Overcoming the Biggest Challenges Faced in the Food Supply Chain
With customers now expecting fresh, exotic food on their plates the whole year round, the food supply chain continues to grow and evolve at a quick rate. Growing consumer demands haven’t only extended the supply chain geographically, but have alsoadded new links and stakeholders to it, making it more complex and longer than ever.
Manufacturers, producers, logistics providers, distributors and other parties are now under more pressure to get the products delivered to the consumer, safely, quickly and in the best condition possible. This has created a variety of obstacles and challenges for the food supply chain.
There are six main stages in a typical food supply chain:
- The procurement of raw materials
- Processing and packaging
- Whole distribution
- Redistribution to consumers through the retail channel
If issues are encountered in any of the aforementioned stages, the whole supply chain can be compromised. At OrderTron, our vast experience in providing quality food order management software solutions has taught us a few things about the food supply chain, and the challenges faced by businesses operating in the industry. Over the course of this blog, we’ll list some of the major ones, along with tips on how to overcome them.
As we’ve mentioned, the modern consumer has high expectations, which means that traceability has become more of a demand than a request today. If you’re not sure what we mean by traceability; it’s the ability to track food products across all the various stages of the supply chain. Most modern consumers want complete information on the food products they’re buying. This information includes where the product, and even its different ingredients, come from. This means it’s become critical for businesses to have accurate data not only on the food products themselves, but also the supply chain.
Possessing and sharing genuine information from each stage of the food supply chain strengthens brand integrity, enhances customer loyalty and improves food safety. A lack of transparency and traceability, meanwhile, gives way for supply chain blind spots that expose you to unnecessary risk. It can impact the trust consumers have in your brand, which can lead to a drop in sales and profits. It can even lead to lawsuits and other legal issues.
The primary reasonbehind issues with traceability in the food supply chain is businesses using old, outdated systems such as manual inspections and paper tracking. These lead to errors and delays in the collection and sharing of information. Introducing automation and using a digital platform for recording and sharing product and supply chain information can go a long way in addressing traceability issues.
Inability to Maintain the Quality and Safety of Food Products
With federal and state regulations on food safety tightening consistently, it’s become an even bigger challenge for manufacturers and retailers to deliver safe, high quality products to the consumer. Some of the most prevalent factors that impact the safety and quality of food products include:
- Poor warehousing and storage practices
- Transportation delays
- Inclement weather
- Industrial sabotage
These are some of the leading reasons behind the increased prevalence of food recalls. You don’t need us telling you how damaging a product recall can be to a business.
When it comes to increasing the safety and quality of food products, the first step is comprised of selecting the best raw materials, establishing a production method that’s in accordance with international standards and last but not the least, testing and proving them.
Packaging is another factor that plays a critical role. To ensure the safety and freshness of your products, it’s vital to choose the right packaging processes and materials.
Lastly, it’s also important to choose a trustworthy and reliable logistics partner that has a good record and reputation and is experienced in handling food products.
Poor Communication between Parties
Poor information and fragmented information can have a drastic negative effect on the food supply chain. It’s important for different parties in the supply chain to be aware of each other’s actions and be on the same page. Inadequate can lead to waste, inefficiencies and can potentially create mistrust among customers and their suppliers. The bigger the scale you operate on, the bigger the problem gets.
In the moderndigital age, poor communication shouldn’t be a problem. Thanks to technological advancements, gaining a full view of the supply chain and communicating with your suppliers or retail customers has become easier, faster and more affordable. Order management software solutions like OrderTron provide you with 360-degree visibility over your orders, ultimately streamlining the exchange of information between you, your suppliers and other partners.
It’s especially important food retailers to have proper and streamlined communications with their suppliers. This ensures that the right products are delivered at the right time, which is critical for maintaining an inventory of high quality and fresh products.
Increasing Supply Chain Costs
There is a wide variety of costs you have to deal with when it comes to running a food supply chain. Some of the prominent ones include:
- Energy and fuel costs
- Freight and other logistics costs
- Labor costs
- Technological investments and upgrades
With so many different types of costs to keep check of, effectively keeping track of operating costs become a constant challenge.
When it comes to controlling cost, the first step you need to take is to know your costs. You might have heard the old adage: “In order to manage it, you need to measure it”. With supply chains of a simple nature, this can be easily done with spreadsheets. The more complicated the supply chain becomes; the more advanced the technological solution you’ll need. A network solution can better serve supply chains that are of a more complex nature. With such a solution, you only need to integrate to the network, instead of syncing up with each supplier separately.
Another mistake food product manufacturers and distributors make is being too cost-conscious, which is a surefire way of inhibiting growth and efficiency. While an expensive technological solution can require a high initial outlay, they can save your company a lot of money over the long run. It can also help modernize your business and help it achieve a competitive edge. When it comes to comes to technological upgrades and investments focus on the long term benefits instead of just initial costs.
Inefficiencies in Tracking and Controlling of Inventories in Stores and Warehouses
Effective and efficient inventory management is a major challenge faced in the food supply chain today. It’sneedless to say that carefully managing your inventory is key to maintaining quality, controlling costs and satisfying your customers. If you have an inventory deficit, you’ll disappoint your customers, and if you have surplus inventory, it’ll just end up being wasted. It’s definitely possible to achieve the perfect balance between keeping your inventory wastes low and keeping your customers happy.
An advanced inventory management solution can help you help you achieve that perfect balance. The ideal solution should be able to provide you all-round real-time visibility over your inventory, this includes the goods that are on-site, the goods that are off-site, and those that are in transit. Thebest inventory management solutions can also support IoT, RFID and other automated tracking technologies that help in accurately recording inventory data.
Another way to gain better control over your inventory is to invest in advanced order management software like OrderTron, which allow you to place orders from anywhere at any time. These will help you maintain an optimal inventory at all times.
The Bottom Line
The food supply chain is one of the most complex and challenging ones. Whether you’re working with local suppliers or running a global operation, it’s important to ensure that you’re delivering safe and high quality products at all times. The key to success is having streamlined communication with your partners and having complete visibility of your supply chain.
Sign up with OrderTron today for our order management system software. Our software integrates food service suppliers on one platform for your convenience. Contact us for more information or register for a free trial. Our customer helpline is available at all times to help users out.