E-logistics of agribusiness organisations

Logistics is one of the most important agribusiness functions due to the idiosyncrasy of food products and the structure of food supply chain. Companies in the food sector typically operate with poor production forecasting, inefficient inventory management, lack of coordination with supply partners. Further, markets are characterised by stern competition, increasing consumer demands and stringent regulation for food quality and safety. Large agribusiness corporations have already turned to e-logistics solutions as a means to sustain competitive advantage and meet consumer demands. There are four types of e-logistics applications: (a) Vertical alliances where supply partners forge long-term strategic alliances based on electronic sharing of critical logistics information such as sales forecasts and inventory volume. Vertical alliances often apply supply chain management (SCM) which is concerned with the relationship between a company and its suppliers and customers. The prime characteristic of SCM is interorganizational coordination: agribusiness companies working jointly with their customers and suppliers to integrate activities along the supply chain to effectively supply food products to customers. E-logistics solutions engender the systematic integration among supply partners by allowing more efficient and automatic information flow. (b) e-tailing, in which retailers give consumers the ability to order food such as groceries from home electronically i.e. using the Internet and the subsequent delivery of those ordered goods at home. (c) Efficient Foodservice Response (EFR), which is a strategy designed to enable foodservice industry to achieve profitable growth by looking at ways to save money for each level of the supply chain by eliminating inefficient practices. EFR provides solutions to common logistics problems, such as transactional inefficiency, inefficient plant scheduling, out-of-stocks, and expedited transportation. (d) Contracting, a means of coordinating procurement of food, beverages and their associated supplies. Many markets and supply chains in agriculture are buyer-driven where the buyers in the market tend to set prices and terms of trade. Those terms can include the use of electronic means of communication to support automatic replenishment of goods, management of supply and inventory. The results of the current applications of e-logistics in food sector are encouraging for Greek agribusiness. Companies need to become aware of and evaluate the value-added by those applications which are a sustainable competitive advantage, optimisation of supply chain flows, and meeting consumer demands and food safety regulations. E-business diffusion has shown that typically first-movers gain a significant competitive advantage and the rest companies either eventually adopt the new systems or see a significant decline in their trading partners and perish. E-logistics solutions typically require huge investments in hardware and software and skilled personnel, which is an overt barrier for most Greek companies. Large companies typically are first-movers but small and medium enterprises (SMEs) need institutional support in order to become aware that e-logistics systems can be fruitful for them as well

East Midlands food & drink sector strategy

The food & drink sector is one of four priority sectors identified in the regional economic strategy, A Flourishing Region. This document sets out a strategy for maximising the contribution of the food & drink sector to the economic development of the East Midlands

Optimal production scheduling for dairy industries

In this work, a complete two-level framework for use in food and in particular dairy industries is proposed. The specific characteristics of the dairy industry have been taken into consideration, in terms of the behavior of food sales over time and the special requirements in the production phase. At the scheduling level, an MILP (Mixed Integer Linear Programming) model of the system was developed, using a continuous representation of time

E-COMMERCE: A NEW BUSINESS MODEL FOR THE FOOD SUPPLY/DEMAND CHAIN

The use of electronic commerce for quality control and cost cutting efficiencies by the food and agricultural industries in the United States is the focus of this paper. The food industry engages in e-commerce through 1.) Internet shopping for consumers called business-to-consumer (B2C) e-commerce 2.) Business-to-business (B2B) Internet market discovery exchanges used by food suppliers at any point in the supply chain, and 3.) Business-to-business (B2B) relationships that reduce costs and increase efficiencies in the procurement, storage and delivery of food to retail stores or distribution centers. This third use of e-commerce is the most highly developed and widely adopted. It allows retailers to share information about consumers' purchases and preferences with food manufacturers and farmers and for tracking food products' characteristics, source, and movement from production to consumer. This circle of information allows high quality and consistent products to be consumed at lower prices. This paper is about the development of e-commerce in the food industry, the economic concepts and goals that it meets, and the changes it brings to the industry. E-commerce both fosters and demands vertical coordination. It favors consolidation of firms. It changes the business culture from one of adversarial relationships to one of cooperation and trust. It changes the historical supply chain into a supply/demand loop while it lowers the cost of food. Policy issues arise around monopoly power, privacy, a diminution of variety, and the demise of small, undercapitalized firms.Industrial Organization, Marketing,

Optimising supermarket promotions of fast moving consumer goods using disaggregated sales data: A case study of Tesco and their small and medium sized suppliers

The use of price promotions for fast moving consumer goods (FMCG’s) by supermarkets has increased substantially over the last decade, with significant implications for all stakeholders (suppliers, service providers & retailers) in terms of profitability and waste. The overall impact of price promotions depends on the complex interplay of demand and supply side factors, which has received limited attention in the academic literature. There is anecdotal evidence that in many cases, and particularly for products supplied by small and medium sized enterprises (SMEs), price promotions are implemented with limited understanding of these factors, resulting in missed opportunities for sales and the generation of avoidable promotional waste. This is particularly dangerous for SMEs who are often operating with tight margins and limited resources. A better understanding of consumer demand, through the use of disaggregated sales data (by shopper segment and store type) can facilitate more accurate forecasting of promotional uplifts and more effective allocation of stock, to maximise promotional sales and minimise promotional waste. However, there is little evidence that disaggregated data is widely or routinely used by supermarkets or their suppliers, particularly for those products supplied by SMEs. Moreover, the bulk of the published research regarding the impact of price promotions is either focussed on modelling consumer response, using claimed behaviour or highly aggregated scanner data or replenishment processes (frameworks and models) that bear little resemblance to the way in which the majority of food SMEs operate. This thesis explores the scope for improving the planning and execution of supermarket promotions, in the specific context of products supplied by SME, through the use of dis-aggregated sales data to forecast promotional sales and allocate promotional stock. An innovative case study methodology is used combining qualitative research to explore the promotional processes used by SMEs supplying the UK’s largest supermarket, Tesco, and simulation modelling, using supermarket loyalty card data and store level sales data, to estimate short term promotional impacts under different scenarios and derive optimize stock allocations using mixed integer linear programming (MILP). ii The results suggest that promotions are often designed, planned and executed with little formalised analysis or use of dis-aggregated sales data and with limited consideration of the interplay between supply and demand. The simulation modelling and MILP demonstrate the benefits of using supermarket loyalty card data and store level sales data to forecast demand and allocate stocks, through higher promotional uplifts and reduced levels of promotional wast

THE FOOD SERVICE INDUSTRY: TRENDS AND CHANGING STRUCTURE IN THE NEW MILLENNIUM

By 2010, foodservice establishments are projected to capture 53 percent of consumers' food expenditures, whereas in 1980, foodservice captured less than 40 percent. The foodservice industry accounts for approximately 4 percent of the Gross Domestic Product and about 11 million jobs. It has been rapidly changing due to economic factors, technological advances, and labor matters.1 This overview covers many of the issues and trends affecting the different segments of the foodservice supply chain including the foodservice operators, distributors and food manufacturers. Changing customer demographics are a driving force in the evolution of the foodservice industry. As the baby boomers reach middle age, they do not seem to have time to cook and their children and grandchildren do not seem to have the interest, or talent. The U.S. population in 2000 had over double ($6,500) the per capita discretionary income that it had in 1975 ($3,109) 2 and, with a high value for recreation and pleasure they are pulled out of the kitchen and into the restaurants. An ever-shrinking world also brings variety to menus as cultures and cuisines converge, introducing new flavors and textures. A tight labor market has affected the foodservice industry from top to bottom leading to a derived demand for convenience products from manufacturers. At all links in the chain, companies are experiencing mergers and acquisitions. Operators, manufacturers, and distributors are all fighting for a share of the profits as competition continues to intensify. This review of the foodservice industry incorporates interviews with industry professionals, current information from leading foodservice associations, and predictions from the top industry research firms and consultants.Agribusiness, Industrial Organization,

(Meat)ings : operational and strategic challenges of a retailer meat supply chain

This business case is based in a 2015 project of review and analysis of the whole supply chain of the Meat Department from the major retailer in Portugal, SonaeMC. The main drivers for the existence of this project were the huge entropy within the department and the towering perishable shrinkage. We follow Célia Fialho and a final year graduating student, through four meetings to pinpoint critical issues to propose strategic and operational solutions to solve the above-mentioned issues and to improve the supply chain. The case is targeting strategy and operations management students (and similar), introducing main concepts and topics related and to present a real retailer supply chain in a change situation.Este caso de estudo é baseado num projecto, de 2015, de revisão e análise de todo o processo da cadeia de abastecimento do Departamento do Talho, do maior retalhista em Portugal, SonaeMC. Iniciou-se o mesmo, devido à existência de uma enorme entropia dentro do departamente e da crescente quebra intrínseca. Seguimos os passos de Célia Fialho e um estudante finalista, através de quarto reuniões para identificar problemas críticos e apresentar soluções operacionais e estratégicas para resolver os diversos problemas da cadeia. O público-alvo deste caso são estudantes de estratégia e gestão de operações (e similares), introduzindo conceitos e tópicos relacionados e apresentando um caso real de uma situação de mudança numa cadeia de abastecimento de retalho