Supply Chain Product Safety Is Our Guide

When the media reports that an unsafe product has caused illnesses and deaths, every segment of the supply chain is scrutinized. Illnesses arising from contaminated products garner headlines and Congress reacts by convening hearings and proposing legislation that can alter our businesses practices and legal processes.

We all can remember news stories about contaminated products in the supply chain that made newspaper front pages and the TV news, including cantaloupes tainted with listeria bacteria, toys painted with lead paint from China, and sales of counterfeit Lipitor.

Third-party logistics warehouses are an integral part of the supply chain. We store and handle products for every sector of the economy, providing many value-added services, which include managing national and global supply chains for our customers. The facts show that we handle well over 99.99% of products safely and securely without any disruptions.

There are many entry points in the supply chain where contaminated, adulterated or counterfeit product can be introduced. There are good actors and bad actors, and a criminal element seeking to take advantage.

The 3PL warehouse industry strives to maintain our part of the supply chain safely and securely. We pursue every measure, for example, to ensure that food product we handle does not become contaminated or adulterated. We invest substantial amounts of time, money, and training resources in practices and procedures to ensure product safety.

Too often, however, when Congress shapes legislation to address issues in global and interstate commerce, lawmakers fail to recognize the role of the 3PL warehouse in the supply chain. Lawmakers and regulators view the supply chain as a linear, one-dimensional set of transactions between a buyer and a seller. However, the modern supply chain is a complex, collaborative, value-creating network with many intersecting patterns of movement between the beginning and end points. Failure to recognize this distinction results in faulty attempts at legislative and regulatory solutions.

Legislation does not always recognize and appropriately address the emerging role of the warehouse-based 3PL. For example, the 3PL never takes legal title to the product, nor does it have legal authority to choose the buyers or the suppliers of the product inside the box. Therefore, legislation that places the same responsibility on a 3PL as on the manufacturer or other supplier misses the mark, holding a 3PL responsible for things it has no ability to control.

At the same time, by not recognizing the actual role of the 3PL in the supply chain, such legislation misses the mark by losing the opportunity to hold 3PLs accountable for those actions that are within their purview – those relating to the appropriate care and handling of the product as it moves through the distribution process.

The solution is to increase the knowledge of policymakers about how the supply chain works in real life. IWLA seeks to accomplish this by facilitating site visits by congressional staff and agency officials to our members’ facilities. We show them how our members track and trace every shipment, down to a single package, and in the case of medical supplies, down to each prescription bottle. These visits by congressional staff and agency officials help them understand the nature of our role and what we do to execute and implement recall orders. It illustrates just how our portion of the supply chain works to ensure product integrity.

Another solution to misguided policymaking has been to insist the 3PL warehouse industry has “a seat at the table” when industry and government meet to set supply chain policies. The days of expecting our customers to represent our interests in the arena of public policy are long gone.

This approach enabled IWLA to secure the position of the 3PL in the Consumer Product Safety Improvement Act and the Food Safety Modernization Act. In addition, we are undertaking the same sort of site visit and process inspection with FDA officials who will implement the FSMA. We also are working with others in the pharmaceutical supply chain on a federal policy proposal that replaces the patchwork of inconsistent and inefficient state laws.

The bottom line: It is our members’ record of integrity and professionalism that allows IWLA to show how the supply chain can work to provide the utmost protection to the consumer. As advocates for the warehouse-based 3PL industry, it is vital for us to demonstrate to Congress and regulatory agencies that we not only talk the talk, but we walk the talk, that we do our part and we do it well.