Under Armour Cup Recall: Small, But Hurts
Having been a business reporter for almost a decade, I've learned two things about product recalls.
1. The word recall is one of the most damaging words in all of business.
2. No matter what the recall is, how many people have been affected or how big the business is, much of the public reaction has to do with the image that is conjured up when hearing about the news.
So you can imagine my reaction when this headline came into my e-mail box this morning from the U.S. Consumer Product Safety Commission:
Under Armour Recalls Athletic Cups Due To Injury Hazard
The reason for the voluntary recall? Under Armour apparently received "five reports of cups breaking, including an injury involving cuts and bruising."
That's not a lot out of the 211,000 of them made. But the image is pretty brutal. No one flinches reading that if it's a t-shirt or shoe that has to be returned.
Athletic supporters are obviously an extremely small part of their business, but will the shares decline today off the graphic news? In the first 30 minutes of trading, shares were down about four percent. Is that cup reaction or some profit taking by some investors who saw the stock climb an impressive 13 percent yesterday off good earnings.
Questions? Comments? SportsBiz@cnbc.com
