Food Safety in the 21 st Century National Restaurant Association Doubletree Hotel Atlanta, GA October 23, 2008

Supply-Chain Hurdles: Meat and Poultry Gale Prince [email_address]

Consumer Expectation Safe Dining Experience

Under Magnifying Glass

What is on the consumer’s mind?

Consumer Research

Consumer Research Source: FMI Trends 2008

Consumer Research Source: FMI Trends 2008

Consumer Research Source: FMI Trends 2008

Consumer Research Source: FMI Trends 2008

Top Food Stories 2007 Rankings Pet Food Recalls 21 Million pound Ground Beef Recall Peanut Butter Recall Nutrition Labeling NYC FDA restrictions on importing farm raised fish from China Nutrient fortified sodas, juice, teas and flavored waters Country of Origin Labeling Source: Hunter Public Relations Year End 2007

Pet Food Recalls

21 Million pound Ground Beef Recall

Peanut Butter Recall

Nutrition Labeling NYC

FDA restrictions on importing farm raised fish from China

Nutrient fortified sodas, juice, teas and flavored waters

Country of Origin Labeling

Congressional Hearings

Recent Food Safety Problems 2006 Produce Safety was the top news story Spinach Carrot Juice 2007 Product safety was the top news stories Peanut Butter Pet Food Canned Chili 2008 Ground Beef Tomatoes and Peppers

2006 Produce Safety was the top news story

Spinach

Carrot Juice

2007 Product safety was the top news stories

Peanut Butter

Pet Food

Canned Chili

2008

Ground Beef

Tomatoes and Peppers

Product Recalls Are Becoming More Massive 25 million pounds 22 million pounds 1.8 million pounds 143 million pounds Over a year’s production of peanut butter All production codes of chili sauces Multiple brands by multiple mft’s of pet food Over 600 different food products recalled in Europe all related to one adulterated ingredient 30 Millions of toys recalled

25 million pounds

22 million pounds

1.8 million pounds

143 million pounds

Over a year’s production of peanut butter

All production codes of chili sauces

Multiple brands by multiple mft’s of pet food

Over 600 different food products recalled in Europe

all related to one adulterated ingredient

30 Millions of toys recalled

Product Recalls Are Costly Preliminary recall costs reported by firms of recent recalls: $56,000,000 $35,000,000 $60,000,000 $30,000,000 $37,000,000 $103,000,000 Some firms ceased business These costs do not include litigation costs Nor does it include the cost in lost sales

Preliminary recall costs reported by firms of recent recalls:

$56,000,000

$35,000,000

$60,000,000

$30,000,000

$37,000,000

$103,000,000

Some firms ceased business

These costs do not include litigation costs

Nor does it include the cost in lost sales

Legal Impact $15.6 Million in one case Jack in the Box $12.0 Million Odwalla apple juice $4.6 Million for eleven children and E. coli $6.25 Million for hepatitis A Green Onions Food Borne Illness Pending Lawsuits: Pot Pies, Spinach, Peanut Butter, Pizza, Canned Chili, Ground Beef, Tomatoes, Peppers, Lettuce, restaurants, supermarkets, etc

$15.6 Million in one case Jack in the Box

$12.0 Million Odwalla apple juice

$4.6 Million for eleven children and E. coli

$6.25 Million for hepatitis A Green Onions

Food Borne Illness Pending Lawsuits: Pot Pies, Spinach, Peanut Butter, Pizza, Canned Chili, Ground Beef, Tomatoes, Peppers, Lettuce, restaurants, supermarkets, etc

20 Year Trends in Product Recalls

Do Recalls Always Happen Late Friday Afternoon?

Consumer Reaction To Product Recalls

Pet Food Recall Triggered questions on source of ingredients in pet food, but…

Triggered questions on source of ingredients in pet food, but…

Consumer Reaction to Recalls August 2007 Gallup Poll Over 70% of consumers reported to having been impacted by recent food recalls 62% say they have avoided buying certain brands or types of foods 40% reported to have destroyed or returned recalled products 25% worried by impact on their health Gallup Poll taken prior to Chili Sauce Recall

August 2007 Gallup Poll

Over 70% of consumers reported to having been impacted by recent food recalls

62% say they have avoided buying certain brands or types of foods

40% reported to have destroyed or returned recalled products

25% worried by impact on their health

Consumer Reaction to Recalls Harris Interactive Research-April 2007 79% aware of food recalls for past three years 29% felt recalls were “serious concern” 55% would switch brands temporarily 15% said they would never purchase the recalled product 21% avoid purchasing any brand made by the manufacturer of the recalled product

Harris Interactive Research-April 2007

79% aware of food recalls for past three years

29% felt recalls were “serious concern”

55% would switch brands temporarily

15% said they would never purchase the recalled product

21% avoid purchasing any brand made by the manufacturer of the recalled product

Consumer Reaction to Recalls Impact of major food safety issues on consumer purchasing decisions Consumer reported they would not purchase the recall product in the future… 2005 - 6% 2006 - 38% 2008 - 15% FMI Trends 2008

Impact of major food safety issues on consumer purchasing decisions

Consumer reported they would not purchase the recall product in the future…

2005 - 6%

2006 - 38%

2008 - 15%

Consumer Reaction to Recalls Harris Interactive Research-April 2007 News media 24 hour format Story Repeated every 15 minutes Proliferation of blogs Consumers have access to more information about a brand’s not –so– shining moments Once on the internet your story is there forever Internet reinvents recalls months and years later

Harris Interactive Research-April 2007

News media 24 hour format

Story Repeated every 15 minutes

Proliferation of blogs

Consumers have access to more information about a brand’s not –so– shining moments

Once on the internet your story is there forever

Internet reinvents recalls months and years later

Consumer Satisfaction Blogs Consumer Generated Media CGM

Blogs

Consumer Generated Media

CGM

Recall Challenges Ahead I do not expect recalls to decrease Can expect more massive recalls Foodborne disease investigative skills keep improving Media found food safety information sells Consumers becoming more sensitive

I do not expect recalls to decrease

Can expect more massive recalls

Foodborne disease investigative skills keep improving

Media found food safety information sells

Consumers becoming more sensitive

Why the increase in food safety concerns and recalls?

Why the Change Concentration of food production Increased batch size Product changes Changes in food distribution Consumer changes Medical services New science Epidemiology Lawyers

Concentration of food production

Increased batch size

Product changes

Changes in food distribution

Consumer changes

Medical services

New science

Epidemiology

Lawyers

FOOD NET SITES Represents about 15% of US population

CDC Food Net Trends 1996 - 2007 Updated March 2008

Center of Disease Control Pulse Net

Electronic Communications

CDC Outbreak Response and Surveillance Team (ORST)

What does this tell us? The foodborne disease detectives have become very good! The science and electronic capabilities of epidemiology will continue to grow rapidly Electronic communications links all of this together with instant messaging.

The foodborne disease detectives have become very good!

The science and electronic capabilities of epidemiology will continue to grow rapidly

Electronic communications links all of this together with instant messaging.

What does this tell us? Now “ LITTLE PROBLEMS” in the past can now become major events! Failures of basic food safety elements can get your facility into the spotlight. What do customer complaints really say? Do not take unusual events lightly! PREVENTION IS THE KEY TO FOOD SAFETY

Now “ LITTLE PROBLEMS” in the past can now become major events!

Failures of basic food safety elements can get your facility into the spotlight.

What do customer complaints really say?

Do not take unusual events lightly!

PREVENTION IS THE KEY TO FOOD SAFETY

Preventing Food Safety Problems Protecting Your Guests And The Bottom-line

Preventing Food Safety Problems Starts with knowing your product and process Vulnerability of your product to food safety issues The microbiological risks of your product Where are the Critical Control Points Potential impact of post preparation handling The kitchen environment The impact of employee practices

Starts with knowing your product and process

Vulnerability of your product to food safety issues

The microbiological risks of your product

Where are the Critical Control Points

Potential impact of post preparation handling

The kitchen environment

The impact of employee practices

Preventing Food Safety Problems Historical issues Staphylococcus Salmonella E. coli O157:H7 Norovirus Chemical contamination

Historical issues

Staphylococcus

Salmonella

E. coli O157:H7

Norovirus

Chemical contamination

Preventing Food Safety Problems Common Sources Employees Employee practices Temperature Control Cooling Cooking Cross Contamination

Common Sources

Employees

Employee practices

Temperature Control

Cooling

Cooking

Cross Contamination

Preventing Food Safety Problems Know your supply source Ask about the suppliers food safety controls Expect there maybe contamination on raw unprocessed products Design your food safety programs to isolate and prevent cross contamination Temperature control Cooling Cooking

Know your supply source

Ask about the suppliers food safety controls

Expect there maybe contamination on raw unprocessed products

Design your food safety programs to isolate and prevent cross contamination

Temperature control

Cooling

Cooking

Developing a Food Safety Culture In Your Kitchen

Culture Management must demonstrate the culture by Setting the example Provide and maintain your facility to promote good food safety practices Provide employee training and re-enforcement Monitor performance Don’t miss a teachable moment! Being proactive and provide leadership

Management must demonstrate the culture by

Setting the example

Provide and maintain your facility to promote good food safety practices

Provide employee training and re-enforcement

Monitor performance

Don’t miss a teachable moment!

Being proactive and provide leadership

Preventing Food Safety Problems Employee Training Follow up… Facility Inspections Self Third party Inspections can serve as a training tool

Employee Training

Follow up…

Facility Inspections

Self

Third party

Inspections can serve as a training tool

Preventing Food Safety Problems Regulatory inspections Regulatory inspection reports Have you addressed items on the reports Regulatory inspection is not the tell all You need to go beyond You cannot delegate your responsibility to the HD It is YOUR facility and YOU are responsible for FOOD SAFETY!!!

Regulatory inspections

Regulatory inspection reports

Have you addressed items on the reports

Regulatory inspection is not the tell all

You need to go beyond

You cannot delegate your responsibility to the HD

It is YOUR facility and YOU are responsible for FOOD SAFETY!!!

Preventing Food Safety Problems Two hot topics for 2009 Product Recalls Do you monitor? WWW.Recall.Gov Are you responsive? Traceability How well can you trace your supply chain? How quick can you identify the source of an item? Practice

Two hot topics for 2009

Product Recalls

Do you monitor?

WWW.Recall.Gov

Are you responsive?

Traceability

How well can you trace your supply chain?

How quick can you identify the source of an item?

Practice

Preventing Food Safety Problems To do 1. 2. 3. October 23, 2008 Today you have an opportunity…

Responsibilities

Our Responsibilities Moral To do what is right for your guests Legal To meet regulatory requirements Both as a Corporation and You Personally

Moral

To do what is right for your guests

Legal

To meet regulatory requirements

Both as a Corporation and

You Personally

Complacency Is a self-satisfaction especially when accompanied by unawareness of actual dangers or deficiencies Merriam-Webster Dictionary

Complacency “ We have been in business for 67 years and we have never had a problem.” “ We have always done it like that and it has never been a problem.” “ The inspector didn’t say anything about that being a problem”

“ We have been in business for 67 years and we have never had a problem.”

“ We have always done it like that and it has never been a problem.”

“ The inspector didn’t say anything about that being a problem”

Complacency What about your operation? Have you as a manager become complacent? Are you taking things for granted? Are you accepting less than what you should?

What about your operation?

Have you as a manager become complacent?

Are you taking things for granted?

Are you accepting less than what you should?

Complacency YOU Cannot Accept A Complacent Attitude With FOOD SAFETY

Food Safety is a Journey Not a Destination! You must continue to strive for improvements each and every day in protecting the consumer

Meeting Guest Expectations

Thank you for your attention [email_address]