the retailer as the last line of defense...costco canada today •4th largest retailer in canada...
TRANSCRIPT
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The Retailer As The Last Line Of Defense
Marcelle Lavergne Costco Wholesale Canada Ltd
April 26, 2013
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Peterborough, ON
10/02/08
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Costco Canada Today
• 4th Largest retailer in Canada
• Sales $15.1 B
• # of Employees: 24,850
• # of Cardholders: 10,008,000
April 2013
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Costco Today
626 Warehouses Worldwide
449 – US 9 – Korea 85 – CN 9 – Taiwan
23 – UK 33 – MX
15 – Japan 3 - Australia April 2013
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Costco Today
• Typical Costco warehouse carries approximately 4,000 items for sale – Fresh foods , groceries and sundry items – Electronics, appliances, house wares – Apparel, books, health and beauty aids – Gas stations, optical , hearing aid, tire and
photo centres, and pharmacies
• Top quality national brands, as well as Kirkland Signature
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Costco Today
• 17.54 million hot dogs sold in Costco Canada in FY 2012
1.50
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Costco Today
• Fresh Foods and Food Service includes the following departments:
• Meat • Bakery • Service Deli • Food Court
• Represent 17% of total warehouse sales • Known for its high quality food items
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Retail - Risk Management
Risk analysis is defined for the purposes of the Codex Alimentarius Commission as
“A process consisting of three components: 1. Risk assessment
– Hazard identification and estimating the risks
2. Risk management – Identifying and implementing appropriate
measures to control the risk
3. Risk communication” – Communicating information about the risks and
the control measures applied.
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Retail - Risk Management
• Food Safety is crucial at all points along the supply chain, from farm to fork.
• Retailers are the last line of defense before food reaches the consumer.
Grower / Supplier Distributor Manufacturer Retailer Consumer
Supply Chain – Product Flow
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Retail - Risk Management
• The retail industry has a responsibility for the safety of the products it produces or brings into the market.
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Consumer Expectations
Today’s consumer • More knowledgeable and discerning about product safety • Expect food to be safe (zero risk) • Look for health or safety certifications • Pushing retailers and manufacturers to improve
their food safety practices • Expect clearer product labeling, traceability and transparency
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Consumer Expectations
• Consumers demanding fresher foods •Increasing importance of foods of plant origins •Importation of food and ingredients globally
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Consumer Expectations
• Consumers spend less time preparing food at home – Ready-to-eat foods – Ready-to-heat or ready-to-eat meals
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Consumer Expectations
• Consumer demand for ethnic foods – Importation of food and ingredients globally – Consumption of raw (sushi) or lightly cooked
food
• Organic or “healthier” food choices
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Retail - Risk Management Retail Council of Canada
– Major grocery retailers participate on various food safety and procurement committees
– Jointly developed the Retail HACCP Program • Generic retail HACCP plan • Retail food safety best practices, checklists,
templates
– Developed the Retail Listeria Program • Developed / updated retail best practices
– Developed retail-specific FoodWise food safety training program
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Retail - Risk Management
Retail Food Safety Programs • FoodWise Food Safety Training • HACCP Guide for Retailers (CFIG/CCGD) • HACCP Guide for Distribution Centres • Retail Guidance Document – Pathogen Control
in RTE Refrigerated Foods (including Lm) • Pandemic Preparedness Guide • Nutrition Labeling Reference Guide • Supply Chain Food Product Recall Manual
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Retail - Risk Management
Retail Supply Chain Food Safety • Vendors should provide a food safety audit or
GFSI certification • Includes a supplier program for their vendor’s
suppliers
Grower / Supplier Distributor Manufacturer Retailer Consumer
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Costco - Risk Management
Costco Vendor Program • Our Buyers purchase food, ingredients and
packaging material from reputable sources that are inspected by the appropriate level of government
• Annual food safety audits required: – Processing facilities – Distributors – Farms and ranches
• Calibration audits
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Costco - Risk Management
• Costco’s Vendor Requirements: – Mandatory annual food safety audit or GFSI
certification – HACCP program in place – Foreign metal detector, preferably X-ray – Program in place to approve and monitor
their suppliers – Test and hold program for select high risk
foods and most ready-to-eat foods
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Costco - Risk Management
• Our vendors are our partners in business – For us to prosper as a company they must
prosper with us – Establish clear standards and expectations – Continuous improvement
• Product quality • Food safety program
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Costco - Risk Management Costco Food Safety Audits and Inspections • Our vendors and consumers expect us to
prepare and handle food in a safe manner – Internal food safety audits, operations and
facility audits – Daily food safety inspections – Monthly self audits – Refrigeration temperature checks – Sanitation and pest control
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Costco - Risk Management
Costco Food Safety Training • Managers, assistant managers, supervisors and
fresh department leads are certified at the management level every 3 years (22-30)
• Food handlers are trained and certified annually (web training and exam)
• Ongoing hands on training
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Meat Department
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Service Deli Department
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Bakery Department
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Food Court
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Costco - Risk Management
Consumer Incident Reports • Food items produced at Costco
– Are fully investigated – Cooking and refrigeration temperature logs are reviewed where applicable – Identify root causes – Implement corrective actions
– Preventative action
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Costco - Risk Management
Consumer Incident Reports • Vendor food and non-food items
– Reviewed with our vendors – Tracking of vendor complaints – Many require investigation by the vendor
• Root cause analysis • Corrective measures • Preventative action plan
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Costco - Risk Management
Product Recalls (Class 1 and 2)
• Product is immediately pulled • An administrative block is applied at the cash
register • A query is run to identify the members who
purchased the recalled item • Our members are notified of the recall by
telephone, usually within a few hours • Option to mail recall letters
• Typically we reach 85% to 95% of our members
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Costco - Risk Management
Quality Assurance • Testing of private label food items (Kirkland
Signature) on a quarterly basis – Physical tests – Chemical tests (third party) – Microbiological tests
• Work closely with our vendors to establish product specifications and verify compliance
• Environmental sampling program
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Costco - Risk Management Crisis Situations • Emergency planning
– Ongoing process to prevent, mitigate, prepare for, respond to, and recover from a serious incident
– Natural disasters (ie, earthquake, tsunami, flooding) – Power outages and water supply issues – Supply chain interruption
• Disaster recovery and business continuity planning
– Ongoing process to identify the impact of potential losses and maintain viable recovery strategies and plans, and the continuity of services
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Costco believes that food safety is a priority and all food products should be
“HANDLED WITH COSTCO CARE.”
Questions?
Thank you!