Effectively managing the food and beverage supply chain goes beyond cost savings. Every year, 33.3% of food produced for human consumption is wasted. This is amid a spiraling shortage of raw materials necessary for food production that is impacting the throughput capabilities of several manufacturers. A great example is the Huy Fong Foods saga. The company has said it will be unable to produce its famous chili sauce because of a shortage of ripe pepper, affecting its color and taste.
Situations like raw material shortages push the need to prioritize inventory management and gain control over the food and beverage supply chain. Improved management could also cut costs while helping businesses avoid blowbacks from shortages due to poor planning.
This article will review insights and best practices for managing food and beverage supply chains to ensure resilience and growth.
The global consumer base is growing, and consumption demands are evolving with it. This has strained food and beverage supply chains as they struggle to keep up — for several reasons. The varying demands of the consumer base have made it challenging for businesses to meet consumer needs effectively.
Consumer demand increasingly tilts towards fresh farm produce and other quickly perishable foods. Supply chains have to respond, but the nature of such products means more investment in the necessary infrastructure, such as cold chain or reefer, to ensure the goods get to their desired destination without damage. This typically means highly optimized cold chain management.
These supply chains also have to contend with vulnerability to fluctuations in supply and demand.
Organic products face challenges in maintaining certification standards, preventing cross-contamination with non-organic products, and managing shorter shelf lives.
Rigid health and safety standards often impact the supply chain’s ability to deliver on time. Part of complying with health and safety standards is ensuring adequate traceability and transparency from farm to fork. Managing refrigerated logistics can also be complicated for most supply chains. Frozen foods demand ultra-low temperature controls, rapid response to mechanical failures, and efficient recovery plans to handle defrosting incidents.
Contending with policies and compliance with rigorous health and safety standards can take its toll on the supply chain.
Most food and beverages do not go directly from farms to consumers. Instead, raw materials undergo extensive transportation and packaging processes before reaching the market. These materials are transported to manufacturing plants, where they are processed, packaged, and then distributed to consumers. Proper packaging and preservation techniques are crucial to maintaining the flavor and quality of these foods during transit.
Waste and shortage are two main problems plaguing the food and beverage supply chain.
The best practices highlighted and reviewed here will be beneficial for supply chains to manage these problems effectively. Optimizing the food and beverage supply chain allows businesses to meet more nuanced demands and gives them a competitive advantage.
The average modern supply chain cannot do everything by itself — least of all, the food and beverage supply chain.
Supply chains have many moving parts, making it challenging for one organization to manage all of them. There is a critical need for partnerships and collaboration. However, not just any; these partnerships have to be reliable suppliers and be geared towards the long term. Cultivating long-term partnerships or sourcing strategies makes it easy to enhance transparency. More importantly, it allows for effective collaborations that could produce innovations and flexibility for these supply chains to quickly adapt to shifts in demand.
Because of the sensitive nature of the food and beverage supply chain, it is essential to diversify sourcing and avoid overreliance on any one supplier.
Technology is the supply chain’s best friend, providing a significant advantage in an increasingly competitive landscape.
Technology allows for transparency across the entire food and beverage supply chain operation. It also allows these supply chains to predict demand and streamline operations to meet them efficiently. Some of these technology solutions are:
Technology solutions in the food and beverage supply chain are particularly helpful in the cold chain.
Despite the astronomical waste, 800 million people across the globe are battling starvation.
This is why sustainability is very critical for food and beverage supply chains. There has to be less waste. Making sustainability a priority also helps limit the impact of the food and beverage supply chains on the environment. One way to accomplish this is by utilizing sustainable packaging options. Transportation is another vital link to sustainability, as good transportation solutions eliminate preventable risks to food, including spoilage and contamination.
Also, considering that logistics and transportation make up a significant chunk of greenhouse emissions, implementing sustainable strategies will optimize energy consumption.
The lack of proper temperature control can derail the entire food and beverage supply chain, leading to waste.
Knowing the temperature ranges to store each product in the food and beverage supply chain is crucial. In many cases, five minutes of the wrong temperature is enough to damage food. During transit, it is vital to maintain strict temperature controls tailored to the products. For instance, dairy products will require a different temperature from frozen fish.
Technology also plays a critical role in monitoring temperature. The use of telematics systems will help businesses and supply chains monitor and adjust conditions in real time.
Route planning and optimization play a significant role in the food and beverage supply chain operation.
The supply chain stakeholders should do everything possible to prevent the products from staying on the road more than necessary, as this will significantly reduce the risk of spoilage. One key way to achieve this is by leveraging route planning and optimization solutions to reduce delivery times. It will also help ensure the integrity of the product.
Providing specialized training for handlers on the unique requirements of organic and premium beverage products reduces bottlenecks and ensures the processes are completed quickly.
Regulations and expected standards can be a hassle to keep up with, but disregarding them puts the business and supply chain at an enormous disadvantage.
These regulations are here to prevent the food and beverage companies and their supply chains from harming consumers. Conversely, adhering to them also helps the supply chain avoid enormous fines and sanctions. The world is constantly evolving, but it is essential to keep up with or stay updated on the ever-changing food safety and transport regulations.
Maintaining meticulous records for audit purposes and ensuring all partners comply with industry standards can prevent major problems for the supply chain.
Continental Logistics is more than a transportation provider. We're a transportation partner that provides customized solutions that will match your needs. And it's not just about transportation; our knowledge branches out beyond the transportation industry, extending into our customers’ industries as well. That helps us better serve your food and beverage supply chain. With Continental Logistics, say goodbye to issues such as chargebacks, rejected loads, and product waste. Connect with us today.
