Tune Up Traceability with Enterprise Resource Planning

To address this complex challenge, leading food manufacturers have adopted enterprise software to automate and integrate traceability across the multiple steps in their supply chains.

Lot-tracing capabilities enable the manufacturer to track a defective lot from finished good back to raw ingredient, from raw ingredient to finished good, or from mid-production backward or forward—all within a few hours. Should a food safety issue occur, this capability can help prevent death and illness.

Brand Protection

However, the issue goes beyond regulatory compliance. Food manufacturers are also seeing increased demand for brand protection measures from their larger customers in retail and distribution. Many national retail chains such as Wal-Mart and Kroger require their food suppliers to conduct mock recalls. Some are even validated by external audit firms as a part of comprehensive food safety audits.

For a processor, the cost of a failed mock recall can be catastrophic. And in the case of a safety recall, not having lot-specific information will often force the manufacturer to expand the size of the recall, thereby compounding the costs, due to inability to accurately identify the affected lots.

In response to the food safety crises of the past few years, the industry is stepping up its policies and standards. Food industry organizations and associations are leading initiatives to develop traceability standards to ensure that the resulting data can be transmitted up and down the production chain.

The Produce Traceability Initiative, for example, is spearheaded by the United Fresh Produce Association, the Produce Marketing Association, and the Canadian Produce Marketing Association. And leading retailers like Wal-Mart now require suppliers of produce and other food products to be certified against GFSI standards.

Additionally, ISO 22000, the newest international standard for food safety management systems, requires further integration of people, processes, and systems to improve traceability.

With all this mounting pressure from the government, retailers, consumers, and the food and beverage industry, what can small and midsize regional processors expect?

There’s little doubt that some companies simply will not survive the tsunami of regulations and the growing pressure from industry and consumers. Many food manufacturing companies have had to close their doors due to a complete recall of all products because they did not or could not trace the problems in a reasonable time period.

Others will suffer significant losses as they struggle to pass mock recalls required by their retail customers. And even more processors will be swept up by larger competitors that have the systems, infrastructure, and processes to manage the long and increasing list of requirements.

The Right Technology

These challenges present great opportunities for forward-thinking processors that can leverage the right technology for competitive advantage.

Enterprise resource planning technology that is tailored for food and beverage companies provides an effective way for processors to automate and integrate traceability across their supply chains, improving reaction times, reducing costs, and providing a greater measure of brand protection.

A solution with lot-tracing capabilities allows a company to trace back to the source of all ingredients and trace forward to the distribution of all food products made and sold. If a safety alert arises, the processor can access information about the grower, supplier, and date range associated with the affected lots.

Armed with this information, a company can recall the affected product lots, preventing illness and avoiding having to recall product that is perfectly safe and salable.