It's not often that a simple lot number saves the day. But during this summer's spinach scare, a lot number and the supplier's ace product tracking system helped lead FDA investigators to the source of the deadly E. coli outbreak.
David Maloney has been a journalist for more than 35 years and is currently the group editorial director for DC Velocity and Supply Chain Quarterly magazines. In this role, he is responsible for the editorial content of both brands of Agile Business Media. Dave joined DC Velocity in April of 2004. Prior to that, he was a senior editor for Modern Materials Handling magazine. Dave also has extensive experience as a broadcast journalist. Before writing for supply chain publications, he was a journalist, television producer and director in Pittsburgh. Dave combines a background of reporting on logistics with his video production experience to bring new opportunities to DC Velocity readers, including web videos highlighting top distribution and logistics facilities, webcasts and other cross-media projects. He continues to live and work in the Pittsburgh area.
The story of what happened this summer when spinach was contaminated by a virulent strain of E. coli is first a tragedy for the families of those who died. It is second, a compelling detective story that unfolded as health officials around the nation scrambled to identify the source and the cause of the outbreak (a strain eventually identified by scientists as E. coli 0157: H7).
It is also a story about food distribution and the ability of those who ship food around the nation to track in detail where their shipments have come from and where they go. When something goes awry, that "field to fork" tracking information can offer valuable clues to the problem's source and allow those who manage the affected supply chains to react swiftly and effectively.
The outbreak in August and September led to three deaths and sickened at least 200 people in 26 states. Using a bar code from a bag of tainted spinach, investigators eventually traced the source of the outbreak to plants grown in California. Grocers and distributors responded immediately, pulling fresh spinach from store shelves, distribution centers and processing facilities. During subsequent weeks, investigators narrowed the source of the contamination further to the world's largest supplier of organic produce, Natural Selection Foods of San Juan Bautista, Calif. The company provides vegetables for 34 regional and national food brands, among them Dole Fresh Vegetables. At least nine bags of baby spinach later discovered to be tainted with the E. coli bacterium carried the Dole brand and were packed by National Selection Foods.
Quick response
Dole's response to the situation came long before the company received any confirmation that some of the contaminated products had been packaged under its brand. As soon as there was a suspicion that vegetables might be the cause of the E. coli outbreak, Dole began discussions with the Food and Drug Administration (FDA) and other authorities to help determine the source. Dole also began making preparations to recall products if and when it was warranted.
"As these events unfold, you do not know at first what the problem is, but you need to prepare and begin discussions as soon as possible," says Steve Robinson, Dole's vice president of business process development. "We maintain a database of all customer data. We track all movements of each pallet and case that we manufacture using bar codes that are scanned at each step. If a recall is needed, we know specifically the date of and lot numbers of the products involved and can call up in the system to see exactly where that product was shipped."
Dole relies on homegrown software systems for product tracking and tracing. As orders leave the facility, specific information about the products and their destinations is recorded in the system. Much of that information is then shared with customers through advance ship notices.
Once the FDA had determined that bagged spinach was the cause of the E. coli contamination, Dole immediately pulled its customer records to see where fresh spinach was shipped. It then sent e-mails to customers notifying them of the need to remove and destroy all bagged spinach in the food pipeline.
"We make sure that our food safety programs are well entrenched," adds Robinson. "Traceability is part of good food safety. It starts in the field, [extends] on through manufacturing, and then continues once it leaves us."
Hannaford Brothers, a retail grocer with 150 stores in New England, was also deeply involved in the spinach recall. "We were all impacted and had product in the pipeline," recalls Gerry Greenleaf, vice president of distribution. "When we got the notice, we mobilized our systems very fast."
Information from Hannaford's EXE warehouse management system showed which stores had received spinach shipments, according to assigned product codes. Since this recall required that all spinach be destroyed, managers did not have to check for individual lot numbers. The company pulled the affected products from its three DCs and immediately notified stores using a Web-based application that delivers a pop-up alert to each store manager.
"E-mail is great, but it does not get attention always," says Greenleaf. "With the spinach, we were able to communicate quickly to retail using the alert system."
Though in this instance stores were instructed to destroy all their spinach, that's not usually the case. In most recalls, stores are simply told to send the recalled items back to the DC on the next available truck. From there, products go to a reclamation center where they are either returned to the manufacturer or destroyed. Greenleaf adds that any recalled product that is in transit (inbound from the manufacturer to the DC) is merely refused at receiving and sent back to the manufacturer.
Tracking history
Though most consumers would be surprised to hear it, the United States has no laws requiring companies to recall products found to be defective. It does, however, have a law requiring companies in the food supply chain to keep track of their goods' whereabouts. Passed in the wake of the 9/11 terrorist attacks, that law, the Bioterrorism Act of 2002, calls for companies to maintain detailed records for use in the event of a recall or a terrorism-related investigation.
"The Bioterrorism Act requires anyone who touches food products to be able to identify the immediate previous source of the food and the immediate subsequent recipient of the food," says Deborah White, associate general counsel for the Food Marketing Institute (FMI). FMI is a trade association serving 1,500 food retailers. Along with the record-keeping requirements, the act also stipulates the registration of facilities that handle food and places certain regulations on imported foods. It covers fruits, vegetables and alcohol products. (Meat and chicken, which are regulated by the U.S. Department of Agriculture, do not fall under this legislation.)
In the event of an infectious outbreak, the Food and Drug Administration is given investigatory responsibility for tracing the infection back to its origins, relying on records kept by suppliers throughout the chain. When the FDA comes knocking on a food distributor's door, it had better have a good, trustworthy and accurate method of sharing that information quickly.
These days, that record-keeping method is almost certain to be electronic. There are many software programs that offer the ability to record and track lot numbers and date codes. Most inventory control systems and warehouse management systems (WMS) have fields for recording this information, in addition to the specialized software programs geared specifically for tracking and tracing functions.
One example is software maker Aldata's G.O.L.D. Track line of software, which is used by many grocery wholesalers and retailers to track and trace products through the supply chain. Along with recording lot and batch numbers and manufacture dates, the software also stores information such as expiration dates, the temperatures a product is exposed to along its journey, and country of origin for imported goods. Typically, the information needed to populate information fields resides in electronic form and is handed from the supplier to the recipient for automatic entry into the warehouse management system. This information is then passed along to customers.
Lot numbers and product codes are typically also recorded on invoices, bills of lading and other documentation shared between suppliers and customers, according to Jill Hollingsworth, vice president of food safety for FMI.
"In general, there is a link from the retailer to the distributor and back to the supplier. They work as partners," she says. Enterprise, inventory management and warehouse control systems are also designed to make it easy to exchange this information. Once a threat is identified, stores can now be notified in hours, not days, Hollingsworth adds.
Because goods being recalled may be in transit when the notification goes out, transportation companies also need to be a part of the information chain. "This requires a software handshake between the transportation guys, the suppliers and the retailers," says Bruce Bowen, vice president of retail solutions for Aldata. "Often this is done through a simple exchange of XML data."
Going into withdrawal
Recalls that make the news, like the case of the contaminated spinach, are relatively rare. More often, companies recall products for much less serious reasons. Oftentimes, the cause is a manufacturing error, like the failure to add an ingredient during processing. Though perfectly safe to eat, these products might not taste the way consumers expect, so the company decides to withdraw them from the market.
Even something as seemingly innocuous as packaging can prompt a recall. One breakfast cereal manufacturer recently recalled a kids' cereal brand because of a crossword puzzle on the back of the cereal box. When viewed a certain way, the puzzle appeared to have a rather inappropriate answer. Though there was nothing wrong with the cereal, the manufacturer nonetheless chose to pull the product.
Whether the threat is minor or serious, food suppliers still must have a recall plan in place. Keith Arntson, Del Monte's distribution manager for western states, says that recalls are an infrequent occurrence at the company's Lathrop, Calif., DC, which distributes mostly canned goods. But it has nonetheless established a detailed procedure.
"We very rarely recall products," he says, "but when we do, we directly contact our customers by e-mail. Then we follow up with a letter." The Lathrop facility's DC Wizard warehouse management system captures item and date codes as products are shipped so that a list of where affected lots were delivered can be easily generated to initiate a customer contact.
Arntson says that there are times when a canned product is recalled because of a labeling defect. In those instances, the cans often can simply be relabeled and redistributed to customers. If there's a problem with the cans' contents, however, they're usually sent back to the supplier's DC for further evaluation. In a few cases, the customer is instructed to destroy the product.
Randy Fletcher, vice president of logistics and supply chain management for Associated Grocers, says his distribution center in Baton Rouge, La., receives about one recall a week from his many suppliers. Associated Grocers is a cooperative of more than 220 independent grocers in the South. Fletcher says the notification of the recall, usually in e-mail form, normally comes from the suppliers themselves. FMI also notifies its members when a recall occurs. "Both our buyers' software systems and our Retalix WMS have the ability to record and find lot numbers," says Fletcher. "We can track upstream from where we got the product and downstream to where we sent it."
Associated Grocers then uses a variety of methods to get the message out to its customers, including e-mail, fax and notification on the company Web site. "Within an hour, we send out the first notification to customers," Fletcher says. "We use any method we can to assure that notice is given promptly."
He then follows up the electronic notifications with a hard copy that provides further details, such as the severity of the threat and the procedure for dealing with the product.
During the recent spinach scare, Associated Grocers was told to destroy all of the spinach it had in its warehouse. The cooperative sent the same instructions to its stores, directing that all spinach be destroyed, even though Associated Grocers did not have any spinach from the contaminated supply. (Its spinach comes from Florida.) That was in accordance with FDA recommendations as a precaution, as the source of the tainted spinach was still being investigated. Public confidence was also a consideration. Given the severity of the threat, most grocers did not want to risk alienating customers by continuing to carry any bagged spinach whatsoever, regardless of source.
In less critical recalls, stores are instructed to return recalled products to Associated Grocers' DC in Baton Rouge. From there, the distributor works with suppliers to determine what to do with the product. Some is destroyed, some is sent back to the supplier to be relabeled. In the case of the cereal boxes with the offending crossword puzzles, Associated Grocers was instructed to cut off the puzzles from the boxes, send the puzzles to the manufacturer as proof of credit, and donate the cereal to a food bank.
"We don't want to destroy it if it is consumable," adds Fletcher.
Fast action
As bad as it was, this summer's contaminated spinach scare could have been much worse if not for the fast response on the part of the FDA and the food industry. Relying on their software systems, grocery suppliers, wholesalers and retailers were able to quickly pull products from shelves to assure the integrity of the supply chain.
"There is always a delay ... until the person is diagnosed and we know what the cause is," says FMI's Hollingsworth. "But once that is determined, the system works quickly and effectively."
Nearly one-third of American consumers have increased their secondhand purchases in the past year, revealing a jump in “recommerce” according to a buyer survey from ShipStation, a provider of web-based shipping and order fulfillment solutions.
The number comes from a survey of 500 U.S. consumers showing that nearly one in four (23%) Americans lack confidence in making purchases over $200 in the next six months. Due to economic uncertainty, savvy shoppers are looking for ways to save money without sacrificing quality or style, the research found.
Younger shoppers are leading the charge in that trend, with 59% of Gen Z and 48% of Millennials buying pre-owned items weekly or monthly. That rate makes Gen Z nearly twice as likely to buy second hand compared to older generations.
The primary reason that shoppers say they have increased their recommerce habits is lower prices (74%), followed by the thrill of finding unique or rare items (38%) and getting higher quality for a lower price (28%). Only 14% of Americans cite environmental concerns as a primary reason they shop second-hand.
Despite the challenge of adjusting to the new pattern, recommerce represents a strategic opportunity for businesses to capture today’s budget-minded shoppers and foster long-term loyalty, Austin, Texas-based ShipStation said.
For example, retailers don’t have to sell used goods to capitalize on the secondhand boom. Instead, they can offer trade-in programs swapping discounts or store credit for shoppers’ old items. And they can improve product discoverability to help customers—particularly older generations—find what they’re looking for.
Other ways for retailers to connect with recommerce shoppers are to improve shipping practices. According to ShipStation:
70% of shoppers won’t return to a brand if shipping is too expensive.
51% of consumers are turned off by late deliveries
40% of shoppers won’t return to a retailer again if the packaging is bad.
The “CMA CGM Startup Awards”—created in collaboration with BFM Business and La Tribune—will identify the best innovations to accelerate its transformation, the French company said.
Specifically, the company will select the best startup among the applicants, with clear industry transformation objectives focused on environmental performance, competitiveness, and quality of life at work in each of the three areas:
Shipping: Enabling safer, more efficient, and sustainable navigation through innovative technological solutions.
Logistics: Reinventing the global supply chain with smart and sustainable logistics solutions.
Media: Transform content creation, and customer engagement with innovative media technologies and strategies.
Three winners will be selected during a final event organized on November 15 at the Orange Vélodrome Stadium in Marseille, during the 2nd Artificial Intelligence Marseille (AIM) forum organized by La Tribune and BFM Business. The selection will be made by a jury chaired by Rodolphe Saadé, Chairman and CEO of the Group, and including members of the executive committee representing the various sectors of CMA CGM.
The global air cargo market’s hot summer of double-digit demand growth continued in August with average spot rates showing their largest year-on-year jump with a 24% increase, according to the latest weekly analysis by Xeneta.
Xeneta cited two reasons to explain the increase. First, Global average air cargo spot rates reached $2.68 per kg in August due to continuing supply and demand imbalance. That came as August's global cargo supply grew at its slowest ratio in 2024 to-date at 2% year-on-year, while global cargo demand continued its double-digit growth, rising +11%.
The second reason for higher rates was an ocean-to-air shift in freight volumes due to Red Sea disruptions and e-commerce demand.
Those factors could soon be amplified as e-commerce shows continued strong growth approaching the hotly anticipated winter peak season. E-commerce and low-value goods exports from China in the first seven months of 2024 increased 30% year-on-year, including shipments to Europe and the US rising 38% and 30% growth respectively, Xeneta said.
“Typically, air cargo market performance in August tends to follow the July trend. But another month of double-digit demand growth and the strongest rate growths of the year means there was definitely no summer slack season in 2024,” Niall van de Wouw, Xeneta’s chief airfreight officer, said in a release.
“Rates we saw bottoming out in late July started picking up again in mid-August. This is too short a period to call a season. This has been a busy summer, and now we’re at the threshold of Q4, it will be interesting to see what will happen and if all the anticipation of a red-hot peak season materializes,” van de Wouw said.
The report cites data showing that there are approximately 1.7 million workers missing from the post-pandemic workforce and that 38% of small firms are unable to fill open positions. At the same time, the “skills gap” in the workforce is accelerating as automation and AI create significant shifts in how work is performed.
That information comes from the “2024 Labor Day Report” released by Littler’s Workplace Policy Institute (WPI), the firm’s government relations and public policy arm.
“We continue to see a labor shortage and an urgent need to upskill the current workforce to adapt to the new world of work,” said Michael Lotito, Littler shareholder and co-chair of WPI. “As corporate executives and business leaders look to the future, they are focused on realizing the many benefits of AI to streamline operations and guide strategic decision-making, while cultivating a talent pipeline that can support this growth.”
But while the need is clear, solutions may be complicated by public policy changes such as the upcoming U.S. general election and the proliferation of employment-related legislation at the state and local levels amid Congressional gridlock.
“We are heading into a contentious election that has already proven to be unpredictable and is poised to create even more uncertainty for employers, no matter the outcome,” Shannon Meade, WPI’s executive director, said in a release. “At the same time, the growing patchwork of state and local requirements across the U.S. is exacerbating compliance challenges for companies. That, coupled with looming changes following several Supreme Court decisions that have the potential to upend rulemaking, gives C-suite executives much to contend with in planning their workforce-related strategies.”
Stax Engineering, the venture-backed startup that provides smokestack emissions reduction services for maritime ships, will service all vessels from Toyota Motor North America Inc. visiting the Toyota Berth at the Port of Long Beach, according to a new five-year deal announced today.
Beginning in 2025 to coincide with new California Air Resources Board (CARB) standards, STAX will become the first and only emissions control provider to service roll-on/roll-off (ro-ros) vessels in the state of California, the company said.
Stax has rapidly grown since its launch in the first quarter of this year, supported in part by a $40 million funding round from investors, announced in July. It now holds exclusive service agreements at California ports including Los Angeles, Long Beach, Hueneme, Benicia, Richmond, and Oakland. The firm has also partnered with individual companies like NYK Line, Hyundai GLOVIS, Equilon Enterprises LLC d/b/a Shell Oil Products US (Shell), and now Toyota.
Stax says it offers an alternative to shore power with land- and barge-based, mobile emissions capture and control technology for shipping terminal and fleet operators without the need for retrofits.
In the case of this latest deal, the Toyota Long Beach Vehicle Distribution Center imports about 200,000 vehicles each year on ro-ro vessels. Stax will keep those ships green with its flexible exhaust capture system, which attaches to all vessel classes without modification to remove 99% of emitted particulate matter (PM) and 95% of emitted oxides of nitrogen (NOx). Over the lifetime of this new agreement with Toyota, Stax estimated the service will account for approximately 3,700 hours and more than 47 tons of emissions controlled.
“We set out to provide an emissions capture and control solution that was reliable, easily accessible, and cost-effective. As we begin to service Toyota, we’re confident that we can meet the needs of the full breadth of the maritime industry, furthering our impact on the local air quality, public health, and environment,” Mike Walker, CEO of Stax, said in a release. “Continuing to establish strong partnerships will help build momentum for and trust in our technology as we expand beyond the state of California.”