brussels “using traceability in the supply chain to meet consumer safety expectations”

Brussels

“Using traceability in the supply chain to meet consumer

safety expectations”

Agenda

Introduction– ECR Europe work: context and facts– Summary on content of the ECR Blue book

Manufacturer and Retailer positioning Concrete examples of implementation of

good practices– Kraft International Commercial– Cora

Example of collaboration between a manufacturer and a retailer

Panel discussion and Question & Answers Conclusions

Introduction - Context and facts

Business requirements Legal requirements: General Product Safety Directive and

General Food Law March 2003: ECR Europe Board launched a core team

under the initiative of ECR D-A-CH, France, Spain May 2003: Presentation of core team mission at the

ECR Europe Conference in Berlin June 2003 - January 2004: Blue Book developed and

validated 15th January 2004: Blue Book officially endorsed by 21

ECR National Organisations End January 2004: Blue Book as ECR Europe

publication Today: Breakout session at ECR Europe Conference in

Brussels

Content of the Blue Book: main aspects addressed

Chapter 4: Business needs – Ensure consumer safety and confidence – Protect brands, companies, product categories and the

entire industry life– Limit the impacts of crisis by a joint efficient management– Efficiency comes from collaboration and common practices

Chapter 5: Legal requirements– Traceability and flow of information (as a tool to protect

consumer safety) – Product withdrawal and recall and therefore crisis

management procedures

Chapter 6: Traceability & Technology: Process and solutions

Chapter 7: Incident / crisis management, withdrawal and recall processes

Key business rules along the Blue Book

As a manufacturer

Nestle supports Blue Book

– Pragmatic approach to a European and even Global Process

– Common framework and guidance to all companies

– Promotes collaboration

The Blue Book enables the “one step down, one step up”

approach for all companies independently of their size

Carrefour and food safety vs EU

Food safety is non negociable, the precautionary principle must be applied where it is necessary for consumer safety and health

Traceability is a fundamental tool for food safety but it is also used to improve daily operational performances

Carrefour supports legal obligation of results and pledges for a voluntary approach of liberty

of means

Carrefour and traceability systems

Traceability must be seen in an evolutionary, voluntary context in partnership with every players involved, taking into account management and/or administrative and/or logistics and/or economics and public health objectives

Carrefour develops systems of products specifications management, of logistics management, of crisis management which have proved their global efficiency. SSCC and EAN-128 are pragmatic examples Carrefour supports Blue Book in a voluntary

context in technological development, taking into account, according to food safety

requirements, specific objectives of the different sectors of activities involved

Carrefour for its consumers with its business partners

Traceability applied today by Carrefour allows us to guarantee to our consumers fast and efficient quarantines, withdrawals and recalls

Carrefour develops with its business partners targeted quarantines, withdrawals and recalls taking into account public health (precautionary principle), business and economical criteria Carrefour guarantees first and foremost food safety for its consumers, then Carrefour takes into account the business context and partners economical concerns (contractual)

Coming Up

Case study manufacturer:

– Kraft International Commercial

Case study retailer:

– Cora

Kraft International Commercial

Ronald Grube

Traceability and Technology: Process and Solution

Practical case profileThe object: Plant buffer whs. and Distribution Center in Disena

Storage equipment: conventional rack storage & block

storage

Material type stored: FG,RM,PM,PoS Capacity data: 10.000 pallets available capacity

The mission: implement efficient traceability procedures that

fit perfectly into our global supply network and sensitise the traceability aspect

The challenge: consider different technological levels at

different sites

The tools: ECR Standard solutions based on EAN.UCC Standards

Migration plan: The 8 important steps


SCOPE

Assessment

Scorecard

Identification

Lot Codes

Labels

EDI

Test Run!

implementation

analysis

The scope: a question of interfaces . . .


Warehouse

Plants

Co- Manufacturers

Trade

Co- Packers

other Warehouse

INBOUND

OUTBOUND

RETURNS PICKING COPACKING

STORAGE

Assess a micro-cosmos: your warehouse!


Unique identification Data communication Data capture Data link management

EDI Infrastructure . . .

For every flow:


Use scorecards to measure the degree of implementation achieved and compliance

Identify and document the steps required to implement a change programme and achieve best practice with the following possible impacts:

– Organisational changes

– Investment in technology

Key learning: Scorecards are useful


Scorecard results: the “initial situation”

Traceability is based on manual procedures (e.g filing delivery notes)

We need: fast reliable answers to

– What has been received and send out ?

– From whom goods were received and to whom had they been delivered ?

To consider: risk of mistakes for initial situation is high and even increasing with a higher shipping volume


GLN GTIN for CU GTIN for SKU

Unique identification of locations and products

GLN identifies legal, functional and physical entities with a unique identifier and is key concept in EDI

GTIN must be allocated to each product GTIN changing based on GCI allocation rules

Implement the linkage of unique product identification with a lot code

Consumer Unit

Traded Unit

Pallet

4012345123456


A lot code is necessary at any point in the supply chain

A lot code should never be manipulated or changed

Example of lot code structure

I P D SID LINE DATE PLANT

alphabetical numerical numerical alphabetical ...I = Internal

E = ExternalPackaging Line

NumberProduction year Plant code

Any pallet needs to carry an SSCC

Implement EAN.UCC pallet label toguarantee common design

Ensure product identification integrity


Uniform mono-lot pallet

SSCC

3 76 10100 912 568 763 3

ECR Company Ltd.

Premium Product 12x100g

CONTENT

5000243720517

COUNT

48LAYERS

4

Lot Code

MYAUI235BEST BEFORE END (MM YYYY)

03 2002

(00)376101009125687633

(02)05000243720517(15)020331(37)48(10)MYAUI235

SSCC

Lot code

GTIN of SKU

Logistics label: the serial shipping container code (SSCC)

The edge: electronic data interchange


Pallet with SSCC

SSCC scanned

Message

Applicable EAN.UCC standards are EANCOM® and EAN.UCC XML messages

EANCOM® Despatch advice EDI message is the enabler for efficient traceability

Each physical movement of a product is linked to a transactional flow

Logistics op. Logistics op. Plant Warehouse

Buy Consumer unit in Outlet

Allocate Plant Data transfer Record lot charge ,

BBE, EAN 13 Generate SSCC list incl. # cases delivered to which

consignee

Generate Customer drop point list sorted by SSCC, lot code , #

cases delivered

Tracking information

Transfer information

Verify customer list and drop point

SUCCESS

Yes

Recall successful

No Data check Data check Data check

Test run (the “mock- recall”)


Example of a sequence diagramm visualising a test run

Can your warehouse tell you exactly and on time for a randomly chosen product:

- how much was delivered to the warehouse and when?

- how much is still remaining in the warehouse?

- how much and to which customer has it been dispatched?

The figures:

Planning time: 4 months

Time needed to migrate: 6 months

Implementation core team: 4 – 6 FTE

Investment: 10 – 20 % of WMS project cost


The efficiency of the traceability network is determined by its weakest link.

Every single component of your supply chain must be in line with defined traceability

processes and solutions - do not forget the

„THE DEVIL IS IN THE DETAIL“

CORA

Gérard Ferry

ECR France and Cora support the Blue book

AUCHAN, BONGRAIN SA, Brasseries KRONENBOURG,CARREFOUR France, CASINO, COCA COLA, COGESAL MIKO,COLGATE PALMOLIVE, CORA, DANONE (EVIAN VOLVIC),DANONE Groupe, DECATHLON, DUCROS SA, EASYDIS, ELVIR, Fromageries BEL, GENCOD EAN France, GEORGIA-PACIFIC France, Gilbert LEMELLE, KELLOGG'S Produits Alimentaires, KRAFT FOODS France, LACTALIS, LEVERFABERGE France, L'OREAL, METRO, NESTLE ProduitsLaitiers Frais SA, NESTLE WATERS France, PANZANI,PEPSICO France, PROCTER & GAMBLE, SOLINEST, SYSTEMEU, SYSTEME U OUEST, UNILEVER BESTFOODS France,YOPLAIT.

Coordination with the following French organisations: FCD, ANIA, Gencod EAN France, AFNOR, AFISE, CFA, CFCA, … and public agencies

Definition of an incident

An incident is any situation, that might imply a real, presumed or perceived product safety or serious quality deviation from legal requirements and / or internal quality norms

Definition of a crisis

It is any “incident situation” where there is reason to believe that a product distributed in the supply chain or placed on the market may be injurious to human or animal health and /or to environment protection, and / or have serious negative impact on the business organisation and / or image of the company

Definitions (1)

Withdrawal«shall mean any measure aimed at preventing the distribution, display and offer of a product dangerous to the consumer»

Recall«shall mean any measure aimed at achieving the return of a dangerous product that has already been supplied or made available to consumers by the producer or distributor»

from Directive 2001/95/EC

Definitions (2)

Recommendations on organisation, documentation and training

Organisation to have in place to efficiently withdraw/recall a product– Defined responsibilities– Contact list (internal/external)– Documentation

Internal documentation

Personal skills

Training

Self assessment

Procedures, roles and responsibilities are to be documented in prevention of an incident,

not in reaction to an incident

Recommendations on responsibilities at each organisational level

Crisis management at company level is coordinated by a crisis management group

This group is headed by one central crisis coordinator

The crisis management group is the committee responsible for deciding and controlling the actions

At the start of a crisis, the organisational requirements for dealing with incident

management in the firm's organisational hierarchy must be in place

Recommendations on contact list (internal/external)

Contact list must always be complete and up-to-date

The list must include– all contact options both during and outside office

hours– substitutes in case one of the people responsible is

not available

The list must be made available– at a suitable place (e.g. the firm's intranet,

posters)– to enable access mainly outside office hours

If the product in question has already left the firm's own organisation, the external

partners involved must be contacted

Recommendations on ethical code

Four principles– Co-operation and co-ordinated action– Provision resources throughout the chain– Non-use of crisis situations as support to

marketing actions– Communication

Apply the “golden rules”

Companies are committed not to deliver communication to the media that refer to

third party companies without having previously co-ordinated it

Is your company ready? Self assessment scorecard

Incident /crisis management

Requirements / actions Score

Incident /crisis management team has been appointed with clear definition of roles and responsibilities

Internal guide on incident/crisis management with clear definition of withdrawal & recall procedures, incident evaluation … has been fully documented

Contact lists have been documented and distributed

Contact lists have been made available to key trading partners

Each person involved in incident/crisis management, product withdrawal/recall procedures understands their role and scope of actions

Training material has been developed

Training of people is performed regularly

Regular exercises are run to test the crisis management team, incident and crisis management plans, checklists and to update the self assessment scorecard

Regular exercises are run with key trading partners

0: No action taken1: Plans have been established but the work has not started2: Implementation has started with a limited scope (e.g. some product categories)3: Roll-out of full implementation has started4: Plans fully implemented

Cora experiences

More than 250 alerts and withdrawals per year, around one per day

2 to 5 recalls per year (food and non- food)

Avoiding Quality

Preventing/anticipating

TraceabilityContacts listCrisis team

configuration

How to manage a crisis? Cora’s vision

Notification in the trade terms (selling and buying) of the companies

Preventing crisis

Four recommendations

– Implementation of a (cheap) phone number (ie n° azur)– Updating names of the people to contact in case of crisis– Permanence of email addresses and phone numbers– Commitment to insure products quality and traceability

Avoiding Quality



configuration

Alert

Crisis No

Yes


Alert: crisis or incident?

Could the problem stop production/ distribution for a long moment?

Does the problem have effects on the environment?

Is the problem media covered or on the way to be?

Does the problem overstep an individual framework?

So it’s a false alert!

No

No

No

No So it’s a crisis!

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Does the problem concern several family of products?

Does the problem have consequences on consumer health or safety?

Does the problem affect high risk population? (child, elderly people…)

Is the product still useable (edible) (not destruct/eaten)?

No

No

No

No

Does the problem exist?

Is it a crisis or a false alert?

Yes

Avoiding Quality



configuration

Alert

Crisis No

Yes

Managing

Withdrawal, recall, quarantine,

Information flows, Communication, …

Crisis settling


Managing crisis

Withdrawal

Recall

Freezing (quarantine)«shall mean any temporary measure aimed at freezing the products shipment in the supply chain and not to deliver them to the consumer during an agreed time period. After analysis, the following choices can be taken : the product de-freezing (put back for sale) or its withdrawal » (ECR France proposal)

How to inform rapidly and effectively our partner?

From ? manufacturer or ? retailer ? owner or ? non owner of the brand EMERGENCY-WARNING

File n° ………………… Update on :………………….. N° …… for …… concerned EAN N°……. for …… concerned points of delivery

Departement or category of product : Brand : ( 1 reflex form per product)

? Quarantine of the product (without any instructions of de-freezing, withdrawal of the product from : dd/mm/yy hh:mm)

? Withdrawal of the product (without any re-sale possible)

? Recall of the product

Samples to keep : ? yes, quantities : ? No

From : Company : Name of the interlocutory : J ob title : Telephone : Mobile : Fax : Email : Global Location Number (GLN) :

Destinataire habilité Company : Name of the interlocutory : J ob title : Telephone : Mobile : Fax : Email : Global Location Number (GLN) :

Concerned point of delivery

EAN Code of

consumer unit Brand Denomination Size Flavour,

shade, … Lot numbers concerned

Expiry date SSCC Quantities (CU)

Transport reference Delivery order reference Delivery date

Reasons of the alert and potential risks: Is there any message for consumers? ? Yes (see enclosures)

? No Alert source : ? Manufacturer ? Retailer ? Consumer ? Administration ? Other :

I f withdrawal or recall : way of destruction or return :

Quantities ascent / evaluation

Comments :

Receipt advice : Point of sale / delivery centre informed on :

Products flow «reverse logistics»

Possible site of destruction

PoS by DSD

Delivery

Ascents of incriminated products

Avoiding Quality



configuration

Alert

Crisis No

Yes

Managing

Withdrawal, recall, quarantine,

Information flows, Communication, …

Crisis settling

Con

tinu

ou

s im

pro

vem

en

t pro

cess


Collaborative approach

Cora and Nestlé

Experience in 2003 in France

Nestlé Quality Management detected a "plastic foreign body" in a product already distributed to the Trade

Crisis Team alerted – Assessment

• What is it?• Is it dangerous to consumers? (NO)• Who received the product?• Should we alert our Customers? (YES)• Communication developed

– Customers contacted• Not serious issue but Nestlé decision to withdraw the product• No need to remove the product from the shelves, only DCs• Product, Batch number, pallet numbers (SSCC), Distribution

Centres

Experience in 2003 in France - 2

Dialogue between Cora and Nestlé Teams– Better understand the issue– Further information sharing

Cora Internal assessment of the issue reported– Withdraw the product from the distribution centres

only ?– Cora's usual way of dealing with incidents

Common Cora / Nestlé decision – Withdraw the product from distribution centres and

shelves

Common agreement on: the event is now over Archive

Experience in 2003 in France - 3

Key learning and recommendations Even if minor issue, do not underestimate it and

treat it as an incident The experience shows:

– Each retailers is different in terms of organisation and internal process

– Need for regular discussions / meetings in order to understand each other ways of working and align as much as possible the approach

– at least one meeting per year where information is shared: what's new? proposals for improvement, etc.

– The absolute need for regular joint exercises – The absolute need to take stock of the way each issue / alert

/ incident was managed in order to improve

Nothing really new: It is documented in the ECR Europe Blue Book

Panel discussions and Q & A

Facilitated by Saliha BARLATEY

Key message and conclusion

Saliha BARLATEY

ECR Europe Core Team's Key message

As a Project Team, we have done our very best

Help us to ensure the implementation of this European best practice:

– In your own company– By your trading partners (co-

manufacturers, co-packers, suppliers, third party logistics & solution providers…)

This blue book has been developed for all of us, with

one objectiveBusiness Excellence

ECR Europe [email protected]

ECR D-A-CH - CCG

Ruediger HAGEDORN

Email: [email protected]

ECR France

Olivier LABASSE


ECR Spain - AECOC Jordi MUR


Just contact...

Many thanks to ...

ECR Europe Core and Validation Teams

And to the 84 companies, which have contributed to the Blue Book

Saliha BARLATEY NESTLE Europe, ChairmanPhilipp BOTZENHARDT ECR D-A-CHHugo BYRNES CIESGéraldine FOUQUE ECR FRANCERonald GRUBE KRAFT FOODSRuediger HAGEDORN ECR D-A-CHIngemar HANSSON ECR SWEDENOlivier LABASSE ECR FRANCEJürgen MATERN METROMiodrag MITIC EAN INTERNATIONALJordi MUR AECOC, ECR Spain

ECR Europe Traceability Core Team

brussels “using traceability in the supply chain to meet consumer safety expectations”

Documents

blue book slide

ecr blue book manufacturer

food safety requirements

blue book pragmatic

ecr europe conference

food safety vs eu food

brussels slide

ecr europe publication