DENTON (UNT), Texas – A University of North Texas College of Business expert says the recent recall of Farm Rich frozen foods may have lingering effects on the business, as consumers may not know when it’s safe to buy again.
Whitney Peake, assistant professor of management in the College of Business, has studied contamination scandals in the food processing industry and is available to comment on consumer reaction to food recalls and the impact on businesses. She can be reached at firstname.lastname@example.org or 940-565-3345.
Rich Products Corp. has recalled about 10 million pounds of Farm Rich frozen food items over the last two weeks, according to news reports.
“What we’ve found is that although consumers may be made aware of a recall situation through the media, they rarely hear of a recall ending,” Peake said. “This may lead to loss in sales over an extended period of time, even when products are considered safe to the consumer again.”
Plus, Rich Products Corp. may find buyers shying away from its non-recalled products, too, she said.
“It is likely that the Rich Products Corp. will suffer some legitimacy losses across the board for its products,” Peake said. “They may see sales declines for some time after the scandal breaks, especially since this is a large recall that has affected people in 15 states thus far.”
Farm Rich’s competitors may not be hurt though, Peake said. Consumers tend to overreact to recalls for foods that are not highly branded — such as tomatoes, spinach or cantaloupe – and avoid buying any of those foods, even from a variety that hasn’t been recalled, Peake said. But when the recall is for a highly branded food such as Farm Rich, consumers are still likely to buy the other brands, she said.
“Despite the problems that Farm Rich will likely encounter, innocent bystanders in the frozen meals industry will likely not feel a major impact,” Peake said. “Since the products are clearly branded, consumers will have greater ease in determining the affected product lines, unlike when more commodity-type products are recalled, like cantaloupe.”