The demand-driven supply chain, or demand-driven supply network, is a combination of technology and processes that detect and respond to real-time demand across a network of consumers, suppliers, and employees. This has been significantly enabled by the increased use of new technologies brought about by the Internet of Things (IoT). While traditional supply chain inventories and services are provided based on forecasted demand and historical sales patterns; in a demand-driven supply chain, the companies that comprise the supply chain collaborate to shape market demand by sharing and collaborating information, thereby avoiding time lags in information flow and avoiding the bullwhip effect across the supply chain. A demand-driven supply chain is one that is focused on the demand generated by consumer data and feeds this data to the supply base, hence increasing inventory availability through a demand-pull strategy. The DDSC planning process is driven by customer needs. It implements a tactic known as ‘demand-pull.’ This helps the market to work more effectively with other supply chain players by sharing new information. Below are five key anchors to a demand-driven supply chain: Anchor 1: Evolving Consumer Demand in India Today’s customer environment is more dynamic than ever before. Technology innovations driving substantial shifts in customer behavior challenge organizations across the food service industry. The supply chain of yesterday was linear, sequential, and static. It is now dynamic, multi-directional, and evolving. To achieve their goals, supply chain leaders must make decisions quickly enough to keep up with the market. In this continuously changing market, planning teams need to refocus their efforts on the unique demands of individual customers. Food trends are influencing traditional Indian cuisines. To appeal to health-conscious consumers, food manufacturers have altered their menus to include healthful options. Some restaurants now serve nutritious meals, plant-based meat, and organic food. Internet and smartphone usage will raise the demand for specialized foods. Web-based ordering and the usage of AI and IoT in order are altering the market. These advancements have revolutionized home delivery by bringing food to the consumer’s door faster. According to Research and Markets, the Indian online food delivery industry is expected to reach US$ 21.41 billion by 2026, up from US$ 4.66 billion in 2020. This changing landscape, along with forthcoming trends and India’s growth trajectory, is propelling the foodservices business forward. This growth rate is projected to continue, driven by consumers and foodservices businesses. By being able to quickly identify shifting consumer sentiments and how demand might respond, food brands can increase profitability, lead time, and margins. So, in this continuously changing industry, professionals can refocus their efforts on the unique demands of individual customers in order to scale across the country. Anchor 2: Decision-Driven Integrated Planning To compete in a rising market and maintain business processes, companies must connect their supply chain planning in an integrated manner from start to finish. Traditionally, organizations have relied solely on past data, limiting their ability to adapt to future disturbances. Finally, food manufacturers can manage their supply chains holistically, with real-time insight across the network. Integrated planning enables a dynamic, collaborative S&OP process to sense and drive demand. By utilizing the rolling forecasts feature within the value chain, food brands can predict demand two months in advance and can accordingly prepare and plan for it. Anticipating consumer desires, when they desire it, and where they desire it can be difficult for many firms. Gaining end-to-end visibility across the supply chain enables food brands to detect customer demand signals. To aid demand planners in planning more quickly, accurately, and precisely, predictive planning based on statistical functions might be beneficial. This is accomplished by analyzing historical data and forecasting future demand, providing the planner with a variety of statistical methodologies from which to pick. Anchor 3: Supplier Relationship Management More complex supply chains necessitate precise, measurable techniques to evaluate each provider. Supplier Relationship Management (SRM) helps determine how suppliers contribute to or detract from a company. SRM aims to increase efficiencies and value for all stakeholders. It identifies essential suppliers and lays the groundwork for buyer-supplier engagement. Finding suppliers who share the same goals as food brands might result in improved overall efficiency. Suppliers will better grasp business requirements with open and effective communication. This knowledge helps avoid supply chain delays and makes debugging difficulties easier. SRM aims to increase a company’s value and profitability. SRM can improve supply chain performance, reduce wholesale prices, and increase efficiencies. It can also assist reduce risk, improving administrative and onboarding efficiency. To compete in the marketplace, the entire supply chain operations process needs to focus on improvements that needs be measured by key performance indicators like SIFOT. Supplier in full and on time – SIFOT is fundamental in running a supply chain effectively. It allows food brands to gauge the performance of a supplier by understanding what percentage of their supplier deliveries are being delivered in full. Anchor 4: Enhanced Supply Chain Execution Supply chain execution is the daily implementation of the supply chain plan. It comprises managing inventory levels, taking orders, planning and executing work orders, picking and packing orders, and scheduling shipments. Execution may also include revising the strategy to address changing demand or a supply chain challenges. Efficient supply chain execution ensures order fulfilment and increases customer satisfaction. It also helps businesses gain a competitive advantage by attracting new customers and increasing revenue. Complexity increases when it comes to food brands and their challenges. A production strategy is developed in conjunction with supply chain execution but supply chain professionals must act quickly. To pull it off in a timely manner for order fulfilment, companies need to employ technology like warehouse management, transportation management, planning and forecasting, supplier management, order management, and more to help them make better decisions. Anchor 5: Supply Chain Visibility Supply and demand changes require companies to obtain visibility into this complicated network of customers, suppliers, and logistics providers. Enhanced supply chain visibility is critical in a demand-driven supply chain. Companies require visibility from the supplier dock to the customer door to know what is going on and...
The increased popularity of plant-based foods has created new supply chain problems, particularly given that many of these organic products are being introduced by traditionally non-organic merchants. Organic supply chains and produce suppliers have long followed regulations regarding produce handling, such as temperature controls, cargo tracking, and supply and demand planning software, to ensure that the product could be tracked from farm to table and, in the event of a recall, traced back to its source. However, for meat replacements that incorporate numerous plant-based ingredients, supply chain organizations that handle these products face unique food safety problems. The food industry is now debating how to store and handle meat alternatives, how to manage each ingredient in the product, and, most crucially, how to determine temperature controls or the source of infection. The popularity of plant-based food is further strengthened by a new analysis from The Good Food Institute stating that plant-based meat alternatives might account for 6% of worldwide meat consumption by 2030. Producing 25 million tons of product per year would be required in such a scenario. With its growing stature in the food industry, brands from the plant-based food segments would want to string together a supply chain for their mock meat offerings. As supply chain specialists, catering to the food industry for three decades, we suggest considering the below-mentioned few points that might help with outlining a supply chain for plant-based meats. Infrastructure From a high level, the meat alternative supply chain is shorter and much more compact than the meat supply chain. Combine that with the fact that plant-based meat alternatives can get to the market a lot faster than traditional meat. The labor factor can make a big difference. Saying that producing PBM requires the process called high-moisture extrusion, which means the infrastructure to process it requires to handle the processing at different temperatures. This means the infrastructure not only needs to be technologically equipped but also requires a skilled workforce to see through the intricate processes. The plant-based meat brands require temperature-sensitive storage that is close to their potential markets due to its low shelf life making the process of production and delivery faster. It is advised for upcoming plant-based meat brands to impanel with a supply chain specialist for their temperature-sensitive storage needs since they are well-equipped to handle products with low shelf life and temperature-controlled needs. With a specialist handling the supply chain for the plant-based meat brands, their well-defined routes to market and strategic presence can be leveraged as well. Workforce According to a recent Deloitte research, when asked about the skills that supply chain employees including those in the plant-based meat segment should possess, 73% of respondents say technical competence is extremely or very critical, and even more, 79% believe leadership and professional competencies are extremely important. The technological capabilities required now are those that enable supply chain experts to address complicated risk management or statistical modeling issues that might arise in a complex and evolving plant-based meat sector. Talent development is another area that needs focus since the plant-based segment is at a nascent stage, the resources employed within the industry will require to be educated about the segment and the processes. The bottom line is that when it comes to a niche category like plant-based meat, the workforce needs to be both technologically equipped to understand the processes that are defined and specific to the industry while adhering to compliance and being able to take quick action in case a tough situation arises. Central Information system A centralized system can be affordable and adaptable, allowing plant-based meat brands to respond to market changes at a faster pace. Brands in this segment that use a centralized system might soon become leaner and more efficient. A consolidated information system ensures supply chain visibility giving decision-makers precise supply chain visibility. This would make it easier for plant-based meat manufacturers to identify which ingredients originated from which farms and would enable them to act promptly if an ingredient went bad prior to processing. Through the use of technology such as barcode tags and RFID cards, it would also be easier to separate poor batches of components from good batches, so avoiding a crisis situation at the start of the supply chain cycle. Product and supplier management Supplier relationship management (SRM) enables the plant-based meat business to take a systematic approach to evaluate suppliers’ contribution and influence on success, identifying strategies to improve their performance, and building a strategic approach to carry out what has been found. Supplier lifecycle management (SLM) should also be implemented in the supply chain to enable an end-to-end strategy to manage high-value or strategically significant suppliers, from selection to relationship closure. The critical element of the process is to recognize the value suppliers may provide and to integrate those benefits into procurement processes. By implementing such methods, plant-based meat brands can mitigate risk, boost efficiency, reduce price volatility, and consolidate their supply chains. The unified information system enables fake meat companies to locate suppliers that may assist them in reducing delays, resolving issues of unavailability, and enhancing transparency and traceability. Temperature-controlled environment The supply chain’s difficulty becomes even more formidable when resources and products demand temperature control, as is the situation with plant-based meats. Because the shelf life of such products is frequently limited, the speed and dependability of the transportation and handling systems become even more critical. As consumers turn toward plant-based foods, product oxidation becomes an issue that brands within this segment face. As a product, plant-based meat is a refrigerated item that is susceptible to light oxidation, thus reducing its shelf life and quality. Delivering the texture and flavor consumers demand can be extremely challenging if the product is not properly protected from oxidation during the storage and transportation phase. To ensure product integrity across the value chain, different temperature regimes must be addressed independently in terms of storage, staging, and distribution. Additionally, the items must be continuously inspected and maintained – using proper monitoring and tracking systems. Due to the significant risk of non-conformance at handover...
Optimize sourcing to unlock greater value across fulfilment cycle Let’s Partner Strategic sourcing for a balanced demand-supply chain Supplier sourcing is inevitable as the food sector expands rapidly across geographies and channels. We make sourcing a strategic activity that adds value. Strategic sourcing examines business and consumer demands while leveraging supplier relationships and reducing risk. We assist businesses to gain access to our expertise, capabilities, and scale by managing supplier risk and compliance throughout the procurement process. Sourcing strategically with us helps reduce demand-supply mismatches. Download our checklist to evaluate your supply-side risks Download Download Improved supplier performance for efficient bottom-line Our supplier management solution continuously measures performance and improves the process for total system cost optimization. We improve productivity and reduce costs by combining supplier management and business planning. It aids decision-making by providing intelligent data and relevant real-time information throughout the sourcing cycle. Supplier scorecards record quantitative and qualitative performance data, giving you improved visibility over supplier data, as well. Increase supplier performance with effective supply planning Click here Click here Trading approach modelled for risk mitigation Businesses traditionally coordinate with many suppliers to procure goods. This increases identification, synchronization, delivery, and payment reconciliation efforts, exposing organizations to overages and risks. We let businesses focus on their core business by orchestrating the sourcing process from start to finish. For many years, we have worked in India’s food business, giving us access to a vast supply network. Our trading platform allows businesses to easily operate across geographies and channels without compromising on quality or other associated parameters. Enhanced P2P cycle driven by technology Our Outsourcing solution gives enterprises better control and visibility over the whole Procure-to-Pay lifecycle, allowing them to better manage cash flow and financial commitments. This assures cost reduction and centralised control, allowing businesses to focus on their customers or demand rather than their supply. Our procurement solution integrates seamlessly with P2P cycle and is constantly improved for efficiency based on spend data and supplier performance. Outsource fulfilment for a more efficient P2P cycle Click here Range of solutions to serve you better End-to-end Sourcing Strategy Procurement Outsourcing Spend Analysis Supplier Planning Procure to Pay Cycle Management Supplier Performance Management Together we can achieve these outcomes Increased Cash Flow Improved supply chain visibility Reduce Risk Improved order fulfilment Improved production scheduling Consolidated actionable insights Increase supplier performance with effective supply planning Let’s Partner Let’s Partner Resources Transforming Waste into Wealth: Bio-Diesel Innovation for a Leading QSR Chain Discover how a leading QSR chain transformed its sustainability challenges into opportunities by converting used cooking oil into bio-diesel. This… Read More Proactive or Paying the Price: The Cost of Ignoring Predictability CategoryThought Leadership February 26, 2024 [Avg. Read Time = 4 mins.] Amidst the daily hustle, a small yet popular bakery… Read More Impact of ESG on Food Supply Chain Sustainability Imagine a future where your food supply chain goes beyond just being fast and cost-effective, to also being green, fair,… Read More Women Leadership in Supply Chain Food Supply Chain Leadership Forum’ is an initiative by Radhakrishna Foodland aimed at creating an exclusive engagement platform in the Indian… Read More Load More
Orchestrate demand and supply planning for better predictability Let’s Partner Leverage consumption insights for increased profitability Supply chain planning in consumption-driven categories can be complex. The ability to accurately sense demand on time becomes a critical driver for revenue growth for food brands. We have coded our comprehensive knowledge of the industry into a proprietary methodology to forecast and fulfill demand while assisting businesses in capitalizing on every revenue opportunity to grow profitably. Accurate demand projections improve supply planner visibility and transparency. Supply chains work smoothly when demand planning coordinates with all business processes, positively impacting business revenues. Understand why focusing on consumer trends is the need for modern supply chains Click here Outcome driven demand planning for precise predictability Demand planning greatly affects supply planning systems by projecting future demand trends, allowing planners to better adapt to changing consumer needs. DemandXPro is our intelligent proprietary tool for forecasting demand accurately across channels and product categories, particularly in the context of the Indian food service industry. The system uses machine learning algorithms to forecast future demand and give actionable insights based on transactional and semi-structured micro and macro data such as seasonality, festivals, promotions, growth trends, and changing culinary preferences. Combinations of Statistical and Machine Learning Methods specific to India’s food consumption patterns are deployed to arrive at the best possible solution for the most complex problems in the supply chain. These help with: Increased forecast accuracy Reduced loss of sale Near-zero expiries Consolidated actionable insights Know how we enabled our QSR client in achieving accurate and reliable demand forecasting Download Download Improve supplier performance through effective planning solution Measuring, analyzing, managing, optimizing, and tracking supplier performance is critical to achieving predicted savings. Our Supplier Management System is an integrated solution that enables detecting, tracking, and assessing supplier lifecycle risk, correcting systemic risks, and managing supplier interactions. This is achieved through streamlining logistics procedures to increase efficiency and reduce delivery costs. The system also enables Material Requirement Planning to ensure that suppliers receive the correct purchase orders on time along with visibility on demand forecasts and safety stocks thus reducing stockouts and payment delays. Supplier scorecards record quantitative and qualitative performance data giving you better control over supplier data. Outsource your procurement to unlock greater efficiencies in your P2P cycle Click here Regulate cash flow through effective inventory planning Our inventory planning methodology promotes a smooth supply chain by allowing businesses to keep a close track of their inventory thus avoiding overstocking or outages by knowing what they have in stock, where it is, and when it needs to be refilled. With our decades of experience in the food ecosystem and understanding of inventory patterns, we help firms better adapt to food industry fluctuations and anticipate changing trends. Our integration of demand and supply indicators can help develop effective inventory planning. Monitoring inventory movement provides a greater awareness of market circumstances, hazards, and delays, allowing for more flexible planning. Good inventory management prevents other overstocking issues like product expiries and wastages, helps respond to market changes quickly and reduce costs. Manage inventories efficiently with our agile warehousing solutions Click here Planning solutions tailored for success End-to-end Demand Planning Demand Planning Strategy Demand Planning System Design Product Life-cycle Design Demand Planning Management & Operations Advanced Insights and Analytics Material Requirement Planning Capacity Planning Procure to Pay Cycle Management Supplier Performance Management Integrated Planning Inventory Rationalization Together we can achieve these outcomes Improve supply chain visibility Optimised Inventories Increased profitability Improved order fulfilment Improved production scheduling Increase cash flow Connect with your experts to re-imagine your supply chain planning strategy Click here Let’s Partner Resources Transforming Waste into Wealth: Bio-Diesel Innovation for a Leading QSR Chain Discover how a leading QSR chain transformed its sustainability challenges into opportunities by converting used cooking oil into bio-diesel. This… Read More Proactive or Paying the Price: The Cost of Ignoring Predictability CategoryThought Leadership February 26, 2024 [Avg. Read Time = 4 mins.] Amidst the daily hustle, a small yet popular bakery… Read More Impact of ESG on Food Supply Chain Sustainability Imagine a future where your food supply chain goes beyond just being fast and cost-effective, to also being green, fair,… Read More Women Leadership in Supply Chain Food Supply Chain Leadership Forum’ is an initiative by Radhakrishna Foodland aimed at creating an exclusive engagement platform in the Indian… Read More Load More FAQs (Frequently Asked Questions) What are demand planning and forecasting? Demand planning and forecasting is the process of planning, predicting or forecasting the demand of products in the market to assure inventory and stock management. It helps deliver the right products in the right quantities that satisfy the customer demand without resulting in excessive production or deficit supply. What do the process of demand planning and forecasting involve? Supply chain companies in India catering to logistics requirements help with systematic demand planning and forecasting. The process of preparing the demand planning and forecasting is as follows, Preparation of data based on past market demand and analytics Initial forecasting Using market intelligence to integrate the supply chain of demand forecast Analysing the data with different operational data of specific years and predictions Determine final data through demand planning and forecasting Monitor the data to make changes for further improvement Why demand planning and forecasting is essential? Demand planning and forecasting help determine all business decisions and streamline them in the most effective way possible. Since operating decisions are generally based on the product’s market demand, demand planning and forecasting beforehand help with arranging the supply chain and end-to-end integration. Promoting efficient supply chain integration, demand planning and forecasting also prepare the company for future uncertainties like lack of supply or excessive production compared to demand. What are 4 crucial elements of demand planning? The 4 crucial elements of demand planning are Analysing demand based on the product type- Understanding the market’s demand and the types of goods demanded. Analysing demand based on the quantity requirement- Understanding the market demand to produce the quantity...
As a company’s business drivers change, business processes, SCM technology investment and the overall approach to supply chain management must change and keep pace with the current market scenarios. Nowadays, demanding consumers are causing changes in how shippers and supply chain providers work together. In the past, consumers have had very little or no influence at all on the supply chain because they were oblivious of what it was. A consumer would order an item but could have no clue where it is made or who makes it or even when to expect the delivery. However, today’s consumers are though indirectly, but actively involved in the creation of the supply chain. Order Tracking: Consumers today are actively involved in each process of the supply chain activity. With the ability to track orders, consumers expect more from their suppliers. Order tracking allows the customer to gain insight into where their order is at any given point of time. From the time an order is placed until it is delivered, the customer wants to know everything. Answering the customer requires visibility across multiple processes and systems. Companies must pay more attention to their supply chain and quickly solve any shortcomings that could possibly delay the delivery time. Whether it’s for a manufacturer or distributor, order accuracy is positively impacted by order tracking. Customers are easily able to double-check orders as they move through the fulfillment process, in many cases allowing them to catch mistakes before orders are shipped or order alternative items when a desired item is out of stock or backordered. Sustainability: Consumer demand for more sustainable business practices can have significant supply chain implications. For instance, mobile phone purchasers may typically consider four key factors into consideration when buying a new phone: the desire to upgrade, the need to stay within a budget, the durability of the product and environmental sustainability. Consumers today are willing to pay more money for a product they consider to be more sustainably efficient. Supply Chain players should therefore focus more on making their supply chain environmentally sustainable to attract these group of customers. Companies that have a pro-environmental view need to be ready to take responsibility and to move towards sustainable business practices. Consumers’ interest towards recycling and sustainable solutions has increased. They appreciate the idea of recycling waste to produce something new; circular products have become “the new normal”. Consumers are asking for more visible and concrete information about how the products that they are using has affected the environment. Increasing Customer Satisfaction: Understanding consumer trends and order histories serve as a sort of blueprint when companies need to make decisions about how to boost sales. Instead of guessing, one can make informed planning based on actual data and trends. That includes keeping accurate inventory, even during the busiest periods. Maintaining stocked shelves so as not to miss out on sales opportunities. Distributors and suppliers must innovate and optimize every step of the shipping process to meet consumer expectations. Understanding consumer trends and demands helps the networks to increase business efficiency and eliminate customer pain points by integrating new supply chain activities to ensure overall customer satisfaction. Evolving Customer Channels: The ongoing shift away from traditional retail to direct-to-consumer(DTC) shipping is rapid. 40% of brands now sell directly to the consumer. The DTC sales are projected to reach around $130 billion by 2025. Supply chain players should therefore focus on reorganization of the supply chains. They should emphasize on providing a Unified Brand Experience i.e., creating a DTC model that gives full control of the brand and develop direct engagement with customers to gain real time feedback and optimize supply chain accordingly. Selling DTC allows you to collect first-hand data and own it to focus on improving customer experience. A global sports accessories brand is focusing on its DTC channel and aims to reach $16 billion through the DTC channel by 2020 (a whopping rise of more than 140 percent from 2015). By choosing the right systems, approaches, and partners within the supply chain, companies are providing the customers with great service, transparency, and visibility they desire. Having an efficient supply chain means one can beat the competitors on price and improve profitability. Having high performing operations means one can meet or exceed the customers’ expectations on delivery of the product. The relationship between Customers and supply chain players have created a network to incorporate individual components of the supply chain into an interconnected web that enables seamless information transfer and support, thus providing opportunities to improve bottom lines and provide exceptional experiences to consumers. At Radhakrishna Foodland, we strive to provide accurate demand planning, forecasting and inventory solutions by analyzing historic demand, historic sales and trends in consumption pattern to help reduce the pressure to match stock to anticipated sales as accurately as possible and inculcate greater transparency in all supply chain operations. Our Order and process management solutions assure seamless integration of order receipts to cash receipts to consumer feedback and ensure standardization of processes across all domains. We strive to warrant safety and authenticity of data to provide real-time traceability throughout the supply chain. This helps businesses to focus more on increasing their profitability and enables them to optimize their overall customer satisfaction. Sources:
As a continuation of our earlier article, we are sharing the last five resolutions guide food brands in stringing together strategy to create the supply chain of the future. 6. Evaluate your strengths and weaknesses The supply chain is only as strong as its weakest link. Identifying areas for improvement can be challenging, without access to precise real-time and historical data. By implementing automated, supply chain solutions, businesses can achieve granular visibility. That would mean segmenting the supply chain to extract and analyze accurate data from various segments within the supply chain like warehousing or transportation to identify its pain points that need addressing. Evaluation as a process helps to strengthen the end-to-end fulfillment strategy while saving businesses time and money. 7. Simplify the supply chain design A convoluted supply chain can mean that there are more potential for things to go wrong. Food brands with diverse suppliers and processes runs the danger of losing focus causing delays in sourcing, manufacturing, and transportation. Supply chain complexity is one of the major issues firms confront, according to Michigan State University research. Operating in various consumer markets involves numerous suppliers, which means more workflows, regulatory requirements, and vulnerable links. Supply chains can easily become entangled and convoluted, undermining efficiency. Businesses should analyze the entire supply chain to see where it may be simplified. Simplifying procedures can lead to cost savings, increased efficiency, and higher product quality. A lean supply chain is better prepared to deal with unexpected challenges. Its processes frequently improve overall performance, quality, reduces expenses, and increases responsiveness. A high-level audit of operations will reveal areas for improvement, resulting in shorter lead times and lower prices. Technology can help firms manage supply chain issues and streamline operations. Combining these factors can lead to happier consumers, which is the goal of every food brand. 8. Increase Transparency to save costs Transparency extends beyond supply chain visibility, as confirmed by a Harvard Business Review report that reveals cost reductions of up to 20%. To better understand supply chain participants and threats, organizations can now use internal and external data sources. Mobile technology can track compliance or employment data instead of on-site or third-party audits. Additionally, they can track supplies from their point of origin to the producer, and then the finished products from the manufacturer to the end consumer, assisting in the confirmation of quality and preventing fraud. While transparency can educate and engage clients it can also be used to reveal potential operational changes, promote good corporate responsibility, strengthen brands, and mitigate future events. 9. Transform digitally Supplier technology helps food brands build a future-ready supply chain while boosting accuracy, compliance, and visibility. Analytics can help organizations identify market patterns and forecast future demand. Business risks can also be addressed to ensure business continuity and provide end-to-end visibility. According to Forbes, 50% of organizations feel technology has a significant impact on supply chain, logistics, and transportation operations. Digital supply chains rely on ubiquitous data access. They can boost dependability, agility, and efficiency by facilitating cross-platform cooperation and communication. Traditional supply chains must adapt to new digital realities or risk being left behind. A digital operational model incorporates digital capabilities across governance, processes, data management, and IT that enables process integration and standardization. 10. Consider working with a specialist Before assembling a team to fill in the gaps, it is critical to understand the supply chain constraints. Consultants help negotiate the existing supply chain network’s uncertainty. They can help with supply chain technology, 3PL and 4PL outsourcing, warehouse and transportation management, network analysis, Lean distribution, and more. Food brands should consider collaborating with a supply chain specialist who can build a fit-to-purpose business strategy to reduce total value chain costs while improving the performance of the supply chain and manufacturing and distribution costs. According to a report by the UK-based market research firm Technavio, the 3PL market in India is poised to grow by US$10.74 billion in the period 2021-2025, progressing at a compound annual growth rate (CAGR) of almost 8%. Because supply chains are so complicated and unique to each business, consultants can assist uncover gaps between business strategy and supply chain design. A consultant can help traverse the stages and provide guidance to ensure the successful implementation of a supply chain relationship. As we transition into the new year we can together look forward to the challenges and changes the new year brings by embracing these 10 resolutions offered to help supply chains prepare for a productive and efficient year.
The success or failure of a company depends on its business partnerships which include the relationships with its supply chain. The supply chain is a lifeline to the food industry that keeps the businesses up and running. Whenever the food industry faces unprecedented disruptions like COVID-19 or natural disasters like floods, a strong supply chain relationship will prevent a food business from the chaotic obstacles of setting things right by itself. A long-term strategic partnership with a 3PL company helps sort out key issues, including food safety, food product quality, sustainability, new market opportunities, technical information and assistance, and environmental responsibilities. Read on to know why foodservice operators, like Quick Service Restaurants (QSRs), cafes, and cloud kitchens, must prioritize creating a lasting relationship with their supply chain partner and how to achieve it. Factors influencing a strong relationship between a 3PL company and the food industry The supply chain relationship is the backbone of food supply chains. Several factors influence the bond between 3PL companies and foodservice operators, including those mentioned below: Benefits of long-term supply chain partnership According to the University of Tennessee research, a long-term supply chain partnership proves to be highly beneficial even during an economic slowdown. It also opens up new markets and helps in business growth, and a list of other advantages. Check out some of the prominent benefits of having an enduring supply chain partnership. Reduced costs As in any other domain, the food industry looks to reduce costs in every possible way to provide finished products at a fair price to its customers and maintain profitability. A mutually beneficial relationship with a 3PL company can assure the food service operators of an overall low operational cost through wholesale procurement of goods, low wastage due to well-maintained warehouse and inventories, and efficient logistics services. Collaborating with a 3PL partner in the long term helps identify and eliminate processes that incur high costs but provide no value to the company. Efficiency and Optimized processes The HORECA businesses, including Quick Service Restaurants, cloud kitchens, cafes, and FMCG companies, have focused for long only on customer relationships. But now, it has become imperative for these companies to acknowledge the importance of nurturing a healthy supply chain relationship that enables efficiency and optimization of the existing procurement, storage, and logistics processes. It also brings positive outcomes like increased responsiveness to market changes, high ROI, reduced order fulfillment time, and high market share. Reduced waste and increased food safety About 4.5 trillion tonnes of food is produced every year, which is twice as much required to satisfy the world’s food needs, yet millions are left to starve and be malnourished. Hence reducing food wastage and optimizing the food supply chains is one of the most important goals for food-related industries. Foodservice operators are looking to minimize food loss and maintain quality through Food Grade 3PL partners. By developing a mutually beneficial relationship with a 3PL company, food wastage can be drastically reduced at each stage in the supply chain, and the safety of the food products can be maintained at optimal levels. Conclusion Food service operators or HORECA businesses are better equipped to handle disruptions by maintaining a trustworthy supply chain partnership. Choosing a suitable 3PL partner, aligning the mutual objectives and strategies, and analyzing the Key Performance Indicators (KPIs) will allow the companies to face unforeseen obstacles effortlessly. It is high time these businesses begin to nurture a mutually beneficial partnership with 3PL companies to witness positive results in their business growth. RK Foodland is India’s leading supply chain management company with over three decades of rich expertise. We understand your business goals, identify gaps in your existing supply chain, and build strategic partnerships.
One of the fastest-growing sectors in India and the world is the QSR sector. In the years 2021-2025, the Indian market for Quick Service Restaurants (QSR) is expected to develop at a CAGR of over 18%, according to a report by Research and Markets. Multiple causes, including urbanisation, food delivery service expansion, the rise of working professionals and millennials alike, and an increase in disposable income, are fuelling a boom in the fast-food industry. As a result, this is the most competitive restaurant-style due to the large a number of new entries and aspirations. The QSRs also face a variety of issues in their business. External factors like food inflation and agriculture reliance on the monsoon affect the business. Demonetisation also had a negative impact on the firm, resulting in lower revenues. The Indian market is very fragmented. Several local firms compete with larger international firms. This reduces system standardisation and increases dietary variability. So, the buyer demands more choice everywhere. The businesses sell the same cuisine at varying prices. This reduces client loyalty. Then there are internal business concerns like supply chain, logistics, and warehousing. Training of manpower is vital; it is a major concern due to the high attrition rate in this industry. Inefficient employees produce system inefficiencies. If the company is well-known, then this sector requires greater attention. The supply chain is critical to a QSR’s success. A better supply chain means more value for the company. But the QSR supply chain in India is highly fragmented which means there are many middlemen involved leading to wastage of resources. The supply chain is becoming increasingly important in today’s competitive QSR industry. To compete effectively, QSR brands try to establish formidable supply chains. Traceability Nowadays, many consumers demand traceability, wondering exactly where all products and ingredients come from. Having trustworthy data on food goods throughout the supply chain is crucial now more than ever. Every step of the food supply chain should be tracked and communicated to ensure quality, product integrity, brand integrity, and consumer loyalty. Lack of transparency and traceability in the supply chain can expose it to undue risk given the fact India witnesses nearly 5-15 % (About USD13 Bn in value) wastage in fruits and vegetables annually. It can harm a QSR brand’s reputation, resulting in lower sales and profits. It can also cause legal issues that delay product launches. Traditional monitoring mechanisms and human inspections are often to blame for food supply chain traceability. A communication breakdown occurs owing to errors and omissions. In the event of contamination, traceability may allow for targeted recalls. Transparency, traceability, and trust in the food industry have long proven difficult. The supply chain data can give producers, suppliers, distributors, retailers, and consumers with trustworthy product and ingredient origin information. Inventory visibility is improved and stock-outs are avoided, which is critical when giving limited-time promotions. Managers can take action if a QSR store uses too much of a limited ingredient. It also helps with internal shrink and inventory loss statistics. Temperature-Controlled Supply Chain Fresh, frozen food is becoming an essential menu item for many QSRs. Temperature changes can affect the shelf life, flavour, and sensory experience of refrigerated foods. With a well-constructed temperature-controlled supply chain, QSR businesses may improve their ability to maintain product quality and reduce losses. Through real-time monitoring and historical analytics of the cold supply chain, including crucial environmental factors for products, a temperature-controlled supply chain assists QSR companies in reducing spoiling costs. A well-maintained cold chain leads to enhanced product quality, safer delivery, and predictive maintenance. Having a well-designed temperature-controlled supply chain enables the QSR industry to quickly identify and address temperature and humidity issues in the cold chain—before they escalate into larger problems. By partnering with a third-party supply chain specialist who specializes in cold chain management, QSR brands can monitor and manage the cold supply chain more effectively in real-time, distribute products more safely and efficiently, improve delivery quality while decreasing costs, and increase customer satisfaction. Data-driven Forecasting With technological improvements enhancing the supply chain, QSRs can invest in solutions that bolster supply chain activities such as demand forecasting. A data-driven forecast generates demand predictions based on historical data, economic trends, and market analysis, allowing for more efficient inventory planning and the avoidance of losses. A data-driven demand estimate might mean the difference between profit and loss for a quick-service restaurant brand. Accurate forecasting that takes events, promotions, and other sales-related aspects into consideration is critical to avoiding losses, especially for QSRs that operate on razor-thin margins. With precise projections, operators at a quick-service restaurant (QSR) can generate data-driven predictive orders, which are critical for inventory management. An accurate forecasting system reduces capital retained on a restaurant shelf, improves bargaining positions with suppliers, allows for space reduction or reallocation inside a restaurant, and reduces waste. Supply chain professionals with excellent technological skills can help QSRs by predicting labour, ordering, and production needs. This estimate is based on POS transaction data and a complex algorithm that considers seasonality, events, promotions, and other factors. With new technologies, operators can adjust projections to account for both positive and negative consequences, such as increased sales activity due to neighbouring sports events, boosting forecast accuracy. Inventory Management Technological advances in inventory management systems provide better food tracking. With efficient inventory management, QSR businesses may improve food safety and reduce health hazards. Accelerate the placing of food products on shelves, ensuring that they are still fresh for customers, and optimise transit and packing methods to save money. Inventory management systems can also connect to the QSR supply chain for real-time product information. In the event of a problem, they may track specific shipments. A large amount of data is being shared, which can shed light on safety, delivery, and overstock concerns. Finding the correct inventory management technology can also assist QSR brands in more successfully balancing their supply. If they have a surplus of inventory, they run the danger of it going bad and being thrown away. However, if...
Supply chain sustainability has been building up steam in recent years, as consumers are becoming more environmentally conscious and are expecting businesses to do the same. A growing number of companies are looking to build sustainability into their supply chain operations as it has direct impact on the environment as they try to compete with a growing consumer base. It is widely established that sustainable business can equate to profitable business. So, how can a sustainable supply chain benefit your business? Reputation Ensuring that companies focus on the planet along with their profits makes good business sense and enhances their reputation as a sustainable company. Profitability Thinking sustainably will help drive down costs and reduce expenditure in the long run, which will further help towards increasing the profitability of the firm. Innovation Establishing a sustainable supply chain enables companies to work with partners who provide environmental friendly products and services that foster innovation. There is no quick and easy path to sustainability, but the right solutions can help achieve a defined sustainable supply chain. Companies tend to account for waste and activity at every stage as part of their overhead. Therefore, having a comprehensive understanding of how sustainability impacts every unit of business including the supply chain is essential. An early step is to evaluate inventory suppliers, identify the most significant environmental and social challenges and then to prioritize efforts. Establishing and communicating expectations through a code of conduct is a critical step in involving every unit in the sustainability efforts. Simplifying procedures and eliminating wasteful practices contributes substantially in improving supply chain efficiency and reducing waste. It is important to focus on small, iterative improvements along with major changes to bring simplicity in the processes. Every change that reduces waste, speeds up delivery or enhances quality makes an incremental improvement to sustainability. Misalignment between supply and demand results in too much or too little production of raw materials, manufacturing of goods and distribution of products. This creates rework and excessive inventory which is a massive source of waste. Lead times are one of the greatest areas of waste within a company that should be controlled through process improvement. Good predictive analytics combined with machine learning can forecast likely demand and ensure more efficient supply and manufacturing processes. The warehouse is an important component of efficient sustainable supply chains. When it comes to creating sustainable value, there are several practices that warehouses can implement such as automating both warehouse solutions and management processes, increasing energy efficiency within a warehouse, and optimizing warehouse design. Some practices like smartly located inventory which can bolster efficiency and productivity or use of electric forklifts which eliminate the need for gas and oil in warehouse operations can revolutionize the way how companies adopt green approach to procurement and warehouse management. Route optimization as well as using renewable fuels considerably helps to reduce the environmental impact of transportation and distribution. Artificial intelligence can work with GPS devices to optimize shipping routes. Advanced analytics can even help update routes in real time, to take account of congestion and other issues. Through our expertise, we, at Radhakrishna Foodland have helped a leading QSR chain to tackle the problem of disposing off used cooking oil by converting it into biodiesel and used it in vehicles for transportation to stores. This helped the QSR chain to reduce misuse of used cooking oil as well as air pollution during transportation. The environment friendly solution added credibility to the brand and enhanced its brand image.
The improvisation of technology and software have enormously encouraged the integration of cold chain logistics & end-to-end fulfilment making the process safe, efficient and convenient. Integration in Cold Chain Logistics Cold chain logistics deals with the integration of an end-to-end system that deals with the management of temperature-controlled products across distances maintaining the quality for a better experience. The cold chain logistics haggle with manufacturers, processors, distributors, & foodservice retailers to lessen their end-to-end obligation along with reducing overall operational costs. As an essential part of management, having integrated cold chain logistics yields benefits for the business in ample ways. This integrated fulfilment reduces risk, improves customer satisfaction along with making strong relationships with suppliers & clients. There are a number of things that need to be handled keenly while building integrated cold chain logistics. Since end-to-end fulfilment is a complex process, the food industry highly relies on the cold chain companies in India assisting with outsourcing cold chain management. Outsourcing cold chain management being the finest resort, it helps efficiently with managed end-to-end fulfilment, visibility and reduction in waste, and improved margins. Building an integrated cold chain logistics system to aid your food business and give an edge over competitors is a worthy chase. However, it involves strategic planning and expertise in the field for better integration. Importance of Building an Integrated Cold Chain Logistics System Building a strong cold chain logistics benefits your business in various ways and helps you multiply your margins. Many cold supply chain companies in India render services for strong cold chain management. These logistics companies in India encourage smooth functioning of the food companies maintaining the perfect equilibrium between demand and supply of the market. It helps your business eliminate food safety issues and shifts the load on the company offering end-to-end fulfilment. The shifting of load on other dedicated teams allows you opportunities to multiply the margins and focus on improving the services for your customers. A strong integrated cold chain logistics helps you with enriching the shelf life of your products. Building a cold chain management system also improves efficiency and productivity. A strategically planned system for cold chain logistics and management also eliminates the risk of quality deterioration, benefiting you with smart management of the inventory. A strong cold chain management system helps with increased reach and penetration. It allows you to explore the markets where reaching looks like a difficult chase. A smart placing of cold chain logistics can help you with good exposure to different markets. It also helps you maintain order accuracy. Since keeping track becomes easier with a dedicated team to look after the cold chain management, it reduces the risks of missing or displacing orders. It also regulates delivery and maintains a balance between all the demand and supply promoting smooth functioning of the business. Integration of Cold Chain Logistics for End-To-End Fulfilment Integration of temperature-controlled logistics in India has led to smart development in the field of cold chain management. Apart from the benefits of having strong cold chain management, it promotes the smooth functioning of your food business and maintains a flow eliminating uncertainties and discrepancies. Joining hands with industry experts offering top-notch services always reaps great results. Integration of cold chain logistics provides cost-effective and efficient services with respect to the value. This sustainable way of management allows a flexible flow of your business. The technical development in the software and management structures have made the system absolutely reliable and relevant for food services business and industry. Highly relevant for frozen food products, medical types of equipment, heat-sensitive drugs & frozen desserts; cold chain management assures the quality of a product without degrading or degradation throughout the journey as end-to-end fulfilment. Looking forward to an integrated end-to-end fulfilment with strong cold chain management?