The Future of Supplier Data Management

Posted by Dana Johnson Downing on February 7, 2019 at 11:18 AM

matt-1248038-unsplashWho could have guessed – even just a decade ago – that something as mundane as a food label would be the focus of so much attention? Certainly, no one could have predicted it would take center stage in a Super Bowl ad. 

But the food, beverage, and supplement industries are in the home stretch for making product labels compliant with the new U.S. Food and Drug Administration rules. Larger food manufacturers – those boasting $10 million or more in annual revenue – “must modify, recalculate and re-label all products in line with the new label regulations, reflecting changes to Nutrition Facts Label, updated scientific information and providing consumers with relevant details to assist in making the best food decisions, according to Q1 Productions, which hosted the 6th Annual Food Labeling: Evolving Regulatory Compliance Conference.” Smaller companies have until 2021.

As such, 2019 marks the last full year companies have to transition operations, and labels, to meet the new requirements. But manufacturers have more than the FDA’s label requirements to worry about. U.S. regulators have suggested new GMO label rules. Additionally, “Canadian authorities have changed allergen labeling requirements, and the pressure to monitor supplier ingredients and labels on an international scale is mounting.”

But there’s more behind the drive for better, consumer-friendly product labels than regulatory zeal. Consumers have been clamoring for increased transparency for years, applying even more pressure on food industry executives.

With the FDA reporting that nearly half of its published recalls can be blamed on incorrect or incomplete listings of ingredients and allergen on labels, documentation becomes that much more critical. FDA inspections can drive this point home in the most painful way. 

When it comes to both items and packaging materials, suppliers must disclose attributes such as material composition, allergens, additives, physical and chemical properties, and microbiological susceptibility. The requirement around maintenance records the FDA’s instituted has encouraged the use of electronic databases for analysis and compliance.

Talk of this requirement drove a lot of the conversation at the 6th Annual Food Labeling: Evolving Regulatory Compliance Conference late last month in Alexandria, Virginia, and it’s actually the motivation behind a session at the conference led by TraceGains CEO, Gary Nowacki, where he discussed “Trends in Supplier Data Management,” and how the right software can produce more accurate labels, improve supply chain transparency, and make FDA compliance a lot less stressful. 

Other topics that dominated talk at the Q1 food labeling conference included:

A panel discussion on “Considering Consumer Interpretation Surrounding GMO Labeling” was particularly lively. Industry executives remain concerned about the transition from the term Genetically Modified Organisms (GMOs) to bioengineered (BE) as defined and outlined by the U.S. Department of Agriculture (USDA) in the National Bioengineered Food Disclosure Standard, which many believe will cause consumer confusion and uncertainty, given the traditional and widely accepted use of GMO. This evolution in language is of concern to many food companies that have already begun production on labeling and marketing the more commonly used term GMO, as well as those organization making non-GMO certification claims. 

One of the panelists was Karin Moore of the Grocery Manufacturers Association, who read a long list of terms that have been used to describe BE or GMOs in recent years, and she questioned whether the USDA had done research or focus groups with consumers to understand their needs.

According to Moore, the regulation crafted by USDA is far different than what was expected when the legislation passed in 2016. The panelists’ conclusion was that with all of the different terminology, consumers will likely stay confused, even with the new BE labels. Now we need to socialize a new term and so far, the government isn’t stepping up to do the necessary educational outreach. The implementation date of the Standard is Jan. 1, 2020, except for small food manufacturers, whose implementation date is Jan. 1, 2021. The mandatory compliance date is Jan. 1, 2022. Regulated entities may voluntarily comply with the Standard until Dec. 31, 2021. 


A member of the audience questioned whether there would still be a need for non-GMO certifying agencies and Moore described a scenario where a product that requires a BE label could also have a non-GMO Project Verified label due to the threshold differences. Clear as mud, right?

Another interesting presentation focused on Proposition 65 and the enforcement actions that have been taken so far. California’s Prop. 65 requires food manufactures distributing product within California to provide clear and reasonable warnings when products expose consumers to chemicals that have been identified as causing cancer or reproductive side effects.

Of recent concern has been the litigation surrounding chemical compounds found in roasted coffee beans, which are listed on the extensive Prop. 65 hazard list. Considerations concerning casualty and route of exposure overturned this particular case, but many additional enforcement cases are pending, and the food industry is deeply and rightly concerned surrounding California’s enforcement of the law. Attorney David Biderman of the Perkins Cole law firm, described new interpretations and enforcing trends, issues surrounding residual chemicals, and clarification on detecting and labeling of metals.

So, will consumers be more receptive to BE rather than GMO? Do Prop. 65 warnings really influence how consumers shop? 

In my opinion, they all sound pretty scary. In this regulatory environment, ingredient suppliers and food manufacturers need to invest in technology that helps them operationalize supply chain transparency so they can give consumers the info they want and need to make informed choices and comply with laws and regulations, so they can avoid costly litigation. 

TraceGains’ suite of software solutions can help food manufacturers: 

  • Use technology to increase supplier transparency.

  • Quickly acquire data from suppliers.

  • Standard forms that simplify the collection of information about ingredients that require GMO or Prop. 65 disclosure.

  • Automate data transfer between supplier and labeling systems.

To learn more about how TraceGains can help your company Plug In and Go Faster, reach out today by calling 720-465-9400 or you can request a demo right now.

Tags: Allergens, Labeling, Gluten-Free, prop 65, Supplier Management, Recalls