Ian Harrison: For food producers which already have strong procedures and controls in place, the requirements will not be onerous. They will simply provide businesses with a clear-cut opportunity to audit their production processes, highlight any weaknesses or areas for improvement, and confirm that they are already operating at best practice level. For producers operating to a lower standard, the interest the FDA takes in their business might come as something of a wake-up call. This higher level of oversight can only result in better practices right the way down the food supply chain and will give consumers confidence in the products they buy. The open question is who will pick up the additional cost — the taxpayer, the producer, or the consumer in terms of marginally higher food prices?
JP: Your perspective would depend upon the type of food processor you are. If I’m a processor controlled by the USDA, I’d be concerned about the turf wars between the bureaucracies and another agency (like the FDA) coming in to check records as well. If I’m a small or regional processor and I’m not looking to sell to major corporations, I’d definitely be concerned by the FDA’s expanded role. However, anyone who sells to several of the national chains and are Safe Quality Food (SQF) 2000 certified would still have some concerns about the record-keeping that may be required by law. At the heart of the opposition to the bill is the fear of the unknown — of just what the regulations will entail for businesses.
Most consumers don’t actually know what the Food Safety bill will mean for them specifically. Those who do and who observe recalls and changes in legislation still don’t know what the rules will be; the same is true for processors. Personally, when I think about the stipulations in the bill regarding track and trace — which doesn’t even require a recommendation for the next three years — I wonder if we’re going to have more food recalls problems in the meantime.
VR: This bill creates obvious barriers and restrictions to the food manufacturing process and most companies do not want increased government regulations. Yet the reality is that there are certain changes in processes that need to take place. For example, companies will need to adapt to more of an enterprise-wide solution which allows manufacturers to make better claims, support what’s on labels and test during the manufacturing process. We also need to have more traceability to see which lots are contaminated before shipping to the shelves. Finally, from a cost perspective, it is important to get ahead of eminent problems in order to ensure more quality. The cost of quality is lower when you resolve the issues earlier in the product development cycle rather than later. Recalls are extremely expensive so getting ahead of the curve is critical. In order to meet these challenges, companies need to make sure they have tools that enable Quality during design and formulation, during production and manufacturing, and ensuring they are using machinery and equipment that is safe and reliable and will not contaminate the food.
As a consumer I’m happy with the new bill because the government is taking a harder stand against these problems and reducing outbreaks by getting ahead of the curve. However, I am still slightly skeptical of the government’s ability to effectively execute against these new laws.
In preparation for the regulations contained within this bill, what types of investments should food processors be ready to make?
IH: To an extent, we believe producers should hold back a little now until the guidance is issued in order that they optimize their investment in new process or plant. Generally businesses are allowed a period of time — usually around six to nine months — as a grace period while industrial processes are modified to comply with the new requirements.
VR: Food manufacturers should be prepared to invest in their internal policies, procedures and technology solutions. These investments should begin in the design phase and extend the entire way through to execution. For example, in the design phase companies need to learn to manage raw material supplies in order to meet stricter specifications and quality standards. In turn, regulatory teams need to back up claims and manufacturing teams need to sample and test in order make sure that a contaminated lots are not shipped to shelves. Hence, it becomes critical for food processors to invest in Formulation Management and Product Lifecycle Management Solutions that will enable Design for Safety or Design for Quality processes.
Food processors will have to invest in manufacturing and production solutions that will enable better Quality Management and to be able to manage Quality data, capture sampling data, and report on vendor quality for raw materials. Additionally, these systems must be able to track and trace against lots to make sure contaminated lots do not get on shelves. Food processors have to proactively manage food safety before products are shipped out of the manufacturing facility.
Additionally, food processors need to invest in Supply Chain Solutions that ensure there is no contamination during the storage and transfer process. Warehouse Management Solutions and Transportation Management Solutions that can ensure repeatable and reliable locations for storage and transfer and that can make sure that food is stored and transferred in the right conditions to prevent spoilage is critical.
There are various aspects of the process that would benefit from asset management systems such as knowing if equipment is older and rusted in order to prevent contaminating food supplies on the production line, in the warehouse, on the trucks, etc. Enterprise Asset Management Solutions become even more important not just to make sure machinery is operating properly, but to ensure machinery is safe and will not contaminate food.
If you were to offer an educated guess, do you think this bill is just the beginning in expanding the FDA's reach, or is this all we'll see regarding the FDA for some time?
IH: We believe that this could be the ‘thin end of the wedge’ — in other words a prelude to greater intervention by government agencies in American and overseas enterprise. We certainly seem to be in an era of increasing government control. However, history shows that there’s a pendulum effect here, and that in time the pendulum will swing back in favor of greater autonomy for businesses and a lower level of governmental or regulatory oversight.
JP: There has always been the presence of USDA inspectors at certain facilities; up until now, the FDA just doesn’t have the manpower to do more than one audit per year. Although the FDA’s power may expand, with the combined bureaucracies it would be simpler to have one agency that is aligned with industry groups and deals solely with food safety. In an ideal world, everyone would be pulling in the same direction for the same common goal.
Any additional thoughts or comments regarding how this bill will/could impact food processing operations?
IH: This Bill will have a significant impact. It requires food and beverage manufacturers to ensure the safety of the entire food supply chain from field to shelf. It’s one thing for consumers to buy a can of soup, but the ingredients for that product could have been grown in areas where food hygiene and processing standards may not have been adequate, or sub-contracted to a web of producers not all of whom follow required procedures or maintain appropriate standards. No reputable business would knowingly purchase substandard ingredients and put its reputation at risk, but this legislation will focus minds and may force some companies to review their sourcing criteria and procedures.
JP: We’re going to see a major impact on smaller processors, who will not be able to cope with the increased paperwork and heavy fines. It’s probably a matter of time before these operations are forced out of business, since the market is unlikely to allow them to significantly raise prices and furthermore larger processors will look to acquire them. Although the Tester Amendment protects the smallest farms — those with under $500,000 in annual revenues — the medium-sized food processors will have the hardest time complying with the new legislation. Although there’s no doubt they have good intentions, few have these programs in place already and the cost to invest in new technology is too great to support.
For the consumer, this means we’ll be even more dependent on large, national food companies for our supply chain and safety.
VR: The food safety bill stresses the importance of quality and making sure the business is built around designing for quality. In order to reduce costs and mitigate the risk of harm, companies need to make sure they’re building their processes from a design, manufacturing and regulatory perspective. I also believe the bill will usher in a greater need for technology solutions to enable higher food safety and quality.