Feeding the Baby Products Supply Chain
Managing the baby products supply chain is not child’s play. Here’s how manufacturers in this highly regulated product category stay hyper-vigilant to protect infants and toddlers while constantly adjusting to parents’ ever-changing color, style, and flavor preferences.
What do actresses Jennifer Garner, Kristen Bell, and Jessica Alba have in common?
They all started baby product businesses after they became mothers. Like every other parent, they became obsessed with the quality and safety of anything that went on, in, or near their children.
Garner’s company, Once Upon a Farm, sells fresh, organic baby food. Bell’s Hello Bello premium but affordable diapers, wipes, and skin care products are sold exclusively at Walmart. Alba’s The Honest Company sells a range of products from organic formula to diapers and baby shampoo.
“Quality should be scrutinized for any product, but when it comes to children’s safety, it is of the utmost importance,” says Charlie Wilgus, general manager of the manufacturing and supply chain practice at Lucas Group, an Atlanta-based executive search firm.
“You never want a lawsuit because of something happening to a baby,” adds Joe Politoske, vice president and senior account executive at USC Consulting Group.
The baby products supply chain is highly regulated because little humans are so vulnerable. Rigorous testing and certification are designed to protect them from injury and illness caused by everything from loose parts they could choke on to flammable fabrics or toxic materials that include lead. Manufacturers and retailers must be vigilant to ensure that suppliers—including those overseas—adhere to design, materials, testing, and certification requirements.
At Zulily.com, a Seattle-based online retailer that started as a flash sale site for parents, vendors are required to maintain all relevant testing documents that regulations mandate. Teams work closely with partners across the supply chain to manage compliance for all product categories, but especially baby products that include strollers, toys, and apparel.
“We train our buying teams on product safety issues and evolving regulations while working with vendors whenever safety concerns are raised to ensure that their products meet all applicable safety standards,” says Doug Hyland, Zulily’s director of compliance.
Dominique de Bourgknecht, founder and CEO of baby deedee, a New York manufacturer and retailer of baby sleeping bags and pajamas, has been able to find product and certification quality at a large, integrated, family-owned manufacturer in India.
“This kind of integration, where one part of the family knits the fabric and another cuts and sews, offers a cost advantage plus more control over product quality and consistency,” de Bourgknecht says. Baby deedee uses a third-party laboratory to ensure there are no issues.
Symbia Logistics, a Colorado-based third-party logistics provider, handles fulfillment for ABBY&FINN, a subscription premium diaper and wipes company. “We take particularly exceptional care with how we handle any product someone will wear,” says Dave Boger, Symbia’s operations and business development manager.
Co-founded by the owner of another company that makes BPA-, PVC-, and phthalate-free bibs, cups, and other products, ABBY&FINN goes to great lengths to make sure its products are safe for newborn skin.
For example, its diapers, available in a range of sizes and parent-pleasing patterns and colors, are made with plant-based materials. They include no harmful chemicals or dyes and the “sap”—the mostly plant-based material that provides absorbency—is completely baby-safe.
They take this care because it’s what co-founders Lance and Amanda Little and Matt Anderson want for their children, but also because parents demand it. “The materials we use are always top of mind with making sure we listen to our customers and stay aware of industry trends,” says Little. “For example, we just changed manufacturers to include even more natural ingredients in our wipes.”
But ABBY&FINN’s parent customers want more than sustainably harvested wood pulp in their disposable diapers. They want their wee ones’ diapers to be fashion-forward, too.
“You’d be surprised at how on-trend some designs need to be,” says Anderson. “We have to stay on top of domestic and European fashion trends and colors.”
Consumer tastes literally play a role in baby food supply chain challenges as well. Whether it’s diapers, onesies, or pureed fruit, it’s about what the parent, not the infant, prefers.
“The flavor palate for baby foods seems to change every year or two, while for other food processors it’s every five to seven years,” says Politoske. Changing preferences require manufacturers to constantly adapt, which can be an issue when it comes to processing certain fruits or vegetables.
“Equipment that suddenly has to process pomegranates, for example, might not be able to keep the hard seed from becoming part of the finished product, so the equipment needs to be modified,” he explains.
Because consumer tastes can shift as quickly as infants become toddlers, baby food manufacturers want to minimize the amount of product in inventory.
“You don’t want a year’s worth of supply based on a forecast when trends could change,” Politoske explains. “That’s a significant amount of inventory that could be at risk.”
His company addressed that issue when working with a top North American baby food manufacturer that wanted to use a new, more modern facility to help globalize its supply chain. By expanding sourcing to South America, where the growing season is opposite of that to the north, the company could, for example, produce applesauce twice per year instead of just once. Splitting production in two according to opposite seasons means the manufacturer has less in inventory, which not only reduces the flavor-of-the-month risk, but also ties up less capital in goods.
Ingredient quality and traceability is extremely important with baby foods, too (see sidebar, page 69).
“The depth these companies go to to certify the supply chain is enormous,” Politoske says. “We work with other food products where quality is a given, but there’s an extra level of care and attention with baby products.”
Consumers and celebrities alike understand why that’s so important.
Playing with Blockchain
Gerber parent company Nestlé has joined the IBM Food Trust collaboration of leading food companies and retailers that includes Dole, Walmart, Carrefour, Golden State Foods, and others to use blockchain technology to make the food supply chain safer.
Nestlé is using the system to track ingredients in a popular variety of its Gerber baby food.
“People want to know, quite rightly, where ingredients they give their baby have come from,” Chris Tyas, Nestle’s global head of supply chain, told The Wall Street Journal.
Using technology developed by IBM’s blockchain unit, participating partners are working with suppliers ranging from small farms to large growers to input details about ingredients into the Food Trust solution. All participants—growers, suppliers, processors, distributors, retailers, and regulators—can have access to trusted information about the origin and state of the food based on their permission level. When necessary, they can use that data to quickly trace contaminated products to the source so those products can be removed from store shelves. This can help minimize illnesses caused by tainted ingredients or foods.
For a processed product such as baby food, Food Trust starts with a simple question: Who are this product’s suppliers? They need to be brought on board to share data in a way that creates end-to-end visibility.
One challenge of getting everything needed—from the date and time produce was picked and packed to when it was cleaned, chopped, and processed—is that participants don’t always use the same system to record and enter data.
“How do we enable data to come in from across the supply chain when there’s diverse technology sophistication?” asks Suzanne Livingston, Food Trust’s director of offering management. “Some of the smaller players might have IT systems they developed themselves or a spreadsheet. We’ve gone to farms where the system is a notebook.”
Food Trust has been able to make the integration process as easy as possible for all participants.
While many organizations are working with blockchain to trace ingredients, what makes this particular collaboration different is that there is no single owner.
“Food Trust lets companies own and retain their own data and insights and have control over what data is being shared and with whom,” Livingston says, adding that the system was built with input and guidance from all partners.
Baby Steps: Play by the Rules
The juvenile products category is one of the most highly regulated in the world. In the United States, the Consumer Product Safety Improvement Act (CPSIA) sets federal requirements. Signed into law in 2008, CPSIA gave the Consumer Product Safety Commission (CPSC) a significant role in creating and enforcing federal requirements as they pertain to children’s products. In addition, Section 104 rules allow CPSC to mandate federal requirements for specific product types covering everything from cribs to walkers and booster seats.
According to the Juvenile Products Manufacturers Association, key elements of CPSIA require that baby products:
Comply with all applicable children’s product safety rules
Have a written children’s product certificate that provides evidence of the product’s compliance
Be tested for compliance by a CPSC-accepted accredited laboratory unless subject to an exception
Have permanent tracking information affixed to the product and its packaging where possible