Peanut Butter Supply Chain still Jammed Up
Peanut Corporation of America, the source of the recent salmonella outbreaks has filed for Chapter 7 bankruptcy, but fears of food contamination still persist across the country this week. In the past few days there have been dozens of additional salmonella-related news reports. Everyone from supermarkets to food banks to school catering services have announced further recalls. No one wants to take a chance at being the cause of a public health epidemic. And who can blame them? The damage to brands associated with salmonella can be catastrophic.
Why can’t Salmonella Outbreaks be identified more quickly?
The answer is that they probably could be identified faster if there was more extensive use of technology in the food supply chain. Last July, I wrote a GXS post entitled – Can B2B E-Commerce save us from the Salmonella Outbreaks? – in which I introduced the idea that technologies such as EDI, XML, RFID, barcode labels and data synchronization could be utilized to accelerate traceability efforts in the supply chain. In this post, I will offer a few examples of how these B2B e-commerce technologies could be utilized to accelerate recalls and traceability with the current peanut butter salmonella outbreak.
The Retailer Scenario
When food contamination issues arise, food retailers need to be able to quickly identify all of the impacted SKUs to remove them from the shelves and back room inventory. For products such as peanuts, the challenge is compounded by the fact that retailers must not only identify the obvious products such as salty snacks and peanut butter, but also the products such as cookies or salad dressing which might contain peanuts as an ingredient. The search must be performed across a retailer’s own private label SKUs, supplier branded products and food service merchandise. Most grocery stores have bakeries with cookies, pies and cakes as well as an assortment of prepared food items for busy consumers. Many of these food service items contain peanut oils or peanut products as well.
Data Sync could Accelerate Recalls for Grocery Retailers
Using data synchronization technologies, suppliers could publish their product catalogs to retailers electronically. Catalogs usually contain information about each individual SKU such as brand name, manufacturer, price, dimensions, weight, packaging, storage requirements, taxation policy and country of origin. Increasingly, new attributes are being published in catalogs which identify whether the product is organic, carbon neutral, locally grown, heart-healthy or trans-fat free. Products with known allergens such as peanuts can be tagged as well in electronic catalogs. Read more in my GXS post Consumers to Mandate Data Sync in the Grocery Sector.
The destination for a product catalog within a retailer environment is a Product Information Management (PIM) application. The PIM houses a list of each SKU carried in the retailer’s merchandise mix along with all of the associated attributes. When a food safety issue occurs, retailers with a fully-populated PIM would be able to conduct a search inquiry – Tell me all of the products in my stores with peanuts as an ingredient. Armed with a list of potential contaminated merchandise, a retailer would then be able to quickly pull individual SKUs from the shelf, cases from back room inventory and pallets from the distribution center.
Food Traceability Technology is Out-of-Sync
Unfortunately, few retailers are actively synchronizing product catalog data with their suppliers. Even those which have a PIM and data sync technologies in place are challenged to get supplier participation. Many smaller suppliers claim that they lack the budget, resources and technical expertise to implement data synchronization. Vendors have introduced numerous low-cost, easy-to-use tools to enable small suppliers to synchronize their catalogs with retailers. For example, there are Microsoft Excel templates for catalogs that can be easily transmitted by anyone who can use Microsoft Office. Alternatively, end users can key their product catalog data into web-based portals hosted by the retailers.
There are a few companies which have undertaken extensive implementations of data synchronization. For example, a handful of leading food suppliers such as Coca-Cola, Kraft and Smuckers have been strong proponents of data synchronization. Additionally, major chains such as Wegmans, Wal-Mart and AAFES have been synchronizing data with suppliers for years. Do these retailers have a competitive advantage in their time-to-respond to food safety issues? I won’t debate that point except to say that I know where I will be shopping the next time a salmonella outbreak occurs.
For more information about how data sync can be utilized for food recalls see:
- GS1’s Food Traceability site at http://www.gs1.org/productssolutions/traceability/overview/
- FMI and 1SYNC’s Product Recall Portal at http://www.recall-products.org