A Race Against Time

From January 1, 2005, all manufacturers and suppliers in Europe will be required by law to provide complete traceability of all foodstuffs, animal feeds and the ingredients contained therein. “Traceability must be ensured in all production, processing and distribution stages,” states the EU framework directive. This means that every producer, processor or trader in the foodstuffs chain bears the responsibility for its particular stage. It is also vital to be able to trace at all times from which preceding stage a product has come and to which subsequent stage it has gone. The aim is to make it easy to identify where all the raw materials contained in products come from, from the sales counter to the field, as it were. Holger Behrens is convinced that “completely documenting and tracing every single raw material in a given finished product and the customers it is delivered to will prove a mammoth administrative and logistical task.” Behrens is a member of the Executive Board of Ettlingen-based SAP Business Partner command, which among other things develops and provides software for SMBs in the food production sector.

IT support for batch traceability

Without comprehensive IT systems that efficiently structure and clearly display complete product information, the food industry will struggle to meet the exacting requirements in the future. Dealers, shaken by food scandals, the BSE crisis and label fraud, will tend to place more trust in those food manufacturers who embrace modern technology instead of engaging in a paper chase.
At the other end of the supply chain stand the consumers, many of whom, for example, are extremely skeptical of genetically modified foods. Compulsory labeling of foodstuffs and animal feeds made from genetically modified organisms (GMOs), which has been in force since May 2004, accommodates the concerns of this group. The Directive requires companies who use or supply genetically modified products to ensure traceability. This means that information relating to the presence of GMOs must be passed down the entire trading chain and stored for at least five years.
Compulsory labeling also exists for substances which can trigger allergies. “As soon as such a substance is used in a foodstuff, whether as an additive or an ingredient and irrespective of in what amount, the manufacturer is obliged to declare it in the list of ingredients from 2004,” says lawyer Peter Liesen, consultant at the Association of the German Confectionery Industry. In addition to data on the finished product, the software would therefore have to be able to provide additional information on the raw materials used. A further factor is that companies will in future have to be able to report information about goods’ movements to dealers and the authorities in a matter of hours, instead of within a few days. For these reasons, IT support for batch tracing is indispensable.

The industry has to hurry

The food industry is not yet adequately equipped for the implementation of the new Directive. This is certainly the experience of member of the command Executive Board Holger Behrens, whose Foodsprint SAP Industry Solution already conforms with the new guidelines. “Companies are still dragging their heels as regards the legislator’s extended requirements,” he says, “and in doing this, they are underestimating the explosiveness of this issue.”
And it is a race against time. A few retailers are already requiring that their suppliers transfer invoices, including batch information, electronically within the framework of the IFS (International Food Standard) certificate. Holger Behrens’ experience with his own food software solution has shown that implementing an IT solution with integrated batch tracing takes on average four to eight months. “In other words, companies who don’t want to be left without an IT solution on January 1, 2005 better get a move on,” he stresses. The end of the year could also see bottlenecks when it comes to securing consulting services, since even companies who have implemented food-industry-specific ERP (Enterprise Resource Planning) solutions will face the task of implementing batch tracing in their organization.

Integrated batch tracing …

command recommends that companies preparing for EU Directive 178/2002 select IT solutions featuring an integrated batch tracing component. This necessitates ERP solutions that offer integrated mapping of all foodstuff manufacturing stages – stand-alone solutions will be a problem in future. Integrated systems with standardized data storage, on the other hand, provide the huge advantage of maintaining all relevant production process data, from receiving the raw materials, formula development and processing to packaging, in one end-to-end system. The SAP Industry Solution Foodsprint, for example, features fully integrated quality management, with all test reports of raw materials from incoming goods, incoming process checks during the manufacturing process and final checks of finished goods being captured and managed in the SAP system. Additionally, a Lab Information and Management System (LIMS) can also be connected.

… provides damage limitation in the event of recalls

An integrated system also makes companies more efficient in handling the new duty to report which is already in force in Germany. According to this, companies are obliged to notify the supervisory authorities immediately as soon as they have reason to believe that food supplied by them does not comply with health regulations. “Simply recalling products without involving the authorities is no longer an option in the wake of the new consumer information law,” stresses Peter Liesen of the Association of the German Confectionery Industry. Companies must remove unsafe animal feeds or foodstuffs from sale immediately, brief the responsible authorities and inform consumers of the recall. In the event of suspected incidents, the manufacturer is also obliged to make all information about the batch, together with the addresses of suppliers and customers to which it has sold the goods, available as quickly as possible. The more accurately it can pinpoint the affected batch, the fewer goods must be withdrawn from circulation.