are slim: Either discard the items, return them to the manufacturer (if you can) or have them tested.

You can’t legally sell them if you don’t have a GCC. It might be tempting to simply sell them and try to run the non-compliant items out of stock after Feb 10. I wouldn’t advise that. Fines are $100,000 for violating the CPSIA.

Sure, it’s a roll of the dice whether you see an inspector or not, but if you do see one, it’ll probably be when you least expect it. Most small retailers I work with are not in a position to handle a rand0m $100,000 fine. Even if you are, you probably have better things to do with that money:)

If you are a manufacturer, you must test items and provide GCCs to your retailers on a lot by lot basis. If possible, provide an online area of your website where retailers can look them up by SKU and by lot number. Easy for you, easy for them. By the way, if you import items from outside the U.S. – you’re the manufacturer, so don’t assume you can skirt the issue that way. 

As for those GCCs, I’d also consider including a copy in every shipment’s paperwork, since one must be provided for each lot. Be sure that lot numbers appear on invoices, bills of lading and packing slips.

If you have an online system to look up your GCCs, I’d suggest that you print the URL of the GCC for that lot on all that paperwork as well. It gives the retailer no excuses when it comes to recognizing that you’ve provided a GCC. In fact, doing this offers your clients some options that your competition may not offer.

Always look for an edge – and making CPSIA compliance easier for your retailers is certainly a plus at a time when they are all pretty worried about how they are going to deal with this unfunded mandate on their time and record keeping resources. 

If you are a manufacturer who sells retail (ie: most people who make things in their own home, shop etc), then you still need to have your items tested. There are some exceptions, but they are pretty slim pickings, like natural fabrics that haven’t been dyed, inked or coated with any other material. If you are unsure, I suggest talking with an attorney who is familiar with the CPSIA. 

So…whether you are a retailer, manufacturer or both, that’ll get you working till August.

What about August?

August is “tomorrow” in the real world. You know that you’ll blink and it’ll be here. 

So what do you do to get ready for August? Well, it really depends on your products.

XRF testing is – so far – off the table as of August, when your merchandise must be tested by a certified third party testing lab. Problem is, the CPSC doesn’t have to issue the rules for a post-August CPSIA world until May. Until then, choose your merchandise wisely. As the rules flesh out over the next few months, we’ll come back to this topics from a post-August retail worldview.

That means you have that 100% inventory turn challenge twice this year. Don’t wait till the last minute – and again, if you are a retailer, be sure your purchase agreements with suppliers are iron-clad. I’d suggest that you try to stock your store with merchandise that is already compliant with August’s rules if at all possible.

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#CPSIA – Got a little Howard Beale in you?

That scene in Network where Howard Beale goes a little nuts pretty well describes my attitude regarding the CPSIA and those who continue to ignore it (and the calls to Washington about it). No, the clip isn’t G-rated, sorry.

I realize this issue has pretty much pegged my blog-o-meter lately, but I ask you to think about it – If thousands of these artists, craftspeople and such go out of business, who does that hurt besides them? 

Other small businesses. Which hurts other small businesses. And so on. 

Like it or not, you’re in that food chain somewhere. 

Meanwhile, 345 people in and around my town were yesterday and today. In a town of 4500, that hurts – particularly when there were several hundred other others laid off indefinitely just a week or two earlier.

I’ll say it again: Get off the couch, pick up the phone and call your Senators, US Representative and the CPSC. Do it before your business is the one that’s closing or laying off people. 

As for you… the one who thinks it doesn’t apply to you, I have a word for you: Pink Zebra.

Feeding the Pink Zebra

Pink Zebra Boutique is the name of a mom-owned boutique in Katy, Texas. She just made the tough decision to get out of the “stuff for kids under 12” market. Just because of the CPSIA. She’s not closing her business, just giving up a big piece of it for no other reason than the CPSIA. 

A real mom. A real business in small town. A retail storefront that now has to figure out how to replace that revenue because they have to shut down part of the business. There will be more.

Just a reminder in the meantime: Don’t tick off the moms.