Tuesday, February 17, 2009

The High Cost of Saving Money

Food safety expert David Troster contributed the following article, which illustrates a common scenario - what initially looks to be a cheap price turns out to be an expensive problem.

Cutting Costs the Right Way

The Buyer's Dilema - Keeping Costs Down

"Stop the line, there's glass in the product!"
Production, Quality Control and Factory Manager all run to the line to see what's happened. There it is,a piece of glass, colorless, hard to spot in the fruit, with sharp chipped edges.
Where'd that come from?" They all ask. Everyone was sure it was not their factory. They had glass control systems in place. "It's in the raw material so it's a buying problem." The buyer was shown the glass and he shrugged. The story unfolded: Always under pressure to keep costs down he'd done just that and purchased a cheap lot from a trader. The information he had was that the fruit was the right size and color, plus QC had received a sample case and approved it. All in all it looked OK and the price was right.

Factory Manager's Dilema - Cleaning up the Buyer's Bargain

The Factory Manager then started to put the buyer right. "First thing to remember is that testing is just part of a verification process where we make sure that the people before us in the food chain have got it right. Testing cannot and never will tell you the complete story. With the cheap price we saved $100/tonne but what of the costs of using that material? The whole lot is suspect so it can't be used in case there's a product recall. It will have to be dumped and that will cost money. We need a replacement lot and buying spot is not going to make the Directors happy. The line is stopped till the replacement stock comes, so who pays the wages while we wait for it? Then there's the loss of profit on top of it all. Cheap lots can be very expensive and high risk."

"If the primary processor has problems then we all do"

It's happened like this many times before, but the clever ones learn. In today's high speed manufacture one must understand in detail the whole of the food chain, and that starts with the farmer or grower, who needs to provide quality produce. Primary processors are very important since it's their task to clean up and pack the product. Unfortunately this is where foreign bodies sometimes slip in. Fruit on trees does not have mineral stones embedded in its surface, nor are there glass windows in a commercial orchard. If the primary processor has problems then we all do.
The solution is very simple. In addition to product testing, audit the supplier and identify the potential hazards, then work with that supplier to eliminate or reduce those hazards. In many instances what is needed is common sense, and it need not be costly. For example to keep out flying insects along with cats, dogs, and rodents - close the doors and screen the open windows. To prevent glass shards, replace glass windows with plastic, cover lights and only allow essential glass on site. The cost of these sorts of controls are nothing when compared to having to pay for a line being idle because bad product was supplied, or being faced with the costs of a product recall. The price of a product recall is your reputation and your business.

The True Cheap Option

Prevention is always the cheaper option. There may be costs involved in setting up the system, but long term customer relationships with happy satisfied shoppers make it worthwhile to start your preventive works today. The peace of mind alone is worth it!

David Troster is a Food Safety Consultant with thirty years experience in many areas of the food and hospitality industries. David's areas of work include:

  • A practical approach to developing working HACCP systems integrated into your operating system.

  • Training Directors and Managers in Food Safety.

  • Supply chain auditing, identifying the hazards and helping you eliminate them.
    Factory design.

  • Advice on European legal requirements.

If you need more details or have a specific question then please e-mail David at troster@netone.com.tr

Tuesday, February 3, 2009

Action Plan for Food Safety and Responsible Sourcing

At the recent PTNPA convention, we gave a presentation entitled "An Ounce of Prevention or a Metric Ton of Cure". (CLICK to view) We would like to propose a solution. We have been working for the past two years on the development of a program that addresses the issues that make the nut and agricultural industry vulnerable, and offers a turnkey system to protect us from the kind of situation that has resulted from the recent peanut recall.

FDA Globalization Act of 2009

Although there has been heavy focus on domestic oversight, the fact is that we know even less about where and to what standards our imported food products are processed. Ignorance is no longer an excuse that will be tolerated. Legislators have come down very hard on the people they feel were responsible for ensuring public safety. Congressmen John Dingell, Bart Stupak and Frank Pallone Jr. have incorporated higher standards of accountability in their most recent draft of the Food and Drug Administration Globalization Act of 2009. This act can be viewed in full at the following link:

Now is the time for industry self evaluation. Would our current system stand up to government and consumer scrutiny? It doesn't matter if individual companies have this ability. We need to set standards for the entire industry. We are only as strong as our weakest link.

The CCC Solution

The CCC system presents a preventative approach to responsible sourcing and food safety and addresses many aspects of the FDA Globalization Act.

Step One: Identification - The CCC system first identifies those suppliers who subscribe to good manufacturing practices. Companies that need help in establishing GMPs can utlilize our consulting services to assist them in bringing their facilities up to the necessary standards.

Step Two: Inspection - Through a third party audit by independent unbiased inspectors using industry experts who have a background not only in Quality Control and production, but also a working knowledge of the industries being inspected.

Step Three: Certification - Once the identification and inspection process is completed, these facilities will be certified under the guidelines of the CCC.

Step Four: Tracking - The CCC has developed a user friendly, comprehensive tracking system software called CONCERNTRAK©. During the inspection process our auditor interviews two key production personnel. These individuals are fingerprinted via a biometric identification procedure. To ensure a higher level of security, only these prescreened personnel can enter data into the system. CONCERNTRAK© enables the end user to trace lots back to the production line and produces verifiable documentation, making this process quick and easy. Each carton is labeled with the tracking number and sealed to ensure a tamper resistant box that can be cross referenced with all documentation.

Step Five: Promotion - Our logos for Cashew Concern Certification and Commodity Concern Certification enable manufacturers to convey the message to consumers that they have done their due diligence to responsibly source the food products under their brand name.

Step Six: Protection - The integrity of our industry is protected when we take steps to adopt programs such as that of the CCC, to ensure the safety of our food production through a system of self regulation. If an incident should occur, at least we have a system in place to present to the authorities. Having no viable system to ensure traceability and responsible food sourcing will highlight our deficiencies, and would present an embarrassment to the industry.

The "Ounce of Prevention"

We can no longer assume that it will be "business as usual". With the current climate in Washngton we can be sure that sooner rather than later our industry will be called upon to explain the procedures and systems we have put in place to ensure responsible sourcing. We have two choices. We can start now to develop these systems using countless hours of time and energy or, we can adopt a turnkey system, such as that offered by the CCC where two years of research and development have already been done. This is our "ounce of prevention". It will certainly be more tolerable than a potential metric ton of cure.

Identification*Inspection*Certification* Tracking*Promotion*Protection

Building a Solid Foundation to Establish a Healthy Future for the Imported Food Industry