Tag Archives: transparency

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Consumers Drive GMO Debate, Chicken Playtime and Tech Innovation

By Maria Fontanazza
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Last week several leading organizations in the food industry gathered to discuss trends and key issues facing the industry at The Wall Street Journal Global Food Forum. From the GMO debate to small farming and humane practices to sugar preferences, it’s clear that consumer demand for more control over what they’re consuming will continue to drive industry practices and future policies.

Industry leaders will gather at the 2016 Food Safety Consortium, December 5–9 in Schaumburg, IL | LEARN MOREAgriculture in the Global Landscape

The agricultural sector is often one of the most protected markets, according to Darci Vetter, ambassador and chief agricultural negotiator at the Office of the U.S. Trade Representative. Vetter strongly advocated for moving forward with free trade agreements in the United States for fear of falling behind in such a competitive global market.

When the audience was asked which country would see the biggest increase in agricultural exports in coming years, 40% selected China. To this observation, Vetter commented that while China has invested a great deal into basic research in the field of agriculture, the country has not been able to turn discoveries into viable technologies for farmers.

“China’s vision of national security is very much tied to food security.” – Darci Vetter, ambassador and chief agricultural negotiator at the Office of the U.S. Trade Representative

Antibiotics: Not in My Chicken

As industry faces unprecedented scrutiny from consumers, the use of antibiotics in livestock remains a hot button issue. Nearly 15 years ago, Perdue Farms saw evidence that consumers were concerned about antibiotics, and the company has made significant strides to reach today’s slogan, “No Antibiotics Ever”. This means that 100% of the chickens are not receiving antibiotics unless they’re sick, which is about 5%, according to company Chairman Jim Perdue. Measures the company has taken to reduce the incidence of illness in birds includes wiping every egg that comes into a hatchery with a baby wipe (Perdue says that the company is the biggest user of baby wipes); using herbs such as oregano in feed, because it has been shown to help condition the gut; and engaging in “chicken playtime” (a controlled atmosphere for chickens to play), which is said to reduce stress in chickens.

Debating GMOs and Technology

In order to address the growing population, industry must look at the entire suite of tools available, said Vetter. According to Mike Frank, senior vice president and chief commercial officer of Monsanto Co., 60–70% more food needs to be produced to feed the future population. Global warming, affordability and consumer education are just a few challenges that farmers face while trying to improve productivity and efficiency. This is where technology plays a key role, said Frank. Industry needs innovation to address the challenge of producing more food and managing the environmental footprint.

“We need every farmer, whether organic or not, to be successful.” – Mike Frank, senior vice president and chief commercial officer, Monsanto Company

Frank predicts that big data will dramatically change agriculture within the next five to six years by allowing farmers to farm by the square meter, thereby improving productivity in areas such as seeding and pest management. Farmers will also be able to leverage data to gain a better understanding of soil conditions and weather, and how it will ultimately impact their harvest.

Closing the Food Safety Loop

“Food safety doesn’t magically happen,” said Frank Yiannas, vice president of food safety at Walmart. He emphasized how companies must work hard to reduce risk early in the process, citing Walmart’s guiding principles: Is it safe? Is it affordable? Is it sustainable? He also touched on the company’s program to reduce the incidence of Salmonella in chicken parts and how companies should approach risk not just from the scientific point of view but also consider the regulatory requirements and perceived risk in making risk management decisions.

“We as leaders need to shift the conversation and let food unite us.” – Frank Yiannas, vice president, food safety, Walmart

The discussion between FDA commissioner Robert Califf, M.D. and Susan Mayne, director at CFSAN, focused more on chronic disease and healthy eating, however Califf expressed a need for more interrelated data sources within FDA. He also encouraged that industry conduct more research to ensure that decisions are based on good evidence.

Cecile Camerlynck, Transparency One

Why We Buy: The New Era of Transparency

By Cécile Camerlynck
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Cecile Camerlynck, Transparency One

Supply chains are getting increasingly more complex. Add to this the fact that consumers want more and more information about the products they buy. How can we obtain and store the information we want (and need), when we interact with hundreds of suppliers? Transparency in your supply chain is no longer a “nice to have”, but has become a must-have.

Product, price and quality used to be enough. Brands created products with good, better and best strategies targeting specific customer segments based on price and quality differences. Classifying customers and products allowed for more targeted offers—and a closer connection to the consumer.

And then Apple and Amazon reinvented the shopping experience. Digital and mobile took off. The customer experience became a point of differentiation in the store, online and on devices. As a result, the customer experience and omni-channel retailing have been core values for the past decade.

Today, a new value is emerging: Transparency. It is no longer enough to have a high-quality product, at a good price and with a rewarding shopping experience. The rise in health-conscious consumers, a highly interconnected society (transparency in the digital era), and a greater frequency of recalls and social responsibility issues has increased consumer demand for transparency. They want to know where and how products are made, what they are made of, and who made them.

Unsurprisingly, shoppers are very concerned by news about food safety issues such a Listeria and food fraud, which have become increasingly well publicized. Experience shows that these events have a significant impact on consumer confidence in brands and in certain types of products, which can take a long time to overcome.

According to a report released this year by World Vision Canada, consumers want to make ethical buying decisions.1 However, they are kept in the dark and don’t have enough information about products to do so. The organization is pushing for a new law, such as those already passed in the United States and the UK, to ensure that factories in foreign countries supplying the Canadian market don’t use minors to make products.

Every brand will need to determine the right level of transparency for their company and customers (consumer trust drivers like country of origin, label accuracy, etc.). Only 1% of consumers will want to know everything. For the other 99%, what they really want to know is that the brand they are buying from has a safe and responsible supply chain. They want to trust the brand promise. However, many brands still only know their immediate suppliers—and to ensure this trust, they need to dig deeper.

Providing transparency in your entire supply chain will reduce what we call the “visibility barrier” and give you access to all the information that you need and that your customer wants. Rather than simply reacting when a crisis emerges, you will proactively know your entire supply chain identity.

In 2016, technology and business practices exist to truly create brand trust by ensuring a safe and responsible supply chain. Yes, supply chains are complex and global. Yes, they represent thousands of companies, some of whom may not want to share information. But if more than a billion people can connect on Facebook, when it comes to knowing the supply chain, it’s simply not enough to say “I don’t know.”

Reference

  1. Press, J. (June 9, 2016). “New report on child labour raises call for supply chain transparency law”, Times Colonist, Accessed August 12, 2016. Retrieved from: http://www.timescolonist.com/new-report-on-child-labour-raises-call-for-supply-chain-transparency-law-1.2274235
Randy Fields, Repositrak
FST Soapbox

What Comes After FSMA?

By Randy Fields
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Randy Fields, Repositrak

The initial deadlines for Food Safety Modernization Act implementation are upon us, and while it will be a year or more before companies must comply with the regulations, now is an appropriate  time to consider the happens next with food safety in the United States. Packaging requirements, issues with imports, the move toward clean labels, updating facility auditing requirements, and a wide set of compliance issues will be near-term time-consuming issues for food safety directors and executives all the way up to the c-suite.

FSMA is the most impactful set of safety regulations to hit the grocery and restaurant industries since before World War II. But there are other elements of consumer protection that will quickly capture the attention of supermarket and foodservice executives after August, and smart companies are already looking ahead to ensure a competitive advantage.

Packaging requirements aren’t just limited to country of origin labeling. Consumers are demanding full transparency from manufacturers and the retailers from which they buy their food. Shoppers are demanding clear descriptions of what they’re eating and voicing their displeasure for companies that are not providing the details they want by buying competitive items. A quick look at the comparative sales of the big processed food companies during the last few years verifies this isn’t a fad.

Tainted imported food (for both humans and pets) nearly a decade ago was a key trigger for the legislation that ultimately became FSMA. While the act addresses record keeping and some elements of lab testing, there are still several issues to tackle, including third-party validation rules and the voluntary program for importers that provides for expedited review and entry of foods.

The move toward clean labels or reducing the number of ingredients in processed food is taking form in several different ways. For example, many manufacturers, particularly those that make products targeting young consumers, are eliminating high-fructose corn syrup from their product lines to address consumer concern about the impact the ingredient is having on obesity and other health issues.

Updating facility auditing requirements, at retail, foodservice and manufacturing operations, has been largely left to trade associations and the companies themselves. A single incident of foodborne illness or death linked to a store commissary, a restaurant or a processing facility is all it will take for consumers to demand government action to raise standards and increase inspections.

On compliance issues, FSMA requires companies to collect verification data of their supply chain’s adherence to regulations for up two years and have it accessible within 24 hours. Similar to Sarbanes-Oxley, CEOs are responsible for verifying the compliance of their supply chain under FSMA.  Given these risks, companies have started to automate their management of compliance documentation. Now forward-thinking companies are applying the same technology to ensure that information supplied by trading partners on products such as gluten-free goods or items containing nuts is frequently updated to avoid lapses that could lead to lawsuits and worse.

There certainly are a few different visions of the future of food safety. One commonality is that consumers will continue to demand an even safer food supply chain.  If companies don’t pursue this goal, legal action or governmental regulation will step in to encourage change.

Maria Fontanazza, Editor-in-Chief, Innovative Publishing Co. LLC
From the Editor’s Desk

Feeding the Fear and The Battle to Regain Consumer Trust

By Maria Fontanazza
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Maria Fontanazza, Editor-in-Chief, Innovative Publishing Co. LLC

When it comes to educating consumers, the process of building trust goes beyond providing research and scientific information. Consumers respond to having connections and shared values related to food safety, the treatment of animals, and nutrition. However, today’s crowd-sourcing environment has served to both enlighten and distribute information that isn’t always fully understood by consumers.

As food companies are facing increasing pressure for transparency, they’re grappling with more effective ways to communicate what’s in their products. “That’s a healthy part of the marketplace, and there’s nothing wrong with food companies responding to consumer demands,” says Jayson Lusk, Regents Professor and Willard Sparks Endowed Chair in the Department of Agricultural Economics at Oklahoma State University. In many cases, when companies provide more information about certain ingredients, it puts them in a difficult position. “Often, many consumers are not in a position to evaluate or understand why an ingredient is used or evaluate the safety risks, so there are all kinds of biases that consumers have; [for example,] if it sounds like a chemical name, it must be deadly. There are all kinds of misinformation on the Internet about various food ingredients that consumers have easy access to.”

Just giving stats and scientific information isn’t always the most effective route. “People don’t tend to respond to just scientific information. That’s unfortunate,” says Lusk. “The research shows people are more persuaded by stories, by a better understanding of why farmers or food processors might be interested in using a particular ingredient.”

Issues surrounding artificial additives, antibiotics and GMOs are particularly contentious, and marketing and advertising play a big role in shaping public perception. Take, for example, gluten-free orange juice. Most natural juices (not juice drinks) are free of gluten, but labeling them as such opens the door to new markets (or maybe it just confuses people more). “One of the big challenges for a lot of food companies, especially big companies that have multiple brands appealing to different segments, is that on the one hand, they defend the use of certain ingredients [for example, genetically modified organisms],” says Lusk. “At the same time, they offer brands that make claims that say they don’t have those ingredients and make all efforts to make sure we aren’t selling you these things.”

This dichotomy can be perceived as a lack of integrity, because it undermines the message of trust that food companies want to convey to the market. Companies need to explain why they’re using certain ingredients in a product and the impact it has on safety and nutrition. And consumers need to understand that either the addition of or absence of certain ingredients can lead to higher prices. Many consumers are willing to pay a premium for products that are labeled as organic or non-GMO, but many consumers still want food to be affordable.

This year companies are being particularly aggressive in announcing their moves to remove additives or antibiotics, or provide GMO-free menus, but the question remains as to whether this will have a positive impact on the bottom line, as well as whether consumers really understand the implications. In April, Chipotle publicized that it was the first U.S. restaurant chain to use only non-GMO ingredients. However, if you read the fine print, you’ll learn that its tortillas still use additives, and the soft drinks that the chain sells may contain sweeteners from GMO corn. Panera stated its plans for removing artificial additives from its menus by the end of 2016. Kraft’s famous Macaroni & Cheese will no longer have that eerie glow, as the company is nixing artificial flavors and dyes, including Yellow No. 5 and 6. Walmart just voiced its new position on responsible use of antibiotics in farm animals, and so did President Obama—at least in Federal cafeterias.

And in an effort to put the kibosh on the “big is bad” mentality, Hormel has put down $775 million to pick up Applegate Farms, a producer of organic meats. Rest assured, as Applegate tells its irate consumers on its Facebook page, its products will “continue to work toward transparency in labeling” and its “standards and products won’t be changed”. Applegate is doing the right thing. It is engaging with consumers, whether or not it likes what they have to say, and it’s doing so in a non-defensive way.

Beyond this, companies need to really study their consumers, understand their patterns, and learn how to educate them in a meaningful way—beyond a simple label.

I try to avoid food with a lot of extra…crap. But sometimes I’m just too tired (or hungry) to pay attention to every detail on the label. And sometimes I eat that red velvet cupcake at a party and, after examining my florescent tongue in the bathroom mirror, I think, shoot—how much dye was in that??? And maybe I like the idea of slicing an apple that doesn’t turn brown. Then again…maybe I don’t.

Truth is, I’m just not sure yet.

Maria Fontanazza
Editor-in-Chief

Randy Fields, Repositrak
FST Soapbox

Despite FSMA Exemptions, Compliance Will Not Be Optional For Small Suppliers

By Randy Fields
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Randy Fields, Repositrak

The product recall at Blue Bell Creameries earlier this year is yet another example of food safety issues negatively impacting food marketers, growers, processers and manufacturers. We all remember the Peanut Corporation of America’s salmonella outbreak in 2008 and the Jensen Farms listeria outbreak in 2011. Salmonella-tainted eggs in 2010, E. coli in strawberries in 2011, and listeria in caramel apples last Halloween combined with dozens of others during the last six years, have sickened thousands and killed dozens of people.

The brand reputation impact from the incidents at Peanut Corporation of America and Jensen Farms was terminal—both companies went bankrupt. The effect on Blue Bell, while likely not fatal, is expected by industry experts to be substantial and include loss of revenue and market share. The company has already announced plans to lay off more than 1,000 workers as a result of the recall.

In addition, growers saw cantaloupe consumption take a nosedive after the Jensen Farms listeria outbreak, which was one of the worst foodborne illness outbreaks in U.S. history in terms of number of deaths. They are only now seeing sales levels return to those before the incident. And because the farm itself went out of business, personal injury lawyers went after the companies that sold the disease-ridden cantaloupes—the retailers. By virtue of last year’s out-of-court settlement by Walmart on the Jensen Farms lawsuit, both suppliers and retailers are now responsible for everything they sell.

Enter the Food Safety Modernization Act, signed in 2011 and about to begin finalization in August. FSMA mandates that retailers and suppliers have documentation that verifies their supply chain’s regulatory compliance is readily accessible for government inspection. Add these records to the business relationship records that retailers and suppliers should already be maintaining (including indemnifications and certificates of insurance that help manage brand risk), and you’d think our risk of foodborne illness is about be eradicated.

Although FSMA represents the most sweeping change to our food safety laws in the last 70 years, it may not have the greatest impact where the supply chain is most vulnerable. Today the largest suppliers that sell the majority of our food have very sophisticated systems to ensure safe food production and transportation. This group will have the easiest path to compliance with FSMA, and they most likely already hold themselves to a higher standard. It’s actually the smaller suppliers, which likely do not have the available resources or sophistication to comply with FSMA requirements, that will be exempt from certain documentation under FSMA based on their size. This group of suppliers is growing rapidly to meet consumer desire for fresh food that is locally grown and produced. Unfortunately for them, it’s only a matter of time before wholesalers and retailers decide that the risk is too great to continue to do business with these small suppliers.

The good news is that technology exists that can help small suppliers reduce risk in their extended supply chains. Affordable, interoperable systems have been developed to address the market need for receiving, storing, sharing and managing regulatory, audit and insurance documentation. Suppliers of any size can also track products as they move through the supply chain and trace them back in the event of a recall. This move to automation will help all suppliers not only meet the demands of FSMA, but also establish a base for retailer and consumer demands for transparency in the supply chain going forward.

Having a comprehensive food safety system is quickly becoming a competitive advantage. Retailers and consumers are looking for those suppliers that have an unblemished safety record and are transparent about their safety processes, so the time is now for small suppliers to hold themselves to a higher standard than FSMA requires for future business opportunities. The stakes are just too high for retailers and wholesalers to not verify that everything they sell to consumers is produced and transported safely.

Food Transparency No Longer an Option

By Maria Fontanazza
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As consumers demand to know the “who, what, when, where and how” of products they purchase, companies must focus on bringing honesty to the table to build trust.

Consumers are becoming more informed about the dangers of certain ingredients and the presence of allergens and pesticides in food. In the future, virtually the only way companies can build and retain consumer trust is through providing transparency in the food chain.

“Transparency will no longer be an option,” says John Keogh, president and principal advisor at Shantalla Inc. “Food businesses have to commit themselves to transparency as the only way to demonstrate to the market how customer-oriented they are.” Keogh discussed the need for companies to be forthright not just about what is in food, but also the entire product journey—the who, what, when, where and how—during a recent webinar by the GMA Science and Education Foundation, “Transparency in the Food Value Chain”.

Drawing on examples such as the horsemeat scandal in Europe, trust is quickly lost when dishonesty rears its head. “We need to bring a level of honesty and ethics into supply chain transparency,” says Keogh. This includes disclosing where the product is made or grown, including the state, in the case of the United States; the province, in the case of Canada; and where Japan is concerned, the prefecture. A recent example is Taiwan’s plans to require prefecture labels of Japanese food imports following the Fukushima Daiichi nuclear power plant disaster, which has raised significant concerns over radioactive contamination in food.

As the supply chain becomes increasingly global and more complex, several factors are compelling transparency. Regulations that address food safety, security, defense, and fraud will all have an impact. The Foreign Supplier Verification Program (FSVP) under FSMA will put pressure on the nearly 200 countries that import products into the United States. According to Keogh, there are 220,000 importers on record, and they have about 300,000 facilities, all of which must be inspected under the FSVP mandate. In Europe, the EU regulation 1169/2011 requires the disclosure of more information to consumers, including mandatory origin labeling of unprocessed meat from pigs, sheep, goats and poultry, mandatory nutrition labels on process foods, and disclosure of allergens in the ingredient list. Companies will also need to consider requirements for Halal and Kosher foods.

Technology plays the key role in driving consumer awareness and demand for more information, but Keogh notes there is a gap between consumer expectations from a data perspective and the ability of companies to actually deliver this data. He offers some examples of emerging technologies that companies can use to facilitate supply chain transparency. Sourcemap is a supply chain mapping solution that allows companies to link from their raw materials sites to the end customers. Companies can generate reports from various metrics and identify the weak links in their supply chain. Trace One is a product lifecycle management solution that has a focused module for transparency. The company also recently announced the first B2B social network for supply chain transparency as well as the full alignment with GS1 standards and embedding fTrace into its platform. Manufacturers using Trace One have visibility on all of their ingredients, suppliers and facilities, and can search for products that may be affected by an ingredient or facility problems related to a recall, for example.

“Food chain transparency has the potential to create new business opportunities for retailers and manufacturers,” says Keogh. Moving forward, companies will need to have a foundation of standards, specifically GS1 Standards, and use them at a deeper level to enable interoperability between the technologies that supply chain partners use. Keogh urges companies to think beyond food safety and food quality to value-based transparency to increase value not just for the end consumer but also for supply chain partners. This will also involve ensuring privacy of data surrounding pricing and proprietary information.

Maria Fontanazza, Editor-in-Chief, Innovative Publishing Co. LLC
From the Editor’s Desk

Translating the Talk into Action

By Maria Fontanazza
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Maria Fontanazza, Editor-in-Chief, Innovative Publishing Co. LLC

With a little less than two months under my belt as an editor in the food safety industry, I have already started to become a bad dinner date and my hands beg for mercy as a result of my newfound obsession with soap and water.

Quirks aside, I am seeing some common threads in this industry, although they are themes we see in any highly regulated industry. Partnerships. Collaboration. Transparency. Alignment. Accountability. Now more than ever, these words mean something. FSMA has forced the issue of food safety to the forefront. Yet, we’ve barely begun and I’m already hearing the phrase “FSMA Fatigue”.

For the folks who have been involved in preparing for FSMA from the start, they probably are a bit fatigued. There have been many meetings, and there’s been a lot of talking surrounding what’s going to happen, what needs to be done, and what challenges we’ll face (in many cases, together). But let’s not forget that not everyone is as well versed on the nuances of the regulation. I admit, I am raising my hand here… for now.

Now let’s back up a couple of sentences. “There’s been a lot of talk…” Yes, there has been. While these are enthusiastic discussions about what we as regulators, food processors, retailers, suppliers, scientists and everyone in between should be anticipating with FSMA rules and the consequent implementation, HOW are we going to navigate this new frontier?

Let’s start this conversation now.

You’ll see a lot of changes to Food Safety Tech this year. We’ve already started the information exchange with industry stakeholders about how we’re going to work together to get through FSMA implementation and the tools we need to arm our audience with to help them along this journey. We also just announced our Call for Abstracts for the Food Safety Consortium Conference in November.  The Consortium will bring together leaders and regulators in this industry and facilitate a forum for that candid “how” discussion. Food Safety Culture will receive strong attention, and key players will be presenting a case history of how to apply metrics to food safety culture within organizations.

I’m excited to join this industry, and thank you to those who have already extended a warm welcome. And for the many who I have yet to meet, please drop me a note as you encounter challenges or have ideas about critical food safety topics. Our job at Food Safety Tech is to provide a platform through which we can enable a constructive dialogue about overcoming challenges, working together effectively, and navigating this journey into the future of food safety.

Maria Fontanazza
Editor-in-Chief