First is escalation of bad luck - bad enough to have a flashlight break and potentially get into product, but then, the failure to capture all the product so it does not get into commerce. Are you thinking someone went back to count the cases a few weeks latter and discovered that they were a little short? If it had been shipped the day the issue was discovered, wouldn't the recall have been made the same day.
Control of tools - not sure if this is a maintenance flashlight or one that belongs to quality, but most probably not someone working in production. It is important that these support groups understand the importance of accounting for tools as they work. That includes keeping control of them as they work, and ensuring that they have collected them at the end.
Control of held product - During a corrective action procedure, reconciliation of held product is critical. That is, the actual amount of tagged in the hold area is consistent with the amount that was supposed to be held? Interesting to note that two weeks passed from the day of the incident, so was this the first verification?
Escalation of cost - the longer it takes for corrective action, the higher the cost. We will make some assumptions to demonstrate this point, costs based upon product cost at retail and can weight.
- Breaking a flashlight - less than $10
- Breaking a flashlight and stopping the line before it gets into the can - assuming 500 lbs of product at $0.30/lb for in-process product = $150. There would be costs associated with shutting the line done for clean up as well.
- Breaking a flashlight and not discovering it until product is in the can - assuming that there were 10 pallets of finished product (60 cases per pallet) at a manufacturing cost of $0.65 per can = $4680. There would be a disposal cost to include as well.
- Shipping 40 cases of that product by accident = So there is the $4368 for the product that was not shipped, but now there are charges for that shipped product at store level. With a price of $2.08 per can (which the store will charge the company) plus 20% handling fee assessed by the store, and it is unlikely that the store chain will only recover just that particular code once it hits the shelf, so the store will likely remove 3X the amount..so this will cost 3600 on top of the $4368 or a total of $7968. This does not include any fines the store may charge back to the facility.
- So this went from a couple hundred dollars to eight thousand dollars or so, and this could very well be an underestimate.
- If the broken flashlight went unnoticed, or no notification was made, and USDA had complaints about foreign objects in canned product - that would result in a recall of at least a day's production. which at that point, would mean that product would all be at store level in terms of distribution. Costs at this point could range widely, perhaps up to 50K. Add any costs associated with injury to a person and the legal fees. Punitive damages could also be assessed especially if the incident was found to be concealed by plant personnel.
FSIS Recall Notice
Hormel Foods Corporation Recalls Beef Products Due To Possible Foreign Matter Contamination
Class II Recall015-2016
Health Risk: LowFeb 9, 2016
Congressional and Public Affairs Maria Machuca (202) 720-9113 Press@fsis.usda.gov
WASHINGTON, Feb. 9, 2016 – Hormel Foods Corporation, a Tucker, Ga. establishment, is recalling approximately 450 pounds of beef products that may be contaminated with extraneous materials, the U.S. Department of Agriculture’s Food Safety and Inspection Service (FSIS) announced today.
The Dinty Moore Beef Stew items were produced on Jan. 26, 2016. The following product is subject to recall: [View Labels (PDF Only)]
15-oz. cans of “Dinty Moore Hearty Meals No Preservatives Beef Stew” with Best By date Feb. 2019 and production date T01266.
The products subject to recall bear establishment number “EST. 199G” inside the USDA mark of inspection. These items were shipped to Kroger locations in Texas and Louisiana. Product was available for sale after Feb. 1, 2016.
The problem was discovered during the plant’s routine inspection activities. After discovering and recovering parts of a flashlight from the production area, the company placed all product produced during this timeframe on hold. However, 40 cases had already been shipped into commerce.
There have been no confirmed reports of adverse reactions due to consumption of these products. Anyone concerned about an injury or illness should contact a healthcare provider.
Consumers who have purchased these products are urged not to consume them. These products should be thrown away or returned to the place of purchase.
FSIS routinely conducts recall effectiveness checks to verify recalling firms notify their customers of the recall and that steps are taken to make certain that the product is no longer available to consumers.
Consumers with questions about the recall can contact Consumer Engagement at (877) 446-7635. Media with questions about the recall can send an email to: email@example.com.
Consumers with food safety questions can "Ask Karen," the FSIS virtual representative available 24 hours a day at AskKaren.gov or via smartphone at m.askkaren.gov. The toll-free USDA Meat and Poultry Hotline 1-888-MPHotline (1-888-674-6854) is available in English and Spanish and can be reached from l0 a.m. to 4 p.m. (Eastern Time) Monday through Friday. Recorded food safety messages are available 24 hours a day. The online Electronic Consumer Complaint Monitoring System can be accessed 24 hours a day at: http://www.fsis.usda.gov/reportproblem.