Transparency. It’s been top of mind for years. But because of the shift in public’s interest in healthy ingredients and where they come from, businesses are responding by making transparency part of their strategic business initiatives. This includes providing a complete list of ingredients, known allergens and their nutritional information. They also want to know where and how products are sourced and handled. If this information isn’t available, it creates an air of distrust with today’s savvy consumers.
This information is becoming increasingly mandatory, not just because of FSMA and other regulations but because customers are demanding it. With globalization and increased imports from foreign suppliers, regulations as well as consumer expectations for food quality and safety has dramatically risen in the past few years. It is now one of the most critical ways you can earn consumer trust and loyalty. Here are three ways to incorporate transparency into your business plan.
1. Supplier Engagement Makes Good Business Sense
To offer transparency to customers, you must engage with your suppliers. You can’t offer your consumers the transparency they are demanding if you are not getting the information from your suppliers. Plus, it is critical to know who your suppliers’ suppliers are to mitigate risk.
Leveraging a supplier management technology solution will save you time by automating processes such as supplier onboarding and will help you keep track of documents, certificates and audits that you require.
It also helps support supplier communications so you can establish an open dialogue, which is critical when problems arise. You can’t expect a supplier to fulfill your requirements around safety and brand promise if you aren’t open about your expectations. It’s a two-way relationship that can make a huge difference in your business.
2. Label Transparency
FoodLogiQ recently published a survey that revealed supply chain transparency by food companies is a critical driver in consumer purchasing decisions and brand loyalty. Fifty-four percent of respondents want as much information as possible on the label, and nearly 40% want country of origin, allergen alerts and GMOs all identified on the label.
In this survey, those who identify as “caring deeply about the quality of food they eat,” are overwhelmingly in favor of more transparent labeling, with 86% of that demographic expecting country of origin, allergen alerts and genetically modified ingredients to be noted, and they ask that “as much information as possible” be included on the label (or menu) itself.
If a brand doesn’t provide this information, consumers will look elsewhere for it. This puts companies in a vulnerable position.
3. Building a Transparent Culture and Backing Marketing Claims
Food safety professionals and the marketing department are now working together to communicate their transparent farm-to-fork story. This cross-departmental collaboration will not only meet business goals but the teamwork strengthens the overall business.
To maintain a positive reputation, it starts with being open and honest, and engaging your customers in an authentic way. And once a brand establishes itself as being transparent, consumers are more open to trying other products from that company. Building a culture of transparency that is focused on safety and quality can be an incredible marketing advantage and give food companies an edge over competitors.
A recall, stock withdrawal or a report of a foodborne illness can wreak havoc on a business. But the worst thing you can do is hide it. If a brand has ever been under fire for false information, low-quality ingredients or a major recall, consumers know. They are more informed about your products through their online research and social media. It is better for consumers to receive this information directly from the brand than through a third-party site.
If a company is faced with a recall, it is important to involve multiple business units that each have a stake in resolving the issues as quickly as possible. Include the marketing department in your food safety plan and preventative controls so if you are faced with a recall, you have a communication plan in place.
How to Meet Transparency Business Goals
For food companies to provide this transparency, protect their brand image and earn their customers’ trust, they need full end-to-end supply chain traceability technology to modernize their processes and access real-time data. Centralizing your data creates a single source of truth to make data-informed decisions and remain compliant, all while empowering consumers to make safer, more informed decisions about the food they eat.
The good news is that food companies making transparency a priority are being rewarded by customer loyalty, as consumers are willing to pay more for those products. The previously mentioned survey revealed that 88% of respondents—from all demographics, Millennials to Boomers—were willing to pay more for healthier foods including those that are GMO-free, have no artificial coloring/flavors and are deemed all natural.
Transparency transcends all categories: From restaurant menus to labels on consumer package goods. So no matter what business you are in, implement these strategies to systematically impact on your bottom line and keep your food chain safe.
Six years ago, following FSMA being signed into law, Associated Wholesale Grocers, Inc. (AWG) knew it had to implement a supplier approval program to comply with the Preventive Controls rule. At the time, it had a manual process for managing the records of its 3000+ suppliers. The company needed an effective place, accessible any day of the year (and at any time), to collect and store all of its corporate and food safety documentation.
“I come from a manufacturing program where I was used to having a very robust supplier approval program,” says Shelly Stegner, director of food safety for AWG, a grocery co-op. “But in distribution companies such as AWG, food safety hasn’t necessarily been the culture, because we don’t do any reprocessing or repacking, or touch the product. When we had to comply with [FSMA], it was a whole new thing for AWG, and we knew we had to roll something out.”
AWG spent about two-and-a-half years looking for a company that could help not only manage documentation but could also give them control over the documents from a visibility perspective. After conducting thorough research, AWG selected Repositrak Inc.’s cloud-based Compliance Management solution. The product was recently launched to help companies during the sourcing process, assisting them with supplier qualification, order negotiation and on-boarding a new supplier. The solution also highlights compliant vendors based on business and safety requirements.
Food Safety Tech: What are the advantages and drawbacks to using an automated solution like Repositrak?
Shelly Stegner: It’s an easy way to keep track and retain all the records that you’ve never been able to retain before. And not only can you retain them, but there are also visual statistics behind the documents (which you don’t have when with hard copies). It’s not just having the documents—it’s actual usable data when you use [Repositrak] that helps drive efficiencies within our company, and it helps decrease our risk and liability with vendors—for example, we know that their certificate of insurance has expired, whereas before [using Repositrak], we didn’t know that.
The drawbacks are cost. Is it the cheapest option out there? No. But is it the most efficient option that we found? Yes. A lot of the companies may have been cheaper, but we would have had to hire an individual to do all the work. There is a cost associated with it, so [some] vendors are hesitant. The other drawback is that the industry overall has many different solutions, so if the supplier is not using Repositrak for their supplier approval program, it’s another point of entry. Maybe it only takes 30 minutes to do it, but it’s still something else that they have to do.
I think it’s becoming easier for vendors with Repositrak as we get more traction and as it becomes more of an industry-known [product]. Suppliers only have to upload documents once, and it automatically reaches all their customers. So for them, the more [suppliers] that are on one system, the easier it is for the whole industry.
FST: What are the challenges to implementing this type of system?
Stegner: For a company that was completely in the Stone Ages, we didn’t even have a list of all of our active vendors—so we thought we had 6000 active vendors, and we only had a little more than 3000. Just getting the information to Repositrak about active vendors and contacts proved to be the most difficult thing for us. Once we got Repositrak the key information, they ran with it.
FST: From time management perspective, what are the savings?
Stegner: Before we had nothing in place. Now, during my third-party audits or when FDA arrives, I can show them where we are in compliance when they ask about our supplier program. It saves me a ton of time in that regard.
Now when I have a recall, I can go into the system and look up a contact, versus waiting to get a contact from a category manager. If I need to issue a recall, I can see if [the vendors] have reviewed our recall program and issue it without waiting on that either.
As far as the time it takes to approve documents, there’s an increased time, but there’s also an awareness that we never had before. So not only are we collecting the documents, but now we are building a whole food safety culture that also has a new awareness and understanding of what it means to distribute safe food.
FST: What are the general challenges you see companies facing, especially in the area of compliance and having visibility throughout their supply chain?
Stegner: I think there’s a challenge with some companies on keeping information confidential because they simply don’t want to share information.
As far as traceability goes, our company is challenged with technology. [There’s] the financial need of upgrading our technology to have the true traceability that has so increasingly become required by consumers from farm to fork. A great deal of technology is needed to understand that in real time.
The farmer has their traceability, and the supplier has their traceability, we have ours, and then there’s the retailer—it’s tying all those together that proves to be a bit of challenge.
Last week a panel of industry authorities gathered to share their perspectives on the importance of transparency in the supply chain and the challenges that food companies experience in managing different aspects, from their suppliers to once product reaches retailers.
“Understand that food safety today has changed significantly and will continue to change. It’s a dynamic field and regulations have only accelerated,” said Jorge Hernandez, chief food safety officer at The Wholesome Company. “You need to be more proactive internally and externally.”
Moderated by John Wadie, U.S. marketing operations manager for 3M Food Safety, the other panelists were Melanie Neumann, president of Neuman Risk Services, LLC and Terry Levee, Senior Director, Giant Eagle.
The panel is being rebroadcast as a free webinar, “Challenges Seen in Implementing and Executing Supply Chain Management”, on Tuesday, June 20 at 1 pm CT. It is part two of the 3M Food Safety FSMA Webinar Series: From Rules to Tools. Register here
Any ready-to-eat food product is only going to be as safe as the ingredients used to manufacture it. Unfortunately, most companies spend most of their money and time focused on broadening their customer base at the expense of properly screening new or existing suppliers. These companies fail to recognize that the single most significant threat to their company is failing to avert a potentially disastrous supplier problem that is lurking just outside of view. Whether your supplier has an inadequate food safety system or a poor food safety culture, such failures can cause your supplier’s products to become contaminated with deadly pathogens. In turn, if you are sourcing any products from that supplier, its food safety problems will inevitably become your own.
So, what should you do to ensure that your supplier’s food safety problems do not become your own? Over the past two decades, I have witnessed countless food safety failures cause countless more outbreaks and recalls. Most of these outbreaks and recalls could have been avoided by the companies that were affected simply by taking a few extra precautions. Thus, throughout the years, I have developed the following recommendations that all companies who manufacture or sell ready-to-eat products should follow when they are screening new or existing suppliers.
First, visit each of your suppliers’ facilities and make sure that they are producing your products in a clean and sanitary environment. If the facility is old, worn and has significant maintenance issues, consider moving to a different supplier. Poor facility construction, or the failure to maintain a cleanable and sanitary environment in weathered facilities, remains one of the most significant causes of product contamination. Microorganisms can take hold and easily find residence in older facilities that are not being appropriately maintained. In turn, once harmful pathogens become entrenched in environments that are difficult to clean and sanitize, it becomes extremely difficult to root them out.
Second, make certain that each of your suppliers have a robust environmental monitoring program. The only way for your supplier to prove to you that its sanitation program is effectively controlling microorganisms in the environment is to test and to test often. Unfortunately, many suppliers’ testing programs are woefully inadequate because the suppliers test too infrequently or only after cleaning and sanitation. As a result, in addition to requiring that each of your suppliers implement a robust sampling program, you should also require each of your suppliers to sample their food processing environments at least three to four hours into production. This way, they will always have an accurate picture of the sanitary conditions of the processing area during production.
Third, be sure to only partner with suppliers who are willing to test their finished products before selling them to you. If a supplier has confidence in its sanitation and monitoring programs, then that supplier should be willing to test the products it is selling you. If, however, your supplier refuses to test its finished products, it signals that the supplier does not believe it is able to produce a ready-to-eat product that is consistently free from contamination. Thus, if you ask your supplier to test its ready-to-eat products for the presence of harmful pathogens, and it refuses, immediately take your business elsewhere.
Fourth, inquire about your supplier’s suppliers. Remember, a platoon is only as fast as its slowest runner. If any supplier in the distribution chain has a problem, that problem will affect every company located downstream from the failure. Thus, be sure to get a commitment from each one of your suppliers that it will impose the same requirements on each of its own suppliers, and then verify that your supplier is actually doing what is promised.
Fifth, make sure only to do business with those suppliers that can demonstrate they have a strong food safety culture. The best way to judge the strength of a supplier’s food safety culture is by inquiring about the structure and credentials of the supplier’s food safety team. If the person in charge of food safety for the supplier is well credentialed, has deep experience, and is supported by a well-qualified team, that demonstrates that the supplier takes food safety seriously. If, however, the supplier does not have a food safety director, his or her resume is weak, and he or she does not appear to have adequate support, then the company likely lacks any food safety culture whatsoever. In this case, it would be advisable to find an alternative supplier that has invested in the right people and put them in the right positions.
In the end, the best way to protect your products and brand is to only use suppliers that are appropriately vetted and screened. If you commit to only using suppliers that have invested in clean and sanitary facilities, robust environmental and finished product testing programs, and strong food safety cultures, then you will likely be able to virtually eliminate the chances that your products will be associated with an outbreak or recall. If, however, you choose to leave your suppliers’ food safety performance to chance, your suppliers problems (and, they will have problems) will inevitably become your own.
Shawn Stevens will be speaking during a webinar on this topic, Contracting With a New Trading Partner? Here’s Your Risk-Reduction Checklist, May 2, 2017, 1–2pm ET. Register now.
Today’s food and beverage producers must deliver to exact requirements and provide safe products of the highest quality. In an increasingly global and connected world, the emergence of new business models, such as Amazon Food and the offer of direct deliveries to consumers, is creating ever more complex supply chains for manufacturers. The number of steps between the raw ingredients and the consumer is increasing, creating new and more numerous challenges inside the production process for food and beverage manufacturers. Thus it is important to remain committed to constantly innovating and developing new services and technologies to support customers with increasing supply chain complexities. This includes systems to help track products as they enter the factory environment, when they leave the factory, and when they enter the retail distribution chain. The digitalization of management processes and services, alongside basic management processes, is playing an important role in helping food and beverage manufacturers to manage these complexities.
Learn more about keeping track of your suppliers at the Food Safety Supply Chain Conference | June 5–6, 2017 | Rockville, MD | Attend in-person or virtuallySupplier Base
The first step to keeping food safe starts before the raw ingredients enter the processing facility. The safety of raw material is so important because it impacts the end quality of the product. Pasteurization and heat treatment can only improve the product so much, and therefore the higher quality the raw ingredients, the better the final product.
Basic management processes must be in place at this stage of the supply chain, ensuring the good management of the supplier base. Working closely with customers to implement supplier framework audits that allow them to benchmark their suppliers’ performance is crucial. Through this supplier framework customers to collaborate transparently with their suppliers, encouraging the open sharing of information and traceability in the supply chain.
Production Process and Entering the Retail Distribution Chain
Increased sophistication of tools in the industry is also enabling high-level traceability at the packaging stage. This means that food and beverage manufacturers are tracking and tracing products right the way through to the consumer. One such available tool can enable food and beverage manufacturers to program their entire plant through a single data management system, and improve product traceability internally. Specifically designed for the food and beverage industry, specific software provides a user-friendly interface through which customers can control their entire operations—from raw material reception to finished packaged and palletized products. Streamlines data collection facilitates accurate data analysis to ensure that safety standards are maintained throughout the production process.
Using unique package identification technology, such as a 2-D barcode on packages, information can be processed this information and the product(s) tracked throughout the supply chain. For example, if a manufacturer were to experience a food safety issue in a certain production batch, the tool would be able to track all products in that batch and support making a recall. In addition to improving functions on a reactive basis, a reporting function, is designed to provide data to help prevent issues from happening again in the future, mitigating against food safety risks.
As new business models continue to emerge and more parties become involved in the production process, the complexity of the supply chain will only increase. Digital strategies alongside basic management processes have an increasingly important role to play in helping food and beverage manufacturers manage these complexities to ensure that their food is safe for the end consumer.
Recently the Grocery Manufacturers Association (GMA) and the Food Marketing Institute (FMI) announced an initiative to reduce the amount of confusion that consumers experience regarding the “sell by”, “use by” and other date-specific labeling on food packaging. It is also part of an effort to reduce food waste.
The new initiative is completely voluntary, but GMA and FMI are hoping that retailers and manufacturers adopt the standard by the summer of 2018. It streamlines the labeling terminology to two simple phrases:
- “BEST If Used By”. Describes product quality, indicating the date by which the product may not taste or perform as expected but it is still safe to consume
- “USE By”. Applies to highly perishable products and/or products that have a food safety concern over a period of time that warrants a date by which the products should either be consumed or discarded
A variety of factors well beyond “sell by”/”use by” dates contribute to consumer confusion. The following Q&A is a brief discussion with Dagan Xavier, co-founder and vice president, customer intelligence at Label Insight on the impact of incorrectly labeling products (erosion of brand trust) and the challenge food companies face in providing transparent information on their products.
Food Safety Tech: How is the demand for transparency both from consumers and regulators changing the food product labeling landscape?
Dagan Xavier: Transparency sounds easy, but in reality, it is complex. For companies, managing compliance and consumer demands is not cut and dry.
Thankfully, brands and consumers are usually on the same page. But there are times when it’s not the case—and that causes trust issues. For one, brands need to use specific, compliant wording. That wording can sometimes be more complex than a preferred consumer-friendly phrasing. For example, USDA’s proposed labeling of GM-containing products refers to them as “genetically engineered.” Except, consumers are far more familiar with the term “genetically modified.”
Regardless of these nuances, regulations around transparency are in place to help consumers. The regulations set clear definitions about what products or ingredients can or cannot qualify for a labeling claim.
We currently live at a time where there is a general distrust of the food industry from consumers. Having strict regulations in place that add factual meaning behind claims is incredibly important. Meaningful and understandable claims, logos, and certifications are slowly beginning to help build trust back up from consumers.
FST: What challenges are food companies facing in labeling their products?
Xavier: One of the biggest hurdles companies face in labeling is fitting as much information as possible on the package. Between mandatory components (like allergens, nutrients, ingredients) and desired content (marketing copy and images), something almost always gets left off. What gets left off? It tends to be sourcing facts, “Made in America” logos, and other data that consumers find valuable but rank lower on a brand’s priority list.
In reality, 100% complete product information is nearly impossible to fit within the confined space of most product packaging.
The good news is that according to a recent study by Label Insight, most consumers (88%) say they would be interested in accessing a complete set of product information digitally.
SmartLabel (an initiative by the Grocery Manufacturers Association) is an easy solution. SmartLabels save companies space on their packaging, while still allowing them to communicate all product information with consumers digitally.
Most consumers (79%) say they are very likely or somewhat likely to use SmartLabel technology if it was offered by a brand. 44% say they would trust a brand more if it participated in the GMA SmartLabel initiative.
FST: Related to labeling, what are the complicating factors when a company is producing organic, GMO-free, gluten free, etc.—especially when working with suppliers?
Xavier: Having a trusting relationship and open communication with suppliers is key.
Because regulations around organic and gluten-free are so stringent here in the United States, brands need to rely on their suppliers to have ongoing robust certification audits, inspections, documentation and renewal programs.
We expect regulations around GMO-containing products to follow suit.
For companies with dozens of suppliers, it can get tricky managing the documentation of certifications. This is especially complicated if suppliers are overseas and their audits are not delivered through the same certifying agencies that retailers or importers would like.
Adding logos and certifications to packages can be expensive and add risk to brands if a supplier falls out of compliance. In the end, it is important for both brands and suppliers to have robust documentation and a good communication channel. This ensures that all information on-pack is always the most accurate information for consumers and retailers.
After being informed by its supplier Deutsch Kase Haus, LLC that its specialty Longhorn Colby cheese may be contaminated with Listeria monocytogenes, Sargento Foods, Inc. recalled several retail cheese products. The recalled Colby and Pepper jack cheeses (available on the company’s website) were packaged at Sargento’s Plymouth, Wisconsin plant. The company also recalled several other cheeses that were packaged at the same time “out of an abundance of caution”.
The recall involving Deutsch Kase Haus is not limited to Sargento. Guggisberg Cheese, Inc., Meijer and Sara Lee have recalled their Colby and Pepper jack cheeses. According to a release by US Foods, the product recalls were initiated after a notification by the Tennessee Department of Agriculture that some products manufactured on November 3, 10 and 18 could be contaminated with Lm.
Taylor Farms also recalled products that contained the cheese products—the company’s Class I recall involved 6,630 pounds of chicken and pork salad products that were produced and packaged from February 6–9, 2017.
Food recalls are not 100% avoidable, and they are costly. The hit to an individual food company or retailer, on average, can run to tens of millions of dollars. Annually, millions of consumers become ill as a result of contaminated food products, and the dollar costs in terms of lost productivity, medical treatment and deaths run into the tens of billions.1 More than 20% of consumers have said that they would not purchase any brands from a company suffering a food recall.2 At best, damage to a company’s brand and reputation could take a long time to repair. Clearly, the need to prevent food contamination is obvious and should be the ultimate goal of all food safety professionals.
But despite the best industry efforts, recalls inevitably occur. And since they aren’t 100% avoidable, suppliers and retailers must continue to look for ways to minimize the safety and financial impact of the recall events that do occur. It’s good to begin that process by understanding some statistics surrounding the most common recalls. Globally, 46% of food recalls are for chemical hazards or the introduction of non-food-grade ingredients. 79% of these are due to undeclared allergens. 26% of recalls are for food-borne pathogens, and 8% are due to physical hazards (metal, glass, plastic, paper, wood, etc.). The remaining 20% are generally quality-based recalls and withdrawals.3
Head Off Recalls Before They Occur
Knowing the numbers helps suppliers and retailers home in on their most likely problem areas and get a leg up on potential product contamination problems. Since chemical hazards are the single biggest culprit, and because most of these instances are due to allergens, food companies should closely examine their cleaning and sanitation practices during production line changeovers. Keep in mind the potential role of contract service providers as sources of adulteration. Regarding pathogens, evaluate raw and ready-to-eat segregation procedures, staff access points, and good manufacturing practices and employee traffic patterns.
Many companies focus their efforts on passing food safety certification audits, but faithful adherence to food safety measures just to pass an audit misses the point. Focus on the development and implementation of comprehensive food safety systems to guard against contamination and food safety incidents, and not just avoid non-conformances to certification codes. Preventing food safety incidents and recalls before they happen must be the priority.
Supplier Best Practice: The Mock Trace
Manufacturers, suppliers and certification bodies have evolved a set of best-practice recommendations that will go a long way toward reducing the number of food safety incidents and recalls. These include conducting regular internal audits of food safety plans and procedures, including approved supplier programs and environmental monitoring programs, both to re-evaluate their effectiveness and discover new or previously overlooked gaps.
Suppliers should consider taking things to the next level. SQFI’s LeAnn Chuboff suggests that suppliers “make their retailers happy” through the use of mock trace exercises.3 These “dry runs” are invaluable for reinforcing the close examination and evaluation of recall plans and to become intimately familiar with the necessary procedures in the event of an actual adulteration event. Mock trace exercises should be intensive: They are particularly effective in identifying gaps when they occur during off shifts. Making the exercise challenging rather than check-the-box easy helps companies reveal and close critical gaps. Conduct the mock trace in both directions, from raw materials to finished goods, and vice versa.
Include every department in the company. For mock trace exercises to be completely effective, review all documentation for errors or omissions. All employees should be interviewed to determine whether they fully understand food safety and documentation procedures. Review training modules and observe manufacturing procedures for evidence of knowledge or operational gaps. Examine bulk material receiving and storage, employee and material traffic patterns, packaging materials and procedures, and cleaning and maintenance chemicals.
Speed as well as accuracy and thoroughness are critical in the event of an actual recall event. Companies should practice rapid response. Take advantage of all the accumulated experiences from the mock exercise to improve every aspect of the company’s food contamination response tools and practices.
The 2016 Food Safety Consortium features a Listeria Detection & Control Workshop | Don’t miss this event two day event, December 7–8 in Schaumburg, IL | LEARN MOREOver the past few days there have been at least four recalls over Listeria concerns in ice cream products. On Monday, Blue Bell Ice Cream voluntarily recalled all of the products made with a cookie dough ingredient from one of its suppliers, Aspen Hills. “Although our products in the marketplace have passed our test and hold program, which requires that finished product samples from a batch test negative for Listeria monocytogenes before the batch can be released, Blue Bell is initiating this recall out of an abundance of caution,” according to a release on FDA’s website. Other recalls include:
- Two lots of Blue Bunny Hoppin’ Holidoodle ice cream recalled by Wells Enterprises, Inc.
- Chocolate Shoppe Ice Cream Company recalls product containing chocolate chip cookie dough pieces
- Publix chocolate chip cookie dough ice cream
Similar to the Blue Bell recall, the other two recalls involving cookie dough came from the ingredient supplied by Aspen Hills, Inc.
No illnesses have been reported.