Product Description [1] ETM Jonathan Atzmon - Franklin Hardwall Fuel Curb Hose - November 30, What: Hardwall Fuel Curb Hose Manufacturer: Franklin Fueling Systems Inc. of Madison, Wisconsin Description: The hardwall curb hose is 1 inch in diameter, and ranges in length from 9 inches to 100 feet. The fittings can be customized as fixed or swivel in orientation. This product, coupled with the nozzles found at gas stations, are used to transfer refined fuels such as gasoline, diesel, ethanol blends, and biodiesel blends. Identifiers: This recalled house came in black, green, blue, yellow, or red. A data code and model number were printed on the fittings. The data code on these curb hoses ranged from M1014 through M3014 in the WWYY format. The model numbers started with either FLHFR3XXXXX or FLXHW3XXXXX. Also, “FLEX-ING™ FLEX-ON” or “FLEXSTEEL FUTURA” are printed on the hardwall fuel curb hoses. Sold At: Distributors, contractors, and gasoline stations in the United States (U.S.) Price Range: 20 to 560 USD, depending on length of hardwall curb hose Number of Units Sold: Approximately 6,700 When Sold: Between March 2014 and July 2014

Product Recall [1] 2 Recall Date: September 30, 2014 Recall Number of the United States Consumer Product Safety Commission (CPSC): Why: The crimp on the fuel hose has the potential of loosening. The crimp is the fitting that limits the flow through the fuel hose. This malfunction may lead to fuel leakage, which poses the potential hazard of a fire or an explosion. Incidents: N/A Remedy: The recalled hardwall curb hoses should be removed from circulation and utilization immediately. Customers may either obtain a full refund or a replacement hose. They may do so by contacting Franklin Fueling Systems at (800) 225 – 9787 from 9 a.m. to 5 p.m. CT (Central Time) Monday through Friday, or online at If the customer contacts the manufacturer online, he or she must click on “Recall Information: Recall of 1” Hardwall Curb Hose” for more information on the recall and possible solutions. ETM Jonathan Atzmon - Franklin Hardwall Fuel Curb Hose - November 30, 2014

Management Issues [2] 3 Recognition of Problem: The hoses that were affected by the recall have only been in circulation since March Approximately 6,700 hardwall fuel curb hoses have been recalled since. The CSPC has not received any incident reports to date of any fires or explosions. Speed of Response: The response of Franklin Fueling Systems Inc. has been speedy. The problems were discovered during internal testing, which resulted in the defective product to be in circulation for only seven months. Responsibility: No article was found that showed Franklin Fueling Systems expressing any responsibility. Nevertheless, the fact that they initiated the recall indicates that they are indeed taking responsibility for the defective design. The company has provided sufficient alternatives through CSPC and their own website for remediated the recall. ETM Jonathan Atzmon - Franklin Hardwall Fuel Curb Hose - November 30, 2014

Impact of Recall 4 Legal Consequences: As the recall is only two months new, no lawsuits could be found against Franklin Fueling Systems due to the defective hardwall fuel curb hose. Reputation: The incident has had no effect on the reputation of Franklin Fueling Systems. The company remains a world leader in complete fueling systems and fuel curb hose components. [3] The stock of the parent company Franklin Electric Co., Inc. (NASDAQ: FELE) has not experienced any major fluctuations since the announcement of the recall, as per Google Finance. On the contrary, soon after the announcement of the recall, the company’s stock experienced a significant increase. [4] ETM Jonathan Atzmon - Franklin Hardwall Fuel Curb Hose - November 30, 2014

A process cannot be capable if it is not in control [5] 5 Franklin Fueling Systems should institute Shewhart control charts for attribute data. In particular, p-charts should be developed on the number of defectives (d) for each product produced on the same manufacturing line that the recalled hardwall fuel curb hoses were developed on. The p-charts will track the percent defectives in inspection lots of size n. A minimum of 25 samples must be taken for each set of Shewhart control charts for attribute data in order to properly fit the Binomial distribution on which p-chart theory is based. In order to determine the number of defectives (d) for each sample (k), a go/no-go gage should be employed. Then, the proportion (p) should be calculated by dividing the number of defectives (d) by the lot size (n). The following assumptions must be made in order to develop these Shewhart control charts for attribute data for Franklin Fueling Systems, Inc.: The part is either defective or nondefective Sampling with replacement Independent trials. ETM Jonathan Atzmon - Franklin Hardwall Fuel Curb Hose - November 30, 2014

6 The following formulas are used to further develop the columns defined above: The p-chart should include the following, at minimum: x-axis label: Sample No. y-axis label: Proportion Title: P Control Chart (1 – k) Legend: Proportion; LCL; CL; UCL Sample (k) No. of Defectives (d) Proportion (p) Lower Control Limit (LCL) Center Line (CL) Upper Control Limit (UCL) ETM Jonathan Atzmon - Franklin Hardwall Fuel Curb Hose - November 30, 2014 A process cannot be capable if it is not in control (cont.) [5]

7 After the development of the p-chart, the data analyst for Franklin Fueling Systems must determine if the system for producing the product being manufacturing on the same line as the recalled hose is out of control. In order to determine if the sample proportion is in or out of control, the following tests must be applied to the p-chart: An extreme point beyond the control limits (UCL+; LCL -) A run of eight or more points above or below the CL (8+ in a row +/- CL) Six or more points continuing to increase or decrease (linear trend; incr 6+; decr 6+) 14 or more points oscillating up and down (oscillatory trend; 14+ /\/\/\/\/\/\/). It is my suggestion that the production process should be analyzed using quality tools such as flowcharts, fish-bone diagrams, and pareto diagrams in order to find the special cause variations that could potentially render the process out of control, and then subsequently remediate those problems. ETM Jonathan Atzmon - Franklin Hardwall Fuel Curb Hose - November 30, 2014 A process cannot be capable if it is not in control (cont.) [5]

References 8 [1]"Franklin Fueling Systems Recalls Hardwall Fuel Curb Hose Due to Fire and Explosion Hazard." U.S. Consumer Product Safety Commission. 30 Sept Web. 20 Nov < Fuel-Curb-Hose/>. [2]"AboutLawsuits.com." AboutLawsuitscom. 1 Oct Web. 20 Nov < [3]" About Us." Frankling Fueling. 1 Jan Web. 20 Nov < [4]"Franklin Electric Stock." Google Finance. 20 Nov Web. 20 Nov < instant&ion=1&espv=2&es_th=1&ie=UTF-8#q=franklin electric stock>. [5]DeVor, Richard E., and Tsong Chang. "Chapter 13: Shewhart Control Charts for Attribute Data." Statistical Quality Design and Control: Contemporary Concepts and Methods. 2nd ed. Upper Saddle River, N.J.: Pearson/Prentice Hall, Print. ETM Jonathan Atzmon - Franklin Hardwall Fuel Curb Hose - November 30, 2014