The Cost of Food Safety

The current effects of the largest recall in U.S. history, that of peanut contamination, has caused and continues to cause massive product recalls throughout the United States and into other countries.

The company which had the issues and initiated recalls has filed for bankrupcy protection. It certainly has exceeded its level of insurance protection and asset protection.

Who does this affect and what is the cost? Certainly, the families who lost a loved one and those that suffered illness, have real medical costs and have suffered emotionally.

The employees, who no longer have a job, have lost their income. Eventually, since this has happened in the worst economic times since the early 70's, they could lose their homes, cars, etc. They can be on unemployment, food stamps, government assistance programs. They are not working so they do not pay taxes, which increases the burden on the local economy, the state and the U. S. economy.

The businesses in their communities suffer because they lose a customer base.

All the companies that initiated a recall, and the list continues to grow, have suffered loss that will be in litigation for some time. This affects the financial stability of these companies.

An article today by an insurance company, addressed the availability of insurance to handle these type of cases. The manager stated that the food company first needed strong quality, traceability, recall and crisis management programs in order to be considered for this insurance. Certainly, this recall has affected the rates for this insurance.

Good Manufacturing Practices, a complete HACCP plan, a working Quality program must be part of the process. We have focused a great deal of effort on finding better ways to improve speed of recall to protect the public. More work is needed to make an effective program for the entire food industry.

However, if we place more effort on education and practices in our plants, we can effectively reduce and control liability to our companies and to the public. A strong food ethics program is critical to this process.

I will comment more on this in future communications.

I look forward to discussing your situation or concerns.
Contact me at rudy@powerinlearning.com

Until then be safe and be questioning.

Rudy