A teenager’s spending sprees on stolen identities, classical music and a human finger in a bowl of chilli were among the, ahem, ingredients at the Retail Fraud 08 conference in London on May 1.
Mark Rowe reports.
A woman who claimed she found a finger in her bowl of chilli sauce sparked a month-long crisis for the US restaurant franchise chain Wendy’s. Director of loss prevention Chris Manning talked the Retail Fraud 08 audience through the affair and offered advice on setting up a crisis team in case something similar happened to you. In case you think it’s the sort of crazy thing that only happens in America, event chairman Prof Joshua Bamfield made the point that shoplifters if searched prematurely as suspects might feel humiliated and go to the media.
And loss prevention people afterwards told Professional Security similar things can and do happen in the UK; claims of glass in products, and what one listener termed ‘slips and spills merchants’, that is, people who make a habit of claiming they have slipped or fallen in a shop, and demand compensation. Such was the 2005 case of a woman in San Jose who brought a lawsuit against Wendy’s, saying she found the finger inside her 99 cents food. The media had a field day. Chris Manning showed video clips of how police giving updates on the case was treated as national breaking news.
The search for the finger went to Vegas, even Mexico. As Manning recalled, Wendy’s soon found the event went out of control; it had to prove the finger was not from a member of staff, or someone in the supply chain. Hence a crisis team inside the company, including quality assurance, security and the supply chain. Wendy’s literally counted the fingers of its employees; put its side of the story in newspaper adverts, and offered a $100,000 reward for information; and got a crucial lead from a freephone line it set up. To cut a long story short, the claim was bogus. The woman had a history of sueing, and the finger came via her husband – a friend who lost his finger, in an unrelated accident, sold it to him. The woman dropped her lawsuit one month after the allegation, claiming stress, and she and her husband were jailed.
Leaks
Damage was done, however, in lost sales and reputation. A smaller chain might have gone out of business, Manning said. He gave insights into the hour by hour stress and pulls of the various players in the case – the police, the company’s PR and top managers, and the hungry media. Publicity could work either way; it could harm the company’s reputation, but the right leak could produce a lead in the case. Manning hinted also at the difficulties of pleasing everybody: people might leak to the media; the police might be angry if the company released something to the media out of turn; and just as understandably, the company and franchisees were beside themselves, as sales fell. They wanted answers, or a time when answers would come, and Manning had to resist until he was sure of his case; although the company from early on felt it was the victim.
Crisis
Manning passed on what he called ‘crisis learnings’: the first 24 hours are crucial, in that they give shape to the crisis – so get the right people on the ground and don’t expect it will be fixed locally. Tell all the relevant agencies (such as public health in this case) that you want to co-operate, and be honest and prompt. Set up a chain of command. Make decisions that reflect your core brand values: "Do the right thing, the way you want to be remembered after the crisis." The crisis team should meet daily for updates. Among tricky decisions: if the claimant is going on TV, should the company take up an invite to appear alongside her?
If the police are not investigating the case aggressively enough, hire your own investigators; as Wendy’s did. Consider keeping an investigations company on retainer, to call in at any time. Resist the urge to make a public statement until you are absolutely sure, even though you are under pressure. Be prepared for copycats: "It’s amazing how many people in America have lost fingers. I got calls from all over the country, thinking the finger was theirs; because they wanted a piece of the reward." In other words, be prepared for the ‘wackos and crackos’, who will fax and email you, and who have to be weeded out. Make sure you have the right phone numbers for your crisis team members. Keep staff informed; while you might not be able to tell them specifics, you could say that you are aggressively seeking information. He stressed the need for a quick response. The finger in chilli case could have lasted longer – it was not enough for Wendy’s to say it had checked its staff and suppliers and the finger could not have been introduced into the product; the woman was frivolous. It took a year for sales to recover.
