Milinda Dwyer

Milinda Dwyer

Mega retailer Costco Wholesale has high expectations when it comes to food safety and requires more from its suppliers than most, says Milinda Dwyer, Costco food safety representative.

Dwyer, based in the company’s headquarters in Issaquah, Washington, shared the details of Costco’s food safety program with a room full of Washington tree fruit industry members during a food safety seminar at statewide tree fruit talks in December. She answered questions and throughout her talk expressed a willingness to find common ground to issues, especially those stemming from Costco’s ­infamous “addendums.”

Dwyer works closely with produce suppliers, certifying bodies, auditors, and others to ensure that all products sold by Costco are safe. Costco is the second largest U.S. retailer, seventh in the world, and has 67 million members worldwide. More than 600 ­warehouses generated $93 billion in total sales for the 2012 fiscal year.

Costco’s main expectation of suppliers is that all who grow, harvest, pack, and further process the produce must have an annual food safety audit from an approved third party certification entity. For an audit to be acceptable, it must be numerically scored; 85 percent is the minimum score accepted.

Other expectations include:

—Audits are to be conducted as close to the anniversary date of the last audit as feasibly possible.
—The same auditor cannot visit the same site more than three years in a row.
—Product recalls or other serious findings require a new food safety audit be conducted.

Costco also requires that the online Azzule data management system be used to upload audits and details of corrective actions.

“Data management is a huge issue for companies such as ours because there is so much data to manage and keep track of,” Dwyer said, adding that the secure Web site allows suppliers to upload information and meet Costco’s timelines for data entry.

In 2011, Costco received more than 6,200 food safety audits from small and large ­businesses.

When an audit requires corrective actions, the supplier has 14 days to submit (upload) information on what steps were taken to comply with the corrective action. “We take corrective actions very seriously,” she said. “It’s where the rubber meets the road. We want to know how and when you fix what was identified in the audit.”


It’s been Costco’s addendums—additional items required by Costco that are not included in most audit schemes—that have caused the most friction between Northwest growers and packers and Costco’s food safety department. Dwyer says that while 93 percent of all food safety audits for produce have the same requirements, Costco believes that a few important items are missing, thus the need for its list of ­addendums.

The addendums cover topics like harvest crews, the growing area, and produce facilities, which include packing houses, cold storages, distribution centers, and such.

The addendums also dictate when reaudits are required. Costco has deemed several items so egregious that a reaudit is automatic. Examples are if hand-washing facilities are not functioning, product contamination is observed, lack of a written pest control program, evidence of rodents, birds, reptiles or other animals in the food area, and more.

Costco also requires a mock or trace-back recall to be conducted of its produce suppliers. For year-round facilities, three mock recall exercises must be done (two by the facility, and one by the auditing body, with Costco choosing the product item); non-year-round facilities require two recall exercises (one by the facility, one by the auditing body).

Sticking points

Costco itself has a rigorous, internal food safety program, according to Dwyer. Costco buyers must go through food safety training, employees are taught food safety, and retail warehouses are annually audited. However, while Costco requires a third party to conduct audits of its suppliers, Costco employees are the ones doing the company audit.

When queried by the audience why Costco appeared to have a double standard, she answered, “I don’t have a good answer for that. I can tell you that we do a lot of food safety things on our own. But, no, we don’t use a third party, but we do have a lot of internal auditors that come through.”

Another item that generated questions from the audience was a Costco requirement regarding food contact surfaces that goes into effect in 2013. With the exception of wooden bins that are used as an industry standard, produce is not to come into contact with something that can’t be cleaned, Dwyer said. “This includes material like foam rubber, carpet, non-food-grade plastic, duct tape, and such. Items that come into contact with produce must be able to be cleaned and sanitized.”

Cherry growers routinely use foam pads inside picking buckets and bins to soften the drop and protect from bruising. If the foam pad can’t be sanitized in a satis­factory manner, growers will have to find a material to cushion their fruit that can be washed or they will lose points on an audit and could be in nonconformance with Costco’s food safety requirements.

Industry has a year to come up with a solution. After January 1, 2014, those still using food contact materials that cannot be sanitized face automatic failure of an audit, and a reaudit will be necessary to show that the ­situation has been corrected.

Dwyer expressed a willingness to work with industry on the foam issue and other issues that growers and ­packers may have problems in meeting.

“We’ve worked with the tree fruit industry in the past,” she said, adding that she’s met with several industry members in recent years. “Costco has actually changed some things through the course of the meetings. I’m open to discussion and happy to hear your ideas. Costco is happy to hear your ideas, and we want to hear your feedback.”

Another issue was the need to have a documented cleaning schedule for picking bags as well as storing the bags under cover. Some pickers use their own bags, which allows them freedom to move among employers but would make it difficult for growers to obtain them for ­regular cleaning.

Jim Colbert of Chelan Fruit Cooperative of Chelan, Washington, said the industry is working with Costco to find an alternative and is looking for ways that satisfy the sanitation concerns regarding foam and burlap.

Colbert, who serves on the Pacific Northwest Food Safety Committee of the Northwest Horticultural Council, said the committee has been working with Costco to solve what he calls “hairball” issues—things that growers and packers have the hardest time dealing with.

“Milinda Dwyer has been very good in listening to us, but we have some work to do in winning them over and in telling them how we will solve several of these issues.”