retail news in context, analysis with attitude

The Wall Street Journal this morning reports that in Europe, some major food retailers have gone beyond the food safety standards established by the governments there and developed their own guidelines – and inspection procedures - for companies that want to sell them meat, fruit and vegetables.

It is an approach that seems to be gaining favor. The Journal notes that Wal-Mart has announced that “it would buy produce, meat and seafood only from suppliers accredited by private-inspection offices.

“The biggest such private regulator, GlobalGap, now counts 81,000 farms and plants in 76 countries as members, up from 18,000 in 2004. The Cologne, Germany-based group expects to reach 100,000 this year, says director Kristian Möller. The group, whose annual budget is €2.8 million ($4.3 million), has only 11 employees.

“The list of retailers who use GlobalGap is growing, too. In addition to Wal-Mart, McDonald’s Corp. and Wegmans Food Markets Inc. are members. American farmers eager to sell to Europe's lucrative market are also getting in step with the old world.”

There are some negatives attached to the GlobalGap approach; one that is prominently mentioned in the piece is the fact that big suppliers are better able to quickly meet the demands, which sometimes can leave smaller suppliers at a disadvantage. But the general feeling seems to be that a private approach to food safety standards can help retailers move beyond some of the issues that seem to have become more commonplace in the food business.

KC's View:
I have no idea whether the GlobalGap approach is specifically the best one, but it seems pretty obvious that smart companies understand that they need to be ahead of the wave when it comes to food safety, that they cannot depend on governmental oversight and enforcement for their own viability and credibility in this area.

This has been a consistent argument here on MNB - Sansolo and I have been making it with a good deal of frequency. Retailers need to take the lead here, advocating for the consumer and pushing for heightened standards, total transparency, and a system that both enlightens and informs the shopper.