Tag Archives: Demand

The current food supply chain is broken. Here is 5 reasons

Supply chains. We know surprisingly very little about most of the products we eat every day. Before even reaching the end consumer, products travel through an often-vast process flow of retailers, distributors, transporters, storage facilities, and suppliers. Here is five reasons the current system aren’t working:

1. Complexity – In the beginning, two centuries ago, the supply chain was a revolutionary idea. The idea was improve visibility and control of products through interorganizational exchange, as they moved from A to Z. But this old concept and the inherent technology can no longer support today’s production and supply cycles of products, which have become extremely fragmented, complicated process and geographically scattered across the globe. The effect is, that supply chains now is a blurred process that is extremely hard to manage for retail businesses, to effectively track and trace their products, and thereby paving the path for, e.g. fraudulent behaviour. The emphasis on providing cheap food has led to complex supply chains which are ripe for fraudulent activity, according to Prof. Chris Elliot.

2. Demand – We, as consumers, are very demanding when it comes to food. We want fresh bananas, juicy tomatoes, tasty mango all year long, no matter the season, we want it. And your local supermarket knows, and are trying to deliver out-of-season food all year long. It takes a lot of resources to ship non-local goods around the world, which from a sustainability stance, is very damaging.

3. Traceability – With more companies outsourcing for raw materials and distribution, having end-to-end visibility in a supply chain is an absolute necessity in order to ensure public safety, as well as brand protection. The information and data is an integral part of the product quality, so this information needs to provide an accurate picture of where your products are at any given time in your supply chain. A food traceability system is only effective if it can track and trace every component of every product, which the current system can’t.

4. Certifications – On the face of it, certifications on everything from fish to timber can be seen as progress, with a promise of better standards and the pursuit of sustainability. But what purpose are the certification labels actually serving? Can we assume that they are beneficial to producers? Do consumers understand what’s behind a certification label, as there seems to arise new certifications all the time? Today, the industry is more aware that certification alone isn’t addressing problems of low productivity, poor infrastructure and child labour, which continue to destabilise the supply chain. An example is Fairtrade, which is not that fair at all.

5. Transparency – With the requirement of only knowing one step back, and one step forth, actors in food supply chains have very little transparency of where their products come from. This, and other factors, leads to scandals like horse meat in cow meat, harmful pesticides in bananas, Chinese terrified of eating processed food and fraud with extra virgin olive oil.

References:

https://www.theguardian.com/sustainable-business/2016/mar/10/fairtrade-labels-certification-rainforest-alliance

https://www.businesswire.com/news/home/20120511005906/en/trace-Lack-traceability-product-integrity-%E2%80%93-profits