In mid-March, Supply Chain Matters called attention to a business media expose focused on when a consumer product contains what it is supposed to. The Wall Street Journal had published a report reflecting on the importance of knowing your product, your supplier management and oversight practices along with supporting your core product marketing strategies. Today, the WSJ added another dimension to this topic, one that perhaps has more implications for regulatory oversight.
The March WSJ report focused on actress Jessica Alba’s co-founded company, the Honest Company, which has soared to a reported $1.7 billion in private valuation in less than four years. The stated core mission of this consumer goods company is to offer cleaning products that do not knowingly contain harsh chemicals found in mainstream marketed and sold products. One of the harmful compounds of question is that of sodium lauryl sulfate, referred to as SLS. The Honest Company’s claims to consumer are that its products are free of SLS. However, in its report, the WSJ indicated that it commissioned two independent testing labs to analyze Honest’s liquid laundry detergent only to determine that it contained significant amounts of the chemical.
Today’s WSJ report (Paid subscription required) reflects on one of largest producers of natural shampoos and skin cleaners in the United States, that being Hain Celestial Group. That company is reportedly in the process of reformulating dozens of products and dropping claims that do not contain SLS. Like Honest Company, Hain had long declared that its products contained no harsh chemicals. Instead, some products reportedly use the ingredient sodium coco sulfate (SCS), which actually contains SLS.
What adds more interest to this development is the WSJ indicating that it actually commissioned independent laboratory testing last fall on several branded consumer products containing the SCS compound. A product general manager for Hain Celestial indicated to the WSJ that it had begun to review product formulation last spring and decided in November, after being contacted by the WSJ of its findings, to remove the “no SLS” claims on products that contain SCS.
In its latest reporting, the Journal points out that there are no current regulatory guidelines for what makes household and personal-care products “natural.” Instead, producers have termed their products as natural if they are derived from natural ingredients, even they have been chemically processed. The notation that other consumer brands were tested is perhaps an indication that more revelations or revised product claim declarations may be forthcoming.
Our readers might recall that product ingredients and product specifications are increasingly under the public looking glass. Recall the Lumber Liquidators expose in 2015 forcing that company to suspend all of its China sourced laminate flooring products after 60 Minutes, an investigative news television program turned a public light on suspected high levels of formaldehyde from certain China based flooring offered by this retailer. While not of the same severity of concern related to natural products claims, it does reflect the relationships among product management teams and suppliers. Lumber Liquidators is still dealing with both the consumer perceptual and financial implications of that prior incident.
The takeaway from these ongoing developments is that today’s traditional and social media outlets are holding consumer goods producers to a high standard of transparency as to product formulation and declaration claims. These ongoing revelations run the risk of triggering added calls for more regulatory oversight of producers as well as suppliers, one that obviously the industry wants to avoid.
Thus the importance of a rather close relationship among product design, management, marketing and supplier sourcing teams to insure that there is total transparency of product formulation and composition declarations.
