Supply Chain Security for the Food and Beverage Sector

The shortage and the rising cost of raw materials, energy, transportation and labour in the very competitive consumer environment in the Food and Beverage (F&B) sector, has led to many high profile cases bringing attention to the supply chain security. The food manufacturing and retail industry is certainly under pressure. 

In the wake of the horse meat scandal, it’s easy to see how supply chain security failings have a direct effect on the reputation of the companies involved. On January 16th of this year, the Guardian newspaper reported that Tesco’s share price had slumped by £300 million after the negative coverage surrounding the horse meat scandal.

Competition on prices, which many consider a good thing for the consumer, lies at the heart of the issue and food producers walk a fine line between squeezing the most possible from the efficiency of the supply chain and maintaining product quality and staying within the regulations. As supermarkets have strong buying power, they are able to place great pressure on modern F&B manufacturers to find the right balance.

Modern automation and data management can go a long way towards addressing the concerns of food manufacturers, but is often seen as too expensive for the Small and Medium sized Enterprises (SMEs).

Regulations are increasingly requiring improved tracking and tracing through Radio Frequency Identification (RFID) technologies and data management systems. Importantly though, it’s our experience with companies large and small, that the costs of a highly automated, highly integrated and information-rich processes in the factory and up and down the supply chain are very quickly offset by efficiency savings throughout the system. In fact, data from unique RFID tags containing information of products, palettes and batches throughout the supply chain can also offer the opportunity for optimisation of stock control levels and waste reduction that can give manufacturers the opportunity to be much leaner, as well as more efficient.

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