Traceability Can Boost Your Bottom Line in Global Marketplace

Why should U.S. processors publicly commit to enhanced traceability best practices released this week? I can answer that in just two words: business benefits.

Some benefits are exactly what you would expect in a global marketplace where a Twitter-fueled rumor in Southeast Asia can impact your sales here in the United States. Traceability gives you the ability to quickly identify your products, determine which lots are involved, where they were shipped and where they are now. Timely, solid information like that can prevent damage to your company’s brand and the broader U.S. dairy industry.

That alone provides ample reason to embrace the voluntary best practices released Tuesday by the Innovation Center for U.S. Dairy®— established under the leadership of America’s dairy producers through the dairy checkoff program. But the benefits go far beyond risk management. Traceability yields day-to-day results you may not expect—such as increasing labeling consistency and improving work flow.

The best practices were designed by processors, for processors, to increase global competitiveness, help satisfy future requirements of the Food Safety Modernization Act (FSMA) and, in the rare event of a safety issue, quickly isolate products to protect public health and prevent brand damage.

They do not affect on-farm practices and are designed for processors large and small. You do not need enterprise resource planning software or other technologies. In fact, the practices can be implemented effectively with paper and pencil in just a few minutes a day.

They emphasize these three pillars of dairy traceability:

• Modeling physical plants to know where new lots enter and where products transform.

• Creating a lot identifying mark that will be recognized and used by customers.

• Utilizing enhanced record-keeping that will assist in expedient and effective recall capability.

I chaired the industry work group that researched and created the best practices over a two-year period. My company, Darigold, is one of five processors, comprising more than 20 percent of U.S. milk production, to make the “U.S. Dairy Traceability Commitment” stating we will adopt and apply the practices.

Other early adopters are Glanbia Foods, Hilmar Cheese Company, Leprino Foods, and Michigan Milk Producers Association. That’s a respectable level of commitment to launch a new program. But we have set a more ambitious goal—processor commitments covering 80 percent of the U.S. milk supply within one year. We want the United States to be the recognized global leader for dairy traceability.

Go to the Innovation Center’s website at usdairy.com to learn if the best practices are right for your company.

Also consider the experiences of fellow processors, such as Jeremy Travis, vice president of quality assurance at Hilmar. He saw the business benefits of traceability 10 years ago when Hilmar reviewed its traceability system as it sought Global Food Safety Initiative certification.

“The beauty of adopting enhanced traceability best practices is it forces you to run through your business,” said Travis. “Not just suppliers, but the entire process.”

According to Travis, traceability improved:

• Record-keeping

• Lot and material usage control

• Understanding exactly what went into its products

• Labeling consistency

• The speed of movement from materials to finished product

• Overall flow of work

“Some people see traceability as increased cost and complexity,” said Travis. “But we look at traceability as value, not as a cost.”

Travis volunteered to join our subcommittee to help us spread the word about traceability. “We’re all in this together,” he said.

Indeed we are. But processors shouldn’t make the U.S. Dairy Traceability Commitment just for the noble, unselfish reason of helping the U.S. dairy industry.

Commit to traceability best practices to protect and increase your company’s bottom line.

(Dermot Carey is senior vice president of the Ingredients Division at Darigold and chairman of the Innovation Center for U.S. Dairy's Traceability Subcommittee. This article first appeared in Cheese Market News in September 2013.)

The U.S. Dairy Export Council is primarily supported by Dairy Management Inc. through the dairy farmer checkoff that builds on collaborative industry partnerships with processors, trading companies and others to build global demand for U.S. dairy products.