In the highly volatile world of fresh packaged food and beverage, where consumer preferences can shift unpredictably and supply chain disruptions are commonplace, the window for delivering fresh products is vanishingly small. According to the Food and Agriculture Organisation of the United Nations, up to 40 per cent of total food production goes to waste before ever reaching the market.
Many fresh packaged food and beverage companies have accepted a relatively high level of spoilage and waste as a cost of doing business. But this doesn’t have to be the case. By leveraging advanced forecasting capabilities and integrating diverse data sources, manufacturers can significantly reduce waste and ensure fresher products for consumers.
Utilising Diverse Data Sources and High-Accuracy Forecasts: A Necessity for Freshness
High-accuracy forecasting is crucial for fresh packaged food and beverage manufacturers. With advanced forecasting capabilities, manufacturers are better able to predict demand with a remarkable degree of accuracy.
By leveraging machine learning algorithms and integrating diverse data sources such as internal company data, retail customer data, and external data like the weather, manufacturers can adjust production schedules according to actual consumer demand, which reduces the risk of overproduction and minimises waste.
Collaboration with retail partners also plays a vital role in achieving these high-accuracy forecasts. By sharing data and insights, manufacturers can gain a clearer understanding of consumer preferences and purchasing patterns, which ensures both manufacturers and retailers are aligned. Implementing these strategies effectively often involves utilising advanced tools and platforms like RELEX Solutions.
For example, Tegel Foods Ltd, a leading poultry producer in New Zealand, improved their operational efficiency and reduced spoilage by adopting advanced forecasting tools. Integrating internal production data, retail sales patterns, and market trends allowed Tegel to fine-tune their forecasts, ensuring fresher products and enhanced profitability. Implementing RELEX alongside an ERP upgrade, Tegel improved demand visibility, retired most planning spreadsheets, and optimised production targets, communication, and line sequencing for increased throughput and yields.
Similarly, the Vita Coco Company, a leading coconut water producer, enhanced demand forecasting accuracy and reduced inventory levels using advanced forecasting and replenishment solutions. By analysing internal sales data, retail POS data, and weather patterns with machine learning algorithms, Vita Coco aligned better with consumer demand. Creating a digital twin of their supply chain with RELEX, they optimised sourcing, logistics, and inventory management, leading to significant cost reductions and a more efficient S&OP process.
Results like these demonstrate the broader impact of leveraging high-accuracy forecasts and robust planning platforms.
Integrated Planning Platforms in Freshness
Integrated planning platforms are essential for managing the complexities of fresh food production. These systems ensure that every step, from procurement to distribution, aligns with demand forecasts, reducing manual adjustments and enhancing efficiency. With real-time insights, manufacturers can monitor inventory levels, track shipments, and adjust production schedules on the fly. This agility is crucial for maintaining the highest standards of freshness.
The window of freshness may be small, but it is not impossible to navigate. Fresh packaged food manufacturers can achieve remarkable results by leveraging high-accuracy forecasts, fostering better retail customer collaboration, utilising diverse data sources, and automating forecasting processes with an advanced supply chain planning platform. By doing so, they can reduce waste, enhance freshness, and ultimately drive greater success in a competitive market. The success stories of the aforementioned companies serve as a testament to what is possible when manufacturers dare to dream bigger and embrace innovation.
Dr Madhav Durbha is the group vice president Industry Strategy for RELEX Solutions.
