Here's a Clean Slate to Lowering CostsToday, everybody is obsessed with cutting costs, and one of the biggest of the hidden costs could involve how much time and effort it takes to clean equipment and do it correctly.
Okay, sanitation is a snooze, but look at it from the point of dollars and cents. Maybe, just maybe, they’re spending too much money when they don’t have to do so. If bakers and snack producers incorporate the true costs of sanitation into their budgets, they might significantly change the way they look at capital investments, the equipment they’re planning to buy and the systems that they already have in place.
That was the message from the “Equipment & Plant Design Workshop for Allergen/Pathogen Control,” held last week in Chicago. Sponsored by eight food industry associations, the sold-out workshop explored ways in which equipment design should be improved to lower overhead, improve food safety and comply with increasing amount of government regulations and audits being required by a greater number of retailers and foodservice operators as the cost of entry of doing business with them.
Attending the workshop were equipment suppliers and some of the biggest manufacturers in the snack and baking industry who explored how they can work together to develop standards and procedures for improving the sanitary design of equipment that they could share with the entire industry.
That’s because food safety doesn’t provide a competitive advantage. If one food company goes down, the whole category goes down. If one has a recall, everyone pays the price. Don’t believe it? Ask any company that sold any product containing peanuts or peanut butter last year.
For manufacturers, the objective of attending the workshop was simple. They wanted to find ways to lower costs while ensuring the highest standards of food safety. For equipment suppliers, the incentive would be to design equipment to help manufactures obtain food manufacturers’ objectives.
In the end, they could use these equipment design improvements as a selling point in the market. In fact, several manufacturers indicated they would set up a team to actually work and even visit an equipment company to promote ways to improve sanitary design for the food industry. Of course, I’m sure there are a few added benefits for that equipment supplier as well.
The philosophy behind this workshop is the “10 Principles of Equipment Design for Low-moisture Foods.” The principals are the result of a group of sanitation professionals from the nation’s top food companies, which began two years ago to proactively share ideas on improving food safety through equipment design enhancements. This group, now known as the Grocery Manufacturers Association’s Sanitary Design Working Group, modified the American Meat Institute’s 10 Principles of Equipment Design to adapt them to low-moisture foods and further enhance equipment designs for all processors and their suppliers and co-manufacturers.
Today, the principals have been incorporated into a comprehensive checklist that can be used to evaluate any piece of equipment from a sanitation perspective.
This checklist can be invaluable for any company thinking of purchasing a piece of equipment. It doesn’t matter if it’s new or used, or if it’s currently being used in your plant at this particular moment. The list can save you money in hidden costs in the long run.
In addition to the sticker price, companies need to calculate the entire line’s potential return on investment to determine if the system is right for their operation. Additionally, companies need to do everything it takes to keep a system clean and safe under today’s food safety standards.
Categorizing sanitation under “downtime” is only half of the equation. Consider, for instance, the amount of labor that a company needs to invest each week to properly sanitize each piece of equipment on a weekly basis. Then calculate the thousands of dollars they need to do the job on just one piece of equipment on an annual basis. Then consider the lifecycle of that piece of equipment in the snack and baking industry. It’s not unusual for some retooled equipment to last five, 10, 20 or even 30 years in operation.
Now, considering all of your costs over the long haul, how much did you really spend on that piece of equipment? Is it better to buy new or used? Should you re-haul your existing equipment or just replace it? This checklist allows you to take the guessing out of the answers to those questions.
In case histories presented during the workshop, presenters showed how using the principals of sanitary design to make changes to their operations also improved uptime by 15% while reducing engineering maintenance time by 30% in some cases. In other areas, proper sanitation procedures reduced the amount of chemicals being used and the amount of wastewater being discarded. Do you want these savings going down the drain or being added to your bottom line?
Again, it involves a detailed checklist to get the ball rolling.
From there, it gets more complicated and involves establishing a program that verifies and validates proper sanitation procedures. As they say, if the devil is in the details, then there is no greater hell than when it comes to sanitation. Behind every nook and cranny, there lies a potential for allergens or pathogens to cause serious problems to almost any brand. That’s why the world’s largest retailers and foodservice chains want to have all of their suppliers certified as part of the Global Food Safety Initiative.
And don’t even start thinking about the flurry of food safety legislation that’s currently pending before Congress.
Too many times, market-driven companies are focused on committing their resources only for brand building when a little extra investment in brand defense in the form of sanitation and food safety could avoid potential public relations disasters and pay off in the long run.
Even a simple recall takes tens of thousands of dollars to remove product off the shelves and many more resources to determine the root cause of the recall. That doesn’t include costs involved from the loss of production. It doesn’t include the subsequent investment over time that it takes in brand rehabilitation and in regaining market share. For those who were involved in last year’s peanut recall, the tab simply started in the tens of millions of dollars.
And guess what? Some of these companies are still paying for it as they try to rebuild market share today to what it was prior to last year’s peanut catastrophe.
But then again, it won’t happen to you. That’s the prevailing attitude with the so-called kill step such as the oven or the fryer that every bakery has. Nothing to worry about, right?
Unfortunately, several of the participants in this workshop know otherwise, and many of them are the biggest and the best in the business.
It makes me wonder how vulnerable the rest of the industry is. Are you willing to take that risk? Heck, your customers aren’t.
Editor’s Note: Because the first workshop sold out, the associations are holding a second one that runs from June 23-24 in Chicago. For more information, go to www.aibonline.org. Registration is limited.