Frankly CSR

For many companies product safety is a fundamental component of their CSR efforts.  But in the last year or two no market has had to re-evaluate its product safety practices more than the food industry.  Increasing health concerns by consumers, new government regulations, growing (often global) supply chains and increasingly competitive markets have all been influencing factors. And, of course, recent incidents like those at Topps Meat, Cargill, Westland Meat and Menu Foods – to name just a few – have not helped the food industry. 

The Food Marketing Institute’s survey, “U.S. Grocery Shopper Trends 2007,” reported that consumer confidence in the safety of the food supply has dropped dramatically. Confidence had consistently hovered in the 80th percentile for years, but dropped to 66 percent, the lowest point since 1989. Consumer confidence in the safety of restaurant food is even lower, at 43 percent. 

So, how do we address the food safety issue? There are a number of possible solutions that can help companies.  Forbes.com provided a good overview in a recent article, “U.S. Food Safety: Solutions at a Glance.”  One of the solutions the article highlights is product traceability.  Generally speaking, this means food companies are able to track their products from “field-to-fork.”  The flow of raw materials and ingredients are tracked from producers to the manufacturer, and then the finished product is followed through the distribution process to the retailer. 

The Aberdeen Group, a research firm focused on business technology, also views traceability as a solution. Aberdeen’s December 2007 benchmark report, “Compliance and Traceability in Manufacturing,” recommends that companies “…implement technologies with core track and trace capabilities…” to achieve best-in-class performance. The report is based on a survey of 650 manufacturers (not limited to food) primarily in the United States.   

At least one food company had a vision to improve food safety using a traceability solution years ago.  Nutreco is an international animal and fish feed company with over 100 production and processing plants in more than 25 countries.  In 1999, Nutreco, already a customer, came to Lawson with the idea of proactively managing food safety throughout their supply chain. Our co-development effort resulted in a software solution called Lawson Trace Engine. Today it’s the technology that drives Nutreco’s NuTrace feed and food safety program.  This week Lawson announced a new global version of Trace Engine.  

Ultimately, traceability solutions create transparency in the food supply chain, which can only help with the consumer trust issues mentioned above.  And while it’s the “socially responsible” thing for companies to do, it’s also good business.  Consumer trust can improve brand loyalty and customer satisfaction and drive revenue.  A possible alternative is the Topps Meat story I noted above.  In part because it had no tracking capabilities, Topps was required to recall a full year’s worth of product and is now out of business. 

Jeff