Did you know that approximately 50% of the major issues and recalls faced by food producers are not originating from the food producing company itself? To a large extent these major issues and recalls originate at the supplier. Very often the question arises who is to blame – the supplier for delivering faulty product or should we also look closer to home and look more closely into failing supplier management of the food producing companies in the first place?
The myth of certification
These days a lot of companies are stretched in terms of budget and resources. Investing time and money for supplier audits, let alone close collaboration with suppliers to prevent food safety issues is often just a distant aspiration. In order to still have some kind of risk management approach companies tend to use GFSI certification (BRC / IFS / FSSC 2000 / SQF / GlobalbGAP) as a reason not to dive deeper into the capabilities and food Would you buy a house without visiting it yourself or having it properly inspected by a realtor you hired? Would you buy a house just from a picture because the realtor has an ISO 9001 certificate of which you received a copy? Of course you would not – but why do we do this when it comes to the raw materials we purchase to manufacture our food products? At a very minimum we need to request a full audit report in relation to GFSI certificates as well as insight into the HACCP / HARPC study of the supplier – only then we have at least some insight in the capabilities and potentials risks the raw material might pose to our production process and product.
Based on as proper review of crucial data like full audit reports and HACCP / HARCP studies it is possible to get to a more meaningful way of risk management of suppliers. In connection to this high-risk suppliers should only be accepted after a proper on-site audit by a competent auditor who has subject matter expertise when it comes to the supplier’s production processes. Too often supplier audits are just a weak repetition of GFSI audit, focussing on the basics of the quality and food safety management system followed by a site tour of the supplier’s production location.
Understand Your Raw Materials Risks First
As a food producer one should really understand the characteristics of the raw materials which are being used – of course the technical properties and sensory properties are an important first step, but also insight in the potential food safety risks must be established by those who are involved in purchasing raw materials.
A good place to start in terms of understanding the food safety risks in relation to raw materials are two publicly accessible databases – the Canadian Food Inspection Agency and the US Food And Drug Agency have created extensive databases with all food safety risks per (category of) raw material. Use these databases as a starting point for truly understanding the risks in relations to the raw materials being used in your company.
Next to having an initial grasp of the generic risks involved in all raw materials, it is equally important to keep an eye on what is happening on a global scale. Increasingly the food industry is becoming a truly global industry and you might end up purchasing products for origins you were not necessarily aware of. For this reason it is good to keep an eye on multiple databases of food safety authorities. Here are several links to the video’s explaining where to find and how to use the most well-known databases: USA, Europe, Canada, Australia & New Zealand, World Health Organization.
This information is available for free, but the set back is that it takes a lot of time to check these databases on a regular basis. For a little investment, however you can get access to all this information (and more) and get relevant notifications on a daily basis. Watch this video for more information.
Based on the combination of proper review of GFSI audit reports, HACCP / HARPC studies and elaborate raw material risk profiles you can get to a meaningful classification of high, medium and low risk raw materials and suppliers for your company.
Proper data is a good starting point
Usually when looking for new raw materials you will ask your supplier for product specifications and safety datasheets. But this is just the beginning as next to the physical, chemical and organoleptic properties and safety risks you might need a wide range of additional information. Here is just a brief (and incomplete) list of additional information that might be required: certificates on the kosher / halal / organic status of the product, detailed list of allergens present in the raw material and present on the production site, site registration numbers (e.g. for import reasons or by legal requirement like meat / dairy / eggs in the EU), list of ingredients included in the raw material, etc.
It is already seen as a great achievement if a company has a (nearly) complete set of information in relation of all the raw materials and suppliers. But can this data be trusted? It is always wise to review all the data that gets sent by a supplier and in some cases you can even check the provided information in publicly accessible databases. For example, most kosher organizations and local authorities have databases which allow you to check the status of the supplier and raw materials you are purchasing from the supplier. It would be a pity to find out your supplier has skipped a certification and as a result your company is now facing a recall…
Another important aspect which gets overlook often in relation to raw material an supplier data is change management. Whenever a change is implemented to a food ingredient, production process either at the supplier or your company this should trigger a review of all potential implications, including an assessment whether or not this potentially impacts the data (and related risk assessment) on file in relation to the raw material and supplier. It is all too easy to overlook that new allergen which was introduced by the minor change of raw material used by your supplier.
Adaptive control of incoming goods
So far in this article, we have only been discussing (paper based) data. Of course this is a good starting point when it comes to understanding risks in relation to raw materials and suppliers, but this type of data review in itself is not enough. At any point in time mistakes can (and will) happen – let alone wilful misconduct by other parties in the supply chain leading up to your company. For this reason it is important to perform regular checks on the raw materials you purches in the shape of laboratory measurements. You want to verify the microbiological, physical, chemical and organoleptic performance of the raw materials you use to create your own products.
When starting out with a new raw material and / or a new supplier it is a good practice next to requesting the raw material specification to perform analysis by yourself as well. This immediately gives you a baseline indication on the true quality and food safety of the raw material at hand. But is should not stay at this. In today’s increasingly global market we see issues moving like oil stains across multiple continents in a rapid pace. One of the key underlying reasons is that too many companies do not perform checks and tests at all on the raw materials they use.
A proper way of setting up a raw material monitoring program is to use a combination of structurally reviewing Certificate of Analysis (CoA) data in combination with performing your own measurements and factoring in the supplier’s complaint performance into a more holistic approach towards supplier quality performance management. Based on the risk profile and the performance based on measurements you can set the frequency at which you are going to check each raw material / supplier combination. Let’s look into these aspects in a little more detail.
If you enter all CoA data of your suppliers into a statistical package or just plainly insert the data into an Excel spreadsheet you might be amazed how many suppliers are capable of delivering exactly the same product time after time. Other suppliers might deliver you product which is always very close to the upper or lower limit of the specification, which also involves risks for your company.
When combining CoA data review with performing your own measurements (either in your company laboratory or externally) you might even be more surprised. It is important to note here to always draw your own samples of the product which arrives at your company – do not ask the supplier to send a small laboratory sample as this might not necessarily reflect the product that was delivered.
Combining paper-based information with proper measurements, focusing on actual performance, you create a solid supplier quality management approach that will strongly reduce the risks of major issues and recalls for your company.
Food Fraud Awareness and Detection
In terms of food fraud, companies must be aware at all times – a simple annual review of risk profiles in relation to raw materials and suppliers is not sufficient. You must always be aware of sharp changes to price (e.g. when the crop fails or is bad in a specific area or when the demand of a certain raw material suddenly increases), as these are time when ill-willed individuals or companies might be tampering with the product for economical gain.
Of course there are raw materials which are more vulnerable to these practices and we all know the classical examples of Manuka Honey from New Zealand and Italian Olive Oil. Next to this we also know that certain geographies are more prone to corruption and have less strong oversight by the authorities of food safety – this is nicely shown by the annual trustworthiness report of the World Bank (have a look at this video for more information). By nature any company purchasing these products and purchasing from these regions need to be vigilant and perform additional checks (both in the country of origin and at arrival of the products).
Luckily, more and more food safety authorities report food fraud instances as well. As shown before in this article, Horizonscan brings all this data in one place, including food fraud risks – watch this video for more information.
Next to ill-willed suppliers, raw materials might also be tampered with during transport (most of the time this is not for economical gain, but more for terrorist motivations). In this case, implementing a sound tamper evidence approach together with the supplier is a crucial step for companies to take. This could involve the following steps (not exhaustive): tamper evident packaging (using colors / logo’s / holograms), transport checks (pictures at supplier compared to incoming checks), alternating the colour of the shrink wrap foil used on pallets and ordering full truck or containers which are then properly sealed with a numbered seal or lock.
In the above it has been mentioned over and over – in order to manage raw material related risks, you need to work with your suppliers. While the starting point is always a proper, complete and timely exchange of information – it pays to go deeper than just this. Ask yourself these questions: Do you know what supplier site supplies your raw materials? Do you always get raw materials produced on the same production line of your supplier? Does your supplier always inform you beforehand of process changes and changes to the raw materials on their end? Most likely the answer to one or more of these questions is “No.”
Based on the raw material and supplier risk profile, potentially in combination with the strategic importance to your company, you can decide on a list of suppliers that you need to establish a deeper working relationship with. Typically, this involves multiple sites visits, enabling you to familiarize yourself with the supplier’s production processes. Very often important details are overlooked during a formal supplier audit. Preventing food safety and food fraud issues is in the end in the interest of both your company and your suppliers.
Establishing an open relationship with key suppliers is an important and necessary step in proper risk mitigation. There are even benefits to be gained – a more open discussion can lead to mutual cost savings (in this sense it is interesting to invite the supplier over to your plant to see and discuss how their product is being used and handled). With change management in mind it is even worthwhile to establish a multifunctional team on both ends involving not only your purchasing department and quality department, but also R&D, logistics and operations in the supplier relation.