How Food Companies Can Overcome Foreign Trade Compliance Risks

Every country has a different food safety regulation and its perception of risk. These differences in national standards make compliance challenging for exporters and can result in permanent trade frictions and affect food trade.

Compliance-related hurdles can lead to costly delays, higher trade costs, food safety risks, and customer dissatisfaction. Food companies must proactively mitigate compliance risks to ensure frictionless and compliant transactions and faster time-to-value.

Here are the top 3 foreign trade compliance risks that food companies must manage effectively to avoid poor results.

1. Changing regulations

Regulatory bodies across the globe are constantly modifying and updating standards and protocols to meet present demands. Some of the recent changes include:

Latest FDA rules

The Food and Drug Administration (FDA) announces new regulatory updates — including changes to its definition of “healthy,” FDA Standards of Identity, labeling clarity on animal cell technology, and cannabinoids regulation.

GACC Order No. 248

The General Administration of Customs of China (GACC) Order No. 248 sets out new requirements for the registration of qualified foreign food products exporters to China, effective starting January 1, 2022.

2. Supply Chain Risks

Compliance with food safety protocols requires ensuring that the products are of high quality from farm to fork. Here are three key factors that need to be effectively managed and monitored:

• Suppliers

How do your suppliers manage compliance?

• Ingredients

What are the inherent risks posed by the ingredient you use?

• Use of Ingredients

How do you ensure that your staff uses the product safely and compliantly?

3. Innovation and Sustainability Concerns

To meet today’s demand, food companies integrate modern technologies and approaches into their processes. Recent advances include:

• CRISPR-Edited Agriculture, a gene-editing technology for introducing commercially desirable traits in crops·
• Alternative meats from plant-based proteins·
• New food freezing concepts

Implementation of these innovations requires the backing of regulatory bodies to ensure compliance and address concerns such as:

• Environmental and ethical issues
• Labeling issues
• Food safety concerns

Proactively manage foreign trade compliance risks

At Ropaar, we have helped various global food companies to overcome and adapt to ever-changing global trade compliance risks and challenges. We helped them assess their unique landscape and implement cutting-edge SAP global trade solutions to empower them to execute in the new normal.

By leveraging SAP Global Trade Services (GTS), food companies can confidently trade globally with:

• Next-generation export and import management
• Simplified trade preference management
• Adaptive customs management
• Data-driven restricted party screening

Contact our team of SAP experts to learn more.