The most prominent reason for a food and beverage (F&B) manufacturer to be transparent is the risk of a recall. Not only can recalls cause bad PR but they can damage supplier relationships, cause insurance headaches, and cost a lot of time and money. A Grocery Manufacturers Association report found that 81% of manufacturers who had experienced a recall deemed the financial risk as significant to catastrophic. Have you thought about what happens when the FDA comes knocking on your door?
What are you going to do to be ready for a recall? Have you created a mock recall? How quickly and accurately can you recall something to reduce market disruption?
With an ERP solution, you can collect real time data to target the affected product and quickly execute a resolution. Once a lot number has been identified you can trace forward or backward to determine what products have that ingredient, as well as how many were made and the locations. Below is a screenshot of traceability of an ingredient within Sage X3.
Can your current system stand the pressure test of a recall? The ability of your organization to respond is dependent on your system and people. A system of manual files and receipt logs can be time consuming and difficult to read and piece together the flow of the contaminated ingredients. An ERP solution allows for fast resolution including generation of notification letters to distributors and retailers, and creation of call lists based on CRM records. Time is of the essence in product recalls.
There can be a high labor cost to recovery, what if you can’t get everything back because the product has spread over many locations. A system with tight traceability and effective control allow for employees to pinpoint where contaminated goods are residing.
In the event that you are falsely implicated in a recall it’s important to have traceability proof to cover your behind. Watch a short recall scenario video on the traceability of a good as we look at different lots to identify contaminated products.
This is the sixth blog of seven in the blog series 7 Steps to Transparency for Food and Beverage Manufacturers, does your company have the proper tools in place to meet new regulations? To learn more about all 7 steps download the infographic today.