Opinion

Why it’s important not to sugar-coat facts when it comes to ensuring an effective supply chain

23 March 2016

Nick Miller_Crimson and Co
Nick Miller

Nick Miller is the head of FMCG (fast moving consumer goods) at global supply chain consultancy Crimson & Co. In this opinion post he explains why the recent product recall at confectionary manufacturer Mars serves as a timely reminder to the entire food industry of the importance of complete visibility across the supply chain process

Mars’ recent product recall should serve as a wake-up call to the dangers of not being able to trace your products within your supply chain. While effective processes are likely to be in place when it comes to tracing back to plants, manufacturing lines and production process, the challenge often lies in understanding what happens when a product leaves a factory, notably who, when and where it goes to.

Mars was at the centre of an international supply chain incident after a piece of red plastic was found in a Snickers bar bought in Germany. The plastic was traced back to a factory in the southern Dutch town of Veghel, where it was determined that the piece came from a protective cover used in the manufacturing process.

While the confectionary giant was keen to play down the incident, concerns mounted when it could not guarantee the plastic found was isolated. This led to Mars’ products being recalled across 55 countries including Britain, France, Netherlands and Germany, potentially costing the company tens of millions of dollars.

Complete visibility

The incident, while undoubtedly a PR disaster for the brand, should also serve as a timely reminder to the importance of having complete visibility across the supply chain process.

When the news broke surrounding the Mars recall, a lot of people initially saw this as a failure within the manufacturing process, highlighting the importance of having an effective quality management system in place to ensure incidents, such as this, are avoided. While this is critical, what was more apparent was the supply chain failures, notably the need to have complete confidence in traceability processes.

Ultimately, no manufacturing plant is able to guarantee total 100% success during its production processes. Incidents do occur and quality control systems are not infallible. While the regularity of these incidents are likely to be the key differentiator between what sets these businesses apart, what shouldn't differ is how they react to an incident.

Looking at Mars, what was striking was its ability to trace the incident. Because of the processes in place, the company was quickly able to identify the plant in question and isolate the incident. While this was critical to understanding how faults in the production process occurred, what it also highlighted (or didn’t) was what happened to the chocolate after it left the plant.

The impact meant that because Mars was unable to determine whether the incident was a one-off, this led to a ripple effect across its entire supply chain, leading to 55 possible countries, including the UK, being at risk – also demonstrating wider problems across its manufacturing processes when it comes to traceability.

Organisations have the ability to track their products when they leave their warehouses, however, this can be a convoluted process, as it passes down the supply chain to the end consumer.

There is often a lack of sight from the manufactures as to understanding where the products have gone, notably, who has bought them, which retailers sold them and where were they sold? Failure to present this information undermines assurances within the quality management process and can ultimately lead to incidents, much like Mars, whereby significant reputational damage and potentially large financial losses are felt across the brand.

By being able to present this information, it will give confidence to the market surrounding your entire supply chain process and will minimise the chances of your customers being directly affected.

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