Product recalls are becoming more common in the food and beverage industry. Here are five supply chain tips growers can use for dealing with a product recall:
1. Stay on top of changing regulations
Product safety regulations are complex, vary among different countries, and change frequently—almost always becoming stricter. This means that when your food and beverage business expands into different countries, compliance burdens will grow, as well as the likelihood and complexity of product recall.
Modern ERP with a central regulatory repository must support food and beverage businesses to comply with existing regulations and to implement new ones. This will provide a solid frame of reference to keep you on the right side of the law, wherever you operate.
2. Maintain strong, up-to-the-minute supply chain visibility
When a product is identified as defective, whether by consumers or higher up in the supply chain, it’s essential that you identify the potential extent of the contamination, asking these questions:
- What product batches were faulty?
- What raw materials were involved?
- What other batches shared the same raw material, or passed through the same production facilities?
- Is this problem new, or has it been happening for some time?
Having up-to-the-minute data to answer these questions, you can quickly identify exactly where the problem lies, and address the issue with confidence, provide market reassurance and mitigate recall cost.
To gain data access in real time, you must store data centrally, allowing it to be tracked from the furthest reaches of the supply chain, through the production process, and from customers.
Sometimes, food and beverage businesses don’t have lot codes which are specific enough. Rather than break up production into discrete lot codes so the scope of recalls is limited, run the same lot code for many production runs.
Regulators will expect you to connect ingredients and customers through complex, multi-production processes. The result of not having these processes in place can be a massive recall that’ll bankrupt a company.
Having a strong ERP system like Sage X3 can help have this data in the palm of your hand anywhere, anytime to access this information.
3. Be completely transparent
Information travels fast. Consumers can access potential food and beverage product problems as quickly as anybody publishes it. A badly handled product recall can damage the reputation of your business—sometimes irreparably—so you need to control the narrative.
The safest and best strategy is for your food and beverage business to communicate with authenticity that you’re in control of the situation, and that you have the right solutions in place. So as not to lose consumer trust, never make statements that you don’t know for certain are completely true, especially when the pressure is on during a product recall.
It’s here where having strong visibility of your supply chain is crucial, because it allows you to be authentic about the potential extent of problems and quickly pinpoint the cause, essential to protecting your reputation.
4. Reduce the risk and impact of a product recall
Prevention is better than a cure, and while it’s impossible to eliminate the chance of a food and beverage recall entirely, there are steps to reduce its likelihood and mitigate consequences:
- Streamline and thin product lines and packing options.
- Be ultra-precise and narrow with the lot coding system.
- Hold on to samples from product batches, to quickly test for defects.
- Reduce batch quantities to make it easier to isolate faulty products.
- Maintain strong communication with everyone in your supply chain.
- Continually analyze and improve supply chain processes to minimize risk.
- Monitor customer feedback, including social media, to identify defects immediately.
- Maintain a dedicated crisis management team.
5. Have an emergency ready crisis management plan
Urgency is of the essence with a food and beverage product safety issue. It’s also advisable, and very possibly legally necessary, to have a pre-determined crisis management plan in place to ensure you are permanently crisis ready.
- An effective food and beverage crisis management plan might include some or all of these:
- Determine the severity of the risk.
- Identify the extent of contamination, and isolate affected batches.
- Notify distributors and retailers as quickly as possible.
- Put tried-and-tested product recall procedures into action.
- Report the product issue to the relevant authority.
- Publish transparent information on the recall to customers.
Interested in learning more about how the high-powered traceability functions in Sage X3 can help your agriculture business in times of crisis? Click here to learn more.