Cyclospora’s aftermath: If all manufacturers suffer when a food safety incident hits their category, why invest in food safety?

Sweetgreen has never served iceberg lettuce. All summer, the company said so, on earnings calls and in public statements. It didn’t matter.

Sweetgreen estimates that this summer’s cyclospora outbreak negatively impacted its July comparable sales by ~600 basis points while its stock price fell roughly 30% within a month. ⁱ

Other salad-heavy fast casual chains also experienced declines in traffic over this period despite the outbreak being attributed to food sold at Taco Bell. ⁱⁱ

Grocers felt it too: NielsenIQ data showed fresh lettuce unit sales down 9% and prepackaged salad dollar sales down 14% within weeks of the recall. ⁱⁱⁱ

None of that damage sorted itself by fault. It landed on the category.

So Why Bother? The Case for Investing Anyway

With an outcome like this, one might ask: “If everyone’s business gets punished anyway, why bother spending money on strong food safety & quality assurance (FSQA) systems?”

Aside from being the right thing to do, we believe investing in food safety is good business, for the following reasons.

1.Consumer attention to food safety continues to climb

Google search interest in the term “Food Safety” has roughly doubled since 2016 and hit a new high this year. ^iv 

Source: Google Trends.

With increased focus on health and wellness (e.g. consumer preference for clean labels, GLP-1s, controversy over “ultra-processed foods”), this trend is likely to continue. Thus, having an adverse food safety event tied to your product carries an ever increasing ‘franchise’ risk.

2.Risk management: High cost of failure

In addition to consumer perception and brand equity, there are real costs to consider. Each year in the U.S., there are approximately 300-400 recalls of Food & Beverage products. Beyond the high “hard” costs of a recall (e.g. overtime, removal costs, higher recall insurance premiums), recalls often result in a period of time where your product is off the shelf. Further, in some cases, food safety issues can force a manufacturer to close a facility, either temporarily or permanently.

• Hormel: ~6-month shutdown of its Planters nut facility in Suffolk, Virginia in 2024 following listeria contamination
• Treehouse Foods: temporary closure of its Cambridge, Maryland broth plant following 2023 recall
• Pepsico: permanent closure of its Danville, Illinois plant following salmonella recalls in December 2023 and January 2024 exposed repeated quality violations at the facility
• Boar’s Head: permanent closure of its Virginia deli meat plant following listeria contamination that led to multiple deaths and dozens of hospitalizations; USDA investigators found that the plant had ‘inadequate controls’ in place to prevent the spread of the bacteria

Lastly, in some extreme cases, manufacturers have been held corporately liable for their actions ^v and corporate personnel have gone to prison. ^vi

3.High ROI

Lastly, investing in strong quality and food safety systems has been shown to be a good business decision.

As described In Phillip Crosby’s seminal book, Quality Is Free, he estimates the cost of poor quality at 2.5% of revenue for best-in-class manufacturers, versus as much as 20% for companies that treat quality as an afterthought. ^vii

Strong quality and food safety systems also have been shown to benefit production efficiency ^viii, which is consistent with what we observe over and over in our work serving the middle market food and beverage manufacturing industry.

The implication is simple. Manufacturers pay for quality either way: a little, consistently, through strong systems (which in turn can have positive effects on efficiency), or a lot, unpredictably, through recalls, closures, and reputational damage.

Conclusion

None of this erases the reality that your food business could be negatively impacted when the next outbreak lands on somebody else’s supply chain in your category. But we submit that food & beverage manufacturers willing to consistently invest in strong FSQA systems will be more efficient (and lower risk) over the long term than those who don’t. Lastly, we believe these companies will withstand the impact of such outbreaks most easily and recover in the marketplace more quickly.

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ⁱ Sweetgreens’ Q2 2026 earnings transcript
ⁱⁱ https://www.restaurantdive.com/news/taco-bell-traffic-slides-double-digits-placer-ai-data/825759/?
ⁱⁱⁱ “America’s Cyclospora Outbreak Is Becoming A Retail Problem,” Forbes, August 9, 2026, forbes.com/sites/markfaithfull/2026/08/09/cyclospora-outbreak-retail-restaurants-grocery-stores/ (citing NielsenIQ data)
^iv Google Search Trends for “food safety,” Jan–Aug 2016–2026 (chart provided by requester)
^v Office of Public Affairs | Blue Bell Creameries Agrees to Plead Guilty and Pay $19.35 Million for Ice Cream Listeria Contamination – Former Company President Charged | United States Department of Justice Office of Public Affairs | Former Peanut Company President Receives Largest Criminal Sentence in Food Safety Case; Two Others also Sentenced for Their Roles in Salmonella-Tainted Peanut Product Outbreak | United States Department of Justice
^vi Office of Public Affairs | Blue Bell Creameries Agrees to Plead Guilty and Pay $19.35 Million for Ice Cream Listeria Contamination – Former Company President Charged | United States Department of Justice Office of Public Affairs | Former Peanut Company President Receives Largest Criminal Sentence in Food Safety Case; Two Others also Sentenced for Their Roles in Salmonella-Tainted Peanut Product Outbreak | United States Department of Justice
^vii Crosby, Phillip B. (1980), Quality Is Free: The Art of Making Quality Certain (The Penguin Group)
^viii Rihawi, B. (2024). The impact of ISO 22000: 2018 on food facilities performance with multiple production lines. CyTA – Journal of Food, 22(1). https://doi.org/10.1080/19476337.2024.2431281