Food product recalls how to minimise the risk data recovery knoxville

So, any strategy to reduce the risk of recalls must bring supplier relationships into sharp focus. But while manufacturers feel pressured to address potential threats in the supply chain, there are different pressures coming from the other direction, opening them up to further risk.

A recent food and beverage report from insurance broker Lockton surveyed 200 industry respondents in the second half of 2017. Three-quarters of them claimed they were under pressure to reduce prices. One in ten had already opted to use cheaper ingredients and over 70% said they would consider doing this in future.

Other implications can’t be ignored in the pursuit of cheaper ingredients, warns Food Standards Scotland (FSS). “ Changes must be supported by accurate information given to the consumer,”​ says chief executive Geoff Ogle.

“ It may just be a quality issue, and typically is not a safety issue. But, if cost pressures give rise to adulteration rather than substitution, that is clearly another matter.​

“We’d like to see more effort put into ensuring that this kind of information comes through to regulators. If a price point is being pushed too far, and it is untenable for that price to be delivered, then the situation may well not be in the interests of the consumer.” ​

Since the horsemeat scandal, there has been an increasing focus on the authenticity and potential adulteration of raw materials, says Adele Adams, food defence expert and director at Adele Adams Associates (AAA). “ This has increased the amount of testing typically carried out, but this should always be risk-based, so as to optimise the use of resources,”​ Adams advises.

Testing needs to be looked at carefully in other ways. As Adams explains, the manufacturer may require each batch of raw material to be accompanied by a Certificate of Analysis on tests carried out on the supplier’s behalf. “These will then be verified by the manufacturer on a risk-based frequency,” ​she says.

But as Shiers at RQA points out: “ The ingredient may come with a Certificate of Analysis saying, for instance, that a product is nut-free, but if the supplier used a lab that was not accredited for doing allergen testing, then the value of that claim comes into question.”​

As FSS and the FSA make clear, the majority of recalls are to do with undeclared allergens. “ But a lot of recalls are related to microbiology, too, and that’s often down to suppliers,” ​says Cliodhna McDonough, a food regulation specialist at law firm Stephenson Harwood. “ Salmonella, typically, is the primary contaminant.”​

As well as quality control, one part of her job in vetting prospective suppliers on behalf of clients is to look at their recall insurance. “ I would not encourage manufacturers to use suppliers that do not have this type of insurance,”​ says McDonough. “ It should cover reimbursement for any recall, replacement costs, loss of profits and brand rehabilitation.”​

While McDonough talks about her clients wanting their risk “ evenly spread”,​ Ian Harrison, head of product recall at Lockton argues: “ Cost pressures in the supply chain have been huge, and ingredient suppliers are now seeing the ‘reverb’ of sterling’s depreciation. ​ Manufacturers are looking for ways to pass costs back up the chain.” ​

According to Lockton, insurers are seeing recalls happening not only more often, but also on a larger scale, and manufacturers as well as suppliers are suffering as a result. The company’s 2017 survey showed that half of the 200 companies questioned expected retailer liability insurance demands to price them out of future contracts.

Beyond the vexed question of rights of recovery, the real objective is to avoid a recall happening in the first place. “ One angle on due diligence is to think of the supplier as a potential long-term partner,”​ says Shiers. “ Due diligence also implies checks on financial stability. Will the company find itself in a situation where it needs to contract out work?”​

“In-country checks should be carried out. In countries such as Turkey, records will not be digitised, so you need people on the ground to make those checks for you. The cost will pale into insignificance compared with the cost of the product – and certainly in comparison with the cost of any incident.” ​

“ One company may have 500, even 1,000, suppliers. They may conclude this is too many to manage effectively, and that with fewer suppliers, they would have a better handle on them – manufacturer and supplier would get to know each other better.”​

While fewer suppliers may mean stronger relation-ships and better lines of communication, the proviso here must be that companies would avoid reducing their rosters to the extent that they end up relying on a single supplier for a given ingredient.

If there is a drive to shorten and reduce the complexity of supply chains, there is an equal impetus to be better informed about them. Adams at AAA believes that testing alone, however sophisticated, will not prevent another horsegate scandal.

In the context of the individual recall, this particular journey should not be considered over until a review stage has been undertaken, says Victoria Cross, head of the business resilience practice at communications consultancy Instinctif Partners.

“Companies large and small should want to get back to business-as-usual,”​ she admits. “But we were staggered by a failure in many cases to review at all. It’s not only to do with setting up a collaborative discussion about how it went for all involved and how communications flowed. It’s also about implementing practical mitigation steps.” ​