The food supply chain can often be a long and complex journey which starts at the farm. Track and trace systems will allow you to ensure quality of produce before it reaches your customers, while also protecting the brand value of the product. In this post we’ll explore four areas which track and trace solutions improve significantly; efficiency, recalls, compliance and visibility.
Track and trace solutions can help bring greater efficiencies to the food industry. By providing an easy way for business partners across supply chains to share information, you can improve product safety. Another byproduct of being able to granularly track your shipments in real time is the reduction of waste. Once you have gathered granular data over a period of time you’ll be able to glean insights and create ever more efficient logistics and supply chain processes.
When you need to keep tabs on your company's products, a track and trace solution can help. The best part? Users will be able to monitor relevant events that trigger product recalls or other important messages with the click of a button--no more waiting for manual reports!
Tracking and tracing solutions can be helpful when you need to monitor product recalls. These tools help companies track products throughout the entire supply chain, which gives you a better idea of what's happening with your inventory over time.
The best way for you to reduce risk is through efficient tracking mechanisms, where you are able stay in touch with all aspects of the product journey from start-to-finish without sacrificing on quality assurance measures.
Track and trace solutions can also help fulfill your compliance needs. These systems can be built to analyze tamper-proof, time-stamped inventory records and make sure that they are compliant at all times with constantly evolving local and international regulations. As a user of these applications your firm can benefit from knowing that there is a complete and tamper-proof history of your inventory as it moves through various stages in transport or storage.
Lastly, there is a greater demand for visibility from the end consumers. Track and trace technology will allow you to see the journey of our products in detail-from where they are grown all the way through production into stores. This will generate confidence in your consumers of the grade and quality of the products they are consuming.
With track and trace solutions the ultimate in transparency is available today, it takes just seconds for you to know exactly what's going on at every corner of your product supply chain.
A good track and trace solution can simultaneously enhance multiple processes for a food company. A track and trace solution can help you create an operation that is efficient, manages recalls easily, is compliant with the latest regulations and offers visibility to the end user.
Tracking food items at every step of the way while monitoring temperature insights is an important way for grocery retailers as well as their distribution and logistics partners to comply with food safety regulations.
With the onset of the COVID-19 pandemic, track and trace technology has enabled retailers and suppliers at every level of the food supply chain industry to reassure their customers of food safety. Companies who have implemented track and trace technology in the fresh produce industry are able to access and obtain critical produce information at every step of the farm to table journey, allowing them to prevent any contamination issues and save their food items from being discarded because of other unmonitored problems that occur along the way.
Even though greater attention is being given to food safety regulations by consumers recently the FDA had been deeply focused on food traceability before the onset of the pandemic. The New Era of Smarter Food Safety initiative was put in place by the agency in order to implement the Food Safety Modernization Act in a more efficient manner. The FDA acknowledged that the employment of technologies allowed for “a more digital, traceable and safer system to help protect consumers from contaminated food”.
Some technologies that will assist in the implementation of the New Era of Smarter Food Safety will be the use of artificial intelligence, sensors, distributed ledgers, and blockchain based supply tracking. A spokesperson from the FDA said: “When it comes to food traceability, many in the food system still utilize a largely paper-based system of taking one step forward to identify where the food has gone and one step back to identify the source. The use of new and evolving digital technologies envisioned in the effort will play a pivotal role in tracing the origin of a contaminated food to its source in minutes, or even seconds, instead of days or weeks.”.
Scientists at the Institute of Food Technologists, which is based in Chicago, are of the opinion that grocery retailers and their supply partners are entirely focused on incorporating technologies to aid in their responses to any food safety related emergencies they may face on the supply chain level, particularly in the fresh produce space.
Their data found that while there was promise for the adoption of blockchain in order to digitize supply chains, data collection for traceability and standardization is what was imperative to enable proper traceability.
The pandemic has increased interest in different technologies, and more specifically in those which are centered toward transparency and traceability. For retailers and suppliers any technology that can assist in real time responses to any disruptions in their supply chain is being perceived as a valuable investment toward enhancing food safety.
Supply chains across industries are unique and come with their own set of complexities, the cold food and beverage supply chain however is perhaps one of the most complex. When transporting fruits, vegetables, dairy, fish and meat, major variations in temperature and humidity can have a devastating impact on the entire shipment.
Fresh produce is acquired from different locations, which results in complex logistical operations. This has created a stronger need for companies to ensure that their goods are protected at every stage of the journey from spoilage, damage and theft. By incorporating IoT enabled tracking technology, companies can access real time data and gain supply chain visibility through every leg of the transportation journey. This will enable the firm to implement real time solutions as well. Wide Angle Visibility will allow companies more autonomy at each shipment stage and reduce the chances of product damage and spoilage, and ultimately reduce global food waste.
IoT enabled sensors work by sharing real time information through Wi-Fi and wireless networks. Sensors which are installed in goods containers, transportation trucks or even in individual storage units can monitor food items and track any changes in their environment like temperature or humidity changes and even shock, tilt and location impacts. RFID based sensors provide data about the movement and direction of produce coming in or going out of a given area.
Regulated temperature and humidity are crucial when transporting perishable food items. Nuts for example are severely affected by a higher moisture level in their environment as this leads to mold and toxins developing in them – a small change in the moisture level during the transportation journey could result in degradation of quality of the product as well as open food safety concerns for the company. Through deploying sensor technology companies will have an opportunity to make immediate adjustments and preserve product quality at every step of the shipment journey.
Theft in the food and beverage industry contributes to a high amount of loss. Through the combined use of GPS, RFID and sensor technology, companies can consistently track their shipments in real time and ensure that transportation carriers stick to correct routes and that shipments remain tamper resistant. Light detecting sensors on truck doors can also provide companies with information when it comes to unauthorized access to shipments through specific location as well as provide details related to the time and duration of breaches.
Garnering more control over the intricate food and beverage supply chain will help firms optimize their operations and have greater confidence in the quality of the products they are selling. Through the collection of data over time companies will be able to deal with problems at their root cause. Aside from providing increased quality assurance and compliance, this kind of technology has the potential to positively transform all supply chain functionalities proving it to be an investment that has endless scalable options for the future.
In recent years, creating visibility into supply chains through technology that enables traceability has become integral for most industries across the world.
Tracking and tracing food items at every step of the supply chain is an important way for retailers as well as suppliers to comply with food safety regulations. Companies that implement track and trace solutions in the fresh produce industry will be able to access and obtain critical produce information at every step of the farm to table journey, allowing them to prevent any issues of contamination and save their food items from being discarded because of other unmonitored problems that occur along the way.
Governments have begun to understand and see this shift across industries, and are beginning to capitalize on the security and traceability value that technologies like blockchain can offer, especially in the agricultural industry. As of August 2020, the Agricultural Marketing Service (AMS) of the United States Department of Agriculture (USDA) proposed a set of amendments to current organic agricultural products’ USDA regulations. This proposal includes incorporating the use of digital ledger technology for supply chain traceability.
The USDA is focused on protecting organic supply chain integrity, and fostering trust in the USDA organic label at the consumer and at the industry level. And in order to strengthen that trust, they aim to significantly advance their end to end traceability, improve and fortify the control systems of organic produce and put into effect USDA approved organic regulations. The proposal of amendments aims to cover this supply chain protection by reinforcing production oversight and enforcement, as well as the handling and sales of products.
The Agricultural Marketing Service said they will rely on the use of blockchain in order to improve supply chain visibility and traceability as well as to identify authentic organic products. This comes after their mention of the success of the Walmart Food Traceability Initiative, a partnership between Walmart and IBM which employed blockchain technology to successfully track and trace food items like pork, mangoes and leafy greens. They also acknowledged the Bumble Bee Foods’ partnership with SAP, which also uses blockchain technology to effectively trace yellowfin tuna. Given the success of the Walmart Food Traceability Initiative, the employment of digital ledger technology could also serve to build a strong infrastructure that would support the USDA with secure, verifiable and transparent organic produce tracking, ultimately providing real time insights into all layers of the supply chain.
Post their partnership with Walmart, IBM announced an extension of their blockchain network the IBM Food Trust, that has now successfully been adopted by Nestlé, Carrefour and CHO, a Tunisian olive oil producer, truly making its mark in the global food industry. Another notable international use of blockchain for this purpose has been achieved by the French retailer Auchan’s food traceability initiative. Auchan unveiled its blockchain based food traceability initiative across multiple countries in 2018, after thoroughly testing out “FoodChain” in Vietnam, a food traceability system created by the German start up TE-FOOD.
Many industries have achieved traceability and established provenance using blockchain based solutions. National and state governments are now starting to explore the potential of blockchain technology to establish food traceability.
Unemployment figures have surged across the world due to the adverse effects Covid-19 has had on the global economy. Recent data suggests that the total number of unemployment claims during the current recession in the United States just crossed a staggering 44 million.
The struggle to pay for basic needs like rent and food continues for those who have been laid off amid the pandemic. A hunger relief organization called Feeding America, which has at least 200 food banks all over the country, reported a 40% increase in demand across its affiliate food banks in April. While millions of Americans are resorting to visiting food banks for their next meal of the day, reports of surplus produce and an abundance of harvestable crops being discarded has been extremely distressing for some, and has of course raised the question of why what would be ‘extra food’ cannot be allocated to those in need. The process however is not as simple as it may seem.
The concept of food ‘wastage’ in what we can now refer to as the ‘pre coronavirus’ age, was already a growing concern with high averages of about 30-40% of total food produced going completely unconsumed, according to the U.S Department of Agriculture. We see a significant part of this unfold in grocery stores where many food items do not survive the test of time, meat being right at the top of the list, followed by the food items in the produce department, ultimately leading to a loss of sales due to spoilage. With closures all across the food industry, this as well as other kind of wastage has increased across the board.
The supply chain at every level of the food industry has been hit with its own share of complex problems during the pandemic. Given the time sensitivity of their ‘product life’, many farmers were tasked with the burden of a massive surplus of produce – results of months of harvesting and growing crops. Restaurants, schools and other organizations that serve as continued customers and buyers literally shutting down over night due to nation and state wide lockdowns has had, and continues to have a depreciating impact on many food suppliers and farmers, and has also resulted in some going completely out of business.
In order to deal with the new market reality many organizations have jumped in to systemize and reroute this surplus produce; some that are nonprofits from the agriculture industry and many that are primarily volunteer organizations that come to the table with no prior experience in the field. These organizations have adopted new technologies to develop new sales avenues, and in some cases have even had to build a completely new supply chain in a time sensitive manner to ensure that as many perishable goods as possible are saved first. Their main strategy is to create visibility through a bigger outreach for farmers to connect primarily with food banks as well as other food manufacturing companies.
Smaller local farms have not necessarily always had the required capital to adopt support software for logistics and supply chain management – a huge part of seamlessly connecting and delivering goods to grocery stores. There are a few apps and platforms which have been in the business of helping connect local farmers to bigger buyers such as grocery stores or larger institutions like schools by simplifying the process and digitizing availability flows. One such company, Forager, reportedly noticed an increase of almost 180% from buyers ever since March of this year, in what has been an obvious effort to combat the current dominant problem of surplus food wastage. This led to a grant from ReFED, an organization working to cut down food waste in the country. ReFED has a COVD-19 Food Waste Solutions Fund, which administers grants particularly focused on bridging the food loss gap, involving farms, logistics, distribution as well as last-mile delivery. A part of Forager’s grant application was to continue to materialize its pilot partnership program with ‘gleaning organizations’ – these are usually volunteer organizations that collect leftover food from farms after harvest season to donate to food banks, which will of course be of great use under the current circumstances.
Another viable option has been seen through the effort to reroute surplus produce to food manufacturing companies that deal with consumer packaged goods. A company in San Francisco, Full Harvest provides a digital market place that allows farms to position and sell their surplus produce through an online platform. Buyers are usually companies that deal with press juices, baby food, pet food as well as soup companies. Post COVID-19, Full Harvest has successfully been using their online marketplace to create connections for suppliers with surplus produce to companies that produce and manufacture consumer packaged goods.
Traceability solutions like Nazar’s Wide Angle Visibility platform can help firms better deal with demand side shocks by helping them optimize their supply chains and keep a track of their produce in real time using digital twin technology.
As the pandemic continues to highlight many existing problems in different industries, it is a hopeful start to see the use of technology overcome labor and logistics issues and significantly help reduce food waste across the country.
Communication is an integral feature of the human experience, without this vital aspect of our consciousness we would not be able to evolve the way that we have. Our fundamental capability to send and receive information to each other is the foundation of the systems we have created and operate in.
If we take a look back into our history, the notion of ‘shipment tracking’ as a facet of communication to inform another party of valuable information can be seen as early on as the creation of visual signals, for example fires or smoke that were used to inform people of what is happening close by, as well as through the domestication of animals as trade began to flourish between communities. We’ve come a long way since the time of messenger birds and relying on the ‘pigeon post’ to receive messages from afar. Today, literally through the touch of our fingers not only can we communicate, but also rely on those words being sent and received instantly.
The idea of shipment tracking has become an almost necessary world order in the last few years. This simple process which makes accessible and available a package’s last known location is the backbone of the digital supply chain. The access to knowledge of when something will arrive enables a more efficient process to be in place. This phenomenon of ‘tracking’ has been around since some of our earliest human civilizations.
The first ever known courier service was established by the Ancient Egyptians in 2,400 BCE. Papyrus scrolls were transported through people - mostly the Kingdom’s slave labor, as well as raw materials for buildings, linking military posts and more. Ancient Romans had a similar service in place, and also systemized the process by using feathers from different birds to indicate the level of importance of the message.
The United States Post Office, founded around the time of the American Revolution was an important step in establishing a system that adhered to standardized rates for sharing information, until this milestone, the process of tracking had mostly remained stagnant. And then in 1844 was born the telegram, an absolute game changer for the world of communication. It was now possible to communicate across long distances, wherever you were in the world. Not very long after this, the ‘electronic printing telegraph’ was invented – the first ever fax machine. All of which helped make way for easier platforms to share and access shipment tracking information.
As the 1860s set in, and the California Gold Rush paved way for the big migration and more trade, The Pony Express set a real precedent by offering ‘expedited service’. This eventually enabled faster movement of shipments along the Trans-Continental Railroad, as well as the use of telegram lines to share information. And once the mother of all communication was invented – the telephone, quicker and newer ways to obtain more information about shipment tracking were now accessible.
With cars and trucks having been invented at the turn of the century, 1907 saw the founding of UPS as the first ever carrier service to pick up and move freight, and doing so all while providing updates of necessary information from key transit points through the use of the landline telephone; truly a significant milestone in the journey of communication.
Under the Postal Reorganization Act of 1970, The United States Post Office became the United States Postal Service, marking itself as an independent agency and the official mail courier of the country. This paved the way for companies working in the field of package shipment and transportation.
At this point the telephone was still the primary mode of shipment tracking communication, and continued to be so for a few more decades, up until the arrival of the internet in all its glory of digitizing what we once knew as mundane manual efforts. The internet was a true game changer for many things, but perhaps stands as an extremely significant moment in the history and evolution of the world of communication and specifically shipment tracking. It brought forward the option of sharing information much faster than through the telephone and fax.
E-mailing people tracking information became the primary way of relaying this information. However in its initial outspread, the total amount of internet users were significantly much smaller than today, which meant that tracking notifications being sent and received on email was mostly just a business-to-business function.
As the digital universe began to expand further post the 90’s as we set into the 2000’s, email notifications gained much more traction. Perhaps it is safe to say that the real adoption of tracking via the internet only truly came with its full force once Apple and AT&T put out the first ever browser-based functionality phone device – the iPhone; creating a mode of instant access to information. This enabled companies to start offering free tracking services.
Amazon was the first company to build a legitimate path for digital tracking functionality in the world of e-commerce. A few major shipment carriers were already using limited online servers to offer status updates, however they were not very straightforward and unable to share information with smaller business unless there was an application of advanced coding knowledge. As the ability to receive push notifications for shipment tracking became an actual possibility, the momentum was recently taken forward by the offering of access to real-time location data for packages.
The evolution continues, with UPS being the first major American package carrier to launch the ‘Follow My Delivery’ feature. This tool places packages on an interactive map which allows customers to track their packages in real-time. In the world we live in today, the access to this kind of actual real-time information is the driving force behind many purchases, and is slowly becoming the foundational value of many efficient and systemized business strategies.
As more and more processes continue to become digitized, different industries are transitioning into different aspects of atomization. The food industry has made its way up in the list of opportunity gaining contenders of the digital revolution. Food processors, suppliers as well as retailers are all continuing to operationally and monetarily benefit from new opportunities as investment in data solutions continues to peak.
One of the biggest advances to come from these processes of digitization is the significantly increased operational efficiency for food companies. Through using digital analysis platform technology, there is enhanced visibility into the entire supply chain. This technology allows for real-time inventory tracking, predicting maintenance requirements and data collection on equipment performances, all of which contribute to identifying any problems or inefficiencies along the supply chain and creating a space to provide real-time solutions.
Adopting track and trace technology into the food supply chain is being touted as one of the most efficient solutions to global food loss and carbon emissions caused by the industry. The implementation of sensor technology to monitor and track temperatures throughout the supply chain and each food product’s journey is key to increasing food safety and ensuring a significant reduction in retail shrink.
Track and trace solutions can help reduce food waste and optimize operations. These solutions will allow users to obtain critical produce related information at every step of the farm to table journey, reducing food waste arising from unmonitored problems which may have occurred along the way. Properly implemented solutions will lead to a reduction in unnecessary trips to warehouses, less electricity consumed by coolers, and prolonged shelf lives through obtaining produce at optimal freshness at the store, restaurant and consumer level.
Another big benefit of recently adopted technological processes in the global food industry has been the improved level of food safety. The FDA’s Food Safety Modernization Act of 2011 became a game changer for the global food industry by enforcing a law that advocates for food safety within the many complexities of the global supply chain. Food Standards Australia New Zealand also compromises of a similar set of regulations “reduce foodborne illness by strengthening food safety and traceability throughout the food supply chain, from paddock to plate” this organization develops and reviews food standards.
By implementing tracking sensors that enable monitoring real-time temperature, food companies are able to consistently monitor any safety measures, and ensure efficient cold chain management. This technology enables entire supply chains to comply with domestic and international food safety regulations by creating access to important data that can enable real-time food safety solutions.
Over the last decade or so the word ‘transparency’ has taken on a new meaning when it comes to consumer behavior in the food industry. For most food companies, being able to provide transparency and visibility into the entire journey of a particular food item is proving to be an integral aspect of sales. The adoption of these technologies enables transparency along the entire supply chain. Track and trace technologies provide companies as well as customers the option to track items even along the global supply chain, invariably creating more consumer trust. Among other benefits are saved costs, faster lead times and more efficient inventory management.
As the Internet of Things continues to be the foundation of much change, it has certainly created much broader horizons for the food industry when it comes to more efficient processes in the supply chain, being better equipped to comply with food safety regulations and furthering consumer loyalty and trust by providing transparency.
The advent of track and trace technology has been a true game changer for the durability of products across all supply chains, and is perhaps about to live out its best days yet with just how integral it will prove to be with the onset of the COVID-19 pandemic.
As the world eagerly waits for vaccines to roll out, figuring out the logistics of transporting billions of vaccine doses is as pressing an issue as figuring out the vaccine itself. Vaccines are mostly transported by air and road with many stops and storage points with distributors before finally arriving at the end point, where once again doses are stored in the required cold storage facilities. The entire supply chain consists of multiple transfer points including both manufacturing and administration sites.
The last mile of the supply chain to the actual healthcare provider could be completed in the form of a transport vehicle and sometimes even on the back of a donkey or camel. Most vaccines will completely lose their purpose if they are in an environment that is too warm or even too cold and outside of their temperature range. According to the IATA’s (International Air Transport Association) Center of Excellence for Independent Validators in Pharmaceutical Logistics, around a quarter of vaccines lose their effectiveness by the time they reach their healthcare providers because of incorrect shipping procedures, and a significant 20% of biopharmaceutical products that are sensitive to temperature are damaged and completely deteriorate during cold chain transport.
Aside from the possible loss of opportunity for those in need of vaccines, the annual incurred financial loss of vaccines damaged due to temperature issues are estimated to be a whopping $34.1 billion, this includes the costs of lost products, replacements, as well as wasted logistics outlay. And although there is much to speculate about a vaccine that does not entirely exist yet, it is safe to say that all vaccines fall under the cold chain product category and so will the string of the COVID-19 vaccines. As this pandemic continues to challenge most aspects of most industries, vaccine manufacturers, suppliers and perhaps most importantly logistic providers cannot risk even a 20% loss while attempting to safely transport these coveted doses.
Luckily the implementation of real time visibility and monitoring of temperature changes through the technology of track and trace, cloud storage and Blockchain is already in place in many supply chains all over the world, and can systematically be implemented for the logistical transportation of the vaccine. This will allow for prevention of any damage to vaccine doses because of unfavourable temperature conditions.
Enabling IoT sensors in supply chains which rely on the infrastructure of real-time monitoring and visibility allow for processes like continuous data transmission, and a data tracking system which could potentially produce a digital twin tasked with mapping out the transit history of the product in real time. This gives stakeholders access to real time data, creating an opportunity to immediately correct a foreseeable problem, and is already actively in use in the case of some biopharmaceutical logistics.
Another focal part of COVID-19 treatment research has been through the use of antibodies from those who have recovered from the virus. These antibodies exist in the plasma, otherwise known as the liquid component of human blood. The process of storing plasma is temperature sensitive. Through enabling temperature tracking while actually transporting this donor plasma to research facilities has allowed to reduce wastage of plasma that could have otherwise been used to aid in research.
With these tracking and monitoring technologies in place, healthcare providers that will potentially receive the vaccine will have the opportunity to review the entire temperature journey thus far and will immediately be able to configure if the vaccine doses are still intact, as will the manufacturers. This aspect of the correct logistical transportation of vaccine doses will be integral in avoiding wastage, and will actually prove to be one of the core factors which have a direct impact on disease control.
Nazar enables You to know where each box of vaccine has been and how it was stored. By scanning a box label, you can immediately tell whether it has suffered any mishandling. Contact us to learn more!
In what is being touted as the industrial visibility era, more and more companies are employing track and trace technology to stay in the game. Consumer goods giant Unilever recently announced that they will be using geo-location technology to gain and provide more transparency into their palm oil supply chains.
In order to track the palm oil farm to table journey through thousands of supply chains and gain insight on its first mile traceability, the multinational will enable this technology through the use of geo-location data on cell phones. Having conducted a test run in Indonesia, they now plan to scale up the process to incorporate all other palm facilities such as farms, refineries and processing plants in the Southeast Asia region, and are examining the possibility of implementing the same technology in other regions.
The company acquires around 1 million tons of palm oil and palm kernel oil every year, making it one of Unilever’s most integral raw ingredients. This cheaper option of edible oil is used in a number of products like cosmetics, soaps, chocolate and even ice cream; and although the most integral, it is also however one of their most controversial raw ingredients. Hasty expansions of plantations in order to produce and supply this extremely versatile oil has led to much destruction of wildlife and burning of tropical rainforests. The layered and complex nature of these supply chains that start with millions of hectares of land prove to be an extreme challenge in terms of industry insight and visibility. By implementing track and trace technology, Unilever is determined to create more transparency in the industry and better position themselves to assess environmental risks. Their aim is to have all their supply chains be completely ‘deforestation-free’ by 2033.
Depending on the industry, achieving transparency into the first mile of supply chains can be extremely challenging. Crops like palm oil fruit for example can be harvested in many different areas of land owned by different farmers, and could end up being mixed with raw materials from other plantations before actually even reaching the mill. Using geo-location data and advanced track and trace technology to monitor this movement paves the way forward for a more transparent process of every step of the supply chain.
Consumers are the driving force behind this extremely significant shift in demand for visibility. Across all industries, consumers have become more conscious about the ‘sustainability factor’ of not only the products they are purchasing but also the raw materials that have gone into making those products. Willingly or unwillingly companies have had to meet this demand by making clear to their customers that they have complete transparency into not only the source of their raw materials, but also the ethical conditions of how those raw materials are produced. Our track and trace technology offers complete visibility into multiple layers of the supply chain, providing monitoring methods with enhanced transparency. Our technology is applicable to the food industry and creates a direct connection to the journey of food items from farm to table. Creating a standard of transparency is becoming one of the integral foundations of any company’s brand image today.
Over the last decade or so, there’s been a gradual spike in consumer expectations for real time supply chain visibility. Spread across all industries, this dimension of service is now directly related to the quality of reputation of any organization – big or small.
In order to ensure a reduction of waste and ultimately costs, the food and beverage industry is transitioning into becoming quite heavily reliant on track and trace technology as a form of advanced supply chain visibility. By creating and employing this solution for the fresh produce industry, our technology tracks and traces food items from farm to table. Being able to access and obtain critical information at every step of the supply chain journey can save food items from being discarded because of unmonitored problems that occur along the way, as well as circumvent error in multiple layers of the journey.
The COVID-19 pandemic has brought to light the fact that many years of working toward optimizing food supply chains for cost have definitely left them lean, but also extremely fragile. Food processors and producers who make up this line of lean manufacturing have customized production lines, outgoing inspections and capital equipment to meet the requirements of buyers, leaving only a handful of companies in the position of production and distribution control of many major food categories. And while these strategies do help in enabling cost cutting in the short term, what they actually do is end up putting suppliers in a position where they’re not able to adequately adapt to shifts in demand, or sustain broken links in the supply chain.
A notable example of this is when farmers had to resort to burying their surplus crops as well as pour out gallons of milk as recently as April of this year – all while empty shelves at grocery stores stood tall. This is also the reason why there was a nationwide shortage of meat upon the closure of the 4 major meatpacking plants, which are responsible for a whopping 85% of the country’s meat production. America’s food supply chains are unfortunately too delicate to sustain the blows of a crisis or for that matter any major level disruption in chain flows.
In order to “maintain the health of the food supply chain” the government announced aid in the form of $19 billion to facilitate compensation for farmers due to losses brought upon by the pandemic. Although this stands as a significant amount, it is not the solution to the actual problem at hand.
To secure supply, we need to restructure our supply chains by enabling producers with the convenience of switching between paths as required to avoid shortages, and make use of surpluses, through creating multiple paths to the market for every single food item. The structure of supply chains is already organically gravitating towards becoming more circular with surplus or unused food items being fed back into the system for recycling or reprocessing. This kind of change means a shift from set ways of the principles of lean manufacturing and embracing a more flexible and in effect more resilient approach through digitizing systems with real time visibility into supply chains.
Suppliers, service providers, original equipment manufacturers and IT systems all make up the vast supply chain ecosystem, and visibility into a supply chain means visibility into each of these intricate webs of processes. Collecting data and making it accessible and available through creating a literal digital twin of the physical food item journey allows for a complete track and trace of processes. Through this kind of greater visibility into every step of the journey, we enable more flexibility and security. If a supplier for example is unable to deliver, or there is a sudden shift of demand – companies are still able to make a seamless reroute to another chain, with no disruption to cash flow or production.
According to the USDA, a significant 30-40% of all produced food in the country is completely wasted across all networks in supply chains. Greater visibility into supply chains also allows companies the opportunities to identify unused and surplus produce, giving them a chance to reprocess or recycle them back into the supply chain. Waste can also be composted and used to fertilize crops, or even recycled into animal feed.
It is not the shortage of food that proves to be the problem in the United States, but rather a systemized distribution of it instead, as was highlighted as a by-product of the pandemic. By creating a system that is built on the value of transparency and flexibility, our supply chains stand the chance of not only sustaining the next crisis more efficiently but also adopting a more ethical and environmental approach.