FST Soapbox

The Private Food Label Dilemma

By Barbara Levin
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October 3, 2012


• Categories: Food Manufacturing, FST Soapbox, RC - Supply Chain FSQA

Tuesday morning I had my typical breakfast while running out the door – Trader Joe’s almond butter on a toasted whole grain waffle. Good, and good for you, as my mom likes to say. Then of course I got to my desk, looked through my daily FSQA news feeds, and saw that the peanut butter recall was expanded to almond butter – and to other brands besides Trader Joe’s from the supplier, Sunland!

Well so far so good – I’m healthy and not in a high risk group, but it did make me think once again about the problem for food retailers that – in the need to remain competitive for shelf space in their own stores – have turned to private labeling for more and more products store-wide.

I’m a big fan of Trader Joe’s.  I buy a lot of their private label brands – everything from almond butter, to tomato sauce to olive oil. And they did a good job of aggressively getting the tainted nut butters off of their shelves.

But it does make one think of the added challenge for those manufacturing and selling private label goods – where a manufacturer problem can create a huge negative impact on your private label brand. Obviously in cases such as the Sunland nut butters, the ability to trace where the product had gone was key for recalling it. And while that ability is critical – the initial damage to the private label brands is done. Now, it’s just a matter of how extensive the damage is and how much it will cost to repair: loss of inventory, loss of sales, loss of consumer confidence and of course the cost of illness and related lawsuits which have already begun to follow.

And this doesn’t count the non-direct costs – such as advertising to eventually get those customers back – those who may now be “private label shy” and go back to the brand names under the perception that they may be safer.

We challenge the industry to look not just at reactive measures – but proactive, preventative measures as well. How are you leveraging food safety and quality technology? Are you using technology only to trace back once a problem has already occurred? Or are you also using technology to help prevent contaminated ingredients from going into production – and non-compliant finished goods from being labeled and shipped – in the first place. Are you as retailers putting this extra pressure on your manufacturers to take not just the reactive steps but the proactive ones as well?  

Prevention-based food safety and quality assurance technologies have a good return on investment, and may be critical to the ongoing financial health of the food private label industry. Have a thought on this topic? Join the conversation by posting a comment below.