Food recalls are a supply chain visibility problem that hurts the bottom line

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Dive Brief:

  • Chipotle suffered in 2015 as two virus outbreaks (E. coli and norvirus) struck the company’s food supply, Food Safety News reported Monday.
  • While the illnesses and resulting clean-up were costly, no recalls were issued. However, a 50% drop in stock value demonstrates just how damaging an effect the the contamination had, in addition to the negative impact on consumer trust. 
  • The issue of trust is vital for food vendors, with 65% of individuals surveyed expressing the need to know the methods of food production.

Dive Insight:

While a vital need, achieving food safety throughout the supply chain is often difficult due to the challenges of coordinating standards with various suppliers, especially those abroad.

One of the hallmarks of the Food Safety Modernization Act (FSMA) is its insistence on hygienic transportation as part of the supply chain. Any damage or contamination that occurs during transport could be linked back to the manufacturer, causing an expensive and inconvenient recall. And, should a recall be caused by a lack of clean conditions within a transport method, business will certainly be lost.  

Blue Bell, for example, will not reopen a distribution facility until March after a listeria scare forced the company to cease distribution in four states back in September. Establishing a reliable set of standards for every party involved in the processing and dispersion of food is not easy, but ignoring standards could hurt the bottom line. In addition, expanding whole chain traceability beyond primary suppliers should help uncover hidden safety violations. 

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