Hot potato: Food supply scares heighten demand for product recall technology

In light of recent product recalls, manufacturers must be ready to respond quickly to supply chain issues to protect consumers as well as brand reputations. That’s why right now many food & beverage manufacturers are looking to expand their use of solutions that offer capabilities in product genealogy, lot tracking & tracing, and alert notification.
By Karen Dilger, contributing editor (kadilger@comcast.net) February 25, 2009

In light of recent product recalls, manufacturers must be ready to respond quickly to supply chain issues to protect consumers as well as brand reputations.

That’s why right now many food & beverage manufacturers are looking to expand their use of solutions that offer capabilities in product genealogy, lot tracking & tracing, and alert notification. Although these features may not be new to the supply chain space and have been included in many warehousing and inventory systems for years, their use in product-recall scenarios is quickly becoming a necessity.

When the tomato recall happened in summer 2008, manufacturers were forced to respond quickly with data that showed which lot was produced in which facility, and where and when it was shipped. “Track & trace for those in the process industries, such as food and beverage, is very challenging,” says Karin Bursa, a VP with supply chain software vendor Logility . “With other consumables such as car seats, workers simply look at a bill of material to tie part numbers to a variety of end products.”

Traceability gets more difficult as the amount of raw materials increases and the number of supply chain partners grows, adds Bursa.

“Production operators and copackers may use the same semi-finished goods to make several other finished products,” she says. “Jam or jelly can be sold as a finished product but also can be used for pie filling, which adds another step as well as several layers and levels to the process.”

The Logility Voyager system manages alert notification for a recall by automatically contacting partners via the Internet or alerting customer relationship managers about the issue. “Since speed is of the essence during a recall, having quick access to product data, vendor information, and locations where product last resided is very important,” says Bursa.

To prepare for potential recalls, Moore, Okla.-based Vaughan Foods enacted a plan to host two mock recalls a year. The event begins with the company’s quality assurance department, which is notified that a mock recall is in effect, and the team has three hours to complete the process.

“We must isolate the contaminated product, have knowledge about where the product is in the supply chain, and file accurate and timely reports to the authorities,” says Victor Gramillo, quality assurance manager for Vaughan Foods, a supplier of fresh vegetables, refrigerated deli salads, soups, and fruit. “If there is a quality issue with a product, we need to know when and where the product went, and in what production line.”

To prepare for potential recalls, Moore, Okla.-based Vaughan Foods enacted a plan to host two mock recalls a year. Once an event is in process, the quality assurance department team has three hours to complete the process. (Photo courtesy Vaughan Foods)

During routine inspections, hold tags are placed on questionable products using Logility’s Voyager system, allowing users to view which products should not shipped. “Even if a physical hold tag is missing, a bar-code label can serve as an electronic tag, signaling the system to send an immediate alert to operators,” says Gramillo.

Vaughan Foods lost profits resulting from the tomato recall last summer since its customers did not want to buy tomatoes from them, despite Vaughan’s assurance that its supplies were uncontaminated. “We realized we have to minimize risks and take money off the bottom line to prevent any serious problems from occurring,” says Gramillo.

Next up, Gramillo intends to use the mock recall program for marketing purposes, selling the company’s preparedness and proactive stance.

“We can show the results of the mock recalls to potential customers since quality and safety are key considerations in today’s grocery market. Price is still important, but it has moved to the back burner.”