Food Supply Chain Security Issues and Implications

Corresponding author College of Business, University of Central Aricansas, Conway, AR, USA 

Prior to September 11th, 2001 the private sector was well aware of the threat of terrorism. However, the terrorist threats they perceived were different than those perceived today. In the early 1990s, firms were mostly concerned about overseas employee kidnapping (Harvey 1993). Ports were more concerned with theft and smuggling (Thibault et al. 2006). Beyond airline hijackings, the use of supply chain assets as a method to inflict damage was far from the minds of corporate America. 

Terrorist threats complicated these efforts. Costs to secure the supply chain are estimated to reach 151 billion USD annually (Russell and Saldanha 2003). Motor and air carriers are expected to incur an extra 2 billion in costs (Wolfe 2001). Warehouses are expected to incur an extra cost of 1 to 2 per square foot (Warehousing Education and Research Council 2004). It has been estimated that ports will incur 1.1 billion in initial security expenses and an extra 656 million annually. Additional considerations include holding excess inventory to buffer against supply chain disraption (Lee and Whang 2003), a decreased ability to deliver goods on time due to new security processes and measures (Dobie 2005), and an increase in cycle times and lead-times that result (Lee and Whang 2003). 

Supply chain managers do more than coordinate flows efficiently and effectively, but must also simultaneously protect the supply chain and its stakeholders from harm. The study of supply chain security management emerged from this dilemma. Supply chain security management is defined as, the application of policies, procedures, and technology to protect supply chain assets (product, fecilities, equipment, information, and personnel) from theft, damage, or terrorism, and to prevent the introduction of unauthorized contraband, people, or weapons of mass destruction into the supply chain (Closs and McGarrell 2004 p. 8). 

The remainder of this chapter will focus on a particularly important and vulnerable subset of the broader supply chain concept food supply chains. The first section will explore the importance and challenges associated with food supply chain secirrity. Section 2 will detail best in class secirrity practices used by firms in the food industry. Section 3 discusses the role of secirrity in the supplier selection decision. Finally, the chapter concludes with managerial implications. 

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Chapter 18 Food Supply Chain Security Issues and Implications... 

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