FDA Takes Action in Wake of Supply Chain Malfeasance

If the past 30 days are a harbinger of things to come in the food and beverage industry, then perhaps the latest tragedy around the FDA’s failure to better manage the infant formula crisis will emerge as a catalyst for long-overdue change. Recent discussion about a proposed rule change to the Food Safety Modernization Act (FSMA),? Section 204 would enforce better record keeping and swift recall responses. And the introduction of the Formula Shortage Reporting Act of 2022, requiring immediate action from manufacturers when future disruptions to production occur is another step in the right direction.?

For some CPG brands, complying with these requirements might be easier said than done given the complexity of today’s supply chain operations. For example, if passed, Section 204 would require companies who process, pack or hold items on the food traceability list (FTL) to capture and store ingredient data for two years, and submit it within 24 hours of a recall. Likewise, the FDA now requires formula manufacturers to provide at least 72 hours notice before a production interruption as part of the Formula Shortage Reporting Act of 2022. These changes are a welcome relief to consumers and parents still struggling to find formula.?

While I’m not a legal expert, for nearly three decades I’ve worked with CPG companies on all matters related to supply chain operations. And one thing I can say with certainty is that without a formal system of record in place to manage food production, tracing ingredients (where, when, and from whom they came) is a difficult and complex challenge to solve. Human error, overseas suppliers, recalls, and other constantly changing variables all be must be tracked and monitored constantly. But this diligence demands automation and collaboration at scale.

If there’s ever been a time for manufacturers and suppliers to join forces and collaborate on a solution, now’s the time. Bob Ferrari from Supply Chain Brain put it best when he said:?

This (infant formula) shortage relates to a domestic supply network, one where a major manufacturer was forced to shut down production. The resolution is one of domestic response, and since this involves a highly regulated product, dedicated private industry and federal regulatory teams working among all four manufacturers to come up with the best alternatives to ensure daily nutrition needs are met.

We agree: collaboration is the answer. Holistic networked platforms facilitate that by enabling global ingredients suppliers, CPG brands, co-manufacturers, and packing companies to collaborate on safer, stronger, and modern supply chain networks. At TraceGains, we call them Networked Ingredients Marketplaces, and the one we’ve built over the past 15 years is used today by brands like Bimbo QSR and MegaFood to collaborate on 425,000 ingredients from more than 55,000 supply chain locations.

Today, the stakes of not having a modern supply chain have grown exponentially beyond profit and competitive advantage to a whole new level costing lives. If you want to be part of the solution, give me a call, and we’ll help get you started.