Food and Drink - Summer 2011 - (Page 77)

the safe zone A Ask any executive of a food and beverage company what keeps them up at night, and food safety is almost always at the top of the list. This is no surprise when you consider that more than 70 million cases of food-borne illness are reported in the United States each year. Product recalls have increased dramatically over the past decade. E-coli and salmonella contaminations have been the most frequent culprits as well as recalls related to undeclared allergens, often caused by mislabeling. Mitigate Recall Risk To mitigate your company’s exposure to risk, recall insurance is important and highly recommended, but it doesn’t protect your brand, nor does it typically reimburse a company for lost sales. Virtually all food and beverage companies have quality control processes in place, and even the best processes cannot prevent all recalls. However, there are several best practices all food and beverage companies should have in place to avoid the pitfalls of a recall. 1. Keep tabs on quality control at the suppliers/distributors level. Many companies are so consumed with their own quality control processes that they neglect to properly assess others. Worldclass companies visit their suppliers’ plants regularly and work closely with them to ensure quality control processes. One pitfall to avoid is placing overreliance on supplier quality control reports or certifications. When you do identify control gaps, require your suppliers to address the gaps and confirm that they have been remediated. Companies must also understand what happens to their product once it leaves the plant. Determine whether the product is stored properly and ensure that distributors and retailers are employing stringent quality control processes. Visit and observe to confirm. 2. Be prepared for the worst. Every food and beverage company should have a food defense plan in place long before a recall occurs, and that plan should be documented, reviewed and rehearsed regularly as part of your company’s enterprise risk assessment. Speed in execution of a recall process requires coor- Due to an increased access to information, recalls can have a lasting impact. Costs of recalls can very easily accumulate to tens of millions of dollars to dispose of contaminated inventory, reimburse customers and consumers, manage and restore consumer confidence, and return good product to the shelves – not to mention the significant reputational and brand damage, and lost sales that can result from a recall. The change that has had the most impact on the food and beverage industry recently is the Food Safety Modernization Act. Signed into law by President Obama in January, the new regulations are widely thought of as the most comprehensive reform of U.S. food safety laws since the 1930s. The new laws give the FDA unprecedented authority and will increase scrutiny of nearly all food and beverage companies. Recalls are one of the most significant changes to the oversight of the FDA granted by this legislation. Specifically, the FDA can now require a recall with “reasonable probability” that food is tainted or misbranded and could cause serious health risk or death. Practically speaking, companies can expect that the FDA will provide them with the opportunity to recall products themselves prior to issuing a recall order. However, if a company fails to do so, the FDA can issue a formal recall order or shut down operations if it deems necessary. With the potential for an increase in recalls, food and beverage companies need to be prepared to mitigate risks associated with recalls and learn how to handle a recall should it occur. dination across the organization, and everyone must know their role if a recall strikes. Your plan should answer pertinent questions such as: How will you communicate with your customers and consumers? How will you notify your vendors and distributors? And how will you notify and respond to the media? 3. Build consumer trust through communication. A good food defense plan should include steps to restore customer trust in the safety of your product as quickly as possible. Notification of a recall must be swift, organized and well planned. Your consumers must understand your process for restoring safe product, and they must have easy access to timely and relevant information. This means that customer hotlines must have enough capacity and welltrained people. To reinforce consumer trust, share as much of your plan with consumers as possible and don’t be afraid to admit to mistakes. 4. Get rid of the problem. You must be able to quickly identify and measure the amount of product to remove, destroy and execute very rapidly. 5. Engage retailers. You should develop a process to shorten the customer reimbursement process, which will put you in the best possible position to restore normal operations. Consider engaging third-party providers to help in coordinating with retailers and have a well-trained sales force to assist in recall situations. It is critical that you develop product replacement options with suppliers and build contingency plans that are acceptable to their retailers. Ultimately, no company is recallproof. However, by proactively planning for worst case scenarios, your company can be prepared to handle even a significant recall situation and will be enabled to mitigate losses, restore confidence and get your product back on the shelf safely and expeditiously. Tony Perazzo is a partner in Grant Thornton LLP’s San Francisco office where he leads the firm’s local Consumer and Industrial Products industry group. food and drink • summer 201 • www.fooddrink-magazine.com 1 77 http://www.fooddrink-magazine.com

Table of Contents for the Digital Edition of Food and Drink - Summer 2011

Food and Drink - Summer 2011
Tableside Chat
Contents
News a la Carte
Tradeshow Preview
Food for Thought
FAD Exclusive
Fresh From the Start Brands
Railex
Orchard View Farms Inc.
Grandma Hoerner’s
Greencore USA Inc.
FoodSwing Inc.
Pecans.com
RPE Inc.
Dari Mart Stores Inc.
Idylwilde Farms
Kemin Industries Inc.
Olga’s Kitchen
Distributors: How Green Can You Be?
Kohl Wholesale
Nebraskaland
Upper Lakes Foods Inc.
B. Giambrone & Co.
Food Sales West
Milne Fruit Products Inc.
Pellerito Foods
PrimeSource Foodservice Equipment
Town & Country Foods
Producers: The Industry Pitfall
Walker & Sons
Bright Coop Inc.
Covered Bridge Potato Chip Co.
Route 11 Potato Chips
Royal Sausage Co.
Restaurants: Values Drive Sales
El Meson Sandwiches
Peter Piper Pizza
Retailers: The Unwelcomed Guest
Arabica Coffeehouse
Kolache Factory
Reasor’s
Three Things

Food and Drink - Summer 2011

Food and Drink - Summer 2011 - Food and Drink - Summer 2011 (Page Cover1)
Food and Drink - Summer 2011 - Food and Drink - Summer 2011 (Page Cover2)
Food and Drink - Summer 2011 - Tableside Chat (Page 1)
Food and Drink - Summer 2011 - Tableside Chat (Page 2)
Food and Drink - Summer 2011 - Contents (Page 3)
Food and Drink - Summer 2011 - Contents (Page 4)
Food and Drink - Summer 2011 - Contents (Page 5)
Food and Drink - Summer 2011 - News a la Carte (Page 6)
Food and Drink - Summer 2011 - News a la Carte (Page 7)
Food and Drink - Summer 2011 - Tradeshow Preview (Page 8)
Food and Drink - Summer 2011 - Tradeshow Preview (Page 9)
Food and Drink - Summer 2011 - Food for Thought (Page 10)
Food and Drink - Summer 2011 - Food for Thought (Page 11)
Food and Drink - Summer 2011 - FAD Exclusive (Page 12)
Food and Drink - Summer 2011 - FAD Exclusive (Page 13)
Food and Drink - Summer 2011 - Fresh From the Start Brands (Page 14)
Food and Drink - Summer 2011 - Fresh From the Start Brands (Page 15)
Food and Drink - Summer 2011 - Fresh From the Start Brands (Page 16)
Food and Drink - Summer 2011 - Fresh From the Start Brands (Page 17)
Food and Drink - Summer 2011 - Fresh From the Start Brands (Page 18)
Food and Drink - Summer 2011 - Fresh From the Start Brands (Page 19)
Food and Drink - Summer 2011 - Fresh From the Start Brands (Page 20)
Food and Drink - Summer 2011 - Railex (Page 21)
Food and Drink - Summer 2011 - Railex (Page 22)
Food and Drink - Summer 2011 - Railex (Page 23)
Food and Drink - Summer 2011 - Railex (Page 24)
Food and Drink - Summer 2011 - Orchard View Farms Inc. (Page 25)
Food and Drink - Summer 2011 - Orchard View Farms Inc. (Page 26)
Food and Drink - Summer 2011 - Grandma Hoerner’s (Page 27)
Food and Drink - Summer 2011 - Grandma Hoerner’s (Page 28)
Food and Drink - Summer 2011 - Grandma Hoerner’s (Page 29)
Food and Drink - Summer 2011 - Greencore USA Inc. (Page 30)
Food and Drink - Summer 2011 - Greencore USA Inc. (Page 31)
Food and Drink - Summer 2011 - Greencore USA Inc. (Page 32)
Food and Drink - Summer 2011 - FoodSwing Inc. (Page 33)
Food and Drink - Summer 2011 - FoodSwing Inc. (Page 34)
Food and Drink - Summer 2011 - FoodSwing Inc. (Page 35)
Food and Drink - Summer 2011 - Pecans.com (Page 36)
Food and Drink - Summer 2011 - Pecans.com (Page 37)
Food and Drink - Summer 2011 - Pecans.com (Page 38)
Food and Drink - Summer 2011 - RPE Inc. (Page 39)
Food and Drink - Summer 2011 - RPE Inc. (Page 40)
Food and Drink - Summer 2011 - RPE Inc. (Page 41)
Food and Drink - Summer 2011 - Dari Mart Stores Inc. (Page 42)
Food and Drink - Summer 2011 - Dari Mart Stores Inc. (Page 43)
Food and Drink - Summer 2011 - Idylwilde Farms (Page 44)
Food and Drink - Summer 2011 - Idylwilde Farms (Page 45)
Food and Drink - Summer 2011 - Kemin Industries Inc. (Page 46)
Food and Drink - Summer 2011 - Kemin Industries Inc. (Page 47)
Food and Drink - Summer 2011 - Olga’s Kitchen (Page 48)
Food and Drink - Summer 2011 - Olga’s Kitchen (Page 49)
Food and Drink - Summer 2011 - Distributors: How Green Can You Be? (Page 50)
Food and Drink - Summer 2011 - Distributors: How Green Can You Be? (Page 51)
Food and Drink - Summer 2011 - Kohl Wholesale (Page 52)
Food and Drink - Summer 2011 - Kohl Wholesale (Page 53)
Food and Drink - Summer 2011 - Kohl Wholesale (Page 54)
Food and Drink - Summer 2011 - Kohl Wholesale (Page 55)
Food and Drink - Summer 2011 - Kohl Wholesale (Page 56)
Food and Drink - Summer 2011 - Kohl Wholesale (Page 57)
Food and Drink - Summer 2011 - Nebraskaland (Page 58)
Food and Drink - Summer 2011 - Nebraskaland (Page 59)
Food and Drink - Summer 2011 - Nebraskaland (Page 60)
Food and Drink - Summer 2011 - Upper Lakes Foods Inc. (Page 61)
Food and Drink - Summer 2011 - Upper Lakes Foods Inc. (Page 62)
Food and Drink - Summer 2011 - Upper Lakes Foods Inc. (Page 63)
Food and Drink - Summer 2011 - B. Giambrone & Co. (Page 64)
Food and Drink - Summer 2011 - B. Giambrone & Co. (Page 65)
Food and Drink - Summer 2011 - Food Sales West (Page 66)
Food and Drink - Summer 2011 - Food Sales West (Page 67)
Food and Drink - Summer 2011 - Milne Fruit Products Inc. (Page 68)
Food and Drink - Summer 2011 - Milne Fruit Products Inc. (Page 69)
Food and Drink - Summer 2011 - Pellerito Foods (Page 70)
Food and Drink - Summer 2011 - Pellerito Foods (Page 71)
Food and Drink - Summer 2011 - PrimeSource Foodservice Equipment (Page 72)
Food and Drink - Summer 2011 - PrimeSource Foodservice Equipment (Page 73)
Food and Drink - Summer 2011 - Town & Country Foods (Page 74)
Food and Drink - Summer 2011 - Town & Country Foods (Page 75)
Food and Drink - Summer 2011 - Producers: The Industry Pitfall (Page 76)
Food and Drink - Summer 2011 - Producers: The Industry Pitfall (Page 77)
Food and Drink - Summer 2011 - Walker & Sons (Page 78)
Food and Drink - Summer 2011 - Walker & Sons (Page 79)
Food and Drink - Summer 2011 - Walker & Sons (Page 80)
Food and Drink - Summer 2011 - Bright Coop Inc. (Page 81)
Food and Drink - Summer 2011 - Bright Coop Inc. (Page 82)
Food and Drink - Summer 2011 - Bright Coop Inc. (Page 83)
Food and Drink - Summer 2011 - Covered Bridge Potato Chip Co. (Page 84)
Food and Drink - Summer 2011 - Covered Bridge Potato Chip Co. (Page 85)
Food and Drink - Summer 2011 - Route 11 Potato Chips (Page 86)
Food and Drink - Summer 2011 - Route 11 Potato Chips (Page 87)
Food and Drink - Summer 2011 - Royal Sausage Co. (Page 88)
Food and Drink - Summer 2011 - Royal Sausage Co. (Page 89)
Food and Drink - Summer 2011 - Restaurants: Values Drive Sales (Page 90)
Food and Drink - Summer 2011 - Restaurants: Values Drive Sales (Page 91)
Food and Drink - Summer 2011 - El Meson Sandwiches (Page 92)
Food and Drink - Summer 2011 - El Meson Sandwiches (Page 93)
Food and Drink - Summer 2011 - El Meson Sandwiches (Page 94)
Food and Drink - Summer 2011 - El Meson Sandwiches (Page 95)
Food and Drink - Summer 2011 - El Meson Sandwiches (Page 96)
Food and Drink - Summer 2011 - El Meson Sandwiches (Page 97)
Food and Drink - Summer 2011 - El Meson Sandwiches (Page 98)
Food and Drink - Summer 2011 - Peter Piper Pizza (Page 99)
Food and Drink - Summer 2011 - Peter Piper Pizza (Page 100)
Food and Drink - Summer 2011 - Peter Piper Pizza (Page 101)
Food and Drink - Summer 2011 - Retailers: The Unwelcomed Guest (Page 102)
Food and Drink - Summer 2011 - Retailers: The Unwelcomed Guest (Page 103)
Food and Drink - Summer 2011 - Retailers: The Unwelcomed Guest (Page 104)
Food and Drink - Summer 2011 - Retailers: The Unwelcomed Guest (Page 105)
Food and Drink - Summer 2011 - Arabica Coffeehouse (Page 106)
Food and Drink - Summer 2011 - Arabica Coffeehouse (Page 107)
Food and Drink - Summer 2011 - Kolache Factory (Page 108)
Food and Drink - Summer 2011 - Kolache Factory (Page 109)
Food and Drink - Summer 2011 - Reasor’s (Page 110)
Food and Drink - Summer 2011 - Reasor’s (Page 111)
Food and Drink - Summer 2011 - Three Things (Page 112)
Food and Drink - Summer 2011 - Three Things (Page Cover3)
Food and Drink - Summer 2011 - Three Things (Page Cover4)
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