By Sid Peimer, general manager of International Fine Ingredients (IFI). Peimer is qualified in pharmacy and holds an MBA from the University of Cape Town.
The consumer is now receiving a level of protection that was previously reserved for the white rhino and other entities that we felt were an endangered species. The Consumer Protection Act changes all that – the consumer is now a much protected species. The Act does not require negligence to be a prerequisite for liability – there just needs to be a causal link between the defective product and the harm it causes. Product recalls, you could now say, are in season.
It is now not uncommon to ‘meet’ a supplier on the internet. A customer’s mind is put at rest with the certificate of analysis, safety data sheet and other documentation that is required to conduct business. Although there are suppliers of exceptional standing, (there are many happy mail order marriages), when we ‘want to get the job’ what is this referring to, stretching the truth becomes more commonplace. People do that with their CV’s. Maybe you did too. It’s a human thing.
As we become more connected in the trade industry, it becomes easier to source ingredients and components from further afield. Although a customer may benefit from a price advantage, there is a cost to everything – and the cost is a supply chain with less control. Toyota learnt this lesson at the cost of $2 billion – when faulty accelerators put the brakes on their expansion. The cause, as Toyota ascribes it, was the affiliation with far-flung supply chains, making it harder to control quality. It appears that growth at all costs does have a cost .
2010 was not an easy year for the food industry. Actually, it was a tough year for business in general. When times are tight, we tend to watch our costs, and cut wherever we can. Sometimes the result is a delighted consumer having access to an affordable product; at other times the results can be deadly. Unlike the airline industry, where the result of cutting corners produces a spectacular tragedy, the enemies of food safety can only be seen under a microscope.
Product recalls in the food industry don’t necessarily cost $2 billion, but are not uncommon. Nearly every major food manufacturer has suffered a product recall at some stage. The new Consumer Protection Act, however, brings with it a new threat – class action law suits that allow a large number of consumers to vent their anger collectively at a much reduced cost. Now the consumer does not have to stand alone or consume their life savings to seek retribution.
And not only will suppliers need to defend themselves against claims of the harm caused by the defective product, but they will also have a case against the manufacturer for any harm suffered as a result of the recall. We may have spoken about an empowered consumer in the past, but now it’s going to be law.
The effect of product recalls can range from inconvenience with a dented image to financial distress requiring outside intervention. Insurance against these events can come in two forms: liability insurance provided by an insurer and your own insurance of knowing your supplier.
One example of building and maintaining close supplier relationships is exemplified by IFI Based in Johannesburg, this company has a close working relationship with its key suppliers, AB Enzymes and Kemira ChemSolutions, irrespective of the fact that they are both based in Europe. Reciprocal visits are commonplace and each party is aware of what the other two are doing
Not only is there mutual trust between all parties, but we are able to provide our clients with solutions due to the synergy of shared expertise and an understanding of how to deal with the challenges our clients face.
We receive frequent updates regarding product applications as well as global trends, so we bring the best that Europe has to offer to Africa.
AB Enzymes is one of the world’s oldest and best known enzyme companies. Based in Darmstadt Germany, AB Enzymes provides IFI with the established range of VERON enzymes – in production since 1958.
Kemira ChemSolutions, based in Tiel Holland, is a global two billion euro chemicals company, offering chemical products and solutions to the food, feed, pharmaceutical and chemical industries.
