5 Ways to Promote Consumer Trust in the Food Industry

As a series of high-profile food scandals and scares have progressively eroded public confidence in recent years, consumer protection and the interests of the food industry should go hand-in-hand. Building and maintaining consumer trust is hard. But following a food safety incident or revelation of dubious practices, restoring consumer trust is harder still. The implications for missing the mark in terms of how the incident is handled can come at a high cost from both a revenue and brand perspective. 

While more and more manufacturers are explaining how they source and make products, a significant portion of shoppers remain wary. The human brain is wired to be sensitive to potential risks, therefore bad news spreads like wildfire, and the actions of a tiny minority of rogue suppliers can discredit the entire industry. The reality is that companies invest heavily in optimising food safety, yet very few consumers understand the challenges involved:

Accidental or deliberate contamination 

When our pantry is global, so are the chances of contamination. The majority of food recalls stem from operational deficiencies, and come at a high direct and indirect cost to firms. In undifferentiated markets, where consumers can’t distinguish between sellers of good product and contaminated product, this can result in consumer avoidance of the entire category.

Food fraud – when products are deliberately diluted, tampered with, mislabelled or otherwise misrepresented, or substituted with another product – is a highly lucrative business and often integrated with organised crime networks. But when economic times are tough, the opportunities to cut corners become harder to resist, even for otherwise legitimate businesses, as evidenced by the adulteration of food safety records by a major UK poultry supplier which made the headlines in late 2017. Food fraud also impacts on sustainability, nutrition, animal welfare and human rights, which are becoming increasingly important to consumers.

Food labelling

Food labelling is a huge area of contention: on one hand, consumers want more product information to make informed choices; on the other, they often distrust the accuracy of labels or are confused by them due to inconsistency or information overload.

Fundamentally, consumers’ needs are simple: they want to know they’re buying food that’s safe to eat, and doesn’t harm people or nature. In today’s digital world, relevant information needs to be made available to connected consumers at the time of purchase, particularly online where the shopper is at arm’s length from the physical product and packaging.

Greater supply chain complexity

No food safety system is perfect, but the greater the number of links in the supply chain, the more points available for penetration. Food supply chains are becoming longer and more complex, and therefore more prone to potential disruption. Most food retailers know all their first-tier suppliers, or have a good understanding of those suppliers with whom they have the highest spend, but a lack of insight into subsequent tiers or smaller suppliers means many can’t determine where ingredients are sourced from or how those ingredients are processed or handled.

Establishing the vulnerability of suppliers, especially those operating in higher risk jurisdictions, can be time-consuming unless companies implement ways to monitor and manage increased sourcing complexity. But without effective visibility into the supply chain, businesses can have significant blind spots in their enterprise risk management structure, leaving them exposed to potential legal, financial and reputational damage.

Shifting regulatory framework

The food industry has had to contend with a large number of new regulations and standards in recent years, such as the Food Safety Modernization Act of 2011, together with numerous national programmes and industry initiatives that attempt to address the issue of food integrity and authenticity.

It’s therefore worth looking to the pharmaceutical and life sciences sectors, which provide a leading indicator of what’s likely to come in the food industry. Several bills and directives have been introduced across the EU and US dealing with pharmacovigilance, such as the use of serial numbers and track-and-trace technologies to prevent counterfeit drugs entering the legal supply chain.

Given the impact of food on public health, it’s feasible to expect to see greater regulatory focus on implementing similar requirements in the food industry.

Amid this complex landscape, food businesses can respond to these risks and challenges effectively, and help to restore consumer confidence in the industry as a whole, by taking five fundamental steps:

Step #1: Promote a culture of safety and quality from the farm to the shop floor Forward-thinking companies develop a culture of food safety through education and communication to ensure staff are aware of the importance of good practices and the controls to be applied. They are also proactively identifying and managing potential risks by analysing data within and beyond their organisation on leading indicators such as customer complaints and media reports. There is a range of nationally and internationally recognised standards for certification relating to product quality, social and environmental sustainability and system and process certification. Voluntary participation in such schemes can enable organisations to provide various assurances as a competitive differentiator.

Step #2: Lead risk-resilient business culture and best practices from the topThe buck stops in the boardroom. Business leaders need greater over-sight of and engagement with food trust issues, and executive buy-in is essential to developing a culture that is relevant and responsive to both current and emerging concerns. Food businesses need not reinvent the wheel, but should instead look to adopt proven practices from similar, highly-regulated industries such as pharmaceuticals, to start building transparency and trace-ability into their processes now, rather than waiting to be forced by evolving regulation.

Step #3: Continuously review supply chain risks and benchmark against best practicesBusinesses are held accountable for their supply chain actors’ performance, yet for many, supplier risk management is regarded as something of a tick-box exercise. Regardless of which point in the supply chain may be responsible for a food crisis, customers tend to blame the brand from which it was purchased.

So it’s vital to have end-to-end visibility of the supply chain and carry out regular reviews of suppliers’ food safety and quality standards. Taking a pro-active approach to supplier risk management can pay dividends in terms of product integrity, reducing compliance costs, and minimising the need for product recalls.

Step #4: Make considered investments in technology-enabled solutions – The key to transparency is to capture full and accurate data about product movement. Modern manufacturing, warehousing and traceability solutions are designed to help businesses improve standards, manage risks and provide consumers with better information about food products. Industry-specific solutions are purpose-built to support full compliance with food regulations and guidelines, such as GS1. Real-time visibility enables businesses to pinpoint inventory at any stage of the production or logistics process, and automate quality controls and monitoring from end to end, so any problems can be caught before products make it into consumers’ hands.

Step #5: Focus on consumer transparency and prepare to handle crisis events – If a crisis should occur despite all reasonable endeavours, food companies should be able to support near-surgical recall – getting the minimum amount of product off the shelves at maximum speed. This capability can be developed through scenario analysis, planning and drills, underpinned by robust product recall and crisis procedures. A swift response is also reliant on the availability of data in a suitable reporting format within minutes rather than hours, which can support both the crisis event itself, and open and honest consumer-facing communications after the fact.

As bargaining power in the food industry shifts towards the consumer, we will see the lines becoming increasingly blurred between food safety, health and well-ness, and corporate social responsibility. When risks are well managed, there are opportunities to deepen relationships with today’s connected and demanding consumers, and create the conditions for sustainable, profitable growth in the process.

To understand how Signum Solutions and SAP Business One Food and Beverage edition can support such initiatives as GSI contact us on 01244 676900

Top 10 ERP manufacturing requirements for Food & Beverage

As a result of greater reported health incidents due to poor labelling, cross contamination and false ingredient declaration across the supply chain has led to increased regulation in the Food and Beverage industry. Changing your current ERP landscape may be necessary to meet the regulatory demands of today and also for the future.

Here  are the top 10 requirements you should be adding to your ERP section checklist:

  1. Ingredient Declaration and Allergens – calculate nutritional and allergen data, and record supplier certificates and specifications data for Halal, Kosher, Bio categories.

 

  1. Batch Traceability and Recall – simple and easy to use forward and backward tracking to understand and answer all your batch related questions.

 

  1. Batch Date and Quality Status Control – shelf life, expiry date, and inspection dates to reduce stock  write-offs, obsolescence and increase business profits, and status control to block batches to be consumed or sold.

 

  1. Material Consumption – based on a FIFO and/or FEFO basis, and in high volume production backflush traceable products.

 

  1. Quality Control – manage pre, in-process and post production quality control checks, batch and serial re-testing and purchase goods receipt to increase product quality and safety.

 

  1. Recipe Management – create percentage based recipes to include scrap and yield, co-Product, by-product and scrap management – to manage product variation as a result of the production process.

 

  1. Yield Planning and Analysis – build into your recipe planned yield percentages and method for calculating actual yield.

 

  1. Complaint management – centralise customers, supplier and internal business complaints into your ERP system, for analysis and business process integration to product returns, financial credits and quality processes.

 

  1. Scheduling – optimise the factory based on an allergen vs non-allergen production plan, while keeping to customer delivery dates.

 

  1. Certificate of Analysis – print general and customer specific certificate of analysis documents for the same batch

 

If you want to know more about upgrading your ERP system, give us a call on 01244 676900 or fill in the form below.

 

 

 

 

Another Product Recall. Could Your Business Cope?

This week Sainsbury’s have issued a recall of one of their chicken products, due to a packaging error. Over the past year there have been numerous recalls by all the major supermarkets. Despite regulations and precautionary measures put in place, recalls continue on a regular basis.

Managing a product recall is an extremely difficult and challenging process.  However, having the right Business Systems in place will help you minimise the risk and allow you respond quickly and effectively should your business be faced with this situation.

At Signum we work closely with food companies looking to maintain a robust reliable solution to compliance and traceability. Our SAP Business One Industry Edition for Food and Beverage Manufacturing  is a powerful solution, simple to use and affordable. Moreover, over half of Signum Solutions’ customers operate within the food manufacturing industry, which means that we have a great deal of knowledge and expertise not only in food manufacturing system (MRP and ERP) implementation, but also in relation to the latest requirements of food manufacturing businesses.

Full Story: Food recall

To find out more about how we could help your business call 01244 676900, or click the button below.

Food manufacturers: Tracing the Genealogy of a Product

With traceability of the full life-cycle being vital to anything that is being manufactured in the food industry being of the utmost importance when supplying to wholesalers, supermarkets and smaller retail outlets alike, here’s a handy guide to ensure that you don’t miss anything out!

  1. Start with the batch and serial number, checking that all number formats and counters are defined
  2. Check that the shelf life of a product is clearly defined – in both days and hours
  3. Define the batch management policy for expiry or consumption
  4. Calculate the expiry and consume by dates, based on the shelf life of the product
  5. Record the vendor/supplier batch number for each product
  6. Define the period between inspections and plan in future inspection dates
  7. Define the warning period for batch review and expiry date inspections
  8. Record all properties inherited from the product master data, including batch properties and values
  9. Record quality control results using actual test result values, which should be stored against batch properties
  10. Ensure that all of these stages are ticked off and that everyone is aware of this at each stage!

 

That’s a lot of information to trace.  How best to keep track of all of this?

That’s the easy part.  There’s no need for numerous spreadsheets and reports to provide all of these processes and controls, which are ultimately completely necessary when tracing the genealogy of a product.

The system that more and more food manufacturing companies are choosing is part of an SAP certified industry solution called ProcessForce, which is a core part of the Signum Solutions Industry Edition for SAP Business One. It handles all of the above, easily.  As well as doing all of this:

  • Creation of batch genealogy trees, providing a forward and backward historical view of all processes
  • Creation of recall and audit reports, including lists of customers and batch recall reconciliations
  • Drill downs of transactions and document traceability navigation functionality
  • Creation of inventory and batch reports

Want to find out more? 

Call us on 01244 676900 or email enquiries@signum-solutions.co.uk

 

Food Businesses: Will Failure to Innovate be Your Downfall?

There are many risks in the food industry.  With food safety, food testing and potentially food crime to now be concerned with, running a food processing or manufacturing business is continuously growing in complexity.

Recently Food Manufacture Magazine reported that recommendations to the Government, of tightening the auditing of food premises and establishing a Food Crime Unit, made by Professor Chris Elliott, who is conducting the independent enquiry into 2013’s horse-meat contamination scandal, are likely to be implemented.

This of course is good news to retailers and consumers, but for those creating the products and having to track them from ingredient to plate, this is another line of red tape that food companies must comply with – and quite rightly so – but with what impact on the way that you run your business?

Historically, food businesses are not early adopters of technology but could it now be the most advantageous time to change your game and invest in technological innovation?

Many food businesses are finding this is the case, as technology that simply and easily manages compliance and traceability is becoming essential in order to maintain efficiency and to grow as a business, at a time when numerous legalities are being thrown into a pot that is already at risk of boiling over and leaving food businesses in a sticky mess.

Even if you feel as though your business can cope, it’s worth having a look at what is available at this point, so that if you do feel as though processes could be made significantly easier with time (as more compliance issues are sure to arise as the food industry continues to grow) you’ll have an idea of what the latest technology is and where to find it.

Read ‘Planning for Your Food Business ERP Project’ for tips on how to take the next step and begin a search that will point you in the direction of a solution that is specifically created with food businesses like yours in mind.