This hasn’t been the best year for lettuce. E. Coli outbreaks have led to multiple recalls in the past few months, causing serious illness in more than 150 people nationwide since July. In a recall situation, the risks to consumer health are astounding, along with the financial health of businesses. This disruption to the supply chain not only significantly damages a brand’s reputation, it can bankrupt a company. Businesses lose an average of $10 million per recall just in direct costs.
Should a recall occur, consider the steps that must be taken and the costs involved with each:
- Halt production
- Notify retailers
- Alert regulatory agencies
- Identify the source of the problem
- Pull and destroy contaminated goods
- Hire additional manpower to supplement recall tasks
- Pay litigation costs
- Submit government fines
- Purchase recall insurance
- Launch public relations and marketing towards repair of brand identity
- Put plans in place to prevent recurrence
Lack of visibility in the supply chain is a major issue during a product recall. Imagine how much revenue was lost, or the number of consumers who got sick this year before retailers were able to pull all the romaine from store shelves. Even if grocery stores and distributors remove all the product they can, tracking down consumers or restaurants who purchased it is a challenge. Once they leave your company’s hands, products are often difficult to trace and contain.
By illuminating the individual touchpoints, blockchain or serialization provides a solution. In the case of lettuce, businesses can isolate and identify every part of the supply chain from the raw material supplier (individual farm where it was produced) all the way to the end consumer, effectively isolating the blast radius of the recall.
The OneSCM Supply Chain Orchestration Platform can help illuminate these processes, making them more efficient, lowering operating costs, with the added benefit of increasing supply chain agility by reducing overall cycle times. Learn how fast and easy it can be to implement workflow automation in your P2P processes. Reach out to OneSCM today.