Lactalis’ Product Recall

Submitted To:
Prof. Rakesh Pathak

Submitted By:
Aashish Patel (18BSP2831)
Prateek Maheshwari (18BSP3170)
Meghana Kuchibotla (18BSP3085)
Himanshu Mukati (18BSP2997)
Monalisa (18BSP3098)
Narne Vinay Choudhary (18BSP3110)
Kulbhushan Singh Rawat (18BSP4103)
Rubin Peter (18BSP3212)
Saloni Choudhary (18BSP3234)
 INTRODUCTION

• On December 21, 2017 France (DGH) reported that

several kids had been hospitalized
• 3rd product recall in a month (720 batches)
• 12 million baby milk powder boxes were recalled
from 83countries
• Biggest product recall in the history of Lactalis
• Lactalis apologized for the contamination and
exchanged the products by consumers in
pharmacies or supermarkets.
 About Lactalis

• Family owned multinational dairy product company

• Based in Laval (Mayenne) in west France

• In 1993, founder started a small cheese company under brand name Le petit Lavallo and in
1999 company name changed to Lactalis

• In 2017, world's largest producer of cheese and world's biggest dairy groups and annual sales
of US$21 billion and 75000 employees

• Product range included cheese, milk, cream, butter and mik powder and exported its products
to 83 countries across Europe, Africa and Asia

• Owned some prestigious French and International brand included President, Lactel, Parmalat,
Galbani, Bridel, Societe, Celia and Roitlet
 Lactalis’ Earlier Product Recall

• December 1, 2017, DGH found 20 cases of salmonella poisoning

among French children.

• December 2, 2017, Lactalis made its first recall of 12 batches of baby

milk powder.

• December 8, 2017, Lactalis halted work at Craon factory and

undertook a cleaning operation.

• December 12, 2017, Lactalis made its second wider product recall.
 Prominent Product Recall In The Past

• This issue rocked the global baby milk industry.

• Earlier Sanlu, china based company faced this issue which affected the
share price and had a severe impact on China’s food exports

• After the incident Chinese government imposed new regulations

• Another case was happened in New Zealand in 2013- where Whey

protein contained the presence of clostridium botinum bacteria.

• This resulted in huge losses and resignation of the head of Fonterra’s

milk division
 BLAME GAME

Company

Emmanuel Besnier ( CEO ) of Lactalis had multiple appearances to provide an explanation on

salmonella contamination.

• 2017 May – Renovation caused the introduction of bacteria in baby milk powder.

• 2017 Aug – Company found traces of salmonella at Craon factory but didn’t report as it was
not legally bound to do so.

• 2017 Sep – French regulators failed to detect bacteria on inspection.

• 2017 Nov – Lactalis again detected salmonella at the factory but refrained from reporting it to
authorities.

Bacteria was inherent in craon factory that company had acquired from Celia in 2006. (identical
trace of 2005)
Retailers

• Lactalis had clearly instructed the retailers about the recall procedure and
directed them to destroy the products after getting them back.

• Retailers failed to take the product recall issue seriously.

• Some retailers acknowledged and apologized however others blamed the

company.

Government

• Threatened retailers with severe action if they continued to sell the recalled
products .

• The retail sector specialist observed that the govt should have more carefully
monitored the issue and brought the retailers in line much earlier
 Impact On Lactalis Operations

• Affect on Lactalis domestic and international market

• Workers were temporarily laid off

• Restrictions were imposed on sale and further export on the affected

products

• Many lawsuits were filed by the parents of affected children

• Also, a case was filed by French Consumer Association

• Calls for Bensier to step down as CEO and take responsibility

 IMPACT ON FRANCE’S REPUTATION

• Issue adversely affected France’s food exports across the world

• Incident exposed the basic problem of France’s dairy products

quality control and supervision system

• Loopholes in Manufacturing and supervision of dairy producers

• Loss of brand reputation of French formula milk producers

 Conclusion

• In 2017, world's largest producer of cheese and world's biggest dairy groups and annual

sales of US$21 billion and 75000 employees faced product recall

• “Nearly 7,000 tons” of baby milk formula made by the French company Lactalis has been

recalled over fear of salmonella contamination.

• The recall affects all products made at a factory in Craon in northwest France since

February 15, 2017, including some meant for export to Britain, China, Greece, Haiti,

Colombia, and Peru, among other countries.

• Blame game between French regulatory and lactails

• Impacted French reputation In international market

Thank You