The Future of the Food Supply Chain & Logistics
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The document discusses the evolving food supply chain, driven by factors like government legislation, consumer demand for organic and local food, and global trade dynamics. It highlights the importance of technology, such as telematics and IoT, to manage logistics, enhance transparency, and comply with regulations. Additionally, it notes trends like the rise of direct-to-consumer delivery services and investments in rail infrastructure aimed at improving efficiency within the food logistics sector.
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The Future of the Food Supply Chain & Logistics
- 1. THE FUTURE OF THE FOOD SUPPLY CHAIN & LOGISTICS B Y : A N G E L A C A R V E R
- 2. What is Driving Food Supply Chain Changes? • A variety of factors are shaping the evolution of the food supply chain. While all interconnected within a single industry, the implications and impact are wide reaching. • Food supply chain operators are planning long-term changes to adapt to: – Increasing governmental legislation – Growing customer demand – Supply chain globalization – Rising infrastructure investment
- 3. Use of Telematics and IoT • Food will be fresher and more local – Kimbal Musk, brother of Elon Musk, was quoted in an article in stating that 45% of Americans are now seeking organic food in their diet and are more conscious as to local food sourcing. – This will impact supply chain operations as they must adapt their existing distribution networks to accommodate more localized delivery. – Food SCMs will place a stronger focus on technology utilization to track and manage these networks.
- 4. Use of Telematics and IoT • Consumers will know more about food – As customers demand more information about where their food comes from, GMOs and how it was grown or raised, food supply chain operators must comply in order to remain competitive. – These operations will use a variety of technology solutions including RFID, WMS, ERP, manufacturing execution systems, automated data collection technologies, temperature recorders and more to compile and store a detailed audit trail down to the ingredient level. – This information will also be used to comply with evolving food legislation from regulatory bodies such as the FDA.
- 5. Rebounding Rail Transport • In an effort to regain market share in the food logistics sector many localities are investing in and completing comprehensive rail network and infrastructure upgrades. • This will help rail transport operations to capture more intermodal business transporting consumers goods, fresh & frozen goods, and beverages. • One example of rebounding rail transport is the Florida East Coast Railway which has upgraded all 351 miles of rail to make transporting fresh fish items up and down the coast. https://issuu.com/supplydemandchainfoodlogistics/docs/flog1215 - Pg 18
- 6. 3rd Party/Private Courier Delivery • Referred to as the “B2B Sharing Economy” by , this trend brings smaller 3rd party delivery services into the mix. • Private courier services such as UberFRESH and UberEATS will deliver groceries and restaurant orders directly to consumers’ doors. While this is often more expensive for consumers because it eliminates the economy of scale, it does provide an added level of convenience which can be highly desirable for busy consumers. • These services are frequently being implemented in large, densely populated cities such as New York and Boston.
- 7. Rising Imports and Exports • Supply chain globalization is increasing across the board due to the development of more favorable trade agreements. This is leading to significant investment in reefer infrastructure by major ocean carriers. • In order to maintain the integrity of food inventory ,ocean carriers are also planning to invest in new and improved refrigeration technologies such as non-ozone depleting CO2 instead of the existing synthetics. These will regulate temperature more reliably while also reducing emissions.
- 8. Rising D2C Delivery & Online Shopping • The growing popularity of organics has changed the way that consumers eat and it will lead to many also changing the way they shop. • Services such as Blue Apron and Hello Fresh are changing the nature of the food supply chain as they deliver directly to consumer homes without ever stepping foot in a grocery store. • In order to keep pace many grocers will begin to offer D2C delivery and a variety of click-and-collect options. This will require further development of existing distribution networks.
- 9. Conclusion • Lara L. Sowinski, editor-in-chief of Food Logistics Magazine wrote “The global food supply chain is arguably one of the most vibrant industries operating today… There is not one aspect of the global food supply chain that is untouched by transformations taking place in agriculture, weather and climate change, regulatory compliance, labor, consumer preferences, sustainability, technology and retailing.” • All of these factors are significantly impacting the way that the food supply chain operates and will continue to do so in the years to come as technology, consumers and regulations evolve.
- 10. Learn more about technology designed to improve food supply chain and logistics operations. Talk to a Datex expert about your technology needs: 800.933.2839