Restaurants and Institutions

Dennis Lombardi

How long will faith in the food chain last?
March 3, 2008

Most of us have already heard about the beef recall at Hallmark/Westland Meat Packing.  As it relates to any potential medical issues, if there are any, the damage is already done. However, there is another potential wave of damages that may come from how much the media sensationalizes the story.  And there are certainly opportunities to do so if the media wants to take that route.

Over the years, I have done a fair amount of litigation support work identifying how adverse publicity on issues like this impact restaurant brands.  The more the media writes about the issue, the more and longer lasting the financial damage.  I hope hype does not take center stage.

So far, the consumer has retained faith in the U.S. food chain, but with each new incident, there is erosion of that faith.  Over time, if these types of issues continue, consumers may reach a tipping point that could have material impact on both the restaurant and grocery channels.

Two hopes for this latest food recall, first and foremost – of course – is that no one has been harmed by this incident.  The second is that it becomes a catalyst for increased resources and focus for the USDA to reduce the chance of future events like this.

Posted by Dennis Lombardi on March 3, 2008 | Comments (0)