Long-term supply chain partnership in the food industry.
 

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:

  • HORECA businesses agree that trust is the core factor that keeps the relationship alive between the partners. Establish trust through transparency, empathy, and consistency in collaboration.
  • Sharing risks, information, and benefits allows for heightened responsibility between the 2 entities.
  • Commitment to work and resolving issues is a key factor that strengthens the bond based on integrity.
  • Power dependencies between the 2 entities also play a vital role in establishing a frictionless relationship with a 3PL partner.
  • A clear line of communication ensures no misinterpretation or gaps occur in the existing and new processes.

 

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.
Reach us now to know more about our services.