Transcript Daymon Worldwide Private Label Solutions

Global Trends
in Food Safety
November 2009
Steve DelGiorno
Senior Director, Daymon Worldwide
China Market Landscape
 Government:
 Law, regulation and act issued by central government
 Weak governance
 Local implementation and interpretation may vary from Central policy
 Open to bribery & fixing
 Manufacturer:
 International company/ export manufacturers with good QA expertise
But majority -> huge; immature supplier base
Local Immature process caused bad practice; Less QA/ QC investment
 Products apply to multiple standard, like GB/ QB, FZ, NY etc… / DB/ Q standards
 Retailers:
 Very frequent random tests and challenges by local authorities on product label and safety
 Conservative/ limited investment in QA function
 Only basic knowledge and implementation on PB QA/ any QA management; QA not viewed as critical
function; most retailers do not have complete QA department.
 Third party
 May provide lower service standard due to market competitive cost
 Auditors integrity issue when doing site auditing
 Professional skill varied
 High Consumer Expectations - public complaints on product safety issue, particular on food
That’s Why Quality Assurance Is Critical In China
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QA Initiatives-U.S.
Industry
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Development of singular
recall system
Retail
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Adoption of the CIES
recognized standards (BRC,
SQF, IFS, Global GAP)
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Managing compliance and
certification documents
(Organic, Kosher, third
party plant audit reports,
etc.) via the internet
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Sustainability and Social
Accountability initiatives
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More reliance on sensory
testing and development of
Product Innovation Centers
Software systems such as
Hamilton Grant to develop
and store product
specifications
Increased focus on store
sanitation and use of third
party providers to perform
store audits
Review of auditing
protocols on internationally
sourced products
Daymon
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Sharing of plant audit reports
Promote adoption of a single
audit standard by working
closely with FMI and SQF
CIES Technical Committee
member
Development of Quality
Assurance Share groups
Approval of singular testing
protocols on diapers and
feminine protection items
Finding traceability solutionsTraceTracker
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The Audit Situation Today
Auditor
Effect
Retailer A
Audit fatigue
Retailer B
Confusion
Retailer C
Sept.16
Inefficiency
Auditing Firm A
High Cost
Auditing Firm B
Focus on
Audits-Not
Retailer D
remediation
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The Case For A Single Auditing Standard
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Cost Effective—large suppliers have hired full time “hosts” for auditors, reduces repetitive
audits
Current system is filled with redundancy and is sometimes contradictory
Uniform standard assures that all suppliers and retailers are operating from the same
playbook and audits are better calibrated
Time efficient—speed to market is increased, plant visits can focus on improving
quality/product development
Proven---European model for 10 years (starting with BRC)
Food Safety should not be a competitive issue-there is no reason not to share plant
audit reports
Certified Once, Accepted Everywhere
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Daymon’s Road to A Single Auditing Standard
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We are a member of GFSI’s Technical Committee that approves standards-next meeting
May 18 in Chicago
Daymon has hosted SQF (Safe Quality Food) Training Sessions for suppliers and retailers in
2006 & 2008
Participated in a Discussion Panel supporting a single audit standard at the 2007 QAA
(Quality Assurance Association) meeting
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Working with SQF to meet with non food suppliers to develop a non food audit protocol
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Worked with retail share group members to gain their acceptance of SQF plant audit reports
Certified Once, Accepted Everywhere
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Current Food Safety Concerns-U.S.

Supplier Food Safety Audits
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Melamine
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Traceability
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Bisphenol A
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Obesity
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Peanut Corporation of America (PCA)
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9
PCA Update
To date, more than 2,100 products in 17 categories have
been recalled by more than 200 companies.
 Many items sold under Daymon’s retail customers label have
been affected-categories include ice cream, crackers and bakery
products
 0ver 600 illnesses and 9 deaths attributed to contaminated
peanut products
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On January 27, FDA completed their investigation of the Georgia
facility and issued violations
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On February 9, FDA raided the PCA Georgia Facility
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On February 10, PCA shut down its Plainview, Texas plant
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On February 13, PCA filed for bankruptcy
Jeff Almer speaking
at a Congressional
hearing
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Findings
Company e-mails showed that PCA owner
Stewart Parnell ordered shipments tainted with
bacteria because he was worried about lost sales.
Deibel Laboratories Inc. tested PCA’s products
and notified the Georgia plant that salmonella
was found in some of its peanut stock. Peanut
Corp. sold the products anyway.
Parnell told the manager of the Blakely, Ga. to "turn
them loose" after being told that some products had
tested positive for salmonella.
Stewart Parnell-Owner
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12
Melamine
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Melamine
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U.S. Pet food recall in March, 2007—melamine found in wheat gluten
Infant formula recall in September, 2008—Over 300,000 illnesses and 6 deaths
attributed to contaminated formula. There are claims that Sanlu knew of the problem in
June, 2008
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Trace amounts of melamine found in U.S. infant formula in November, 2008
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U.S. FDA sets 1 ppm limit for melamine
FDA sets melamine standard for baby formula
FDA finds traces of melamine in US infant formula
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A woman, whose child died from drinking
tainted milk, holds a sign reading "Give me
back my child" outside Shijiazhuang People's
Court January 22, 2009.
A newborn baby holds onto his mother's finger
at a hospital in Beijing
Sanlu Executives on Trial
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U.S. Reaction
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Retailers sent letters to all private label suppliers:
Wanted to know if any products contain melamine
Wanted to know what testing procedures have been implemented
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Increased scrutiny on quality assurance protocols for all imported food
products
FDA issues a country-wide Import Alert on milk and milk
ingredients/products from China in December, 2008---Products may
enter the country if they are shown not to contain dairy OR not to contain
melamine, based on tests using methods able to detect melamine at
levels as low as 250 ppb
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Traceability
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TraceabilityRecent Causes For Concern
2008---1442 people in 43 states
confirmed
ill with Salmonellosis
traced to contaminated
jalapeño peppers and serrano peppers
(as of August 26, 2008)
2006---204 people ill with E.
coli O157:H7, 3 deaths in 26
states due to contaminated
spinach
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Food Companies need to do more
than train their employees-they need to
develop a food safety culture
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Why Did It Take So Long To Trace?
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No product code
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No "sell by" date
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No markings in most cases
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The traceback can be further complicated by a lack
of records or incomplete records, or in some cases,
huge volumes of records that need to be reviewed
for key information
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Rethinking Traceability
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Current practices document on a “one-up one-down” method (where did
it come from, where did it go)
Limits each member of the supply chain to a review their own records
relative to traceability.
Process can take hours or days (or weeks) to perform a full trace on
product through the supply chain
Can result in:
• lost $ due to production
• lost $ due to product on hold
• loss of consumer confidence
• Incorrect decision making in a crisis management situation
We need a holistic approach to traceability
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One Up One Down
Ingredients
Stores
Transport
Manufacturing
Retail
Distribution
Transport
Transport
Transport
Bonded
Warehouse
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Ingredients
Transport
Bonded
Warehouse
Manufacturing
Transport
Transport
Retail
Distribution
Transport
Stores
A holistic approach allows
instant access to
traceability at all points in
supply chain
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Founded in 2000
Headquartered in Norway, regional
offices worldwide
Allows for real time product
traceability throughout the supply
chain in real time
Information accessed from your
desktop
Traceability is only as effective
as the weakest link in the supply
chain
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Bisphenol A
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BPA-Bisphenol A
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Used in plastic production
Used to make hard plastics such as baby bottles, toddler
sippy cups, water bottles, and the linings of many food and
beverage cans
BPA can leach from the plastic
Found to cause cancer, obesity, diabetes and other health
problems in laboratory animals
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Reaction
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October, 2008--Connecticut, New Jersey and Delaware sent
letters to companies that make baby bottles and baby formula
containers, asking they no longer use the BPA in their
manufacturing
October, 2008-a panel of scientists state that FDA's conclusion
that BPA is safe is flawed
December, 2008-FDA announces that it will revise it’s BPA
review and consider independent studies
February 2009-law makers in Washington state and on Long
Island propose a ban on plastic containing BPA
March 2009-Sunoco, a producer of BPA, announces it will not sell
BPA to manufacturers who will use it in products designed for use
by children under 3
September 2009-California law makers fail to pass a bill that
would have outlawed use of BPA in the state in drink and food
containers aimed at children
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Obesity
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Obesity Trends* Among U.S. Adults
1985
No Data
Source: CDC Behavioral Risk
Factor Surveillance System
<10%
10%–14%
(*BMI ≥30, or ~ 30 lbs overweight for 5’ 4” person)
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Obesity Trends* Among U.S. Adults
1988
No Data
Source: CDC Behavioral Risk
Factor Surveillance System
<10%
10%–14%
(*BMI ≥30, or ~ 30 lbs overweight for 5’ 4” person)
32
Obesity Trends* Among U.S. Adults
1991
No Data
Source: CDC Behavioral Risk
Factor Surveillance System
<10%
10%–14%
15%–19%
(*BMI ≥30, or ~ 30 lbs overweight for 5’ 4” person)
33
Obesity Trends* Among U.S. Adults
1994
No Data
Source: CDC Behavioral Risk
Factor Surveillance System
<10%
10%–14%
15%–19%
(*BMI ≥30, or ~ 30 lbs overweight for 5’ 4” person)
34
Obesity Trends* Among U.S. Adults
1997
No Data
Source: CDC Behavioral Risk
Factor Surveillance System
<10%
10%–14%
15%–19%
≥20%
(*BMI ≥30, or ~ 30 lbs overweight for 5’ 4” person)
35
Obesity Trends* Among U.S. Adults
2000
No Data
Source: CDC Behavioral Risk
Factor Surveillance System
<10%
10%–14%
15%–19%
≥20%
(*BMI ≥30, or ~ 30 lbs overweight for 5’ 4” person)
36
Obesity Trends* Among U.S. Adults
2003
No Data
Source: CDC Behavioral Risk
Factor Surveillance System
<10%
10%–14%
15%–19%
20%–24%
≥25%
(*BMI ≥30, or ~ 30 lbs overweight for 5’ 4” person)
37
Obesity Trends* Among U.S. Adults
2005
No Data
Source: CDC Behavioral Risk
Factor Surveillance System
<10%
10%–14%
15%–19%
20%–24%
25%–29%
≥30%
(*BMI ≥30, or ~ 30 lbs overweight for 5’ 4” person)
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Obesity Trends* Among U.S. Adults
2007
No Data
Source: CDC Behavioral Risk
Factor Surveillance System
<10%
10%–14%
15%–19%
20%–24%
25%–29%
≥30%
(*BMI ≥30, or ~ 30 lbs. overweight for 5’ 4” person)
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Overweight U.S. Children and Adolescents (Aged 2-19 years)
Source: National Health and Nutrition Examination Surveys
20.0%
18.8%
17.4%
18.0%
16.0%
13.9%
14.0%
11.3%
Percent
12.0%
10.5%
10.0%
7.2%
8.0%
6.0%
6.5%
6.1%
5.0%
4.0%
5.0%
5.0%
4.0%
2.0%
0.0%
1974
1980
1994
2004
Survey Period
Non Hispanic White
Non Hispanic Black
Mexican American
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