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Costco’s Finished Product Testing May Do More To Satisfy Advocacy Groups Than To Minimize Food Safety Risks

Jim Prevor’s Perishable Pundit, August 3, 2011

Craig Wilson, Costco’s Vice President of Quality Assurance and Food Safety, is one of the most expert and committed food safety people in the world. We know Craig and have great respect for him. He does not, however, work in a vacuum.

Despite the way the issue has been portrayed in the press, Costco has required finished product testing before. In fact, back in 2007 we asked Eric Schwartz, then the President of Dole Fresh Vegetables, Inc., what he thought about Costco’s requirement to test spinach.

High level executives have to deal in a real-world environment that includes regulatory pressure, demands of advocacy groups and actual food safety concerns. It is in the navigation through all this that one finds the explanation for Costco’s decision to require finished product testing on produce and explains why the industry, especially the fresh-cut sector, sees ominous clouds ahead in terms of requirements for testing that will involve massive expenditures and little, if any, return in terms of food safety.

We’ve studied the issue of finished product testing for a long time. You can learn a great deal about it by taking a look at our interview with Mansour Samadpour, Founder, Principal of IEH Laboratories & Consulting Group, which we ran in the aftermath of the spinach crisis, and of the decision of Earthbound Farms to begin such testing.

Testing is not a bad thing, but the problem is that nobody is prepared to test, nor is Costco or anyone else prepared to require, enough testing to generate statistically significant results.

At PMA’s recent Foodservice Conference, Bob Whitaker, Chief Science Officer at PMA, laid out the issue succinctly. He explained that there were approximately four million spinach plants in one single acre of land. Each plant has from four to six leaves. That is about 20 million leaves per acre. The scientific issue is not whether one tests that land or not; the issue is what percentage of those leaves is one actually prepared to test. Due to the cost of testing and the low incidence of problems, testing is simply not done frequently enough to have any impact on food safety. Nothing Costco is doing is going to change that.

So if Costco is not going to make food safer, why would the company impose such a cost on its vendors, costs that always are ultimately paid by Costco’s own customers?

The common expression is that testing is useful for validation of food safety systems. That is said a lot but doesn’t really make much sense. If the testing is not statistically significant, it can’t validate anything.

So what drives this? Sometimes it is internal, especially pressure from the legal department. Following the spinach crisis, Costco withdrew from selling spinach. When it returned to selling spinach, we wrote a piece titled Costco Quandary — Should Pre-Washed Spinach Be Washed Again?.

The interesting thing here, of course, was that Costco’s decision to add a large starburst demanding that consumers wash the already pre-washed product was in direct contradiction to FDA recommendations. The FDA had analyzed the matter and determined not that washing couldn’t theoretically reduce food safety risk but that, practically, the risk of cross-contamination in the consumer’s sink, bowl, utensils, etc., were greater than the risk of imperfectly washed produce. In other words, consumers were likely to wash raw chicken in the sink, imperfectly sanitize it, then get pathogens on the spinach when it was washed in the sink.

To a legal department, though, not all pathogen contamination is created equal. Although surely the individuals would regret any illness, an illness that can be traced to consumer negligence or incompetence is a totally different matter from an illness that can be traced to a product sold by the retailer.

Now, though, the issue has gone beyond legal. Large corporations today not only have to look to sell products but also to operate in a world of advocacy groups.

Advocacy groups have begun to make it clear that just as they have pressured corporations on genetically engineered foods and bisphenol A, so will they soon begin pressuring corporations for finished product testing.

Here is a letter to shareholders of Kroger that dealt with a proxy item sponsored by a group called Catholic Healthcare West. It was a relatively innocuous proposal requiring Kroger to issue a report on “toxic chemicals” in products it sold. These proposals almost always lose, but they are a headache and they come back year after year.

One point is that retailers don’t need the headache. The other is that on an issue such as product testing for safe food, the proposals are so intuitive that consumers, who know very little about the subject, are likely to perceive supermarket opposition to mandated testing as lack of concern for food safety.

In the grand scheme of things, produce is a small part of sales, the added cost a tiny part of produce costs and so the stomach to fight is not likely to be there.

There are real issues with this. Money spent on testing that won’t make produce safer could have been spent to actually make it safer. Raising costs of basic foodstuffs hurts the poor most of all as they spend a higher percentage of their incomes on food. Testing can also create a careless corporate culture. US auto manufacturers were bedeviled for decades by the fact that line workers let things pass knowing that there was quality control step at the end that would pull flawed product. Because food safety outbreaks are fundamentally black swan events, months or years of negative testing can build an undeserved confidence in the completedness of a firm’s food safety program. This reduces the motivation to improve.

Positive findings in testing, so far, do not seem to be resulting in process improvements — one leaf of spinach is positive, the next is negative — and it doesn’t seem to indicate that any company or person has done something “wrong.”

One also wonders how the requirement for sophisticated testing will actually mesh with retail priorities to expand local and small scale sourcing.

The most likely outcome is that everyone will be forced to test so as to satisfy outside advocacy groups, but the amount of testing will be minimized to reduce costs. The end result will be lots of PR about testing, lots of money wasted, no improvement in food safety.

It is a compilation of outcomes such as this that helps to explain why our country is in trouble.

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