When you work in the consumer packaged goods sector of the food industry, it’s good to have the mindset that a recall could happen. This is one of those “prepare for the worst and hope for the best” situations!

There are several different reasons why you might have to initiate a food recall. There could be:

  • a problematic food test result
  • a food-borne illness outbreak
  • improper handling of allergens
  • unsafe packing material
  • a complaint from consumers or elsewhere
  • a recall initiated by a company that you use as a vendor
  • something uncovered during food inspection
  • findings that concern a Canada Food Inspection Agency (CIFA) rep

Whatever the reason, food safety is critical for CPG businesses. Before you initiate a recall, it’s important to: 

  • Know your HACCP (Hazard Analysis Critical Control Points) requirements. As part of your Food Safety Plan, you should be monitoring food safety risks, taking preventative measures, and ready to act if there is a food safety incident. Knowing when to initiate a recall and who to identify must be part of your HACCP planning.
  • Use an Inventory Tracking System. Do you have a way to track all of your inventory? If you can trace all of your inventory quickly and effectively, you’ll be prepared to quickly respond to a recall situation.
  • Initiate Lot/Serial Number Tracking. It’s not unusual for recalls to occur when there is something wrong with ingredients you use to manufacture packaged food. Carefully documenting the lot codes or serial numbers of each ingredient is important in the event there is a recall.
  • Use robust accounting processes and accounting software to stay on top of tracking and managing your inventory. Automating these aspects of your inventory will save you time and money. When it’s done well, you’ll be able to search and determine where the affected food or ingredients are sourced, stored and sold. 

Recalls can be very expensive, but with the right processes and systems in place you can greatly reduce the costs and scope of the recall (refer to the CIFA food recall procedure). When you regularly use the right processes and systems to manage all inventory from raw ingredients to the manufactured products shipped to clients, for example, you can determine specifically which materials are impacted and only recall the product from that limited number of customers. This minimizes the amount of product being recalled and the number of customers affected. 

Conversely, when these systems are not in place, you must cast a much larger net to ensure that all of the product is returned, which is definitely more costly and potentially rattles consumer confidence much more.

Being able to act quickly and efficiently to identify exactly what needs to be recalled and where it is will save you money. 

If you’re curious to learn more about better ways to track your inventory, contact Finatics Accounting Solutions. We can help you to improve your existing system and use accounting software for inventory management.