Supplier quality management is key to safely sourcing raw materials – part III

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A simple annual review of risk profiles in relation to raw materials and suppliers is not sufficient to ensure quality control. In this third article of a three-part series on supplier quality management, food safety expert Rob Kooijmans (foodrecall.nl) focuses on two important aspects of supplier quality management: food fraud and creating a solid relationship with key suppliers. The first article dealt with certification and auditing, while the second article elaborated on what measures to put in place to manage the information you receive from suppliers is correct and up to date.

Food fraud is here to stay
In today’s world a lot of companies are under huge pressure from their customers (in the end retail) to deliver their goods for as low a price as possible. This price pressure is cascaded down along the entire food (supply) chain. We all like to believe that we are dealing only with trustworthy suppliers, but at the same time we know that this cannot always hold true for the entire food supply chain. Fraud has always been a risk and is most likely here to stay. Companies that successfully address food fraud risks will reduce the likelihood of issues and recalls.

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Is your supplier management process fraud proof?
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 dishonest 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 regions are more prone to corruption and have less strong oversight by the food safety authorities - this is clear from the World Bank’s annual trustworthiness report (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 upon arrival of the products).

Luckily, more and more food safety authorities report instances of food fraud instances. Horizonscan brings all this data in one place, including food fraud risks – watch this video for more information.

Tactics for tracking food tampering
Next to dishonest suppliers, raw materials might also be tampered with during transport (most of the time this is not for economic gain, but more for terrorist motivations). In this case, implementing a sound approach together with the supplier is a crucial step for companies to take. This could involve the following steps (not exhaustive): 1) tamper tracking on packaging (using colors / logo’s / holograms); 2) transportation checks (pictures at supplier compared to incoming materials); 3) 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.

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The benefits of excellent supplier relations

In order to manage raw material related risks, you need to work closely with your suppliers. While the starting point is always a proper, complete and timely exchange of information – it pays to build a better relationship than 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 at 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.”

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Based on a 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 site 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.

In sum: trust needs to be built and it is built through human relationships only, hence setting up a supplier quality management program is a good step to effectively mitigating risks in terms of food safety and food fraud.

Rob's co-worker, Kitty Apples, who is also a co-founder and co-owner of FoodRecall.nlwill be sharing her food safety expertise at Hi Europe 2018 at the Supplier Solutions Theatre on 27th November 2018 from 12.45 - 13.10.