NEW YORK — Ninety-three per cent of U.S. consumers have read or heard reports of recent food safety issues and recalls, according to a U.S. consumer study by Burson-Marsteller and Penn Schoen & Berland Associates. In addition, almost a fourth of Americans said the recalls will change their long-term food buying behavior.
"While most food producers take significant measures every day to protect our food, this should serve as a wake up call to companies — now is the time to perform a checkup on your crisis communications plan," said Bill Zucker, managing director and food issues expert at Burson-Marsteller. "The good news for food companies is that there are some key actions they can take to regain the trust of consumers should an outbreak occur. But those actions require advance preparation."
The study also found while about two-thirds of Americans believe instances of food contamination have increased during the last five years, 87% still somewhat or strongly agree that the United States has one of the strongest food safety systems in the world. In addition, companies with strong brand awareness are more likely to withstand an incident of food contamination than a lesser known company.
In addition, the survey found 49% of mothers said they are avoiding products with peanut butter ingredients even if the products are not on the government’s recall list. Sixty-five per cent of consumers said during a food contamination outbreak they change their short-term food buying habits but not their long-term behavior. However, 23% of consumers said the most recent food scare will change their long-term food purchasing habits.
The survey was published as the Food and Drug Administration and the food industry grappled with the largest recall in history. Compounding the problem was the announcement on Feb. 13 that the Texas Department of State Health Services (D.S.H.S.) ordered the Peanut Corporation of America to close its Plainview, Texas, facility and recall all products manufactured at the facility since March 2005 after an inspection identified violations to the state’s health code. The facility manufactured dry roasted peanuts, oil roasted peanuts, granulated peanuts and peanut meal, according to the D.S.H.S.
Specifically, an inspection of the facility by state health officials found dead rodents, rodent excrement and bird feathers in a crawl space above a production area. The inspection also found that the plant’s air handling system was not completely sealed and pulling debris from the infested crawl space into production areas of the plant resulting in the adulteration of exposed food products.
The D.S.H.S. also ordered the plant, which began operations in March 2005, to stop producing and distributing food products. On
Feb. 10, the P.C.A. said it had temporarily stopped production at the facility as the D.S.H.S. and the F.D.A. conducted their investigations.
On the same day as the closing of its Plainview facility and the recall of all products manufactured at the facility since 2005, the P.C.A. filed for Chapter 7 bankruptcy protection in the Western District of Virginia. As of Feb. 24, more than 2,600 varieties of food products containing ingredients manufactured at the two facilities had been recalled.
The P.C.A. was not the only company to declare bankruptcy due to the recall either. Forward Foods L.L.C., Minden, Nev., announced on Feb. 16 it had filed for Chapter 11 bankruptcy protection. Forward Foods makes Detour energy bars, which were forced to be recalled after a tainted peanut recall by its supplier, the P.C.A.
Forward Foods was notified on Jan. 29 that its products were subject to a nationwide voluntary recall with regard to a Salmonella poisoning risk. As a result, the company was forced to recall several of its Detour brand products, sales of which made up approximately 75% of all protein bar sales by Forward Foods.
"The cost of this recall to this business … is material," Forward Foods said in a Feb. 17 bankruptcy filing with the U.S. Bankruptcy Court for the District of Delaware. "A significant value of inventory must be condemned, and, to the extent customers are appropriately destroying or returning unsold recalled product, the ability to collect outstanding receivables is very much at risk."
Forward Foods is primarily owned by private equity firm Emigrant Capital Corp.
The company listed both assets and debts of between $10 million and $50 million.
This article can also be found in the digital edition of Food Business News, March 3, 2009, starting on Page 16. Click