The Need for a Safe Food Supply Chain

(This is the second blog in a five-part series of posts related to progress on the Food Safety Modernization Act and the importance of track-and-trace.)

None of the participants of the food supply chain — namely the growers, processors or distributors — wants contaminated food to reach the consumer. However, a number of external and internal factors beyond the control of the food value chain members cause the food safety incidents that result in food recalls and withdrawals. In spite of the advancements in food sciences and technology, the number of food recalls has increased from 100 per annum year in the 1990s to approximately 300 recalls per annum in the 2000s. Food recalls not only result in financial loss, but also a decrease in consumer confidence.

Traceability of the food as it moves from the manufacturer’s supplier(s) to the end consumer is essential to ensure prevention of food safety issues. According to a study commissioned by GSI US, Grocery Marketing Association (GMA) and Food Marketing Institute (FMI) -currently manufacturers take 0.5 to72 hours to complete the identification process, measured from the moment an issue is detected to the moment a recall decision is made. After the recall decision is made, records are searched, emails are sent, spreadsheets analyzed, file drawers emptied in order to identify where the contaminated food came from and where has it been sent after processing.

While the bill does not necessarily require the brand owner/manufacturer to maintain records about its upstream and downstream partners, it is highly recommended that they do so as the brand value once eroded is difficult to regain. Many food companies are investing significant money and effort to build awareness for their brands in the market, which can pay-off amply in competitive, commodity markets. One highly publicized recall and the negative image generated in the media, however, can turn an established brand asset into a liability. Nervous consumers can cause distributors and brokers to quickly abandon such tainted products in the channel.

Track and trace for the purpose of recalls is a bit like opening the barn door after the horse has left. When track and trace encompasses the complete supply chain, these technologies can be extended to allow consumers to have greater visibility to the food product genealogy. Consumers can learn where the produce was grown, who grew it, expiration dates, and if the food was recalled. Shoppers can scan the sticker with their smartphones or go to the website and enter the number from the sticker to track the path the food has taken and other information the farmer chooses to share, such as the harvest date, post-harvest storage conditions etc.

it.CPG a SAP solution

To manage the complexity of food value chain participants are embracing computer based technologies like enterprise resource planning systems. ERP systems enable the food processors to manage the operations like sourcing, procurement, manufacturing operations planning, quality management, asset management, financial operations. The integrated nature of the ERP software enables the seamless flow of information related to the various business operations and provides functionality to address the issue of traceability by integrating the supply chain management activities like lot genealogy, recall management, HACCP.  Implementing an ERP solution like SAP ERP greatly helps the food processor in responding to incidents relatively faster when compared to the manual systems. SAP is a leading ERP vendor helping companies in CPG industries managing the food value chain efficiently to meet the challenges of the food processing industry.

SAP industry solution partners like itelligence have a focused approach in providing the domain knowledge and specialized expertise to meet the food processing industry requirements. itelligence’s solution for the CPG industry, branded as it.CPG, has the functionality to support food safety and quality throughout the supply chain right from procurement of raw materials to the point of sale.

SAP functionality around Receiving Inspections, Manufacturing Inspections, Presales Inspections, Recipe Management Quality Certificates, Batch management, Shelf Life Expiration, Batch Where Used List, Document Management, Test Equipment Management, Preventive and Breakdown Maintenance Planning of the food processing equipment helps in managing Lot Genealogy Tracking, Recall Management and managing HACCP requirements and the provisions of the Food Safety Modernization Act.

Our next blog will focus on prevention methods to ensure better control over food safety quality from farm to fork.

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