food safety costs

How Much Food Safety Compliance Really Costs for Meat and Poultry: Report

In Food Safety, Regulatory, Research by Kristen Runvik0 Comments

The cost of complying with food safety regulations in the meat and poultry industries can be immense, according to a recent study published in the Journal of Food Science. In fact, developing a food safety plan alone can cost anywhere from $6,000 to $87,000, not counting the cost of training and other related activities.

For the study, researchers Catherine L. Viator, Mary K. Muth, Jenna E. Brophy, and Gary Noyes looked at the true cost of food safety investments to help regulators assess current regulations and evaluate alternatives.

Read on for a more in-depth look at the study results.

What they did

The researchers, along with seven industry experts, estimated the costs of implementing various food safety regulations required by the USDA’s Food Safety and Inspection Service (FSIS). These requirements include:

  • HACCP plans
  • Sanitary standard operating procedures (SSOPs)
  • Sampling plans
  • Food safety training for new employees
  • Antimicrobial equipment and solutions
  • Sanitizing equipment
  • Third-party audits
  • Microbiological tests

Their goal was to calculate the total cost of compliance for meat and poultry processors, taking into account all of the following:

  • Capital equipment
  • Labor
  • Materials
  • Utilities
  • Repairs and maintenance
  • Annual amortization costs
  • Other costs

What they found

Overall, the researchers found huge variability in the cost of implementing food safety requirements, largely depending on processor size.

HACCP plans

Meat and poultry processors must have a written HACCP plan for each product produced. And how companies develop and validate these plans impacts cost.

Small establishments typically develop the entire HACCP plan in-house. For those that hire a consultant, development costs increase from $13,540 to $17,770.

On the other hand, large establishments tend to outsource HACCP plan development from the start. They also must reassess their plan 2 to 3 times a year, compared to just once a year for small establishments. The effect is that large establishments must invest roughly double the amount.

HACCP Plans Small Establishments Large Establishments
Initial Costs
Develop plan internally $13,540
Develop plan with consultant $17,770 $43,080
Validate plan $10,832 $8,666
Annual Costs
Reassess Plan $365 $730 (x3)
Total Costs $24,736 (without consultant) to
$28,449 (with consultant)
$53,936

If you’re wondering why the validation costs are lower for large establishments, it’s because the researchers assumed these companies have more specialized employees and thus are able to do it faster.

Sanitary standard operating procedures (SSOP)

SSOP plans cost about the same to develop, validate, and reassess as HACCP plans. This is particularly true for large establishments. 

Small establishments that choose to hire a consultant may actually save money, as the consultant can develop both plans at the same time. Overall, a small company can plan on spending $10,270 with a consultant, compared to $13,540 without.

Sampling plans

The cost of microbiological sampling plans varies dramatically for facilities of different sizes. Because of the plans’ complexity, the researchers assumed that all companies hire a consultant to help.

Small establishments typically must pay for about 20 hours of labor, plus consultant fees and travel, developing the plan and an additional 1,200 hours validating the plan. Large establishments spend many times that, with an estimated 3,000 hours for development and 960 hours for validation, plus consultant fees and travel.

Sampling Plans Small Establishments Large Establishments
Initial Costs
Develop plan with consultant $6,542 $87,240
Validate plan $32,496 $46,997
Annual Costs
Reassess plan $243 $486
Total Costs $39,281 $134,723

Food safety training for new employees

Like food safety plans, new employee training costs vary, depending on factors such as employee type, course, and travel costs.

For example, when a manager takes an HACCP course, it costs about $2,512, including the course, travel, and time. Meanwhile, the cost of training new production employees on sanitary dressing is only $122.

It’s worth noting that, while the study refers to the recommended number of training hours for processing establishments, the researchers found that processors typically only provide about one-third of the recommended training hours. This shows there’s plenty of room for improvement.

Antimicrobial equipment and solutions

Equipment

Antimicrobial equipment costs vary based on establishment size, species, and equipment type.

For example, a small beef establishment can spend anywhere between $19,559 and $38,025, depending on if they use hand sprayers or a spray cabinet. In a large establishment, the investment is much higher: $1.6 million will buy a hotbox chilling unit.

Similarly, small chicken establishments can expect to invest $28,946 to $63,941, whereas large ones will fork over anywhere from $66,136 (for post-chill spray bars) to $745,146 (for a water chiller).

Solutions

Antimicrobial solutions do add to the overall cost of food safety, but the investment is minuscule compared to the other factors. In this case, however, large establishments often have the advantage because they can take advantage of volume discounts.

Sanitizing equipment

Sanitation costs vary by establishment size and how many stations are present around the plant. Food companies of all sizes can expect to invest in equipment including knife sanitizers, boot and hand washing stations, and floor foamers. Labor also impacts the cost associated with sanitizing equipment — with an average from $1 to $6 per employee shift.

Third-party audits

The cost of a third-party audit depends on establishment size, the amount of preparation, and how many yearly audits are required.

Audits generally happen twice per year. At small establishments, these audits take approximately 2.5 days, while at large establishments they can take up to 6 days. Some small companies also hire consultants, impacting the total cost.

Third-Party Audits Small Establishments Large Establishments
Without consultant $13,519 $24,093
With consultant $18,186 N/A

Microbiological tests

Finally, meat and poultry establishments must conduct microbiological tests to meet federal regulations, policies, and performance standards. And many companies conduct testing beyond these requirements.

The mean cost per test ranges from $18 to $358, plus labor (~1 hour) and shipping to third-party laboratories. By using an on-site testing facility, companies can cut their testing costs by almost 50%.

Conclusion

Many factors go into determining the true cost of food safety. If you add up all of the numbers in this study, compliance can cost tens of thousands of dollars for small establishments and hundreds of thousands for large ones. But, that’s still a smashing deal compared to the estimated $10 million cost of a recall resulting from a food safety problem.

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