Security Printing and Imaging : Supply Chain

EFPIA Announcements

StevenSimske — Mon, 26 Oct 2009 17:12:00 GMT

Hi, all

The next few blogs will point you to information on the recent announcement of the EFPIA 2D labelling scheme. The EFPIA is the European Federation of Pharmaceutical and Industries Association.

In-Pharma's article on this announcement is:

http://www.in-pharmatechnologist.com/Packaging/2D-barcodes-make-faking-less-attractive-says-EFPIA/?c=JiBz%2FX6W8967KGa2Liah%2FA%3D%3D&utm_source=newsletter_daily&utm_medium=email&utm_campaign=Newsletter%2BDaily

Importantly, as our partner Siemens notes,

[Siemens] "will provide connectivity for pharmacies and manufacturers to the EFPIA database, which is hosted by Hewlett Packard (HP). Manufacturers will populate the EFPIA database with the serial numbers of the saleable units shipped, and pharmacies will read those serial numbers at the point of sale (via 2D barcode) and authenticate the unit sold against the EFPIA database."

In other words, the cloud enables the crowd. 2D barcode readers are not just in the hands of the pharmacists. Look for us all--corporations, enterprises, brand owners, shippers, retailers, consumers, environmentalists--to embrace this approach. It helps level the playing field for everyone, except--one hopes--the counterfeiters.

Cheers,

Steve

FDA seeking 19% budget increase for supply chain security

StevenSimske — Sun, 31 May 2009 04:11:00 GMT

Apparently, this post was lost in the transition to the new blogging application (which took place May 15-22). The FDA earlier this month announced plans to increase field testing and other inspection of imported food and pharma goods in response to the recent salmonella and drug scares.

The FDA budget document states:

“In the complex and rapidly changing environment driven by globalisation, FDA cannot rely on traditional approaches – inspection and sampling at the US border – to protect Americans and ensure the safety of medical products. FDA will use traditional and innovative mechanisms that include FDA inspections and field exams, integrated federal-state oversight, and greater access to inspection data and results acquired from trusted foreign regulatory authorities.”

The plans include a more than 100% increase in the number of field tests of imported drugs, and a boost in the inspections of high-risk foreign and domestic facilities by nearly 20%.

See the overview article at:

http://www.in-pharmatechnologist.com/Industry-Drivers/FDA-requests-19-funding-boost-to-secure-supply-chain/?c=JiBz%2FX6W896enue4TQ%2BDEw%3D%3D&utm_source=newsletter_daily&utm_medium=email&utm_campaign=Newsletter%2BDaily

Cheers, Steve

Peanut Recall

StevenSimske — Sat, 24 Jan 2009 05:27:00 GMT

Among the many popular tales about elephants are the following:

1. Elephants never forget

2. Elephants love peanuts

Given the size of their brains (let alone their heads), it is easy to give credibility to the elephant's celebrated ability to recall. And I've seen them go after the peanuts. So, are elephants our hope for the massive peanut recall (http://peanutrecall.com/)? Unfortunately, the recall is due to that familiar, nasty pair of villains, Sam and Ella. Combined, salmonella are endangering elephants and other peanut consumers.

As with other recent food recalls, there is actually a lot working correctly. And, truly, credit goes to those responsible for the tainted products coming off the shelf fast and furiously. Damage to the consumer is contained. However, the cost is again much higher than it has to be. With convoluted supply chains and idiosyncratic record keeping, there is a lot of collateral damage to untainted products. Safety is step one. But, in a dramatic economic downturn, the collateral damage leads to more lost jobs, for which there is no surfeit of available replacements. More effective food recall is just around the corner.

Until then, however, food recall is reminiscent of another elephant-related story. The six blind men groping an elephant, separately grabbing the trunk, the tail, the tusk, the ear, the leg and the body. To them, the elephant is a snake, a rope, a spear, a fan, a tree or a wall. Which begs the question, if an elephant went bad (they sometimes do), then should we destroy all snakes? Ropes? Trees?

A forced analogy? Perhaps. But the point is, until we can more directly and efficiently trace raw materials forward and end-products backwards, we're going to continue hitting elephant's tails with snake sticks. And that will, as one can surmise, lead to more painful consequences than bargained for.

Cheers,

Steve

Many Manufacturers Moving to Mexico

StevenSimske — Sun, 14 Dec 2008 22:24:00 GMT

A recent BusinessWeek article highlights the more cautious approach many manufacturers are taking with regards to China. The biggest single issue appears to be intellectual property theft, although product quality and other issues (cost of fuel, logistics of extending your supply chain halfway across the world, etc.) certainly play a role, as discussed here in past blog postings.

"China ranked highest in 9 of the 15 risk factors. Rising labor costs are still an important factor for businesses, with 35% citing China as the leading source of concern. Other risk categories where China ranked highest included regulatory compliance, commodity price volatility, supply-chain security breaches, and information technology problems."

businessweek.com/bwdaily/dnflash/content/nov2008/db20081126_315336.htm

"...quality concerns are among the chief reasons U.S. manufacturers are scaling back plans to source more goods from China. Instead, U.S. companies are looking harder at Mexico and other locales closer to home when exploring where to put new capacity."

I have seen this shift in many of the product lines I work with over the past couple of years. Mexico (see http://www.lmtruck.com/articles/petemplate.aspx?storyid=280, for example, to see how Mexico specifically "benefits" from higher fuel costs: "Moving to regional distribution means inventory can be reduced...because firms can take advantage of next-day delivery and cross-docking services to keep goods moving.") and Brazil now factor highly in any US-external manufacturing partnership.

Does this mean the Mexican or Brazilian governments do a better job of protecting intellectual property rights? In some cases, perhaps so, but overall it is likely due to the nature of their manufacturing industries compared to that of China's. Smaller, arguably more centralized (and certainly occupying far less territory), and more closely associated with "western" customs, Brazil and Mexico nevertheless, combined, have a population approximately that of the U.S Meaning, if these developing nations were to become "developed", their middle classes might match China's (or India's) in size. Mexico and Brazil are also much more energy independent than China (the US still imports roughly as much oil from Mexico as it does from Saudi Arabia).

My argument has been, consistently, to make sure that any overseas manufacturers are integrated into your company--not simply "the cheapest option". Without showing loyalty, you can expect none in return.

US firms, in general, may have a culture more similar to Mexico and Brazil than to China. Being able to schedule meetings during normal business hours is, frankly, a big plus for me personally. Overall, there is no reason to believe manufacturers are going to bail out of China en masse--more than likely, the days of highly discounted overseas manufacturing are over, and businesses will be looking at many countries--including China as one option--before deciding on the location for partnership.

[Thanks to Greg Merten for the link!]

Cheers,

Steve

ePedigree Delay a Sign of An Eventual Supply Chain U.N.?

StevenSimske — Thu, 20 Nov 2008 05:49:00 GMT

I have been remiss in discussing the delay in the California ePedigree until 2015. This has been interpreted as a long-term delay for track and trace and overall product safety. For a nice overview and analysis of the problem, see http://www.industryweek.com/ReadArticle.aspx?ArticleID=17793.

However, ePedigree initiatives are underway by the WHO, FDA, EU, AQSIQ (China), GS1 and other standards/regulatory organizations. A full serialization+pedigree requirement may be delayed until 2015, but it is unlikely that ePedigree will not already be in place before then. Recent passing of PRO-IP and Country-of-origin labeling (COOL) legislation in the US indicates that the US,too, will continue with initiatives before 2015.

The delay of California ePedigree legislation, moreover, may be indicative of another passing of the torch. Much as the recent Presidential (and Congressional) election results likely signal a more collaborative, less "independent" US foreign policy, the delay in ePedigree may signal a more collaborative, less independent nation-to-nation legislation in the future.

Will the big players--WHO, FDA, EU, AQSIQ, GS1, ISO, and others--work together to create a reasonable roadmap for product track and trace, pedigree and provenance? In effect, create a "United Nations" for track and trace? I, for one, hope so. With the increasingly convoluted supply chains for virtually all products resulting in chaos during recall, fraud and even normal node-node shipping situations (how many retailers can confidently tell you everywhere a product has been on its way to their shelves?), how long can it be before the legitimate market says, "enough is enough"? Plus, a universal process will reduce confusion, lower cost, and improve response time around the planet.

Is the current combination of counterfeiting, diversion, factory overrun, smuggling, return fraud and other supply chain crime the commerce equivalent of the two World Wars? A series of events so drastic that the set of collective players decides to band together into a United Nations to try to prevent such a meltdown in the future? (I realize the United Nations is by no means perfect--but we have been without nuclear combat for 63 years...). Maybe so. And maybe the delay in the California ePedigree shows that the US, rather than defining the path forward, is willing to work with the rest of the Supply Chain United Nations in formulating the optimum set of requirements moving forward.

-Steve

Hide the Supply Chain...Trust the Seller?

StevenSimske — Wed, 12 Nov 2008 06:18:00 GMT

Thanks to my friend Bill Tucker to this link to Amazon's "frustration-free" packaging:

http://www.amazon.com/gp/help/customer/display.html/?nodeId=200285450

It is described as:

"The Frustration-Free Package (on the left) is recyclable and comes without excess packaging materials such as hard plastic clamshell casings, plastic bindings, and wire ties. It's designed to be opened without the use of a box cutter or knife and will protect your product just as well as traditional packaging (on the right). Products with Frustration-Free Packaging can frequently be shipped in their own boxes, without an additional shipping box."

Amazon is (rightly) advertizing this as a sustainability approach--less packaging is used, and less plastic is wasted. By partnering with the brand owner, Amazon states, "we work directly with manufacturers to box products in Frustration-Free Packages right off the assembly lines, which reduces the overall amount of packing materials used".

This is true--when there is no fraud. It will be interesting to see what security devices are placed on the Frustration-Free Packaging as it moves forward. If "none", I'd be looking at this carefully if I were a counterfeiter.

-Steve

Pharmaceutical Commerce Webinar, November 18

StevenSimske — Tue, 04 Nov 2008 04:58:00 GMT

In two weeks, I have the opportunity to participate in Pharmaceutical Commerce's webinar on "How Digital Printing Changes the Game for Packaging, Labeling, and Brand Protection". The link to register for the webinar is:

http://events.newanglemedia.com/pc/digital_printing/

A brief description of the webinar is:

"This webinar will help you create a more agile supply chain network, and reduce capital outlay around serialization projects. You'll learn how to turn your printing process into a business and supply chain solution!"

"We've assembled an expert panel from HP and Nosco who will discuss ways to improve supply chain flexibility and efficiency through use of digital printing technologies. These industry experts will explore solutions for change management, reduced obsolescence and enhanced customer service across the biopharma supply chain."

"Pharmaceutical Commerce Editor Nick Basta will moderate the panel discussion featuring Joe Tenhagen of Nosco, Matt Gindele of HP Indigo Label & Packaging, and Steve Simske of HP Labs."

"Register today to get a glimpse of how current and future technologies are improving supply chain flexibility and efficiency."

Cheers,

Steve

Does Theft Matter?

StevenSimske — Tue, 09 Sep 2008 05:15:00 GMT

One of my colleagues and friends, Puneet Mehta (one of HP’s top RFID/Supply Chain experts), pinged me recently, and mentioned “I found this interesting article about the theft of baby formula. [Is it salient] to Security Printing?” This is an excellent question. Does Theft Matter?

When you consider the logic of a three-part plan for your company against its worst competitors (the counterfeiters), yes, theft really matters. In act, it is logically where you are directing the counterfeiters. As I’ve discussed before, one of the main advantages of security printing is to provide a low-cost means of adding product security. You’re going to print, anyway, so a would-be consumer can see it’s your product, so why not print something that helps you identify authentic, as opposed to counterfeit, product in your supply chain (or in someone else’s supply chain, come to that). Yes, you need security-VDP (variable data printing) to do so, but if you haven’t already gone digital (and thus variable), it’s time you considered it.

This segues directly to Step #1 in forcing the counterfeiters to do you bidding—get them to spend more on counterfeiting than you did in legitimately creating the product. If you spend nothing incrementally using security-VDP, then the counterfeiter will outspend you, if for no other reason than to figure out what you did, while you did it effortlessly. This is one place where reverse-engineering costs more than the original engineering. Use it. Don’t, however, think you can get the counterfeiter to spend more than you by getting an expensive, but restricted-access deterrent. The counterfeiter will either more cheaply spoof it, purchase them from an insidious insider at the very same provider as you purchase it from, or simply buy in greater bulk than you, and thus get a cheaper rate on the deterrent than you do! Remember, a good counterfeit company (“good” meaning successful here—don’t get all judgmental on me!) will have multiple products in the market, and so they can afford a good price for bulk purchasing.

Step #2 is to get the counterfeiter to buy your equipment. As mentioned above, I’m sure plenty of security deterrent companies are already achieving this “success”. How many security deterrents—from holograms to Holy-cruds [this being those Holy-crud-are-these-hard-to-open plastic shells around many toys and electronic items]—are purchased by counterfeiters to make their product seem “legitimate”? Probably more than we care to know. A more successful strategy is to provide packaging/labeling/printing of products—from notebooks and doughnuts to banknotes and documents—using a special printer that the counterfeiters need to replicate the job. I recommend the HP Indigo, but in fairness there are other non-HP presses with signature technologies and capabilities, especially in finishing. Get one of them, and use it for your products. If you use static and/or generic printing, you’re asking for trouble. And, in the case of HP (or any other special print device provider), you’re missing a revenue opportunity. Just because counterfeiters have become our biggest competition, there’s no reason they can’t become our customers, too.

Step #3, however, is the main focus of today’s blog. Puneet pointed out an article (http://www.phillyburbs.com/pb-dyn/news/113-09012008-1584236.html) describing how thieves have begun targeting baby formula. The article reports on thefts of up to or exceeding $1,000 worth of formula at a time. The response? The infant formula was brought behind the counter. A sure way to stop thieves, but for those who like browsing while shopping, a turn off. Sales are lost when wares are locked. The director of CVS Pharmacy stated, “The store will soon display the formula in a locked case.”

Who are these thieves? Not desperate housewives or househusbands, usually that is. The article notes “Many times the culprits are rings of thieves who sweep Similac, Enfamil and similar products from the shelves because they are a valuable commodity in the retail-theft marketplace”. Oh yeah, baby formula is easy to sell. In other words, it has high turnover in the undermarket, or what I call the market underneath the marketplace. And the rest is, sadly, old hat to any long-time readers of this blog. The thieves mislabel the formula, store it at the wrong temperature, and are often members of organized crime rings with big, nasty folks nicknamed “Bubba” and “Hurty”.

But, in Step #3 of any cohesive anti-counterfeiting program, you will drive the thieves to stealing. If they actually can’t economically reproduce your branding and security, they’ll start to hijack your trucks and raid your distributors. Your supply chain’s integrity is only as robust as the weakest deterrent, lock or mind you have working for you. Remember the mantra—security is not as much about prevention as it is about detection and reaction. Using tamper-evident, copy-evident and uniquely identifiable deterrents forces the thieves to steal. And you complete, with success, the three part program to “win” the brand protection battle. Now you must be prepared to “win” the after-branding battle. When you drive your competition—the counterfeiters—to theft, you need to bring the rest of your armaments to the fray. These are education, investigation, evidence and reaction. I’ve talked about how to put a system providing this into PRACTICE (May 12, 2008), but let me recapitulate briefly.

Make the brand identification integral to your security. That way, if a thief uses your label, he can be tracked. If he doesn’t, well, he will still provide clues to his identity by how he tries to mimic your label. If he doesn’t try to mimic your label and uses his own, fewer clues are gained (and less pity felt for the purchaser, who should know better). But, you’re surely getting the drift here—if you routinely inspect your packages, labels and documents as part of track and trace and authentication, then you will also gather intelligence on the rats scurrying around in your supply chain warehouses. I mean the two-legged rats, of course. This intelligence can be used to define—find and fingerprint—the counterfeiters and thieves, and provide evidence to those willing to prosecute them.

So, does theft matter? It sure does. First off, it is a sign of success. Yeah! You’re making it so hard for your counterfeiters, they’re resorting to stealing. They may actually go to jail for that. But, there’s no time to rest on your laurels. Stealing still requires a smart, security-VDP-driven approach. Why not plan for the future, and put into place a practical program that can both help prevent counterfeiting and later help fight theft?

-Steve

NY Times article covers topics discussed here in July

StevenSimske — Sun, 03 Aug 2008 19:46:00 GMT

My blogs of July 5 and 6 were concerned with how the price of oil may be the tipping point for a turn from unchecked outsourcing. The NY Times ran an article today covering the same topic.

Shipping costs start to crimp globalization: http://www.nytimes.com/2008/08/03/business/worldbusiness/03global.html?partner=rssnyt&emc=rss. The article uses the same example of furniture production, and cites security and global warming as key concerns as well. It does not mention the Unflat Earth, but this may be because Friedman writes for the NY Times.

Regardless, this shift from globalization to localization, inevitable with the arrival of Peak Oil (it may already have occurred) will weigh heavily on supply chains in the years to come. How will this impact your business? The need for security will not diminish--there are likely, in fact, to be even more locations in your value chain, since instead of mass manufacturing in the cheapest-bidded global locale, products will have to be produced in multiple places. Tying security directly to the production--manufacturing, printing, inspection and registry creation--will only be more important under this new reality.

-Steve

Counterfeiters Beware--What Comes Around Goes Around?

StevenSimske — Sat, 26 Jul 2008 06:34:00 GMT

A four year sentence for selling counterfeit pharmaceuticals? The pharmaceuticals were worth $400,000, so the sentence is more draconian than many for counterfeiting. However, there are extenuating circumstances.

Outsourcing-Pharma.Com (http://www.outsourcing-pharma.com/news/ng.asp?n=86605-viagra-pfizer-counterfeit) reports that Ivad Dogmosh sold fake Viagra, but "[t]he antibiotic metronidazole was detected in the pills, which has side effects including seizures, fever and bloody diarrhea. In addition metronidazole interacts with alcohol, which can result in nausea, flushing or headaches." Viagra is the most often counterfeited pharmaceutical on the planet, which is saying a lot--fake pharma is reasonably estimated as a $75 billion/year industry.

However, this story may have an ironic twist (I'm speculating here, but hear me out). Based on the severity of the sentence, it is likely that Ivad was penalized more harshly because of the metronidazole. I can picture him at the trial, declaring "But, Mrs. Judge, I swear I never intended to put metronidazole in the pills. I meant for them to be sugar tablets". Which implies that Ivad was not in control of his supply chain. He may have gone too far in his outsourcing, and scored the dye, expedient or other ingredient from (gasp!) a disreputable sort. Imagine that, Ivad was both the perpetrator and victim of counterfeiting.

What kind of a world do we live in when a counterfeiter can't even trust his supply chain!?

-Steve

Wal-Mart promises ore-to-store provenance record for jewelry

StevenSimske — Wed, 16 Jul 2008 06:33:00 GMT

Reuters reported recently that Wal-Mart "is introducing a line of gold and silver jewelry that can be traced from the mine to store shelves". Please see http://www.reuters.com/article/domesticNews/idUSN1435036120080715, for the full article. An interesting prospect, being able to know everyone who has touched the value chain, from the mine to the Mart. The article mentions that, in order "to create the Love, Earth jewelry line, Wal-Mart worked with mining company Rio Tinto Plc; Newmont Mining Corp, a global gold producer; and Aurafin, a Florida-based jewelry manufacturer." An admirable notion, and one no doubt geared to assuage the plethora of consumers who worry that their shiny ornamentations are the result of "slave labor".

However, the germane issue for security, anti-counterfeiting and supply chain integrity is, "How authentic is this supply chain"? What are the on-ramps for a would-be counterfeiter? Does Wal-Mart's identification of the partners in the supply chain actually serve to increase the authenticity of the end product?

As you may suspect from past postings on this blog, the answers are not cut and dry. Identifying the companies that are "certified" for this program lets would-be counterfeiters know who to target for bribes. On the other hand, it does reduce the number of "middlemen" and so reduces the number (though certainly not the width) of on-ramps. It will be interesting to see what protections Wal-Mart puts in place for this program. As with software, so with "physical ware". The bigger the target, the more snipers taking shots at it. And Wal-Mart is the biggest possible target, with more employees than any other three companies combined. Rio Tinto, Newmont and Aurafin--the weakest link in these companies (a disgruntled stockroom worker, an underappreciated janitor, whoever) or in Wal-Mart itself--can render this crown jewel a bauble. So, unless you have a Smeagol Gollum lurking in your neighborhood Wal-Mart, you're unlikely to be sure who all the Lords of your Ring really were.

-Steve

High and dry

StevenSimske — Sat, 12 Jul 2008 06:37:00 GMT

Hiking in the mountains above the Black Canyon of the Gunnison, I saw the dead tree shown in the photo below...

I was interested in how the tree had died. Was it too high on the mountain? Was the ground beneath it too porous to hold water during the growing season? Was it old? Was it due to a late frost?

When I returned home, I found a much larger (locust) tree in my backyard was also bereft of life, photosynthesizing no more, an x-tree. And this is true of an astonishing number of trees in Fort Collins this year. Not to mention the rest of Colorado and Wyoming (see for example www.rockymountainnews.com/news/2008/jan/15/beetle-infestation-get-much-worse/). Every single lodgepole pine will be dead in this area in 5 years.

Monocultures, such as a lodgepole pine-only forest, are generally quite fragile, susceptible to sudden decimation, and poorly robust in response to a challenge. Trite expressions such as "don't put all your eggs in one basket" come to mind, and for good reason. When you've reduced what should be a complex system to a single element, you are at the whims of fate. It's not linear. One element, no interactions, and the only resiliency your system has is the resiliency of that element. Two elements: you have the resiliency of element 1, or element 2, or the combination of element 1 and 2. Three elements--seven resiliencies (including the interactive resiliency of all 3 elements together). Four elements--15 resiliencies. In general, with N elements, there are 2 to the power of N minus 1 resiliencies.

A robust brand should benefit from the same mathematics. Multiple suppliers, multiple manufacturers, multiple assembly locations. When one of the suppliers, manufacturers or assemblers is compromised, there is a network left behind, robust to the loss. The brand quality and consistently can still be maintained.

So why do brands let themselves go "high and dry", reducing their supply/value chains to a single element? An easy answer is the relentless pursuit of reduced cost, but this is a false pursuit. Measuring cost is like measuring the length of a coastline--its value changes depending on how closely you look. On a related example, if you wanted to get from Provincetown to Plymouth, your path will differ greatly depending on whether your vision extends five miles or fifty miles. If the former, you can only move along the coast of Cape Cod and the journey extends 80 miles. If the latter, you set out almost due west, and the journey is 20 miles.

Short-term cost--that is, cost in the NEXT QUARTER--has become paramount for the US (and other) economies. However, strategies for the next quarter typically have little bearing on costs for the next five years. Steering your strategy by single quarters? Enjoy rowing four times as hard.

Brand protection strategies must also look beyond the next quarter. There must be an innate moving target, which means you can change the specifics of your deterrent, inspection and authentication implementations without your having to change how the strategy is implemented. Variable data printing, as I've described before on this blog, provides an innate moving target. So does refusal to be complacent. Be interactive, be adaptive, respond to what your customers are seeing. Think beyond the current counterfeiting approaches. Attack your own protection. Otherwise, your product will truly be left high and dry, and no amount of rowing will get you to the destination of brand protection.

-Steve

Tomatoes that terrorize--or the recall to recall

StevenSimske — Sat, 21 Jun 2008 06:15:00 GMT

There are three topics that, as part of the HP community blog team, we are not to discuss on our blog: religion, politics and the ingredients in a hot dog. The topic I discuss tonight is a close fourth. So, I will try to be a little delicate here.

The recent tomato recall (http://www.fda.gov/oc/opacom/hottopics/tomatoes.html) may end up being as severe to the tomato industry as the cod moratorium has been to the Newfoundland fishing industry. Based on the cost of present goods and the infrastructure depreciation, etc., a year's loss of sales translates into roughly 10% lost value in an entire industry. Meaning that no tomato sales this year, and the tomato industry is worth 90% of what it was worth before this year...for a long, long time. Was that 10% factored into the "streamlined" supply chain the tomato--like any other agricultural--industry uses to reduce costs, provide just-in-time inventory, and devalue tomato picking? Of course not. Like counterfeiting, massive recalls are simply not modeled by the proponents of the just-in-time, multi-input, massive throughput supply chains that describe virtually every product type on the planet today.

We all know the stories about how many different cattle you're eating when you eat a burger (again, I must not talk about the hot dogs)--it's in the dozens. But do we know how many different raw material providers are involved in the production of a pharmaceutical? Of a tea bag? Of an automobile? Dozens, hundreds, thousands? The more there are, the harder it is to audit each and every element of the product provenance. So many have given up trying. Close your eyes, pretend it won't happen to you, and when it does, well, pull everything off the shelves--TOTAL RECALL. Aside from the incredible waste of such a recall, the lauded efficiencies of scale under non-recall situations simply don't ring true either.

For the food industry, one need look no further than Pollan's excellent book, the Omnivore's Dilemma (http://www.michaelpollan.com/omnivore.php), to see how "supply chain efficiency" has resulted in tragic inefficiency (fossil fuels are converted into corn syrup that converts us into obese diabetics). An Amazon.com (Bunny Crumpacker's) review of it (http://www.amazon.com/Omnivores-Dilemma-Natural-History-Meals/dp/1594200823) notes ominously:

"Each bushel of industrial corn grown, Pollan notes, uses the equivalent of up to a third of a gallon of oil. Some of the oil products evaporate and acidify rain; some seep into the water table; some wash into rivers, affecting drinking water and poisoning marine ecosystems. The industrial logic also means vast farms that grow only corn. When the price of corn drops, the solution, the farmer hopes, is to plant more corn for next year. The paradoxical result? While farmers earn less, there's an over-supply of cheap corn, and that means finding ever more ways to use it up."

All this to have a just-in-time inventory? When gas hits $10/gallon (and it will...soon) will it still be worth it? It costs nearly $1000/day to run a farm tractor already (just ask a farmer). Why have we allowed this to happen?

So, add recalls to the lengthening list of why outsourcing to unaffiliated parties is a recipe for disaster. Here is the potentially delicate subject. I am not against all out-sourcing, and a true Flat Earth is not a bad thing. But we all know that the earth looks flat from space (the earth is size-proportionately smoother than a cue ball), but up close it has all these inconvenient hills, dales, valleys, vales, arroyos, lifts, canyons and rifts. It's messy in the details. Nothing is flat, not even Friedman's cerebral cortex (sorry, too easy a joke there, but Friedman seems to think that people with the manufacturing jobs somehow won't learn how to design and be creative--a huge oversight, in my opinion). If you outsource to people you're intentionally hiring to save costs, you have opposing motivations. You want them to cost less, they don't care if you succeed. You think they're cheaper than employees, they think you're too overstretched to look too closely.

In short, you're asking them to try to cheat you. Guess what? In many cases, they're happy to oblige. And it serves you right. Outsourcing to disenfranchised third parties is a very short-term strategy that has been deployed for medium-to-long-term already. Take a cup of cluelessness, add a dash of denial, and you've got a supply chain that doesn't hold to inspection.

Which brings us back to those terrorizing tomatoes. What went wrong? Sure, Sam and Ella, that dynamic duo, reared their ugly heads. The problem was, no one knew where their necks were. The supply chain is simply too convoluted, with too many on and off ramps, that trying to do a partial recall is simply not worth the effort.

Time to reclaim the supply chain. It's not just about counterfeiting. It's about knowing what you're actually getting.

-Steve