Avoid Food Recalls With These 4 Tips
For food and beverage businesses, nothing is scarier than the threat of a major recall. It can cost millions of dollars and drain your organization of massive amounts of resources, materials, and man hours. Therefore, learning to prevent food recalls is key.
The True Cost of Food Recalls
While it's difficult to track specific dollar amounts and data across the industry, one of the few studies conducted on the topic has found that companies lose an average of $10 million per recall in direct costs alone. Plus, on top of that, there are millions of dollars of additional damage in indirect costs and damage to the brand.
It's important to note that the $10 million price tag is an average figure, not a median figure. In reality, some food recalls are significantly more expensive. And in certain cases, one company's responsibility can actually impact the entire industry. The Peanut Corporation of America incident that unfolded in 2009 is a great example.
The peanut scandal began when company execs knowingly shipped salmonella-tainted peanut butter that was used in dozens of different products. It caused a foodborne illness outbreak that led to nine deaths and more than 700 illnesses. In addition to criminal consequences (including a 28-year jail sentence for the company's CEO), the company experienced direct and indirect costs of several hundred million dollars. Worst of all, the entire industry took an estimated one billion dollar hit, which shows how the poor decisions of a single company can hurt others.
Food recalls are expensive, and the long-term results can be devastating to a brand's reputation. If you want to avoid the direct and indirect costs of such an incident, you have to prevent it from happening in the first place.
How to Prevent Costly Food Recalls
If preventing food recalls were as simple as filling out a form or flipping a switch, we wouldn't have any in the first place. Alas, there are certain factors that are outside of our control. But if you make smart decisions around the ones that you do control, you'll significantly lower your risk of being involved in a seven- or eight-figure debacle. Here are several suggestions:
1. Conduct a Vulnerability Assessment
It's always good to begin with a comprehensive vulnerability assessment to identify any parts of your process where there could be an opportunity for some form of intentional tampering or unintentional contamination. This could involve a specific location, facility, part, system, or group of employees. If you've never conducted a vulnerability assessment, you may benefit from hiring an outside company to come in and perform this study for you. Watch and learn from them. You may eventually be able to create your own internal vulnerability assessments.
2. Use the Right Material Testing
It's imperative that you have the right material testing in place. This will help ensure any potential issues are identified and avoided before they lead to serious problems or recalls. Good material testing requires having the right material testing systems and equipment. Take the time to research your options so you can find a good fit for your business.
3. Use the Correct Segregation Controls
Poor storage and handling practices are one of the most common causes of contamination in food recall incidents. This typically has to do with improper workflows and/or poor scheduling. It can also be tied to improper cleaning and a failure to identify allergens quickly. A stronger approach to segregation controls will help.
4. Invest in More Employee Training
Your food safety processes are only as safe as the weakest link. And while we often assume the weak link is a piece of faulty equipment or bug-ridden software, it's usually a person. People make mistakes and, left unaddressed, they can compromise the quality of your food products. The best way to deal with this is by investing in more frequent (and higher quality) training that preemptively addresses areas of concern.
Putting it All Together
As you can see, there are plenty of factors that you can influence. The key is to focus your energy here and to be proactive when it comes to identifying potential risks and challenges.
You can't prevent everything, but you can put your business in a safer position to withstand food safety recalls in the future.
