2008 Annual Manufacturing Survey: Safety Main Priority, But Green Catching Up

Food safety is still the chief concern of processors, but the ‘green’ trend shot up the charts too; 77 percent see growth this year.

By David Feder, Managing Editor

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Food and beverage processors exited 2007 with confidence in 2008. Our seventh annual manufacturer’s survey shows nearly 77 percent of food and beverage processors anticipate production increases of at least 5 percent this year. And although safety concerns remain the biggest focus for processors, many will be both spending and saving green by “going green.”

There was a record 395 respondents, 160 more than last year’s survey. For the second year, we used an enhanced statistical analysis to generate a clearer picture of processor concerns. Based on a ranking scale assigning weighted relevance to each of nine categories (see chart), each concern was assigned aggregate points to determine level of importance.

2008 Manufacturing Survey Results

Other concerns cited include: “reducing conversion costs, inventory reduction, reducing turnovers;” “replacement equipment and (resources) to accommodate expansion or replacement;” and “regulatory issues.”

Safety first

The optimism for 2008 must be tempered by the concern for food safety, once again the No. 1 concern among our processors. And for good reason: Last year was one of the worst for food recalls. It was a year in which the industry was overwhelmed by food scares and in which “Let’s go for some Chinese” went from a common lunch suggestion to a guaranteed laugh in a Letterman monologue.

"There’s a change of consumer perception regarding the environmental impact of consumer products. Consumers will start to challenge the logistics of certain products and their distribution based on the environment," said Hubertus Schubert, engineering consultant/process engineering for Coca-Cola Co., Atlanta.

But the inundation of Chinese ingredient scandals was only half of last year’s food safety debacle. The domestic fiascos came hot and heavy. One meat processor, Topps Meat Co., folded rather than face the music of the second largest beef recall in U.S. history. E. coli O157:H7 in its hamburgers sickened dozens – but killed no one. And Augusta, Ga.-based Castleberry Foods Inc. was almost taken down by a recall of nearly 100 of its meat-based products for botulism.

We specifically asked about E. coli concerns, although certainly other bugs wreaked havoc last year. Four in 10 answer they are “extremely concerned.” Add in another fourth who are “very concerned” and nearly a fifth “somewhat concerned” and you’ll see this tiny bug is making enough commotion to keep more than 80 percent of processors up at night.

It wasn’t just meat and meat-based pet food that put the fear into processors last year. Bagged spinach and salad recalls nearly devastated those markets. ConAgra early in the year took a $66 million hit for contaminated peanut butter, then near the end of the year recalled Banquet pot pies. Cheese, tortillas, smoked salmon dip, puffed veggie snacks … a veritable supermarket of recalled consumer food products proved processors are having considerable trouble keeping the bugs out of the food.

This epidemic of food-safety failures pushed the issue to one of its highest showings as a top processor concern – more than 52 percent compared to 47 percent last year and 30 percent the year before. "Food safety has captured the attention of both the American public and lawmakers," says Dexter Manning, national food and beverage industry leader for Grant Thornton LLP. “Unfortunately, the FDA’s budget has been slashed in recent years resulting in a reduced number of inspections at a time when we probably need them the most.

“With elections coming this year, many fear food safety will take a back seat,” Manning adds. “On the bright side, the agreement with China is a first step toward improving the quality and safety of imported food and drug products. Under the terms of the agreement, the U.S. will have inspection access to certain Chinese manufacturing facilities for a limited number of products specified in the accord.”

Get clean, stay clean

For the experts, how to ensure safer food still boils down to the no-brainer of clean hands and a clean workplace. “To keep the U.S. food supply safe, all individuals in the food chain, from the farmer to the consumer, must properly handle and process food,” states John Surak of the Milwaukee-based American Society for Quality (www.asq.org). His colleague, Janet Raddatz, tenders a note of optimism: "Our food supply is as safe as it has ever been. Emerging pathogens, mass transportation and a global supply chain will continue to challenge us, yet the food industry remains vigilant in providing consumers with a wide variety of safe, high-quality food products."

So, have our respondents made progress in this regard? Numbers are up only a couple percentage points above the already high numbers implementing employee training programs (89 percent for 2007; 87 percent in 2006) and HACCP plans (57 percent and 55 percent). Improved pest control, more/improved sanitary equipment and rapid microbial detection all stayed within the same percentages in 2007 as 2006.

More than three-fourths (76 percent) of processors say they implemented additional food safety measures in 2007 and about the same (74 percent) say they will this year, too. This is also close to the number (73.5 percent) who have an ingredient/food tracking and tracing program in place. That’s 2.5 percentage points above last year’s responses.

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