Do your homework

27/11/2016 - 23:00
Many catering operators rely on the honesty and integrity of their suppliers, but might this reliance be abdicating their own legal, corporate and moral responsibilities? Compliance expert Andy Tyson, co-founder and director of Trade Interchange, a one-stop shop handling compliance issues for clients, offers his view.

The importance of supplier management is sometimes undervalued. However, complying with legislation and guidelines, as well as customer concerns, when it comes to a business’s supply chain, is crucial to maintaining a solid reputation as well as protecting customers and consumers.

Excuses such as, ‘I didn’t know’ or ‘I wasn’t told’ are no longer accepted or valid. And under-investing in supply chain management increases the risk of irreparable damage to brand and reputation, which in turn could lead to substantial losses for the business.

Legal and ethical responsibilities in the foodservice and catering industry have increased dramatically, following EU allergen legislation, public concerns regarding antibiotics in foods and, most recently, the UK’s Modern Slavery Act.

The possible outcomes of non-compliance on public health concerns – reputation damage, fines and, in extreme cases, criminal charges – mean that foodservice businesses need to be well acquainted with the provisions within the various regulatory frameworks.

Since the regulations on food allergens and labelling were introduced in December 2014, public awareness about potential allergens in food has increased dramatically.

Despite this, many would argue that the hospitality and catering sector is still not up to speed on this pressing and potentially deadly issue. And with 4,500 people hospitalised every year from allergies in the UK and ten needlessly dying from their reactions, this is a serious problem.

Caterers can control training and procedures can be put in place to ensure best practice when it comes to allergen controls within their own individual businesses, but can they control their supply chain?

Making sure that potentially dangerous products do not make their way on to dinner plates is a matter of national safety and responsibility.

Recent headlines claiming that antibiotic resistance ‘could become a bigger threat to people than cancer’, have highlighted the growing national and international concerns about the misuse of antibiotics within food production.

Because animals can serve as a ‘host’ for resistant pathogens and resistance mechanisms, such bacteria can be transmitted to humans through the foods we eat and therefore lead to human infections that are resistant to antibiotics.

Many consumers feel that they are effectively eating what animals raised as food consume, which has fuelled a growing mistrust among the general population about antibiotic-filled livestock.

As a result, investors are becoming increasingly worried about the potential risk to consumers and the irreparable damage that a scandal could cause to a company’s brand reputation and bottom line.

While responsibility for monitoring antibiotics in foods is often placed on meat, poultry and fish suppliers, rather than outlets that sell this produce to consumers, it is becoming obvious that public and investor concerns about this looming health crisis should bring this issue into greater focus for caterers and foodservice operators themselves.

One further potential brand-damaging scandal concerns the recent implementation of the UK Modern Slavery Act, which deals with slavery, servitude, and forced or compulsory labour and human trafficking.

Slavery might not seem a major concern in the UK, but the Modern Slavery Act, through its Transparency in Supply Chain Provisions clause, actually means that any company operating in the UK, with a turnover of more than £36 million, must disclose all the steps it takes to ensure modern slavery and human trafficking does not take place in any part of its business, including the supply chain.

It also means monitoring the suppliers of their suppliers too – if they also generate a turnover in excess of £36 million– which creates a whole new level of complexity.

By bringing modern slavery to the forefront of boardroom considerations, operators are waking up to the severe consequences that they face if they fall short of compliance.

And while many operators have gone above and beyond expectations to comply and bring confidence to consumers, others have been slow to address these issues.

But ensuring compliance is crucial, not only to safeguard customers, but also to protect reputation and brand from damage, fines and potential criminal charges.

The legislation and guidelines may not be all that complex; however, the scope of work is immense. One of the crucial recommendations when it comes to obeying any law or regulation like this is constant collaboration and communication with suppliers.

Obtaining up-to-date information about product ingredients is key of course, but this is only one piece of the puzzle that foodservice businesses need to solve.

Supplier information management (SIM) software is specifically designed to improve the way supplier-related risks are managed. Suppliers complete tailored, comprehensive questionnaires, to collect what foodservice businesses need to know, while also reducing the administrative burden on already busy procurement managers, ensuring greater business efficiency.

These systems can produce full audit trails, which provide evidence of best practice and ensure procedures are in place to protect a business’s brand and reputation. These are essential considerations for chief executives and shareholders alike.

By ensuring transparency about the activities and processes of their suppliers, large-scale caterers are able to identify those that don’t have watertight systems and assurances in place. That way they protect their business and customers alike.

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