As consumer concerns regarding food provenance grow, even large companies are having to make considerable changes to their supply chains. While the market for organic and non-genetically modified products was once small and met by niche companies, major brands must now conform as well.
General Mills recently announced plans to reduce its use of GMO products even further than it already has. While the company already uses oats that have not been modified, it will now set the same standard for the cornstarch and sugar used in regular-flavored Cheerios. While such changes can improve brand reputation and even increase sales, the food supply chain must prepare for the impact of consumer demand on ingredients.
The Food Supply Chain Continues to Grow in Complexity
With changing appetites and expectations, the food supply chain is becoming more intricate in many ways. While there is a push for products that are non-GMO, consumers also want goods that are grown locally. However, there is also an increased taste for foods that are not local and many suppliers are distributing globally.
All of these demands create a need for additional technology in the food supply chain. Because of government oversight and the expiration of their products, organizations within the food supply chain have often been early adopters of new technology. Tools such as automated data collection can improve inventory control and also help in the event of a food recall.
Organizations that manufacture and distribute food can also use this technology to analyze the predicted impact of sudden supplier changes. If their regular suppliers are unable to deliver, companies must have a short list of secondary partners that can take over. If a promise has been made to consumers to use organic or local products, secondary suppliers must meet those same criteria.
Using Technology to Form an Eco-Friendly Food Supply Chain
While consumers are concerned with how the food they eat affects their health, they are also conscious of how it's transport can impact the environment. The demand for local food is as much about reducing greenhouse gas emissions as it as supporting sustainable agriculture. More consumers believe that products available 50 miles away from a manufacturer should not be shipped from the other side of the planet.
Meeting expectations means companies must utilize a greater number of suppliers than ever before. There are benefits to the food manufacturer beyond just improved brand integrity. Delivering food to consumers using the shortest route is typically more cost effective. With the ability of new technology to better trace the supply and distribution of food products, manufacturers are finding it easier to build an eco-friendly supply chain. Some of the other benefits of new technology include:
- Improved inventory control: Given the high rates of spoilage among many of the products food manufacturers use, inventory numbers that are updated in real time and available throughout the ERP system can reduce costs and improve quality.
- Better select-to-ship times: Mobile and automated data collection provide additional points within the supply chain to log information about how products are traveling. This allows managers to pinpoint very specific kinks in their organizations' supply chains within warehouses and beyond.
- Supply chain logistics management: Food manufactures can also gain a better understanding of how their product is arriving to the store or doorstep of customers. If consumers are highly concerned with how far their food has traveled, organizations will need to be able to provide them accurate information regarding food transport.
While the food supply chain continues to grow and change, food manufacturers must continue to be trendsetters when utilizing new technology.