When Bedbugs Bite

News

In July, Abercrombie & Fitch’s Hollister store in Manhattan’s SoHo neighborhood closed for several days after it was hit with a bedbug infestation. A few days later, the company was forced to temporarily shutter a namesake store at the city’s South Street Seaport when another infestation was discovered.

Meanwhile, a Victoria’s Secret in the midtown section of the Big Apple was also contaminated in the same month.

These stores suffered a sales loss while the locations were closed. But even more worrisome was that news of the outbreak spread like wildfire and put the brands’ reputations at stake.

“Incidents like this are happening more and more these days—and not just in large cities,” said Mac Nadel, U.S. practice leader for the retail/wholesale, food and beverage industry at Marsh, one of the world’s leading insurance brokers and risk advisers. “The epidemic is spreading, and retailers need to take precautions to not only prevent outbreaks, but be proactive in knowing how to control and rebound from a bedbug situation.”

Although the retailers didn’t detail the cause, Abercrombie & Fitch said after the incident that it quarantined and tested products that had been recently returned to the stores. In fact, one of the main channels through which bedbugs enter the retail environment is the returns process, according to Nadel.

“Bedbugs in retail often stem from a shopper bringing back an item after it was infested at their home,” Nadel explained, adding that the reverse situation can also arise: Shoppers who purchase infested clothing at a store can spread the infestation to their own home.

Another common way bedbugs make their way into stores is through shipments.

“Before any shrinkwrap is removed, workers need to check for live or dead bedbugs, spiders and other insects, or for bug residue,” advised Joann Sullivan, senior VP in the workforce strategies practice of Marsh Risk Consulting, a division of Marsh. “Bedbugs are notorious hitchhikers, so they will spread easily and reproduce at rapid rates. If any live bugs are found on the package when it first comes in, especially if the inventory is clothing or bedding, it should not be accepted.”

Retailers should develop or implement a process to refuse shipments ahead of time. Merchants and suppliers should agree on processes for inspecting shipments, and suppliers should have an existing one in place to inspect and decontaminate their facilities.

In the meantime, potentially contaminated shipments should be isolated for further inspection, and, in addition to a visual check, boxes should be shaken to see if bugs are hiding. If an infestation is suspected, Nadel suggests reaching out to an exterminator immediately.

“Some people hire dogs to sniff out a location to detect an infestation, but retailers shouldn’t mess around when it comes to bedbugs,” Nadel said. “They should go straight to a licensed exterminator who can inspect the area and quickly take care of any issue.”

Bedbugs are notoriously difficult to exterminate. Pesticides have to hit them directly, and once the chemicals dry, protection doesn’t last. Checks should be done to ensure all bugs are gone.

During an outbreak, retailers should understand the expectations of their stakeholders, as well as employees, government and regulatory agencies, customers, consumers, investors/analysts and media, and make sure they are communicating with them consistently, accurately and in a proactive and timely manner.

“It’s critical to have a formal crisis management process in place,” Sullivan noted. “A defined process should be established to make good decisions quickly, prioritize actions, and understand the broader risks the event may pose to the organization and its reputation.”

Retailers should have a spokesperson ready to speak on the company’s behalf. Someone should also be familiar with the local health codes in order to more efficiently work with health officials to get the store back up and running.

“The bottom line is that retailers should be proactive, educated on the subject, and ready to deal with bugs should any situation occur,” Sullivan said.

© 2014