exporting to USA FDA edition

by John Moysoglou,Country Manager & Senior Regulatory Advisor (Greece, Cyprus, Romania)

US FDA Regulatory Compliance /

SE Europe Office01

02

03

04

Talking points

USA MARKET: FACTS & FIGURES

SELLING @AMAZON USA

10 TAKEAWAYS

1Registration >

Food Facilities must

designate a US

Agent

2Food Safety Plan >

Mandatory to export your

products to the USA –

PCQI specialists needed.

3Labeling Review >

FDA verified label is all

about ingredients NOT

JUST graphics

4FSVP >

The entity that is

responsible for

shipments entering

the US borders.

Export ChecklistStep-by-Step

Powered by

→ “approves” facilities/products

→ requires submissions of labels

or an inspection before

marketing products

Common myths

→ Regulator / Rule-maker

→ Enforcer / Police

Food & Beverages

→ Inspections

→ Import Refusals

→ Import Alerts

→ Warning Letters

→ Suspension of registration

→ Civil & criminal penalties

Enforcement

U.S. FDA Myths

FDA Food Facility Registrationand the Biennial Registration Renewal

name, corporate entity type,

physical location, trade

names used to do business

Facility Information Contact Information

telephone, email address,

emergency contact,

preferred mailing address

Product Information

general product categories

Two-Step process

FDA RegistrationThe Process

Two-Step process

Prior Notice

Food Canning Establishment (FCE) Registration

FCE RegistrationProduct Types

→ Final pH ≤ 4.6

→ Water activity (aw) > 0.85

In cans, glass, semi-rigid and

flexible pouches…

Acidified Food Low-Acid Canned Food

→ Final pH > 4.6 (certain tomato

products > 4.7)

→ Water activity (aw) > 0.85

→ Common examples: green

olives in brine, artichokes, figs

in syrup, roasted peppers, etc.

→ Identify whether your products are

subject to FCE-SID regulations

→ Receive and share a PDF report

detailing the possible requirements

www.fcewizard.com

www.sidverifier.com

→ Verify if a particular SID is currently

on file in FDA’s database

→ Avoid time-consuming detentions

and entry errors at port

FCE ToolsProduct Types

New Nutrition Labeling Requirements

Mainly in Nutrition Facts declarations

→New mandatory declarations: vitamin D, potassium, added sugars

→Vitamin A and C now voluntary

→Calories from fat may no longer be declared

→New definition for “dietary fiber”

→New units for vitamin D, niacin, vitamin A, vitamin E, folate/folic acid

LabelingWhat’s new?

New entries

LabelingWhat’s new?

Attention

→ FDA allows industry time to incorporate the new rules into their

packaging

→ Based upon the annual food sales of the manufacturer

→ Sales > $10 Million: Jan 01, 2020

→ Sales < $10 Million: Jan 01, 2021

LabelingDeadlines

FDA Food Facility Inspections

Foreign FDA Food

Facility Inspections

FDA inspections are designed to:

→ Identify food safety problems before products arrive in the U.S. or enter

interstate commerce

→ Determine compliance status of facilities

→ Help FDA make admissibility decisions

→ Ensure that food products meet U.S. requirements under the FD&C Act.

Note

→ An FDA establishment inspection is a careful, critical, official

examination of a facility to determine its compliance with laws

administered by FDA.

FDA InspectionsThe Process

Facility’s risk profile

→ Product Risk

→ Process Complexity

→ Facility compliance history (refusal rates, previous

inspection results, etc.)

New exporters shipping large volumes

→ Typically FDA inspects 4-8 facilities on one trip

Convenience

FDA InspectionsWho is inspected first

→ Introductions

→ Opening Meeting

→ Quick Tour

→ Document Review

Inspection Process: Day 1

Inspection Process: Day 2

→ Most time spent in factory

→ Closing meeting with

management

→ Delivery of form “483” reporting

Inspectional Observations

FDA InspectionsThe Process

After the inspection

FDA will eventually classify the inspection:

→ No Action Indicated (NAI)

→ Voluntary Action Indicated (VAI) -

→ Official Action Indicated (OAI)

FDA discloses the final inspection classification in an online database

http://www.accessdata.fda.gov/scripts/inspsearch/

Recommendations

An FDA Preparedness is critical

→ Most companies think they are prepared, but they’re not. Having a

review by an external expert is often highly beneficial

Immediately address simple issues found during the inspection process

Respond to the 483 with evidential solutions, not with vague answers

FDA InspectionsThe Process

Food Safety Modernization Act (FSMA)

21

Key points

→ Preventive Controls for Human

→ Preventive Controls for Animals

→ 3rd Party Accreditation

→ FSVP

→ Produce Safety

→ Sanitary Transport

→ Intentional Adulteration

FSMA7 rules

22

Food Safety

Plan

Hazard Analysis

Preventive Controls

Supply Chain

Program

Recall Plan

Verification

Monitoring Procedures

Corrective Action

Record-keeping

Food Safety Planall about

23

Written by a “Preventive Controls

Qualified Individual” (PCQI)

Signed by the owner or managing agent

of the facility

Who?

Risk Analysis

Identify and evaluate the risks

associated with a certain food

→ Naturally occurring

→ Unintentionally introduced

→ Adulteration for economic

gain

Biological, chemical (including

radiological), and physical

Preventive Controls

Steps to ensure food is

handled in a sanitary manner

Eliminate or reduce the risks

associated with the foods

Examples

→ Sanitation Controls

→ Process Controls

→ Allergen Controls

→ Recall Plan

→ Supply Chain Program

Food Safety Planall about

Very Small Businesses

Businesses (including all subsidiaries and affiliates collectively) that

have averaged less than $1,000,000 (adjusted for inflation) in global

sales of food for human consumption plus the market value of

unsold food inventory per year during the previous three calendar

years

How to verify

Determine whether your facility is eligible to file an attestation at

www.registrarcorp.com/qfa-wizard/

Qualified FacilitiesWho is exempt?

Qualified Facilitiesall about

→ Facilities with >500 full-time equivalent employees: September 19th, 2016

→ Small businesses (<500 employees): September 18th, 2017

→ Very small businesses/qualified facilities: September 17, 2018

Compliance deadlines for all covered human food

facilities have passed

How will FDA enforce this requirement?

→Audit of importer’s Foreign Supplier Verification

Program (“FSVP”)

→Facility inspections

FSVPall about

What is a Foreign Supplier Verification Program (FSVP)?

→Another requirement of FMSA, placed on Importer

→Just like you have to develop a Food Safety Plan, your

Importers have to develop a FSVP

→ Monitor and Approve foreign Suppliers (Import alerts, warning letters,

import refusals)

→ Create and implement an FSVP (Hazard analysis biological, chemical and

physical)

→ Conduct Verification Activities (Review food safety plans, sampling/testing,

on-site-audits)

How does FSVP a regulation that is aimed at the U.S

importers affect the foreign exporter?

Did you know your U.S Importer must:

FSVP will affect your

shipments of

products to US

Trade Shows

FSVP affects you

Top-Trends in

2019…

Amplified by

2018 $ BILLION

RETAIL CHANNELS

FOODSERVICE

ONLINE 2.85

32.4

113.4

TOTAL SALES OF SPECIALTY FOOD TOP-10 CATEGORIESSIZE OF THE U.S. SPECIALTY FOOD

RETAIL,

75%

FOODSERVICE

22%

ONLINE

3%

2.2

in 2017

TOTAL SALES

GROWTH

2016-2018

9.8%

TOTAL SALES

IN 2018

$148.7B

SALES

GROWTH

10.3% SPECIALTY

3.1% ALL FOOD

Cheese & Plant-based

Cheese

Chips, Pretzels, Snacks

Non-RTD Coffee & Hot Cocoa

Frozen, Refrigerated

Meat, Poultry, Seafood

Bread & Baked Goods

Refrigerated & Frozen

Deserts

Frozen Entrees

Chocolate & Other

Confectionery

Yogurt & Kefir

Source: Mintel / SPINS

FnUSA in brief

$23.9 billion in 2018 online grocery sales

Strategy & Storytelling are crucial

SEO is key to brand awareness

Supply Chain must be seamless

Sales

Why Amazon

How to launch a product

Before you start

Optimizing New Items

1

2

3

4

Amazon

grocery growth

Online grocery sales grew

from $2.2billion in 2017

to $2.85billion in 2018

Percentage of online shoppers who begin

their search for product information

55% 28% 16%Retail

*CPG = Consumer Packaged Goods

50% 3x

23% 90%

Growth rate for natural and organic consumables compared to conventional

Of CPG dollar growth came

from Ecommerce sales in 2017Acquisition of Whole Foods creates bridge into brick and mortar

Of shoppers buy groceries online today

Expected to triple in fewer than 10 years

Of product research occurs on Amazon,

not on Google

Amazon

grocery growth

CPG MARKET DYNAMICS

Amazon

selling options

As a 3rd Party (3P) via

Seller Central

Direct

via Vendor Central

PROS

Selling Direct

vendor central

Selling via 3rd Party

seller central FBA

CONS

Amazon controls prices to consumer

Out of stock for new products

Annual terms negotiations

Invite only

PROS

CONS

If you aren’t the lowest price, you will not win the “Buy” box

Inventory risk – You are only paid for what sells and

responsible for aging and damaged inventory

Many companies aren’t setup to sell on consignment

Complex sales

Ships from and sold by Amazon

Buy Box: Your listing will win the “Buy” box (only if Amazon is

profitable)

A+ Content

Access to more marketing opportunities & channels (Fresh,

Pantry, PrimeNow etc.)

Sell directly to Amazon consumers

You can set prices to consumer

Enhanced Brand content

Brand registry surpasses the content of other 3P

You control how much inventory is at Amazon

CONVEYOR BELT FAST LANE

Problem Receive Station

→ Operations is key component to doing business on Amazon

→ Supply Chain varies across platforms

→ For Amazon to be able to make their consumer guarantees, they rely on their vendors to efficiently process their

orders within their guidelines, so product can be auto-received

→ Important that warehouse/supply-chain teams are able to do the processing required by Amazon

→ Failure to comply can result in:

• Fines

• Lost sales

• Vendor scorecard/ranking with retail team

→ Make sure you have a supply-chain partner that can do this

Amazon

operations

→ Amazon is a search engine – SEO is key

→ Amazon is the #1 source for product research

→ An oversimplification of how Amazon surfaces listings:

• Relevancy (does the word searched show up in the title?)

• Sales

• Does the word searched show up elsewhere on the page?

− Page content (description, reviews, etc.)

− Hidden keywords

Amazon

search results

MAXIMIZING ORGANIC (not paid) RESULTS

Example

good product listing

Images / Video

Clear Bullet Features

VariationsOptimal Title & Solid

Reviews/Stars

Amazon

Flywheel + Marketing/Promotions

INCREASED TRAFFICE

INCREASED EXPOSURE

Better search

rankingMore customer

reviews

More product

detail page views

Increased #

of customers

Amazon-ready

checklist

→ Ecomm friendly packs

• Selly by the case not by the item

• Profitable range $10-15 (light packages are preferable / less

expensive)

• Variety packs

• Survive supply-chain / not meltable, breakable

→ Competitive advantage

• Brand

• Price

• Features and benefits

• If it’s a brand-new brand that takes education, invest in

PR/Marketing

→ Product that you can reliably ship

→ Agile operations/supply-chain

7

TAKEAWAYS

Focus your efforts

It is a requirement – not an option

3. Younger consumers don’t look at the

supermarkets for quick meals

4. Reduced packaging & food waste

are hot points

1. Plant-based is growing strong

2. Specialty beverages are increasingly a

force in the market

5. The C-store channel is an under-

tapped market for specialty items

6. Foodservice needs to move to greater

customization

7. Opportunity lies in the breakfast

Amplified by

Prior Notice

FCE / SID

Facility Registration

Food Safety Plan

FSVP

LabelingFDA Compliance is key

Understand the market. Plan your strategy. Achieve growth.

www.elementalsco.com

Greece

166A Kifissias Ave. & Sofokleous Str.

Marousi, 151 26, Athens, Greece

Cyprus

Eurosure Tower, 5 Lemesou Ave.

Nicosia, 2112, Cyprus

T: (+1) 757.224.0177

info@registrarcorp.com

T: (+30) 213.099.8027

greece@registrarcorp.com

U.S. Corporate Office

SE Europe Office

USA

460 E. Swedesford Rd., Suite 2020

Wayne, PA 19087, USA