Food fraud has serious food safety and reputational impact, with unscrupulous organisations finding more sophisticated ways of duping companies and consumers. Global Quality lead for industry consultancy Campden BRI, Richard Leathers, outlines how to successfully navigate such threats.
From geopolitical events and pandemics to natural disasters, cybercrime and regulatory changes, there are a huge number of challenges that affect the food and drink industry that cause cost and availability issues.
These increase the risk of food fraud, which can lead to food safety issues, poor product quality and damaged brand reputations.
When things go seriously wrong, such as the infamous horsemeat scandal a decade ago, it can often be because the industry was not prepared to effectively identify or address the potential for food fraud.
No matter the nature of food fraud threats and other supply chain challenges, there are resilience strategies that can be adopted to help businesses navigate and effectively react.
According to the EU Food Fraud Network, food fraud costs the global food and drink industry approximately $50 billion every year.
Additionally, trade in counterfeit and pirated goods has risen steadily over the last few years, with the European Commission’s Alert and Cooperation Network now accounting for 3.3 per cent of global trade.
In 2022 alone, the number of suspicions of food fraud reported by the Food Fraud Network was approximately 600. Since 2020, the number of cases of adulteration have increased globally by 30 per cent, and 47 per cent for counterfeit incidents.
The issue is being compounded by climate change and global warming. Extreme weather events are becoming more common, with the number of climate-related disasters tripling in the last 30 years. Wildfires, floods, and droughts have a significant adverse effect on crop yields, causing availability issues. Rising costs from inflation also contribute as a driver of potential food fraud.
A minority of unscrupulous suppliers may resort to adulteration and other malpractices to overcome these cost and availability pressures for fear of business loss, or to simply increase profits for financial gain.
The Horsemeat Scandal
The Horsemeat Scandal surfaced in 2013 when Ireland’s Food Safety Authority tested a range of frozen ‘beef’ burgers and ready meals for the presence of DNA from undeclared species. It revealed that horse DNA was present in more than one-third of tested beef burgers while some ready meals were solely horsemeat.
Horse DNA was found well above trace levels, which exposed fraudulent substitution of beef for horsemeat – likely linked to rising costs and industry pressure for lower prices.
Despite the low risk to health, the scandal damaged numerous large brands and retailers, and led to product recalls, financial losses, and a decline in consumer trust.
A decade on – managing food fraud today
Given the prevalence of food fraud, it is imperative that food business operators know the details of their specific supply chains. This will help them identify and prepare for threats, prevent disruption, deal with unexpected challenges more effectively, and ensure continuity of supply of safe products.
One of the most important elements in helping navigate the issue of food fraud is ensuring there is a culture of trust and open communication within your supply chain.
Strong supplier relationships built on transparent communication contributes significantly to supply chain resilience.
If communication is poor, suppliers may be tempted to withhold important information that impacts both parties. This could be driven by malicious intent, fear of losing business, or simply a lack of understanding about the significance of the change. Therefore, open and honest communication is crucial for fostering effective supplier relationships and ensuring resilience.
There are certification schemes, retailer standards and benchmarking standards, such as the Food Safety System Certification (FSSC), Red Tractor, Global Gap, BRC Global Standard for Food Safety (BRCGS) and the International Food Standard (IFS), which organisations can utilise to help provide assurance to various stakeholders that they can consistently produce safe food that is traceable. Whilst many suppliers may be regularly audited by these certification bodies, auditing your suppliers directly is another method for ensuring confidence in their systems and practices.
Sampling and testing plans can also be used, alongside auditing, as a verification tool – testing may be used to determine the authenticity, provenance, microbiological status, and quality of raw materials, as well as check for the presence of contaminants and food allergens. Sampling and testing plans should be based on systematic risk assessments that are regularly reviewed and re-evaluated, for which information from horizon scanning is one of the inputs.
Horizon scanning, a proactive approach involving the analysis of medium to long-term emerging risks and threats, plays a crucial role in addressing food fraud. For example, organisations can identify potential threats such as drought, conflict, or price increases that might trigger food fraud, and put measures in place based on the nature and level of the risks identified.
PESTLE is a widely used framework in various industries, and acts as an information-gathering exercise to identify external factors – Political, Economic, Sociological, Technological, Legal, and/or Environmental – that may impact a business. Taking early action based on the findings from horizon scanning helps safeguard businesses against threats, as well as uncover emerging trends and opportunities.
Capturing robust data will help food business operators increase their situational awareness through visibility of their supply chains, so that they can make proactive, risk-based decisions about potential challenges and opportunities. The use of technology, including tech-enabled end-to-end ‘farm to fork’ traceability systems, are one way food businesses may gather this vital data.
Food fraud is a critical issue, driven by factors such as globalisation, geopolitical events, and economic challenges. This escalating problem not only generates substantial financial damage, but also poses threats to food safety, product quality and brand reputation. This emphasises the need for businesses to adopt strategic measures to strengthen their supply chain resilience. By embracing the strategies outlined in the eBook*, companies can help ensure the safety, stability, and continuity of their supply chains in the face of evolving challenges.
*Richard Leathers has written an eBook, Supply Chain Resilience: Identifying, planning for and overcoming supply chain challenges. Visit www.campdenbri.co.uk to access it. 
This story first appeared in the February/March edition of Food & Drink Business magazine.
