Closing the Food-Safety Circle
Last year’s spate of E. coli scares, affecting consumers who ate at places such as Taco Bell or bought spinach from their local supermarkets, has created an environment in which food safety seems to be top of mind for the media and, increasingly, for consumers.
Much of the activity by retailers and regulatory authorities seems to have been reactive. In part, this seems to be because many retailers with whom I’ve spoken have referred to food safety as a kind of invisible attribute. It is something that consumers assume exists. And for the most part, efforts to make sure the food supply is safe have to be largely invisible. To make too big a deal of it, some people think, is to point to potential problems. And nobody wants to do that.
I’m not sure this always is the best approach, and some retailers I’ve spoken with recently have emphasized that food-safety precautions have to be in full sight of the consumer, and in fact need to make the shopper a part of the process. Food safety, they say, has to be established as a kind of cultural imperative that makes it a living, breathing concern. That’s important, and I think it can ultimately make the difference between consumer confidence and lack thereof.
A terrific example of this is Aeon, the largest supermarket chain in Japan, which is using various technologies in its approach to food safety. Now, Japan seems to be a place where consumer worries are a little heightened because of the environment there. Maladies such as Severe Acute Respiratory Syndrome (SARS), Avian Flu and noroviruses are very much on people’s minds there; it seems like roughly a tenth of the people I saw walking the streets of Tokyo when I was there were wearing surgical masks, either to keep other germs out or their own germs in, and in that kind of climate every cough or sneeze you hear tends to carry a different level of import.
At Aeon, these consumer concerns mean that the company seems to be working diligently to close the circle, to include the shopper in the food-safety loop.
For example, at the meat counter there is a computer terminal that, in addition to offering and printing out recipes, allows shoppers to gain access to all sorts of information about the meat products they are buying—they can actually see the certificate guaranteeing that the beef is free of BSE, they can see background information about where the animals were raised and what they were fed, and even see a picture and biography of the supplier.
In the produce department, the private-label items—called “Green Eye”—carry a “QR” code that you can see consumers photographing with their cell phones. They then can access the Internet and see details on their mobile-phone screens about where the product was grown and who grew it.
These are, I think, extremely effective ways to avoid the “musty manuals” syndrome. But I also believe that connecting to the consumer is a critical and sometimes overlooked component of food-safety efficacy. The fact is that many food-safety problems occur after the consumer buys the product and leaves the store—there’s nothing like leaving a hunk of steak in the trunk on a hot day to cause a little food poisoning. But consumers, even if they cause the problem, still tend to blame the store—so including the shopper in the loop simply makes good business sense.
Which is why I was impressed to see that Aeon has educated its checkout people to the point where they can recognize whether a product runs a high risk of going bad, and they will point this out to shoppers and offer them regular or dry ice. That’s a terrific service, and one that more retailers ought to adopt.
In addition to going to Japan, I also had the opportunity to go to Singapore, where I visited with the folks who run the Shangri-La Hotel chain. Mark Patten, who is the executive chef in charge of all the chain’s Asian properties, told me that as the company developed its food-safety systems and procedures, it was crucial that everybody get educated—and that includes salespeople. That surprised me, but Patten told me that because of the multicultural nature of Singapore’s population, sales-people tend to get a lot of unusual demands. For example, people planning Indian weddings often want the buffet to be laid out at 6 p.m., but say that people won’t actually eat until 10 p.m. … so salespeople needed to understand that this is just not acceptable. Hence, the broad food safety education.
I think that if we’re really going to get serious about food safety, this kind of spreading the word is absolutely necessary. It is sort of a cliché, but it works—food safety is a chain with many links, and a safe food chain is only as strong as the weakest link.
When I visited Tesco in the U.K., Liz Kynoch, the company’s group technical and trading law director, told me that as the company broadens its supplier base—using more local and small farmers, for example, as a way of catering to consumers committed to native and sustainable agriculture, the company was finding that these suppliers simply were not up to the retailer’s safety standards. (Not that they were doing anything wrong, but they just weren’t as sophisticated as Tesco needs them to be, though they were very willing to be schooled.) Tesco responded to this by sending its own people on the road to run food-safety seminars for these farmers and suppliers, a move that cannot help but raise the bar on everybody’s performance.
Food safety is a problem that, when things go wrong, tends to generate a lot of headlines. There’s nothing we can do about that, and the industry has to live with the knowledge that things are occasionally going to go wrong.
But one way to minimize the damage is to get everyone involved, to use every tool at our disposal to prevent problems before they happen and make sure that everyone in the supply chain is working together—even consumers.
Some might say that return on investment (ROI) is difficult to gauge when it comes to spending money on food safety. But I disagree. Look at total sales, and consider that number to be ROI…because the damage caused by a major food-safety scare to a company’s reputation and bottom line can be catastrophic.
Victoria’s Secret Names New CEO
Columbus, Ohio, Limited Brands Inc. on Monday announced that Lori Greeley will replace Grace Nichols as CEO of Victoria’s Secret Stores. Greeley is currently executive VP and general merchandising manager of intimates for Victoria’s Secret.
The retirement of Nichols, a 20-year Limited veteran, from the CEO post was announced in May 2006. She will take a new role supporting initiatives within Victoria’s Secret, including the growth of its Intimissimi brand.
Additionally, Mark Weikel, COO of Victoria’s Secret Stores, will add the title of president.
Wal-Mart to Focus on Expanding Seiyu
New York City, Wal-Mart Stores is open to acquisition opportunities in Japan, but the retailer is more focused on expanding business at its 53%-owned Seiyu chain, according to a report by Reuters. Shares of Seiyu jumped Monday after Wal-Mart vice chairman Michael Duke told the Nikkei business daily that the company might look for more acquisition opportunities in Japan.
The paper reported that Duke welcomed planned changes in corporate laws in May that will enable foreign companies to buy Japanese firms through share swaps.
Wal-Mart last year tried to invest in superstore operator Daiei Inc., aiming to boost its presence in the country, but it lost the chance to Aeon Co., Japan’s second-biggest retail group.
Wal-Mart entered the Japanese market in 2002 by taking a small stake in Seiyu. It has since invested more than $1 billion in the chain, but has yet to return the retailer to profitability.
Wal-Mart spokeswoman Amy Wyatt said Wal-Mart’s focus in Japan is on Seiyu.
“It’s a very sizable business today, so we still think that there are a lot of growth opportunities in the existing business,” she said.
In terms of acquisitions, she said: “I wouldn’t go as far as to say we’re shopping for them.”