Food Logistics March 2021

SUB STORY FRESH VS. 1 FROZEN 3PL

SUB STORY 2 MITIGATING SUPPLY CHAIN THREATS

SUB CPG STORY 3 PACKAGING

THIS IS A MAIN HEADLINE BOX This is an explainer for the main headline box

ROCKSTARS OF THE SUPPLY CHAIN

2021

Issue No. 000 March 2021

National DCP’s

FoodLogistics.com

LIZ LONGSTREET DARR Proves the Importance of Quality Leadership Amid Global Pandemic Issue No. 224 March 2021

FLOG0321_01_Cover.indd 1

FoodLogistics.com

3/1/21 3:24 PM

ROCKSTARS OF THE SUPPLY CHAIN

2021

Check out the winners from Food Logistics’ 2021 Rock Stars of the Supply Chain award, which profiles industry professionals whose expertise, vision and industry knowledge continue to drive the global cold food and beverage supply chain forward.

Ed Bowersox CEO CJ Logistics

Jeremy Schneider Food Safety and Quality Assurance Controlant

Mike Frank Senior Director of Business Dev. Jarrett

Mike Marshall Vice President – West Sales PLM Trailer Leasing

321_4 x 10.75COVERFLAP.indd 2

James Eason President, CEO, Mng. Dir. Chelsea International Cold Storage and Logistics, LLC

3/23/21 2:

SUB STORY FRESH VS. 1 FROZEN 3PL

SUB STORY 2 MITIGATING SUPPLY CHAIN THREATS

SUB CPG STORY 3 PACKAGING

THIS IS A MAIN HEADLINE BOX This is an explainer for the main headline box

ROCKSTARS OF THE SUPPLY CHAIN

2021

Issue No. 000 March 2021

National DCP’s

FoodLogistics.com

LIZ LONGSTREET DARR Proves the Importance of Quality Leadership Amid Global Pandemic Issue No. 224 March 2021

FLOG0321_01_Cover.indd 1

FoodLogistics.com

3/1/21 3:24 PM

THE ULTIMATE LOW CAB FORWARD LINEUP

Isuzu offers a wide range of LCF trucks in both gas and diesel options.

Class 3 - 5 N-Series Gas Trucks Class 4 - 5 N-Series Diesel Trucks Class 6 Isuzu F-Series FTR

With GVWRs from 12,000 to 25,950 lbs. and body lengths spanning 10 to 30 feet, Isuzu meets the wide-ranging needs of the medium-duty truck market. Visit your local Isuzu dealer to learn how Isuzu trucks can drive your business.

WWW.ISUZUCV.COM Vehicles shown with optional equipment; some equipment is dealer installed. Vehicles are assembled from component parts manufactured by Isuzu Motors Limited and by independent suppliers who manufacture such components to Isuzu’s exacting standards for quality, performance and safety. Please see your authorized Isuzu dealer for additional details. © 2021 ISUZU COMMERCIAL TRUCK OF AMERICA, INC.

w

FLOG0321_02-03_TOC.indd 2

3/1/21 9:31 AM

ON THE MENU

March 2021 ISSUE NO. 220 COLUMNS FOR STARTERS

04 New Beginnings From

COVID-19—One Year Later Editor-in-chief Marina Mayer details why the New Normal delivers New Beginnings for supply chains.

DEPARTMENTS COVER STORY

Mitigating Supply Chain Threats From the Ground Up Here’s how companies can forecast, prepare—and eventually overcome—supply chain disruptions of all sizes and forms.

14

06

Field To Fork

10

Food on the Move

45

Ad Index

www.FoodLogistics.com

ROCKSTARS OF THE SUPPLY CHAIN

2021

AWARDS

20

2021 Rock Stars of the Supply Chain

3PL / COLD CHAIN

28

WAREHOUSING

The Difference in Transporting Fresh vs. Frozen Foods

32

The Dark Side of Dark Stores

This year’s award recognizes the industry’s most influential people for improving the global cold food supply chain.

Discover how technology helps 3PLs manage the timing of fresh and frozen food transportation.

Discover the benefits and disadvantages to using dark stores.

TRANSPORTATION

PACKAGING

SOFTWARE & TECHNOLOGY

2021 LTL Update: What to

CPG Packaging Needs Safety,

4 Mobile Robot Workflows

36 Expect this Year

39 Technology, Sustainability

40 Add Value to Production Line

With the right logistics partner, shippers can successfully navigate the challenging LTL shipping market’s ebbs and flows.

It’s important for CPG companies to focus on safe and sustainable packaging.

Here’s why.

Here’s how AMRs help CPG companies meet their objectives.

FOOD SAFETY

4 Key Focus Areas for Food

42 and Beverage Manufacturers

WEB EXCLUSIVES

Supply Chain Network Check out why having the right Virtual Summit technological capabilities in place will aid foodlogistics.com/scn-summit organizations in minimizing risk and more.

The L.I.N.K. to Global

Supply Chain Intelligence foodlogistics.com/podcasts

Food Editors Stream Live on Social Media foodlogistics.com/videos/link-live

Published and copyrighted 2021 by AC Business Media. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage or retrieval system, without written permission from the publisher.

Food Logistics (USPS 015-667; ISSN 1094-7450 print; ISSN 1930-7527 online) is published 10 times per year in January/February, March, April, May, June, July, August, September, October and November/December by AC Business Media, 201 N. Main Street, Fort Atkinson, WI 53538. Periodicals postage paid at Fort Atkinson, WI 53538 and additional mailing offices.

POSTMASTER: Send address changes to Food Logistics, P.O. Box 3605, Northbrook, IL 60065-3605. Subscriptions: U.S., one year, $45; two years, $85; Canada & Mexico, one year, $65; two years, $120; international, one year, $95; two years, $180. All subscriptions must be paid in U.S. funds, drawn from a U.S. bank. Printed in the USA.

www.foodlogistics.com

FLOG0321_02-03_TOC.indd 3

MARCH 2021 | FOOD LOGISTICS

3

3/2/21 8:45 AM

FOR STARTERS

FROM THE EDITOR’S DESK

DETAILS

NEW BEGINNINGS FROM COVID-19—

ONE YEAR LATER I Marina Mayer Editor-In-Chief

t was a year ago this month that the Coronavirus disease (COVID-19) was declared a global pandemic. It was this time last year when the entire nation shut down, when employees shifted to their makeshift home offices, when foodservice establishments pivoted to keep product moving and when every corner of every company had to move, and move fast, to keep supply chains afloat.

Looking back, I’d say, this industry did a pretty darn good job!

However, reminiscing about how the pandemic played out presents some bittersweet memories.

March 12, 2020 was the last time our entire staff was under the same roof, at an in-person tradeshow. It was the last time I used my office landline, thanks to Zoom and Teams. And, it was the last time I stepped foot in a grocery store and actually grocery shopped (hello curbside pickup).

But, it also was the day of New Beginnings, an alternative “New Normal” way of doing things.

It was a second chance—a second chance to shore up efficiencies, tidy up processes and better acknowledge the people behind the lines. It was the opportunity for our nation’s supply chains to figure things out

and make the day-to-day work differently, not because they wanted to, but because they had to.

Because “we can’t have another [Hurricane] Katrina or another 9/11 where it was back to business as usual,” Justin Goldston, professor and coordinator of project and supply chain management at Penn State University, said in a recent L.I.N.K. Live discussion.

The COVID-19 disruption forced companies to develop contingency plans for the current state of business, but also prepare for what’s still to come.

And, according to many industry experts (see page 14 to read “Mitigating Supply Chain Threats From the Ground Up”), there is more still to come.

There will always be supply chain disruptions. There will always be supply chain challenges.

But, there may not always be that second chance.

Visit www.FoodLogistics.com and check out our new digital series, “COVID-19: One Year Later,” where we share articles, blogs, videos, expert columns and a timeline of events detailing the days of COVID-19 to present day.

Here’s to New Beginnings…..

Published by AC BUSINESS MEDIA 201 N. Main Street, Fort Atkinson, WI 53538 (800) 538-5544 • www.ACBusinessMedia.com

WWW.FOODLOGISTICS.COM

Print and Digital Staff Group Publisher Jason DeSarle Sales Associate Brian Hines Account Executive Mike Coon Editor-in-Chief Marina Mayer mmayer@ACBusinessMedia.com

Associate Editor Brielle Jaekel bjaekel@ACBusinessMedia.com

Assistant Editor Mackenna Moralez mmoralez@ACBusinessMedia.com

Senior Production Manager Cindy Rusch crusch@ACBusinessMedia.com

Art Director Willard Kill Audience Development Manager Angela Franks ADVERTISING SALES (800) 538-5544 Group Publisher Jason DeSarle (440) 476-9526, jdesarle@ACBusinessMedia.com

Sales Associate Brian Hines (647) 296-5014 bhines@ACBusinessMedia.com

Account Executive Mike Coon (814)-449-4287 mcoon@ACBusinessMedia.com

Circulation & Subscriptions P.O. Box 3605, Northbrook, IL 60065-3605 (877) 201-3915, Fax: (847)-291-4816 circ.FoodLogistics@omeda.com

List Rental Bart Piccirillo, Sr. Account Manager Data Axle Phone: (518) 339 4511, E-mail: bart.piccirillo@infogroup.com

Reprint Services Brian Hines (647) 296-5014 bhines@ACBusinessMedia.com

AC Business Media Chief Executive Officer Barry Lovette Chief Financial Officer JoAnn Breuchel Chief Digital Officer Kris Heineman Chief Revenue Officer Amy Schwandt VP Audience Development Ronda Hughes Director of Digital Operations & IT Nick Raether Director of Digital Strategy Joel Franke Group Content Director Jon Minnick Published and copyrighted 2021 by AC Business Media.

All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or any information storage or retrieval system, without written permission from the publisher.

4

FOOD LOGISTICS | MARCH 2021

FLOG0321_04-05_ForStarters.indd 4

www.foodlogistics.com

3/1/21 9:29 AM

om

FLOG0321_04-05_ForStarters.indd 5

3/1/21 9:29 AM

FIELD TO FORK

NEWS FROM ACROSS THE FOOD SUPPLY CHAIN Daily Updates at FoodLogistics.com

20% Global E-Commerce Growth Fast Tracks Supply Chain Tech Adoption

oatawa - stock.adobe.com

From 2019-2020, worldwide e-commerce revenues rose more than 20% year over year, forcing vehicle, robotic and software automation to alter the supply chain landscape in a matter of months, according to ABI Research. These changes are expected to continue to evolve and persist as both consumer and business digital and contactless behaviors become entrenched.

Limited trials that began prior to 2020 are now attracting government exemptions, revenue-producing activity and massive investment.

Longer-term decisions must be made for a post-pandemic strategy that will be better positioned for the next events to occur across the global supply chain. Technology adoption is growing rapidly across the supply chain with software and hardware to support vehicle automation, robotics, artificial intelligence, machine learning, blockchain and computer vision systems.

“The pandemic laid bare existing gaps in digitization, integration and tenuous contingency plans. Additionally, labor shortages have been magnified from volatile product demand, employee quarantines and seasonal peaks,” says Susan Beardslee, principal analyst, freight transportation and logistics for ABI Research. To read more, visit https://foodl.me/hbctl8.

Vizen Analytics Releases Demand Forecasting for Food Distributors

Deyan Georgiev

U.S. Meat Production Fell Due to Coronavirus While Citrus Flourished New findings from Tridge reveal the true impact COVID-19 had on agriculture and food, where beef production fell by 25% and pork fell 15%. However, for some agriculture sectors, this past year brought positive changes.

Because citrus is known as an immune booster, citrus fruit became exceedingly popular. In addition, the United States eased its reliance on avocado imports due to favorable conditions that allowed domestic growth to flourish.

Cherries from Chile saw a jump in exports to China, with 90% of the cherry exports going to the region.

Ongoing trade tensions between the United States and EU stripped Spanish olive oil of its competitive price advantage, resulting in a 39% (volume) drop in Spanish exports to its second largest importer—the United States— during the first half of 2020 compared to the same period last year.

To read more, go to https://foodl.me/e6yqf.

Vizen Analytics introduced an advanced demand forecasting platform for food distributors, which promises to significantly reduce the level of overstocking and waste in the food supply chain.

Vizen’s proprietary Empowered AI software can improve forecasting accuracy at a minimum of 10%, adding more than 2% to a food distributor’s bottom line in reduced inventory holding costs and less waste.

According to CEO Greg Foster, the cloud-based Empowered AI platform can be implemented rapidly, even in large organizations..

“Consumers have changed their food preferences and how they eat, making the old forecasting models obsolete,” Foster says. “It’s critical for food distributors to understand how much this has changed in their regional service areas. Our forecasting models can do that quickly and cost-effectively.”

To read more, go to https://foodl.me/ jwe3t.

Getty Images

6

FOOD LOGISTICS | MARCH 2021

FLOG0321_06-09_FieldToFork.indd 6

www.foodlogistics.com

3/1/21 9:39 AM

Su Pu

As gre CO S the we sur “ con the sev pu fre exp say ma of loy mo com To

Ul M

Ult or un T Da rec T ver

ww

FIELD TO FORK

NEWS FROM ACROSS THE FOOD SUPPLY CHAIN Daily Updates at FoodLogistics.com

Study Reveals Global Supply Chain Activity Rises as Recovery Builds Momentum

vc-

r

nd

d. w

nt.

s NCSolutions

h

ht

e.

,

om

A survey by NCSolutions found that consumer packaged goods (CPG) grew an average of 19% in 2020 compared to 2019 likely due to the COVID-19 pandemic.

Since the pandemic began last year, 47% of Americans reported that they have tried new brands and categories, with 52% saying that they were most open to trying a new snack food brand. According to the survey, 44% of consumers are willing try new beverage products.

“The increase in CPG spending coupled with the openness of consumers for new brands marks a clear opportunity for brands. Since the start of the pandemic, our teams at NCSolutions have identified several trends emerging with respect to brand loyalty—consumers are purchasing their favorite brands in greater quantities and at higher frequencies than before the pandemic, but they’re also more willing to experiment with competitive brands as they tire from pandemic living,” says Linda Dupree, CEO, NCSolutions. “In response to these trends, many brands are refocusing their advertising efforts through the lens of brand loyalty. Some brands are doubling down on both their most loyal and newest buyers, focusing on these audiences to retain them, move them up the loyalty ladder and prevent them from straying to competitive brands.”

To read more, go to https://foodl.me/una92.

stock.adobe.com

s ors

Survey: COVID-19 Pandemic Increases CPG Purchases by 19%

After a year of massive supply chain instability and disruptions, new data from Tradeshift’s Index of Global Trade Health points to a signifGetty Images icant recovery in global supply chain activity, with quarterly growth rates exceeding pre-pandemic levels by 14%.

Tradeshift’s analysis of digitized invoicing and ordering data suggests a particularly strong end to the year in the United States, where the number of transactions between buyers and suppliers jumped 29% in Q4, double the rate of growth seen globally during the period. Trade activity in the Eurozone rose 22% compared to the previous quarter.

The latest data also shows strong order books among buyers in almost every region, suggesting news of a vaccine rollout prompted organizations to press ahead with purchasing decisions that may have previously been delayed or cancelled prior to the onset of the pandemic.

To read more, go to https://foodl.me/2b257.

Ultimation Industries Announces $1,500 Scholarship for Innovative Vertical Farming Material Handling Ideas Ultimation Industries is offering a $1,500 scholarship to a college student that has the best idea for improving material handling in vertical or indoor farming systems. The scholarship will be awarded to science, technology, engineering and math (STEM) programs in accredited undergraduate and graduate programs in the United States.

This will be the second time Ultimation has given a scholarship. Vanessa Costa, a biology major from University of Massachusetts Dartmouth, received the first $1,500 for proposing an energy-efficient system using gravity conveyor rollers and motorized rollers that recapture the energy and provide power to adjacent motorized rollers.

The 2021 scholarship will be awarded to a student who can demonstrate innovative ideas and systems for the use of conveyors within vertical farming systems. To read more, go to https://foodl.me/nwehl. www.foodlogistics.com

FLOG0321_06-09_FieldToFork.indd 7

MARCH 2021 | FOOD LOGISTICS

7

3/1/21 9:39 AM

FIELD TO FORK

NEWS FROM ACROSS THE FOOD SUPPLY CHAIN Daily Updates at FoodLogistics.com

ACSI Data: Nondurables Struggle, as Major Manufacturers Fail to Satisfy Customers Customer satisfaction in the manufacturing/nondurables sector shrunk 1.5% to a score of 79.2 (out of 100), according to the American Customer Satisfaction Index’s (ACSI) Nondurable Products Report 2019-2020.

“While consumers still view the nondurables industries more favorably than others, the sector’s grip over the Index isn’t as tight as it once was,” says David VanAmburg, managing director at the ACSI. “Shopping patterns shifted almost overnight as customers stocked pantries during the early stages of the U.S. COVID-19 outbreak. The resulting supply chain issues and shortages led food processors and beverage makers alike to trim their product offerings and focus on core products to meet unprecedented demand. Unfortunately, they didn’t do enough to balance customer expectations.”

To read more, go to https://foodl.me/4dnu4. bodnarphoto - Adobe Stock

AdobeStock_286417489

AFFI, FMI Study Proves Frozen Foods are PandemicProof The American Frozen Food Institute (AFFI) and FMI—the Food Industry Association released the second Power of Frozen report, which finds frozen foods among the fastest growing categories in the grocery store.

This time last year, findings from another AFFI report hinted at the resiliency of frozen foods during a global pandemic such as COVID-19.

“The frozen food aisle has been a growth driver for retailers since 2016 with acceleration ahead of most other departments,” says AFFI president and CEO Alison Bodor. “Frozen foods are a pandemic powerhouse ringing in $65.1 billion in retail sales in 2020, a 21% increase compared to a year ago.”

To read more, go to https://foodl.me/v27j6.

8

FOOD LOGISTICS | MARCH 2021

FLOG0321_06-09_FieldToFork.indd 8

UPL, TeleSense Collaboration Aims to Reduce Food Waste UPL Ltd. and TeleSense joined forces to develop monitoring solutions for post-harvest commodity storage and transport to multiple stakeholders across the agriculture value chain.

“Through our OpenAg Purpose, we collaborate with innovative partners to facilitate progress toward reducing food waste while enabling farmer resilience,” says Jai Shroff, CEO of UPL. “With around one-third of global food production lost annually due to food waste, this is a problem our industry cannot ignore. Our partnership with TeleSense represents a new vision for how grain is stored, handled and transported by creating a more efficient, data-driven supply chain that will reduce food waste, improve food quality and increase sustainability.”

TeleSense uses scalable sensor technology on an artificial intelligence platform to monitor the temperature, humidity and carbon dioxide (CO2) levels of stored grain.

It leverages fixed and portable sensors to monitor the current and future condition of stored grain, while automating the detection and mitigation of potential issues such as hotspots, excess moisture or pests. Machine learning algorithms provide users with alerts needed to effectively manage and predict grain quality, ensure safety, improve operational efficiency and increase profitability. Adding TeleSense technology to UPL’s portfolio complements its robust range of gas monitoring, safety and detection devices as well as fumigants. To read more, go to https://foodl.me/95tkn.

www.foodlogistics.com

3/1/21 9:39 AM

nk m20. rce ng ng

Elevate your career with APICS supply chain certifications

o

te

h by ove

f

h

AdobeStock_286417489

st ue

Through Food Logistics’ & Supply & Demand Chain Executive’s partnership with ASCM, receive 10% off your CPIM, CSCP and CLTD certifications by using promo code ACMEDIA10

21%

Higher Salary APICS-certified individuals earn up to 21% more than their non-certified peers.

125K+

Certified Professionals Achieving an APICS Certification means you’re a part of our global network of over 125,000 certified supply chain professionals.

L’s es

om

Explore the opportunities at ascm.org FLOG0321_06-09_FieldToFork.indd 9

3/1/21 9:46 AM

FOOD ON THE MOVE

LOGISTICS TRENDS IN THE INDUSTRY Daily Updates at FoodLogistics.com

GEORGIA PORTS AUTHORITY EXPORTS REMAIN STEADY IN 2020

To read more, visit https://foodl.me/329vf

Georgia Ports Authority

stock.adobe.com

The Georgia Ports Authority (GPA) moved more than 4.68 million twenty-foot equivalent container units (TEUs) in 2020, up 1.8% over its 2019 total of 4.59 million. Total cargo crossing all docks in 2020 reached 38.4 million tons.

The Port of Savannah achieved its busiest December ever last month, moving 447,525 TEUs, an increase of 24%, or 86,700, compared to December 2019. Total cargo crossing all docks reached 3.33 million tons last month, up 12.5%. Rail volumes for the month grew 16.4%, or approximately 10,900 TEUs, for a total of 77,230. Intermodal cargo represented 17.4% of December container volumes.

During the time when manufacturers around the world were shuttering plants, Georgia exports held steady over the calendar year, at 2.3 million TEUs. Export container volumes were led by food, forest products, cotton, clay, automotive goods and chemicals. The Port of Savannah maintained a near-even trade balance of 51% import and 49% export, rare for the industry.

“Efficient global connections make export goods more competitive on international markets, and as our 37 weekly vessel calls show, shipping lines are drawn to ports with balanced trade,” says GPA board chairman Will McKnight. “By supporting small businesses and major industries, our terminals are key to attracting and retaining good jobs for Georgians.”

MAERSK TO EXPERIENCE CARGO LOSS FROM HEAVY SEAS

PR CA

Maersk Essen became one of many cargo ships to lose significant numbers of containers overboard due to rough seas in the past few months. Unfortunately, this series of container losses comes after a period of decline. The ship is said to have a capacity of 13,000 containers, and 750 went overboard. Maersk Essen’s crew and ship are all safe.

The incident follows Ocean Network Express’ loss of 2,000 containers overseas in November 2020 from its ship, ONE Apus.

A cargo ship operated by A.P. Moller-Maersk A/S lost several hundred containers in the Pacific Ocean while sailing through heavy seas from China to Los Angeles, the latest in a spate of incidents in which boxes carrying millions of dollars’ worth of goods have gone overboard. The company said the Maersk Essen, which has capacity for more than 13,000 containers, lost an estimated 750 on Jan. 16 about halfway through its trans-Pacific sailing from China’s Port of Xiamen.

“All crew members are safe, and a detailed cargo assessment is ongoing while the vessel continues on her journey,” Maersk said in a statement. “The U.S. Coast Guard, flag state and relevant authorities have been notified. We view this as a very serious situation [that] will be investigated promptly and thoroughly.”

An tio me by MD car wh the F of sal ass tha sio the pro “ to cur con an gri tod en

To read more, visit https://foodl.me/euwmp

SAFECUBE INTRODUCES NEW DIGITAL TRACKING SOLUTION FOR SEA FREIGHT FLOWS

stock.adobe.com

Safecube launched a new track-and-trace solution called EasyTrack, a 100% digital solution for sea freight flows.

The solution gives actionable insights in real-time through one single digital touchpoint that captures and processes data. The company aims to make tracking simple by connecting with users’ information system. In addition, it helps manage exceptions in a more effective way and provides actionable insights for smarter decisions.

To read more, visit https://foodl.me/tce9e

10

FOOD LOGISTICS | MARCH 2021

FLOG0321_10-13_FOTM.indd 10

www.foodlogistics.com

3/1/21 9:11 AM

elevate_GAdkOpqbTfo_unsplash.5f2afe3a4846f

To

ww

FOOD ON THE MOVE

LOGISTICS TRENDS IN THE INDUSTRY

om

Daily Updates at FoodLogistics.com

NEXTBILLION AI SOLVES MAPPING INDUSTRY PITFALLS FOR FLEET AND LASTMILE LOGISTICS

stock.adobe.com

dell

PROPANE OUTPACES ELECTRIC FOR CARBON FOOTPRINT IN TRUCKS

t ew er

A new comparative analysis presented by the Propane Education & Research Council (PERC) analyzes the carbon footprint of medium-duty and heavy-duty (MD-HD) engine vehicles powered by propane and electricity. The analysis found that propane-fueled MD-HD internal combustion engine vehicles provide a lower carbon footprint solution in 38 U.S. states and Washington, D.C., when compared to MD-HD electric vehicles (EVs) charged using the electrical grid.

Fifteen states and Washington, D.C., proposed full electrification of MD-HD by 2050 with a target of 30% “zero-emission” vehicle sales by 2030. The rationale behind the proposals is based on the assumption that the electrical grid will be fully decarbonized by that time. Likewise, policy based on exhaust carbon dioxide emissions (CO2eq) alone as opposed to lifecycle analysis results misses the full picture. As a result, policy proposals today conflate the promise of electrification with actual decarbonization.

“It’s often assumed that full electrification of all sectors will lead to their full decarbonization, but little thought on how electricity is currently generated, stored, transmitted and consumed has been considered,” says Dr. Gokul Vishwanathan, director of research and sustainability at PERC. “While a fully renewable-based electric grid is not feasible anytime soon, propane is an effective solution today for accelerating decarbonization of transportation and other energy sectors.”

n-

-

h

m

s n or-

elevate_GAdkOpqbTfo_unsplash.5f2afe3a4846f

To read more,visit https://foodl.me/w8gjq

stock.adobe.com

om

NextBillion AI leverages local traffic addresses, varied vehicle types and unique driving behaviors to build custom APIs to address challenges facing on-demand deliveries, fleet telematics and last-mile logistics.

“Every country has different truck laws, every vehicle type drives at a different speed and each organization has different rules for hours of operations and drivetime,” says Gaurav Bubna, co-founder of NextBillion AI. “NextBillion can account for these various constraints in three ways—inferenced telemetry using our advanced ML to observe drive-pattern and roads taken, ingesting rules and logic directly from customers or giving customers access to mapping tools to make their own adjustments on-the-fly natively into the maps itself.”

To read more, visit https://foodl.me/3hwk2

π SHIPPING SUPPLY SPECIALISTS

FDA COMPLIANT PRODUCTS

ORDER BY 6 PM FOR SAME DAY SHIPPING

COMPLETE CATALOG

1-800-295-5510 uline.com

www.foodlogistics.com

FLOG0321_10-13_FOTM.indd 11

MARCH 2021 | FOOD LOGISTICS

11

3/1/21 9:11 AM

FOOD ON THE MOVE

F

LOGISTICS TRENDS IN THE INDUSTRY Daily Updates at FoodLogistics.com

STUDY DETAILS BENEFITS OF ZEROEMITTING VEHICLES

Getty Images

Studies released from the Environmental Defense Fund (EDF) show the dramatic, yet significant benefits of zero-emitting vehicles.

By 2030, the buyer of a new battery electric vehicle will save more than $7,200 over the life of the car compared to a gasoline-powered car.

A new 2030 battery electric vehicle will also deliver nearly $8,000 in additional societal benefits as a result of reduced climate and particulate pollution, which will increase the total net benefits to more than $15,000 per vehicle.

“Automakers are investing in zero-emitting vehicles, models are increasing and costs are rapidly declining,” says EDF senior director of transportation and methane policy Peter Zalzal. “These dramatic shifts in the market underscore the enormous opportunity associated with protective clean car standards and complementary societal investments. Eliminating climate and health-harming pollution from new cars can boost jobs, save consumers thousands of dollars and save thousands of lives.” To read more, visit https://foodl.me/q34ga

TRANSFIX LAUNCHES TRUEVIEW TMS

The difference is

www.JarrettDifference.com

12

FOOD LOGISTICS | MARCH 2021

FLOG0321_10-13_FOTM.indd 12

stock.adobe.com

OU R PEO PLE

Transfix’s TrueView TMS is a modern and flexible transportation management system.

TrueView TMS is built to address the specific pain points of small and mid-sized shippers tasked with having to do increasingly more with fewer resources, static tools and little data. It offers an easyto-use tool for securing reliable coverage at scale, streamlining tender management and automating carrier communications—all while surfacing powerful insights on carrier performance to enable continuous freight optimization.

“What Transfix does better than anyone else is bring ease-of-use and analytics to the freight management process; reducing friction caused by legacy systems and empowering decision-makers to make more strategic decisions,” says Lily Shen, CEO, Transfix.

“TrueView TMS brings transportation management into the 21st century, giving shippers the ability to manage their freight with a few clicks and tap into the most powerful capabilities Transfix offers—instant capacity, real-time visibility and actionable insights across their entire operations.”

itie can au

To

LO RE DE

Th in i wa D cre the T do Un the sho ap dy H •

•

•

To

To read more, visit https://foodl.me/34weq

www.foodlogistics.com

3/1/21 9:11 AM

ww

FOOD ON THE MOVE

LOGISTICS TRENDS IN THE INDUSTRY

om

Daily Updates at FoodLogistics.com

SOFTSHIP’S PORT COST CALCULATOR STREAMLINES, AUTOMATES PORT COSTS

-

fits

-

r car. e

c-

cy

ers

S W

all re -

l ble

se on

ts

om

Softship launched an innovative, web-based Port Cost Calculator for carriers to maintain up-tothe-minute, fully accurate records and full visibility of expenses at all stages of each individual port call. These kinds of solutions are important, as more ports and ocean carriers institute business continuity plans to keep product moving in and out of the United States.

A vessel’s expected port activities are pre-loaded into the Softship Port Cost Calculator from the original port call templates and unforeseen or real-time adjustments can be taken direct from vessel reports. Based on this, the calculator will present a list of all expected charges and costs. These are then automatically applied to the overall voyage result giving the carrier full visibility over the financial performance of each voyage.

To read more, visit https://foodl.me/quxha

LOGISTICS MANAGER’S INDEX REPORT REVEALS INCREASE IN PRICES, DECREASE IN AVAILABLE CAPACITY The latest Logistics Manager’s Index (LMI) report shows growth in inventory levels, inventory costs, warehousing utilization and warehousing prices, but a decline in transportation prices.

Due to constricted capacity and high inventory levels, firms increase the amount of inventory they’re holding, therefore, inflating the cost of inventory levels.

The LMI report, compiled by Arizona State University, Colorado State University, Rochester Institute of Technology, Rutgers University, and the University of Nevada, Reno, in conjunction with the Council of Supply Chain Management Professionals (CSCMP), shows that the industry-wide push toward e-commerce may be a permanent shift rather than a temporary reaction to market dynamics.

Highlights from the report entail: • Inventory continues to be a primary driver of the continued pace of growth.

• The shifting pressures caused by the increase in consumer demand for last-mile services are one of the primary drivers of logistics demand.

• January saw continued expansion in the transportation market.

• Warehousing capacity may rebound to more normal levels seen in the pre-pandemic landscape.

ALTERNATIVE ENERGY SOLUTIONS For Refrigerated Transportation

Providing Electric, Hybrid, and Solar options for the Cold Supply Chain.

Technology

$

Maintenance

Lease

Rental

plmtrailer.com

To read more, visit https://foodl.me/g3kqe

Contact your PLM Consultant: ZeroEmissions@PLMFleet.com

www.foodlogistics.com

FLOG0321_10-13_FOTM.indd 13

MARCH 2021 | FOOD LOGISTICS

13

3/1/21 9:11 AM

COVER STORY

BY MARINA MAYER, EDITOR-IN-CHIEF

an cir

Em pr pr

On to tec “ wo cyb say at tas em lev As cou to shi com use for sur an to con of tra the mo no of pe S to “ ne

MITIGATING SUPPLY CHAIN THREATS

FROM THE GROUND UP 2

020 was full of supply chain disruptions. From natural disasters and civil unrest, to the ever-present Coronavirus disease (COVID-19), the nation’s cold food and beverage supply chains were continuously challenged.

But, it’s the uknonwn threats that are still to come that pose the most risk.

“Like COVID, the greatest threat is the one we are yet to have identified,” says Doug Lawson, CEO of ThinkIQ. “[Nearly] 14 months ago, no one had ever anticipated or planned for the type of disruption COVID introduced. The next big disruption will be one we have yet to anticipate.”

The grocery retail e-commerce boom, labor management challenges, cybersecurity, and now, how to juggle shipments of

14

FOOD LOGISTICS | MARCH 2021

FLOG0321_14-19_CoverStory.indd 14

the COVID-19 vaccine among a cold food chain all present their own sets of supply chain threats. And, for many in the supply chain industry, it’s about preparing for the worst and expecting the unexpected.

“When there’s an impact like the pandemic on major industrial hubs across the world, the ripple effect is even greater. We are seeing this ripple effect transpire in many ways today—both on a global and local level. From a global perspective, we see that supply chains have dramatically slowed, and so too have the alternative suppliers within this chain,” says Brian Alster, general manager, third-party risk and compliance at Dun & Bradstreet. “If 2020 taught us anything, it’s not how many more disruptions we need to look out for, but about how we need to protect our global

www.foodlogistics.com

3/1/21 9:21 AM

ThinkIQ

Regardless of the threat, here’s how companies can forecast, prepare—and eventually overcome— supply chain disruptions of all sizes and forms.

One incr actu

ww

and local supply chains, no matter the circumstances.”

Emerging technologies provide added layer of protection

G N S

P

f

l

om

ThinkIQ

n

ArrowStream

One way to mitigate supply chain threats is to invest, implement and deploy emerging technologies.

“Everything from automation to workforce management tools and cybersecurity will need to be considered,” says Sean Maharaj, managing director at AArete. “For example, routine manual tasks at the processing level will need to employ more robotics to limit exposure levels via real-life person interactions.

As of late, some warehouses across the country have ramped up on automation to pick products for inbound/outbound shipping. Furthermore, transportation companies have accelerated their need to use driverless technologies. Technologies for contactless interactions have also surfaced at the transaction level. Barcodes and even bills of lading etc. have all begun to go electronic to limit person-to-person contact, while speeding up the processing of important information related to transactions between parties. Specifically, the Internet of Things (IoT) has also gained more speed, as companies latch on to the notion of improved uptime and utilization of machinery and assets to deliver better performance.”

Sometimes, all it takes is just a little data to keep the threats at bay.

“Some companies have realized the need to be digitally ready or that their

Restaurant owners and foodservice distributors need visibility to forecast ahead to manage inventory and more.

model for supply chain activity is no longer sustainable. In response, they have shifted infrastructure to be more digital and data-driven,” says Ronen Lazar, founder and CEO of INTURN. “Collecting as much data as possible allows for better insights and the agility to respond appropriately when things change rapidly.

We see this in inventory management, which has historically been a pain point with companies slow to change their methods. Companies that were committed to impractical methods to account for and manage their inventory, such as spreadsheets that needed to be updated manually, are realizing the benefits that investing in a digital platform can bring.”

The foodservice industry, for example, was hit hard

by COVID-19, facing nationwide lockdowns, restrictions on indoor dining, and in some cases, permanent closures. However, technology provided many

One of the primary drivers behind the industry’s change is the increasing demand by consumers for validation that their food is actually what it purports to be.

www.foodlogistics.com

FLOG0321_14-19_CoverStory.indd 15

restaurant owners and foodservice distributors the visibility needed to forecast ahead to manage inventory and more.

“Using data, we enable a collaborative approach to address challenges in risk mitigation, brand protection, supply monitoring, profitability optimization and sales growth enablement, not just in uncertain times, but all the time,” says Kate Hubbard, director of marketing for ArrowStream. “ArrowStream’s technology platform gives chains and their partners critical visibility for complete transparency into their supply chain data such as purchase volumes at the local level, on-hand and on-order inventory at the distribution enter and current inventory levels at the plants, including production levels shared among partners.”

What’s more is, taking action on that data becomes an important element of protecting the supply chain.

“As an example, I have worked with carriers that used predictive modeling to identify rest stops and gas stations that were more prone to freight loss in order to avoid those stops or take extra precautions while there. We could apply similar technology to threats (natural or man-made) as well as the overall quality of the delivery process,” says Chris Orban, VP of data science,

MARCH 2021 | FOOD LOGISTICS

15

3/1/21 9:21 AM

COVER STORY continued

Trimble Inc.

For many companies, gathering the data is just as important as taking action on that data to protect the supply chain.

Trimble Transportation. “Making the existing tracking data we have actionable is also incredibly important. Do we have a plan when a truck is stopped for longer than expected? How about when a driver doesn’t respond to a priority message?

Supporting our drivers while they’re on the road is a critical part of protecting the supply chain, and we can do that by providing them insight into what challenges their route might entail, and where they can safely stop and rest when needed.”

Likewise, moving from a “just-in-time” to “just-in-case” inventory module proved that supply chain management solutions have become instrumental in pivoting in times of need.

“Technology can help in many ways, from better modeling, demand smoothing, pipeline visibility to further automating specific manufacturing activities that were left exposed as a result of the virus,” says Doug Baker, vice president, industry relations for FMI – The Food Industry Association. “Those in our industry who are responsible for ensuring our supply chains remain resilient are anticipating and reacting to crises, which in many

instances go completely unnoticed to the average person. These professionals nimbly secure the safety and security of food from product recalls to food defense. Something much less worrisome, but no less deserving of our industry’s attention is to secure the future of talent in the supply chain. For several years, we’ve experienced disruption due to trucking labor shortages, which is felt more acutely during major eating holidays or during a response to a major disaster.”

blindly investing in technology will not lead to the intended results either. Achieving excellence in supply chain resilience involves answering three questions —Do you have the infrastructure in place to react to a supply chain disruption? Do you have the tools to leverage this infrastructure to react quickly and effectively? Can you predict a disruption? Technology is a key enabler for many of these areas, but alone, it is not sufficient—ultimately, organizations need to change how they think about the tradeoffs among risk, performance and resilience if they are going to successfully improve their resilience capabilities.”

Additionally, companies who haven’t implemented any mitigation solutions are urged to start small.

“Don’t worry about building the perfect monitoring or alerting system, just start gathering data, and then do something with it,” says Orban. “Get your drivers used to the idea that the company is gathering data not to be ‘Big Brother,’ but to help and support them. Make sure the technology that you choose is something you understand and has a clear value to the company. Talk to your peers, see what they are using and what the pros and cons of any technology solution are.”

Companies are encouraged to conduct a gap analysis to determine “where you are in your digital transformation and identify the key foundational blocks required to evolve to your desired goal.

Next is prioritize those blocks based on corporate goals and immediate needs. Once you have your priorities in place, you’ll need to find out where your vulnerabilities are, so that you can shore up those deficiencies and mitigate potential threats in the future,” says Lawson.

That’s because the food and beverage industry is one of the most highly regulated industries in the world, says Neil Coole, director, food and retail supply chain at BSI. “Organizations need to understand that the technologies, innovations and solutions that have been developed are to support them in managing the processes and mitigating the risks that challenge them every day,” he adds. “As we say in our supply

Technology can help in many ways, from “ better modeling, demand smoothing, pipeline

visibility to further automating specific manufacturing activities that were left exposed as a result of the virus.

16

FOOD LOGISTICS | MARCH 2021

FLOG0321_14-19_CoverStory.indd 16

”

For those companies who have yet to invest in technology, many supply chain experts say now is the time to make those investments, before additional disruptions present even bigger risks.

“Technology is transforming the way we work, procure, produce, transport and capture customer inputs. Anybody who is not adopting technology is losing the race,” says James Harford, senior manager in the strategic operations practice of global management consultancy, Kearney. “But,

www.foodlogistics.com

3/1/21 9:21 AM

cha no no S im sup the un “ is r tec Vo be in w see app far app rel rea the to art de pro eco ad B tal ma dis req gro bre “ an on fre of fin im tha ac sup spr of for pro ven res the val Co fun pro

ww

ad

act e

e, ons

e

t

he ey ny a

on

d al. ks nd u , e

ed

SI.

em ply

om

www.foodlogistics.com

FLOG0321_14-19_CoverStory.indd 17

Supply chain disruptions then and now The supply chain disruptions experienced in 2020 were like no other felt in years’ past. COVD-19 spared no country and no industry. It upended cold food supply chains from start to finish and back again.

Yet, it also proved that U.S. supply chains may need to re-think how and where they source and manufacture.

Just as the onset of “COVID-19 brought major supply chain disruption, the outgoing of it is likely going to cause many of the same issues.

”

“Today’s supply chains are more than ever reliant on China-offshore manufacturing,” says Maharaj. “With COVID first emanating out of China, it left many global producers scrambling to find alternatives, as it continued to spread within China, impacting the ability for labor to work in factories to produce, whereas in

the past, there was a greater level of supply chain diversity from even onshore/ nearshore sources. Tariff wars were a small catalyst that started to get manufacturers to think about diversification of their supply chains in late 2019, but the pandemic took it to an entirely new level. In the past, events like SARS and even geopoliticaldriven wars were heavily localized. None were quite as geographically dispersed as COVID, impacting every fabric of the global supply chain. As well, alternate supply sources were readily available in the past compared to today. Finally, the global response to the pandemic was highly fragmented from all levels of government around the world, leaving this as one of the most complicated disruptions of modern times.”

Contrary to past years where events such as natural disasters or trade wars impacted only several regions or industry segments, COVID-19 has had a global, long-term impact, Alster adds.

“In fact, there are very few industries that haven’t had a disruption in their supply chains. For example, in today’s ‘farm-totable’ era, we were seeing a major impact on farms in the beginning of the pandemic, particularly in the U.S., as restaurants around the nation shut down or lowered yields due to local government mandates to shut down or turn to take-out and delivery

Vorto.ai

o

chain resilience workshops, ‘what you do not see, you do not know, and what you do not know, you cannot manage.’”

Some of the implications of implementing technology to mitigate supply chain threats is simply due to the fact that some companies just don’t understand the technology itself.

“The largest threat to the supply chain is remaining stagnant and resistant to new technology,” says Priyesh Ranjan, CEO of Vorto.ai. “The supply chain industry has been around for generations, yet the way in which we move and trade goods has seen little innovation, and the piecemeal approach to innovation implemented thus far has made little impact. The current approach to digitizing the supply chain relies on employees analyzing data in real-time to make decisions. To overcome these shortfalls, the supply chain needs to become autonomous. Platforms using artificial intelligence for analysis and decision-making will digitally transform the process by providing businesses with an economic and environmentally sustainable advantage.”

But, while much of the industry is talking about supply chain threats due to macroeconomic, geopolitical and natural disaster events, the one big area that requires critical attention is the exponential growth of cybersecurity threats and breaches, says Alster.

“Fraudsters pray on cataclysmic events and disruptive time periods such as the one we are in today. Given the increasing frequency of attacks, potential severity of disruption and high costs (including fines) of cyber and data breaches, it’s important to consider the domino effect that even one supplier’s breach can have to a company’s entire organization and global supply chain,” Alster says. “As the pandemic spread throughout the world in a matter of weeks, companies of all sizes had to forgo traditional security and onboarding procedures—of new employees, new vendors and suppliers—in favor of rapidly responding to the conditions in front of them. Now is not the time to relax stringent validation and onboarding procedures.

Companies must collaborate crossfunctionally across governance, IT security, procurement and strategic sourcing.”

 Platforms using artificial intelligence for analysis and decision-making will provide businesses with an economic and environmentally sustainable advantage.

MARCH 2021 | FOOD LOGISTICS

17

3/1/21 9:21 AM

COVER STORY continued

services only. The slowing of the restaurant industry decreased demand for produce, milk and meat products, greatly impacting farms that are suffering from excess product, particularly in the beginning of the pandemic—instantly shrinking local supply chains,” he adds.

Also new to this year’s supply chain disruptions are the vaccines and use of cold storage management, transport and distribution to

move these pharmaceuticals through the cold food supply chain.

“Just as the onset of COVID-19 brought major supply chain disruption, the outgoing of it is likely going to cause many of the same issues,” says Hubbard. “We’re expecting issues with inventory stockouts and surpluses, quality compliance and lean operating teams to be some of the main struggles we see restaurant chains tackle once again.”

Plus, the cold chain may experience more cracks in the system, as the vaccine enters the cold food distribution channel, adds Maharaj.

“Ongoing cybersecurity threats have also become more concerning, not to mention the elevated risk of domestic terrorism. Suffice to say, supply chains have some level of

NONGMO

ad can P con pri “ to cor foo sno the pas ab the the ris pro vis aga an to thr T als cha “ da ide are the en me pro wil pro

thu Label Insight

18

FOOD LOGISTICS | MARCH 2021

FLOG0321_14-19_CoverStory.indd 18

www.foodlogistics.com

3/1/21 9:21 AM

ww

me f

om

adaptability, but extreme crises like these can be hard to account or plan for,” he adds.

Pushing bottom lines aside, employees continue to be every company’s No. 1 priority.

“The pre-pandemic industry focus was to ensure that the workforce was using the correct pre-requisite programs to keep the food safe from the worker (e.g., beardsnood, hairnet, etc.),” says Coole. “Now the industry has seen the issues through past examples of site closures and mass absenteeism as a result of the pandemic; there is a greater emphasis on protecting the industry workforce, designing out risks by engaging a qualified ergonomist, providing their workforce, suppliers and visitors with independent verification against a recognized safe working guideline and assuring that measures are being taken to keep people safe as we continue to work through these challenging times.”

The explosive growth of e-commerce has also put additional pressures on the supply chain—unawareness of allergens.

“Enriching current supply chain product databases with product metadata that identifies and catalogs allergens that are not on-package will help mitigate the threat of hidden allergens. Similarly, enriching product databases with product metadata that creates deeper product profiles related to shopper preferences will improve the match rate of replacement products to out-of-stock products picked

by third parties to mitigate e-commerce returns,” says Tim Whiting, VP, marketing, Label Insight.

“Specific to last-mile supply chain management, the emergence of grocery e-commerce that employs third-party pickers to choose products on a shopper’s behalf added additional complexity and exacerbated supply chain issues when dealing with product out-of-stocks.

Replacement products that did not meet specific shopper preferences were often returned, re-stocked or re-ordered. While certainly not a severe and pronounced disruption at the level of a natural disaster, a growing and crystalizing consumer trend represents potential threats to our nation’s supply chains--unawareness of allergens within the supply chain. Beyond threat mitigation, better product data is good business,” he adds.

What’s in store for the future The fallout from COVID-19 created myriad other disruptions, Maharaj says, some related to limited labor presence in workplace environments such as docks, warehouses and other transportation outlets like truck driver training academies.

But, supply chain risks and threats will always challenge the industry. There will always be a supply chain disruption, and there will always be an event of some kind that tests the supply chain limits.

The explosive growth of e-commerce pushed the unawareness of allergens to the front burner, thus creating an additional layer of risk to the supply chain. www.foodlogistics.com

FLOG0321_14-19_CoverStory.indd 19

However, that journey to a more resilient supply chain is not one to go alone, Coole adds.

“Organizations like BSI exist to partner with food and beverage businesses and their suppliers to identify what are the critical areas of focus and how we can work together collaboratively to proactively identify the presence of risk in any supply chain. Once those risks have been identified, we are then able to work with those suppliers to implement industry recognized best practices to move the needle in the right direction through the aggregation of marginal gains, ultimately, to support food and beverage organizations to anticipate, prepare for, respond and adapt to incremental change and sudden disruptions,” says Coole.

What’s more is, the pandemic accelerated some of the trends already in motion, such as direct-to-consumer logistics, inbound logistics, nearshoring and even deployment of emerging technologies.

“We see a continued increase in the demand for door-to-door delivery and in the preference for sustainably grown and sourced food products,” says Harford.

“Companies can stay ahead of the curve by developing a robust and resilient infrastructure, mining data and ensuring they are focused on solving tomorrow’s challenges vs. those of the past.”

Regardless of the threat, emerging technologies help companies forecast, prepare—and eventually overcome—supply chain disruptions of all sizes and forms.

MARCH 2021 | FOOD LOGISTICS

19

3/1/21 9:21 AM

2021 ROCK STARS AWARD

BY MACKENNA MORALEZ ASSISTANT EDITOR

HOW THE

2021 ROCK ROCKSTARS

STARS

OF THE SUPPLY CHAIN

2021

som pan gam

Food Logistics announces the winners of the 2021 Rock Stars of the Supply Chain award.

T

20

FOOD LOGISTICS | MARCH 2021

FLOG0321_20-23_2021RockStars.indd 20

T

E

OF THE SUPPLY CHAIN KEPT INDUSTRY AFLOAT DURING COVID-19 o put it mildly—2020 was a challenging year. And, it was hard on everyone—no particular person or industry was safe. The Coronavirus disease (COVID-19) pandemic changed life the way know it. People were panic buying and experiencing long delivery times and stock-outs were suddenly considered the norm.

But, the supply chain remained persistent.

We have said it time and time again, the supply chain will not break—it will only bend. And, the people that keep the supply chain moving are rock stars. Their hard work and innovations have shaped the global cold food supply chain, allowing consumers to get their groceries delivered to their house and trace where their food comes from.

According to a survey by Ubimo, 2.3% of consumers did all their shopping online. Although there has been a massive e-commerce boom driven largely by mandated quarantines and shelter-in-place orders, only 9.6% of consumers say that they now conduct weekly shopping online.

All these efforts made within the global food supply chain in a shortened amount of time has garnered these professionals with millions of adoring fans. Without these rock stars, the supply chain wouldn’t be able to keep moving.

“Historically, there has been an inaccurate and pervasive view that frontline workers aren’t worth investing in. Luckily, the tides are changing because nothing brings a level of focus to the things that truly matter quite like a global pandemic,” Carol Leaman, CEO of Axonify, said in a press release. “It’s now crystal clear that business runs through the frontlines. The things frontline employees do and don’t do absolutely impact how a business performs.”

C

The seventh annual Food Logistics’ Rock Stars of the Supply Chain award recognizes the industry’s most influential people for the role they played in improving the global cold food supply chain. These champions represent different industry segments and individuals who spearheaded partnerships among growers, packers, processors, retailers and logistics providers. From early pioneers and entrepreneurs to non-conformist thinkers and executive standouts, Food Logistics is pleased to honor these leaders and their contributions to the industry.

This year’s recipients have found a way to navigate the supply chain during the pandemic all while keeping employees safe.

Take the overall winner of 2021 Rock Stars of the Supply Chain for example. Liz Longstreet Darr started her new position as executive VP of strategic sourcing for National DCP just one week before the country went into lockdown. She managed to rally her new team behind her and proved the importance of quality leadership amid a global pandemic.

“In the supply chain, professionals get recognized quickly when something goes wrong. And, rarely does supply chain people get recognized for all the things that go right. If you get 99% of the products there on time, people contact you about the 1% that doesn’t get there. That’s just how it works in the supply chain industry,” Longstreet Darr adds.

The remainder of this year’s winners of Food Logistics’ Rock Stars of the Supply Chain also exemplify what it means to be a leader.

It’s fitting that exactly one year after COVID-19 turned the world upside down, we are honoring those who helped keep it afloat.

Go to https://foodlogistics.com/21271809 read more about all of this year’s winners.

www.foodlogistics.com

3/9/21 4:10 PM

Lon int of cou the pan thr

“

m

s

to be en ind nav str acc 20

ww

S

ain ole

s

eir

n

k

n

rs

d

l

om

2021 ROCK STARS AWARD

BY MACKENNA MORALEZ ASSISTANT EDITOR

COVID-19 PROVES

THE IMPORTANCE OF QUALITY LEADERSHIP Liz Longstreet Darr, executive VP of strategic sourcing, National DCP is named Food Logistics’ Rock Star of the Supply Chain.

E

ntering a new job and juggling motherhood can be some of the most stressful moments of someone’s life, but when you add a global pandemic to the mix, it is anyone’s ball game.

That’s exactly what happened to Liz Longstreet Darr in 2020. Just one week into her new position as executive VP of strategic sourcing, National DCP, the country went into lockdown because of the Coronavirus disease (COVID-19) pandemic. But, with everything she learned throughout her career suddenly being put

“It’s pretty humbling for me. There’s so many talented supply chain professionals out there, and everyone’s worked so hard this past year and accomplished so much.” to the test, Longstreet Darr didn’t miss a beat. She rallied her new team behind her, encouraging them to focus and deliver industry-leading results. Her efforts to navigate the COVID-19 pandemic by strategically problem solving, among accolades, has earned her Food Logistics’ 2021 Rock Star of the Supply Chain winner.

www.foodlogistics.com

FLOG0321_20-23_2021RockStars.indd 21

Now in its seventh year, the Food Logistics’ Rock Stars of the Supply Chain award recognizes influential individuals in the global cold food and beverage supply chain whose achievements, hard work and vision have shaped the industry for the better.

“It’s pretty humbling for me.

There’s so many talented supply chain professionals out there, and everyone’s worked so hard this past year and accomplished so much,” Longstreet Darr says. “In the supply chain, professionals get recognized quickly when something goes wrong.

And, rarely does supply chain people get recognized for all the things that go right.

If you get 99% of the products there on time, people contact you about the 1% that doesn’t get there. That’s just how it works in the supply chain industry. That’s what we all signed up for, and it’s fine. But, what’s great about this award is it recognizes people for the great work they’ve done behind the scenes. I think for me that’s what it means. It is just recognizing the positive impact that I’ve done.”

Brenda Upton Photography

Longstreet Darr has been in the foodservice industry all her professional life, moving toward the food supply chain industry 13 years ago.

“I always loved the foodservice industry.

I started out—like many people—bussing tables, eventually waiting tables, and then worked in the front of house in restaurants.

I was able to get an internship at Darden Restaurants as a supply chain intern when I was in college,” she explains. “I didn’t know about supply chain when I was young, and I didn’t really ever think about supply chain as a career, but I was fortunate

MARCH 2021 | FOOD LOGISTICS

21

3/9/21 4:10 PM

2021 ROCK STARS

continued

Brenda Upton Photography

there used to be, but as a supply chain professional, we’ve all dealt with supply challenges,” says Longstreet Darr. “I think probably the way we work is actually a bigger change than the amount of supply challenges we’ve faced. Our team is working together via video and other tools that we can find for collaboration.”

While many things have changed because of the pandemic, visibility into the food supply chain will remain.

Longstreet Darr believes that the restaurant industry is now finally catching up to the foodservice industry in terms of technology and reporting. This allows for better decision making and planning in the On top of leading a team amidst a pandemic and having a baby on the way, Liz long term.

Longstreet Darr cares about making a difference in the community where she “I think technology is continuously lives and works. improving and getting more sophisticated. enough to get that internship and realize it comes to the COVID-19 pandemic.

The more that happens, the better that supply chain was a way for me to She asked her team how they can work decisions we make. There’s nothing more stay close and connected to restaurant together to improve things, however, all of important to a supply chain professionals operations without than not running physically being in out of product, so I have encountered challenges like anyone improved, timely a restaurant every day. I didn’t intend visibility into in my career, but they always lead to me to go into it, like I inventory continues think most people having a chance to reflect and figure out how to be important,” she did not intend to. adds.

I can do things differently, to be better and We all just kind of Though, supply ended up here and chain challenges will better myself professionally. fell in love with it.” continue to be the Longstreet Darr norm post-pandemic. started her position Rather than being in March 2020, overseeing the program this had to be done virtually, as National defeated by it, Longstreet Darr encourages management team and working with DCP’s employees worked remote. her peers to be energized by it. By being suppliers to source and negotiate all of “There’s more supply challenges than persistent and dedicated to the task at Dunkin’s packaging needs for distribution.

Her background in the foodservice industry helps her make decisions as she understands what products may impact operations if an issue arises.

“You end up empathizing with them because you’ve been there—you know what it’s like to tell a customer that you’re out of something. It’s never fun,” she says.

“Having that background is helpful and certainly helps with connecting with the restaurant operators when dealing with supply chain challenges.”

Longstreet Darr is always looking to better improve processes, especially when

ha ou “ any to ou be she lea pas som tha D con Sh hav is p “ fro did ha sur thr is c I do

“

”

Brenda Upton Photography

Liz Longstreet Darr stands outside of Dunkin’, which National DCP serves.

22

FOOD LOGISTICS | MARCH 2021

FLOG0321_20-23_2021RockStars.indd 22

www.foodlogistics.com

3/9/21 4:11 PM

ww

ls

g f

e

d.

c.

ROCKSTARS OF THE SUPPLY CHAIN

2021

Liz Longstreet Darr began her National DCP career in March 2020, a week after the country shut down due to the COVID-19 pandemic.

Is your organization prepared for the FDA's New Era of Smarter Food Safety?

es

Visit our New Era resources page for useful articles and insights to help you navigate the future.

Brenda Upton Photography

om

DCP. When everything else is kind of falling apart, I can still log in at 8 a.m. and see my team members and see how they are advancing our strategic planning. It’s just good to do the best you can.”

Brenda Upton Photography

hand, it will lead to a more satisfactory outcome.

“I have encountered challenges like anyone in my career, but they always lead to me having a chance to reflect and figure out how I can do things differently, to be better and better myself professionally,” she says. “I think with every challenge, you learn something, and as long as you can see past it and know that you’re going to learn something from it and get through it, I think that is the key.”

Despite its stressors, work is still considered a safe place for Longstreet Darr.

She explains that her work allows her to have consistency in a time when the world is pretty inconsistent.

“We’ll look back on this year five years from now and say, ‘Oh, my gosh, like, how did we get through that year? What really happened?’ I think we’re all a little bit in survival mode, just hunkering down getting through this,” says Longstreet Darr. “Work is consistent, and fortunately, I enjoy what I do. I work with great people at National

Smarter tools for outbreak prevention

Tech-enabled traceability

Food safety culture

New business models and modernization

Learn more: controlant.com/new-era-blueprint/ Contact us: contact@controlant.com

www.foodlogistics.com

FLOG0321_20-23_2021RockStars.indd 23

Follow us @Controlant on Twitter and LinkedIn

MARCH 2021 | FOOD LOGISTICS

23

3/9/21 4:11 PM

2021 ROCK STARS

continued

MEET THE 2021

ROCKOF THESTARS SUPPLY CHAIN Ed Bowersox CEO CJ Logistics

E

d Bowersox leads CJLogistics as CEO, implementing strategic initiatives and the development of key leaders of the future. With executive oversight, he has been instrumental in several leading company projects and long-term planning. Bowersox is a long-time supporter of leading industry organizations and is often a featured speaker at events. He believes that continuing development of employees is essential in moving the company forward and delivering customer value. His leadership style not only engages employees, but also motivates them as well.

Jeremy Schneider

Food Safety and Quality Assurance Controlant

W

ith more than 15 years of experience in the food quality, safety and regulatory sector, Jeremy Schneider’s expertise spans from fast-casual restaurant chains all the way to food manufacturing. During his career, he has addressed some of the most challenging and critical risks facing food brands. Schneider’s understanding of challenges within the supply chain gives him a unique perspective to identify problems and develop creative solutions for Controlant’s partners.

24

FOOD LOGISTICS | MARCH 2021

FLOG0321_20-23_2021RockStars.indd 24

www.foodlogistics.com

3/9/21 4:11 PM

ww

ROCKSTARS OF THE SUPPLY CHAIN

Mike Frank

Senior Director of Business Development Jarrett

M

SN

ike Frank brings over 30 years of experience to Jarrett, allowing him to be a mentor to many within the organization. He provides guidance and positive feedback, encouraging them to do their best within the company. Throughout his tenure, he has helped Jarrett’s sales grow by six times the annual revenue since 2009. Frank’s main goals are to strategically assist executives transitioning their supply chain from being reactionary in nature to a proactive competitive advantage. By working closely with new clients, their vendors and their customers, clients receive unparalleled business intelligence within their network. Frank continues to bring a blend of operational experience, creative vision for improvements and an integrity-driven sales process to ensure new clients are comfortable with their decision to partner with Jarrett.

Mike Marshall

Vice President – West Sales PLM Trailer Leasing

S

ince joining PLM in 2011, Mike Marshall has been a sales leader. With over 20 years of experience, he brings a proven track record in sales and sales management processes. Marshall is a key member of the team and brings alternative energy solutions to refrigerated transportation. He is highly skilled at identifying meaningful experience and translating it to refrigerated transportation. Marshall is inclusive when sharing knowledge and understands that he is a caretaker of the trust placed in him by customers relying on him to manage their fleets.

as

en es -

James Eason

Operations Assistant Southern Shipping

J

nt

ames Eason is an experienced Cold Chain Expert with a successful track record working for and training companies in cold storage and logistics. Eason has extensive business expertise across multiple industries, having held senior positions at Atlas Cold storage USA, Brighthouse Consultancy and Training LTD Kenya and Global Cold Chain Alliance Technical Advisor.

r’s to

om

2021

www.foodlogistics.com

FLOG0321_20-23_2021RockStars.indd 25

MARCH 2021 | FOOD LOGISTICS

25

3/9/21 4:11 PM

2021 ROCK STARS

continued

ROCKSTARS OF THE SUPPLY CHAIN

Steve Taylor Director of Sales – Food Logistics | AIT Worldwide Logistics Michael Wohlwend Managing Principal | Alpine Supply Chain Solutions

Bill Ten Eyck VP, Strategic Fleet Solutions | Fleet Advantage Rick Hassler Director | Food Freshness Card Matt Brosious CEO | FreightCenter

DanJeffers VP, Distribution | Arlowe Specialty Foods

JJ Lewis Vice President | Enterprise Sales GlobalTranz

Tony Hammonds Executive Vice President of Arrive Fresh | Arrive Logistics

Ryan Hammer Corporate SVP and President | Quality Custom Distribution Services Inc. (QCD) Golden State Foods

Guy Bloch CEO | Bringg Jim Yarbrough Global Intelligence Program Manager | BSI Ashley Thompson Director, Supply Chain Design | Chainalytics Douglas D. VanDerveer Director of Specialized Services, LTL | Choptank Transport Ed Bowersox CEO | CJ Logistics America Mahesh Rajasekharan President and CEO | Cleo James Gunn-Wilkerson COO and CTO | CMX Russell Brace National Transport Support Manager | The Co-operative Group

Brent Barker National Systems Trainer | Gordon Food Service Cory Lehman Director of Asset Management | iGPS Logisics Byron Theodore Senior Director | Global Quality Assurance Inspire Brands Joe Smirlies SVP, Product Management | Invatron Systems Corp.

Mike Frank Senior Director of Business Development | Jarrett Phani Pandrangi SVP and Chief Product Officer | Kii Kristy Knichel CEO | Knichel Logistics

2021

Justin Goldston Professor, Consultant, Speaker Penn State University Mike Marshall VP, West Sales | PLM Trailer Leasing Sanjay Shrestha Chief Strategy Officer | Plug Power Inc. Stephen Dombroski Director, Consumer and Food and Beverage Markets | QAD David Norton VP, Customer Solutions and Support | The Raymond Corporation Randy Fields Chairman and CEO | ReposiTrak/Park City Group Robert Sappio CEO | SeaCube Container Leasing Royce Neubauer President and CEO | SFL Companies Adnan Maksoud Senior Manager, Demand Planning | Shamrock Foods James Eason Operations Assistant | Southern Shipping Services Ltd Nick Pacitti Principal | Sterling Solutions LLC Sean Henry CEO and Co-Founder | STORD

Chris Cummings National Director, Food Advisory Services | Colliers International

Pieter Feenstra Chief Sales Officer | Körber Supply Chain Automation | Körber

Jeremy Schneider Food Safety and Quality Assurance Director | Controlant

Michael Bunge Director, Global Sourcing and Materials | Libbey Inc

Arman Alim Director , S&OP | CTI Foods

Greg Lehmkuhl President and CEO | Lineage Logistics

Christina Gutiérrez-Williams Director of Culinary Development | Thistle

Joe Amici Director of Consolidation | Echo Global Logistics

Allan Dow President | Logility, Inc.

Riley Breese Project Manager | enVista

Dan Egan VP, Sales | Global Logistics MODE Transporation/MODE COLD

Robert Antes Founder and President | TradeTrans Corporation

Kurt Leisman Senior Director, Supply Chain Strategy | enVista Kyle McAndrew Director, Supply Chain Solutions | enVista

26

FOOD LOGISTICS | MARCH 2021

FLOG0321_20-23_2021RockStars.indd 26

Liz Longstreet Darr Executive VP of Strategic Sourcing | National DCP

Nick Recht Enterprise Product Manager | TEKLYNX International Clare Rapa-Marley Head of Standards and Audits | Tesco

Zack Gibbs Senior Product Manager | Trimble Transportation Jason Rosing Co-Founder and Managing Partner | Veridian

Annick Casier President | Odyssey FoodTrans

www.foodlogistics.com

3/9/21 4:11 PM

TARS

Y CHAIN

021

BE HONORED FOR YOUR ACHIEVEMENTS! Each year, Food Logistics showcases individual and corporate leaders in the food and beverage industry. Plan now to enter your company — or a cutting-edge client or vendor — in one of these industry-leading recognition programs:

ROCKSTARS OF THE SUPPLY CHAIN

2022

2021 TOP PROVIDERS

ROCK STARS OF THE SUPPLY CHAIN

TOP GREEN PROVIDERS

Recognizes influential individuals in the industry whose achievements, hard work and vision have shaped the global cold food supply chain.

Recognizes companies whose products, services or exemplary leadership enhances sustainability within the cold food and beverage industry.

Nomination deadline: Closed, enter next year!

Winners announced in March 2022 issue

Nomination deadline: March 19, 2021 Winners announced in June 2021 issue

TOP TOP 3PL & COLD STORAGE PROVIDERS

TOP SOFTWARE & TECHNOLOGY PROVIDERS

Recognizes leading third-party logistics and cold storage providers in the cold food and beverage industry.

Honors software and technology providers that ensure a safe, efficient and reliable global cold food and beverage supply chain.

Nomination deadline: May 21, 2021 Winners announced in August 2021 issue

Nomination deadline: September 24, 2021 Winners announced in November/December 2021 issue

n

ONLINE NOMINATIONS OPEN APPROXIMATELY TWELVE WEEKS BEFORE THE DEADLINES LISTED ABOVE. AWARD RESULTS, INFORMATION AND NOMINATIONS POSTED ON:

FOODLOGISTICS.COM/AWARDS Global Supply Chain Solutions for the Food and Beverage Industry

Nomination dates and issues may change. Consult the call-for-entries email and nomination survey for confirmation

om

FLOG0321_20-23_2021RockStars.indd 27

3/1/21 3:53 PM

3PL / COLD CHAIN

BY BRIELLE JAEKEL ASSOCIATE EDITOR

The Difference in TRANSPORTING FRESH VS. FROZEN FOODS

Reefer transportation has many nuances.

W

hen it comes to food transportation in the cold third-party logistics (3PL) space, timing is everything. But, the differences in transporting fresh and frozen food heightens the issue.

For instance, fresh food has a limited window of transportation time, as the products have a shorter shelf life. But lately, lead times get shorter and shorter as consumers look for fresher and healthier ingredients due to changing trends in eating habits. For frozen products, there is a wider range of time for transportation, that is of course if the products remain frozen.

“When transporting fresh and frozen foods, it is critical to know the maximum shelf life of the goods, as these are a time-sensitive commodity,” says Brad Payne, VP of brokerage from NTG. “Fresh foods begin perishing from the moment that they are processed, through the time they are packed, in transit and ultimately at the

28

FOOD LOGISTICS | MARCH 2021

FLOG0321_30-33_3PL-ColdChain.indd 28

destination. Fresh goods are much more time sensitive and perishable than frozen foods, so you must adjust the supply chain accordingly. Regardless, all loads must be delivered on time, reducing potential disruptions to production and ensuring the goods remain fresh upon delivery.

“Frozen goods give a little more leeway in shipping times, but these goods require a very specific temperature control to remain correctly frozen upon delivery.”

Fresh and frozen products require different temperature controls and timing during the transportation process, but as you go deeper within each category, individual products have different needs.

“Some fresh products like cold-pressed juice and milk have a shelf life of a couple of weeks, so timely transits become essential,” says Craig Laughlin, business development, Zipline. “Retailers are also keeping a close

eye the ma ou als thr req bu in a sea “ ho am im Sh no am is m

www.foodlogistics.com

3/1/21 9:14 AM

ww

control the customer experience. Payne believes that having in-house claims management offers greater peace of mind, offering more information and efficiency.

Technology— the good and the bad Throughout the recent digitization years, 3PLs have leaned into technology to help better monitor the important issues in fresh and frozen transportation. Data, artificial intelligence and analytics can help optimize the process while advanced hardware and sensors can help in temperature control and more. Transportation management systems (TMS) are now more sophisticated to help better control the process.

“Having an optimized TMS helps to ensure that every shipment has proper settings (temperature, time, etc.) by enabling communication across the supply chain,” Payne says. “Another key to success is making sure that a vetting process for all carriers is in place to confirm that they are knowledgeable about the key components of food delivery. For example, knowing the ranges for shelf life of foods at certain temperatures reduces the risk of food going bad en-route. The expertise of the shipper, the 3PL and the carrier will mitigate loss significantly when transporting temperaturecontrolled commodities and perishables.”

While technology adds great benefits for 3PLs, it can also cause additional pitfalls. Adding to the pressure of time was the switch to electronic logging devices (ELDs), which put stricter limitations on drivers’ time on the road.

“The biggest change that has taken place over the last few years is the use of technology in transport, specifically ELD,” says Payne. “In 2017, it was mandated that all trucks must have an ELD, which eliminated the use of paper logs. This required more rigid guidelines pertaining to hours of service and has made it easier to

The biggest “change that

Nolan Transportation Group

om

can put a strain on temperature-controlled LTL capacity.”

Laughlin emphasizes the importance of the nuances in fresh and frozen transportation, and the extensive knowledge 3PLs must have in managing these details throughout the entire network. Food waste and profit loss are major concerns as well as the health risks that come with the sale of possibly spoiled food. This includes every aspect of the process, from product handling to the ability to deliver within these strict timeframes.

“Lead time and handling instructions are crucial,” he says. “BOLs and shipping instructions should include explicit directions on the temperature needed to keep product integrity, regardless if it is fresh or frozen. Depending on the details of each move (number of pallets, weight, product, temperature requirement, due date, pick up/delivery location), lead time is often one of the biggest ways to save money and have product deliver on time because it allows a 3PL to choose the most appropriate mode.”

From a business perspective, the aforementioned issues become a legal matter once cargo claims get involved. If fresh or frozen products become spoiled, partnering companies can submit claims against the 3PL. “If the team you are working with is not knowledgeable on the ins and outs of the process, you are setting yourself up for problems,” Payne says. “It is critical to understand what is at stake or at risk because of certain factors during your route (ex: time, temperature, etc.). Avoiding situations such as if food is not properly stored in correct temperatures, then spoils, is imperative to ensure quality of the good.”

Some companies, like NTG, focus on resolving claims in house, instead of using a third-party insurance company to better

eye on sales/spoilage of fresh products and the short shelf life also allows category managers to make a change or easily test out a new product. Fresh transportations also see more fluctuations in demand throughout the year. Frozen foods will require the same temperature year-round, but there are some products that come in and out of refrigerated transportation seasonally.

“Chocolate is a product that can’t get too hot or too cold, so the length of haul and ambient weather could have a dramatic impact on how that product is shipped.

Shippers of products like chocolate and non-alcoholic beverages can leverage ambient and refrigerated shipping when it is most appropriate, but that seasonal need

www.foodlogistics.com

FLOG0321_30-33_3PL-ColdChain.indd 29

has taken place over the last few years is the use of technology in transport, specifically ELD.

”

MARCH 2021 | FOOD LOGISTICS

29

3/1/21 9:15 AM

3PL / COLD CHAIN continued Zipline Logistics

the flexibility it offers both shippers and carriers while keeping compliant with hour regulations.

“Drop trailers drop equipment at the facilities, which increases accessibility and time for the last leg of the supply chain,” Payne says. “This also helps the timesensitive shelf-life issue of fresh and frozen goods, as the receiver unloads at their convenience and in their ideal timeframe.”

COVID-19’s continual impact

 Frozen food sales soared during the pandemic.

oversee temperature regulation and time transportation even more. Fresh produce efficiency.” companies enter the retail space at a more The need for transparency also grew rapid pace and customers are looking for with the use of digital temperature tracking clean labels. devices, Payne says. Food shippers often “As customers are demanding cleaner include their own temperature trackers in labels, we are seeing more natural foods trailers to allow management and overhead with less ingredients and preservatives, to have a clear picture of what happens and that is stretching across all aisles of to their products during transport. The the grocery store,” says Laughlin. “More shipper will know categories are in real time when demanding refrigerated goods are out As customers are space at retailers – of temperature functional beverages, demanding cleaner range or any other meat substitutes and irregularity occurs. labels, we are seeing dairy alternatives are Payne explains that just a few categories more natural foods with that are now customer these technologies enable greater staples, commanding less ingredients and visibility and make significant amounts preservatives, and that of temperatureit easier to correct the issue and avoid shelf space. is stretching across all controlled the potential loss of Retail compliance has goods. also changed, with aisles of the grocery retailers putting more store.

Change in pressure on brands the cold to deliver on time and chain in full, every time.

Sixty percent of retail Beyond category managers surveyed reported that technology, many other aspects of cold they have ended supplier relationships chain food transportation for 3PLs have over their inability to consistently deliver changed in recent years, even before on time.” the Coronavirus (COVID-19) pandemic Because of these changing consumer took hold. As mentioned previously, the values, 3PLs and their customers increase increased need for natural foods and fresh demand for drop trailer capacity due to ingredients compounds the need for a fast

“

”

30

FOOD LOGISTICS | MARCH 2021

FLOG0321_30-33_3PL-ColdChain.indd 30

The uprooting changes in the fresh and frozen food transportation sector took place before the COVID-19 pandemic came. But, since the pandemic reached the entire world, the industry changed dramatically and frequently. Its effects will likely last far beyond the virus itself.

“The spectrum of transportation of food product has changed most likely forever,” says Mike Kucharski, owner of JKC Trucking. “Before COVID, the industry was in a slight incline year after year. Then when COVID hit, the industry has bottomed out more than once. After the height of COVID, there was a slight incline and has been a roller coaster up and down since.”

Safety has been the No. 1 issue throughout the pandemic so far, which spread into the food industry with no surprise. Consumers became nervous about contracting the virus from the food they were buying, so everyone involved in the food handling processes heightened the need for hygienic practices even more than they already did. Some were not only worried about spreading or catching the virus from fresh food, but also frozen, since some viruses can withstand freezing temperatures.

In June, the American Frozen Food Institute (AFFI) released a statement to clear up concerns: “While many viruses can survive freezing temperatures, SARSCoV-2 does not cause foodborne illness.

Like other viruses, surfaces can become contaminated with SARS-CoV-2 by contact with an infected person. To counteract this possibility, a two-pronged control approach is used—frequent and proper hand washing and surface disinfection. These measures are recommended by the CDC and remain important steps to prevent exposure.”

www.foodlogistics.com

3/1/21 3:56 PM

[ cha the htt sup C po wo sur I sur hig be int stu bo wh the cus “ gro em fro ret po acc de po ho see ha

ww

ur

d

en

”

ll

d

as en t D,

[Download Food Logistics’ podcast channel, L.I.N.K., to hear about “Hygiene in the Supply Chain,” among other podcasts: https://cms.megaphone.fm/channel/ supplychain].

Consumers became aware of the possibility of food shortages during a worldwide pandemic, which prompted a surge in frozen food sales.

In March 2020, the AFFI saw a 94% surge in frozen food sales, and maintained high percentages compared to the year before in later months, suggesting an interest in frozen food is likely to stay. The study also saw that 86% of all consumers bought frozen food items, 7% of consumers who never bought frozen before now buy these products and 50% of frozen food customers say they are likely to buy again.

“With the first wave of COVID-related grocery buying, retailers saw their freezers emptied—with consumers stocking up on frozen goods,” Laughlin explains. “Many retailers temporarily relaxed due date policies and/or added extra shifts to accommodate for the changing grocery demand and replenish as quickly as possible. With more people cooking at home, both fresh and frozen sectors have seen increased grocery demand and have had to adapt to increased retail order size

and cadences. Brands heavily reliant on foodservice and restaurant supply were forced to pivot and establish/expand e-commerce platforms to continue to reach their customers.

“Shipping temperature-controlled DTC is nuanced, as brands must find a way to get their product to their customers in a timely, cost effective and efficient manner, and that potentially means multiple distribution points across the country,” he says.

“Shipping DTC also raises the amount that a customer must order and the entry point cost changes dramatically when ordering an entire case, and many brands have used this as an opportunity to promote new flavors in variety packs.

“At a time when more consumers are ordering groceries online, brands are not reliant on the consumer, but rather the clerk making the grocery selections to choose the replacement product. This involuntary sampling put thousands of products into the hands of new consumers every single day across the country. From a brand perspective, you are not only losing that sale, but your customer may now also be trying your direct competitor. Adding in that the brand may also face fines for their inability to deliver on time (which caused the involuntary sampling), and it becomes

even more essential that CPG brands are working with qualified partners to establish reliable, consistent and cost-effective transportation.”

The change in distribution and retail management due to COVID-19 and the varying state-to-state regulations changes the way processors operate, and in turn, how 3PLs operate.

“Processors were typically about 60/40 foodservice and retail, and companies that used to be solely restaurant supply are now moving into groceries and deliveries due to the lack of demand in the restaurant industry,” Laughlin says. “With these shifts, it is necessary to know how to adjust to market stressors and optimize your supply chain to be more flexible and successful.

Shippers that were able to adapt expanded their networks, re-routed goods and leveraged 3PLs with tools that increase efficiency and visibility during COVID-19.”

The need to stay flexible will be prevalent throughout the pandemic, but will also likely remain post-pandemic.

3PLs that can stay on top of continuously changing consumer trends and needs will be profitable in the long run.

 Safety in fresh food transportation is vital.

d n

e

g

-

ct is ch ng

n

om

www.foodlogistics.com

FLOG0321_30-33_3PL-ColdChain.indd 31

MARCH 2021 | FOOD LOGISTICS

31

3/1/21 9:15 AM

SECTOR REPORT

WAREHOUSING

DARK THE

SIDE OF DARK STORES

It has become crystal clear to virtually all supermarket operators that they must be able to compete successfully for online sales if they are to remain financially viable.

E

-grocery in the United States was already growing rapidly at the start of last year, stimulated both by Amazon’s entry into food retail and Walmart’s scaling of its online grocery pickup service to more than 3,000 stores. Then, the sudden disruption of society by the Coronavirus disease (COVID-19) pandemic generated an unprecedented surge in consumer demand for e-grocery that accelerated adoption by years and permanently altered the food-retail landscape.

Incisiv now estimates that in 2025, e-grocery will account for more than 25% of total food sales, a 13% increase over their pre-COVID-19 projection. It is now crystal clear to virtually all supermarket operators that they must be able to compete successfully for online sales if they are to remain financially viable.

However, the operational and financial challenges associated with e-grocery fulfillment remain unsolved, and have been exacerbated by the surge in demand.

The cost of manual fulfillment in stores consumes most of the gross margin on sales, and pickers compete with customers

32

FOOD LOGISTICS | MARCH 2021

FLOG0321_34-37_[SR]Warehousing.indd 32

for aisle space, reducing picker productivity and irritating customers. As a result, many retailers are considering “dark stores” as a solution to fulfilling online orders.

What exactly is a dark store? The term originated in the UK with Tesco, after it encountered many challenges of fulfilling online orders out of their stores when demand started scaling. Tesco responded by creating facilities solely dedicated to picking online orders, thereby “relieving” nearby self-service stores of this task and coining these facilities “dark” stores because they are closed to shoppers.

Picked orders are then either delivered to customers’ homes or to nearby stores to be held for collection by customers.

Dark stores are an attractive alternative to manually picking in live stores for a number of reasons: · With no customers present and with store layouts optimized for picking efficiency, the cost of manually picking orders can be reduced dramatically, and automation technology can be installed to reduce picking costs even further. · The removal of pickers from the aisles

of self-service stores eliminates the irritation to customers. · Inventory management can be more accurate than is possible in stores, enabling reductions of out-of-stocks and substitutions. · Dark stores can be located in industrial areas where real estate costs are much lower than retail locations. · A dark store can have a greater order-fulfillment capacity than the combined capacity of stores it replaces, thereby increasing overall capacity to generate revenues. · Dark stores can be located in geographies where a retailer has few if any self-service stores, thereby enabling a retailer to establish a market presence essentially as a “pure-play” e-grocer.

However, there are a number of disadvantages to using dark stores to relieve existing self-service stores: · Transportation costs are significantly higher due to longer home-delivery routes and the need to transport click-and-collect orders to the stores, where additional handling costs are incurred as well. These

www.foodlogistics.com

3/1/21 9:13 AM

hig the mo · inc de · tal · ord ba rev sto op pro on acc sto op A by sto Let of ret op for

D

ww

K

E

S

higher costs offset a significant portion of the reduction in picking costs achieved by moving picking out of the stores. · The lead time required to fulfill orders is increased, in many cases making same-day delivery or pickup difficult if not impossible. · Each dark store creates new, incremental fixed operating and overhead costs. · Finally, moving the fulfillment of online orders to a dark store is a form of cannibalization that shifts the generation of revenue from self-service stores to dark stores without reducing the fixed costs of operating the stores, which deleverages the profitability of the self-service stores. As online penetration increases, profit erosion accelerates, and at some point, self-service stores will cease to be financially viable as operating entities.

A self-service store generates revenues by attracting customers to come to the store and shop, i.e. fulfill their own orders.

Let’s consider the operating economics of an individual store when a self-service retailer begins offering customers the option to order from its stores online, but for competitive reasons cannot raise prices

for online orders. For the sake of simplicity, let’s assume that the store’s customer base remains constant and store associates fulfill online orders rather than an outsourced third-party service.

Online sales impose significant variable labor costs for fulfilling those orders, so store profitability declines. However, as long as the additional variable costs are less than the gross margin, revenues from online orders still contribute to the store’s fixed costs and profit.

If the retailer then opens a dark store to fulfill the online orders for that store, the store is relieved of the additional variable costs of order fulfillment, but it is also relieved of the revenues from customers who used to physically shop at the store, but are now ordering online. That’s because those revenues are no longer being generated by the self-service store, but instead by the dark store. In effect, the store has been cannibalized by the dark store. However, fixed operating costs remain the same, so the ability of the store to generate profits has been impaired by the dark store.

From the perspective of the store’s oper-

ating economics, the cannibalization of revenues by the dark store looks no different than the loss of customers to a competitor.

While that’s not true at the enterprise level, the point is that shifting of revenue generation from stores to dark stores creates a real threat, where rapidly increasing e-grocery penetration will eventually cause many stores to begin generating operating losses instead of profits.

It can be argued that operating dark stores is necessary for the retailer to be profitable with e-grocery, and that if the retailer doesn’t cannibalize its own stores, another retailer will. Both of those arguments might be true, but they don’t address the question of whether existing stores—and retail enterprises—can remain financially viable over the long term if e-grocery penetration reaches higher levels.

Dark stores may well make sense as an immediate supplement to stores currently overwhelmed by the COVID-19-driven surge in demand, or in “greenfield” geographies where a retailer has few or no stores. However, retailers should make use of dark stores as a short-term or opportunistic expediency rather than a long-term solution to the core problem of e-grocery profitability.

To survive and thrive in the post-pandemic world ahead, retailers simply must find ways for their existing stores to operate profitably serving both the customers who order digitally and those who shop physically.

Tesco is now creating automated “urban fulfillment centers” located inside or adjacent to self-service stores. In addition, retail leaders are making major investments in automated “local fulfillment centers,” or micro-fulfillment centers, that are also co-located with existing stores. These solutions are alternatives to dark stores that leverage and preserve the value of existing store assets.

-

ng

al

ed

ABOUT THE AUTHOR

e

om

Alert Innovation

es ct

JOHN LERT founder, Alert Innovation

 Dark stores are an attractive alternative to manually picking in live stores.

www.foodlogistics.com

FLOG0321_34-37_[SR]Warehousing.indd 33

MARCH 2021 | FOOD LOGISTICS

33

3/1/21 9:14 AM

SECTOR REPORT

WAREHOUSING

M

ARE DARK STORES LOSING THEIR GLOW? D

As more shoppers opt for online methods, grocers are wondering if dark stores are the most effective model for order fulfillment.

ark stores have been a hot topic over the past few years as online grocery adoption rises and retailers strive to fulfill orders as seamlessly as possible.

Now, during the Coronavirus disease (COVID-19) pandemic, the conversation has grown louder. Some retailers have transformed or are in the process of turning select brick-and-mortar locations into dark stores to keep up with record e-commerce grocery demand.

However, as more shoppers opt for online methods, grocers are wondering if dark stores are the most effective model for order fulfillment.

The growth of dark stores Dark stores are small-scale distribution centers located in traditional retail locations that focus exclusively on online shopping, enabling picking and packing without customers in the aisles. Called “dark stores” because they have no physical

34

FOOD LOGISTICS | MARCH 2021

FLOG0321_34-37_[SR]Warehousing.indd 34

customers, dark stores make it possible to scale e-commerce operations in an effort to increase efficiency and reduce costs.

Grocers across Europe were early adopters of this concept. Grocers in the UK have leveraged dark stores to create facilities for extreme efficiency, especially as transaction volumes increase and customers want to have items delivered to their homes.

U.S. retailers overall, however, have been slow to embrace the dark store.

U.S. grocers have adopted this concept, building e-commerce warehouses to avoid overcrowding the store and lay out their products specifically for online orders, just at a slower pace.

During the pandemic, shutdowns and stay-at-home orders have led some retailers to close stores, reducing some danger for employees but accelerating transition to dark stores, enabling online orders to be fulfilled in wide-open aisles.

The benefits of dark stores Some of the most fundamental decisions retailers will tackle in developing or improving grocery pickup and delivery programs are around fulfillment sourcing.

Simply stated, you have to determine where the items in the shopper’s basket will be collected from.

Retailers have some options. First, they can optimize their in-store pickup processes using planograms to reorganize the location of the most popular items for faster picking. Additionally, they can utilize shuttered stores or warehouse locations for online orders, using either human or robotic pickers. This enables grocers to scale their businesses while growing their online shopper base. Dedicated locations can enhance accuracy for online picking and packing, create space to take robotic technology to the next level and allow for additional capacity and centralized route planning.

www.foodlogistics.com

3/1/21 9:14 AM

Pe of ret con ma du fas cen R rea ma iss cau to sta suc esp get ret sto du hav a la hu A be the hu an hu 20 sta ab 2-5 acc est cou the no at pro att G at sto ad the tha oft an gro an

ww

will

e r ze

r

om

Perhaps because of the U.S.’ slow adoption of dark stores, some North American retailers are now skipping the dark stores concept altogether. As the online grocery market sits at north of $8 billion in sales during the pandemic, many retailers are fast forwarding straight to multi-fulfillment centers (MFCs).

Running a dark store means that legacy real estate costs add to the slim margins of manual picking. It also presents logistical issues. In January, a snowstorm in Texas caused already increased online ordering to skyrocket in just one day. Much like a standard grocery store, can a dark store successfully keep up with this surge, especially if employees have trouble getting to work? There are other questions  Some of the most fundamental decisions retailers will tackle in developing or improving grocery pickup and delivery programs are around fulfillment sourcing. retailers must ask, such as “how will dark stores socially distance their employees and process that takes place inside the Are the big players during COVID-19?” As well, “do the stores store, along with the retailer’s long- and investing? have the ability to pick and pack effectively, Theoretically, retailers are investing in dark short-term needs, the dark store could a la Amazon, who utilizes both robots and be a perfect choice for retailers based on stores to optimize their click-and-collect or humans?” Probably not. the density of orders in a given region. curbside solutions, such as implementing A dark store is just one method of But, while the conversation around dark some robotic technology to facilitate benefitting from labor efficiencies, but at stores is dying down, retailers in 2021 picking and packing. The reality is that if the end of the day, you are limited using will experiment with a mix of physical dark stores were so critical to click and human hands. Even with the best layout fulfillment options to determine where they collect, we would see innovators making and most efficient picking strategies, a can be profitable, especially considering a significant play in this space. And, at this human can only pick about one item every that fulfillment is still the biggest expense point, they’re not.

20-30 seconds. Meanwhile, a properly when it comes to e-commerce.

These innovators are instead opting for staged environment with robots can be The pandemic has changed the game for automation by creating local fulfillment about one every the concept of the dark store. Ultimately, centers (LFCs). In these 2-5 seconds, it really comes down to a retailer striking How will dark stores compact, modular according to some right balance between technology warehouses built within or socially distance their added to a store, automated the estimates. Of and human labor, along with having course, some of employees during bots retrieve popular items. inventory in the right place. Will the items these robots may be retrieved from store shelves, a dark The items are then brought COVID-19? not be as adept store, a warehouse or MFC? Or will it be a to a picking workstation, at picking fresh combination of sources? This will involve where the order can be assembled with produce or other items that require precise balancing key factors like floorspace speed. Meanwhile, at the height of the attention. pandemic, some big-box retailers converted and layout, order volume and available Given the complications involved in using budget. There are advantages to each, and some of their grocery stores to do picking, a traditional grocery store setup as a dark decisions must be based on unique business packing and delivery from those stores store and steady growth in online grocery situations. to lessen the burden on their distribution adoption, grocers are starting to abandon centers. However, dark stores are still an the idea. Instead, they’re opting for MFCs afterthought to retail giants compared that are purpose-built for fulfillment and ABOUT THE AUTHOR to direct-to-home shipping distribution oftentimes utilize more automated systems centers and MFCs. and efficient processes. This format offers SYLVAIN PERRIER grocers an option that will be sustainable president and CEO, One size doesn’t fit all and scalable for much longer.

Mercatus All of this isn’t to say that dark stores are a dead end. Depending on the technology

AdobeStock_206094251

.

Moving beyond dark stores

“

”

www.foodlogistics.com

FLOG0321_34-37_[SR]Warehousing.indd 35

MARCH 2021 | FOOD LOGISTICS

35

3/1/21 9:14 AM

2021 LTL UPDATE:

WHAT TO EXPECT THIS YEAR

T

here’s no contesting that 2020 brought about significant changes in nearly every industry, none impacted more notably than shipping and transportation. Several key issues continue to plague the less-than-truckload (LTL) industry in 2021. Solutions that address these challenges could help stimulate a turnaround toward success for the transportation industry. Consider some of the ongoing concerns for the LTL sector:

Driver shortage A shortage of drivers and transportation professionals has been an ongoing concern in the industry for several years, but we’ve seen an even greater shortage constraint in 2020 for four key reasons.

First, drivers must be at least 21 years old to obtain a commercial driver’s license (CDL). That means recent high school graduates looking for work will turn to alternative careers. Thus, the

36

FOOD LOGISTICS | MARCH 2021

FLOG0321_38-40_[SR]Transportation.indd 36

transportation industry misses out on that initial influx of new hires (who could potentially become career drivers).

Second, the federal Drug and Alcohol Clearinghouse is now in effect, which works to identify Class A and Class B drivers who have a drug or alcohol violation. While the intent of the Clearinghouse is based on the safety and wellness of all drivers on the road, reports show that thousands of drivers have been placed on probation or are out of work due to this program, further tightening the shortage.

Thirdly, drivers are often underpaid and overworked. Drivers work long, exhaustive hours and a lot of trucking companies undervalue their workers’ time. It’s hard to retain talent and attract new drivers when employees’ compensation packages and work-life balance still isn’t highly valued by a lot of organizations.

Finally, one of the biggest transportation employment competitors is construction.

With construction rebounding and thriving, drivers are switching jobs to the construction industry, thus further depleting the driver pool.

None of those concerns have thus far been properly addressed. Now, even further, we also pile on the impacts that have come from the Coronavirus disease (COVID-19). Drivers, especially long-haul drivers, are considered a high risk for contracting COVID-19. In an effort to keep themselves and their families safe, a lot of drivers have left the industry to seek “lower-risk” employment. Furthermore, any drivers who have caught the virus are forced to quarantine for two weeks (like everyone else). As the pandemic continues on, risk is high and compensation for drivers is still low, so a lot of drivers have decided to switch career paths.

Dock worker shortage Overall, we’re seeing a major lack of

www.foodlogistics.com

3/1/21 9:12 AM

ma No the wa Th are no e-c be T of pro so dro red bu hu

Ca

It’s pu are tha

ww

5m3photos - Adobe Stock - On the Road

R

l

ep

e

es

om

manpower in the transportation industry.

Not only are there not enough drivers, but there also aren’t enough dock workers, warehousing staff and support employees.

The reasons for these personnel shortages are similar to those mentioned above. Most notably, LTL workers are switching to the e-commerce industry for greater pay and better job security.

Thus far, we’re still not seeing a majority of LTL companies making the effort to provide better benefits for their employees, so their employees are leaving by the droves. If transport organizations want to reduce their shortages and enhance their businesses, it’s time to start focusing on the human aspect of the business.

Capacity shortage It’s not just a shortage of drivers that’s putting trucks at a standstill. There also aren’t enough trucks for all the packages that need to be sent. Alongside the

www.foodlogistics.com

FLOG0321_38-40_[SR]Transportation.indd 37

shortage of employees, there’s simply too much freight and not enough physical resources like trucks, shelving and equipment to support the increased volumes. This is a twofold issue—a shortage of resources with an increase in volume.

First, there’s a scarcity of tractors and trailers along with facility restraints, particularly not enough dock space and terminal operating doors. We’re also seeing lane imbalances (headhaul vs. backhaul) where a lot of trucks end up making the trip home with excess unused capacity.

Alongside these equipment deficiencies, there’s a significant increase in packages sent. Some LTL carriers have experienced up to 4,000 additional shipments per day compared to 2019. E-commerce has surged, especially in 2020 when even groceries moved to online purchasing.

Manufacturing and digital business are on the rise, and trucking companies haven’t figured out how to handle this increased flow of business yet.

A lot of LTL companies are looking toward automation to help relieve some of these shortage concerns, like selfdriving trucks and warehouse robots.

However, implementation is too slow and inconsistent for this to be the short-term solution.

Higher LTL carrier operating expenses LTL carriers saw a slight decrease in operating costs in 2019, but these expenses have again skyrocketed in 2020 moving into 2021. What do some of these operating expenses look like?

• LTL companies need to offer competitive wages and benefits packages to employees in order to reduce turnover and recruit new workers, which will be the best shortterm effort to address the driver and worker shortage.

• The cost of equipment maintenance, both parts and labor, is increasing.

It’s more critical than ever to upkeep

equipment considering the capacity shortage, so LTL carriers are forced to pay higher maintenance costs without much wiggle room.

• Also working to address the capacity shortage, carriers are investing in more equipment, tractors/trailers, facilities and automation. These are creating hefty upfront and operating costs that are eating away at margins.

• Fuel costs are expected to rise again as the economy picks up and people return to work and travel in 2021.

• Insurance costs are also rising.

“Nuclear verdicts” are settlements often over $10 million, resulting from serious crashes involving injury and/or death.

One study found that nuclear cases are up 300%, so insurance carriers are raising rates to meet these costs.

• Higher operating costs often mean higher costs pushed to shippers or a further tightening of LTL margins.

Poor transit service Transit service is at an all-time low.

Including the aforementioned concerns, service is also being impacted by wildfires, hurricanes, other natural disasters, the spread of COVID-19 (especially in pocket areas) and an increase in West coast imports. Transit service is suffering while trying to battle these variables. On-time results are only about 80-85% for national carriers and slightly better with 85-90% for regional carriers, but clients are demanding more. That’s why LTL carriers are deploying new, temporary business strategies to improve these on-time results, but they might have positive or negative impacts for customers. Some of these strategies that could impact customers include: • Refusal to handle overlength shipments (8- to 12-feet-plus) • Refusal to handle high volume (10,000-plus pound) shipments • Refusal to handle large skid orders (7-plus) • Refusal to handle lighter volume (low density) or high-capacity cube shipments

MARCH 2021 | FOOD LOGISTICS

37

3/1/21 9:12 AM

SR: TRANSPORTATION continued

@am - Adobe Stock - On the Road

Tariff, especially in the areas of detention, overlength, cubic capacity, liftgates, appointments, high-cost zones, remote areas and residential and inside deliveries.

Carriers measure profitability using an operating ratio that determines the relationship of cost/loss compared to revenue. Cargo claim expenses come straight off the monthly carrier profitand-loss report. As cargo claim denials are increasing, loss is also rising and profitability is thus decreasing.

Bottom line—carriers can improve their operating ratios through two strategies— either lower costs and losses or raise revenues.

Lowering costs is a lot harder, especially in today’s climate, and the results happen slower. Raising revenues through rate increases is fast and easy. That’s why so many carriers are simply raising rates, rather than addressing business strategy on the whole.

• Designated zip code embargoes • Limiting significant lane imbalances (headhaul vs. backhaul) • Cancellations resulting from lower revenue thresholds • Reduction in expedited and guaranteed services to limit exposure • Eliminate high-cargo claim shipments • Reduced remote pick-up and delivery area shipments

Freight rate increases Freight rates are rising due to all of the factors mentioned above—driver and worker shortages, capacity shortages, higher operating expenses and poor service metrics. There are other factors contributing to increasing freight rates that are going to hit LTL carriers and shippers hard as well.

For instance, 70% of a carrier’s overall expenses, including labor, fuel, equipment leases and equipment maintenance must be paid within 30 days. These 30-day payment terms are consistently not being met. Rates are thus increasing since carriers aren’t paying in full on time.

Lane imbalances negatively affect labor, fuel, capacity, equipment usage and transit service. Carriers are offsetting these additional expenses due to severe headhaul vs. backhaul inequities with rate increases.

Labor and equipment charges aren’t being fully accounted for in the base price, but are instead tied to accessorial charges.

Carriers are getting more aggressive about capturing every dollar via the Rules

38

FOOD LOGISTICS | MARCH 2021

FLOG0321_38-40_[SR]Transportation.indd 38

What to expect in 2021 To summarize, in 2021, shippers can expect: • Carrier freight rate increases • Carrier refusals to bid for certain commodities, volumes and lanes • Strict payment terms not to exceed 30 days • Added accessorial fees and enforcement • Poor or below average transit service • Increased client cancellations • Required revenue thresholds for customers • Carrier refusal to provide additional equipment or resources when requested

What can shippers do?

One of the best courses of action to overcome these shipping challenges is

partnering with a third-party logistics (3PL) provider. Based on their depth of experience, they can provide shippers with a more diverse perspective and the expertise to address these obstacles. They can provide the technology tools, scale and operational support shippers may not otherwise have at their disposal within the confines of their company’s budget. Many commercialize deals where their fees come from the savings they generate. This makes these resources significantly affordable and quick to engage without the typical budget hurdles in a fee-based model.

With the right digital tools and human support, shippers can build more sustainable solutions to help their network win regardless of market conditions. Some of these strategies include, but are not limited to: · Leveraging technology to choose the right carrier, rate and service combination. · Using 3PLs and expertise to directionally load and leverage spend to reduce costs. · Setting carrier service KPIs and providing analytics on accurate carrier service. · Enabling visibility, real data and problem resolution. · Model and rationalize sourcing and distribution network for the optimal inventory cost while still meeting client service requirements. · Working with 3PLs to incorporate mitigation strategies to prevent system bottlenecks. · Creating customized tariffs and pricing programs based on company requirements. · Integrating systems and data to streamline key decision points within supply chain data-driven analysis and decision making.

With the right logistics partner, shippers can successfully navigate the challenging LTL shipping market’s ebbs and flows.

ABOUT THE AUTHOR JOHN CENTERS chief sales officer, Redwood Logistics

www.foodlogistics.com

3/1/21 9:12 AM

bodnarphoto

SECTOR REPORT

PACKAGING

Consumers today seek more information in food packaging.

T

he consumer packaged goods (CPG) sector in food changed greatly in recent years due to drastically evolving consumer interests and shifts in retail operation.

The biggest change as of late is the Coronavirus (COVID-19) pandemic and its impact on sales. A survey by NCSolutions found that CPG sales grew an average of 19% in 2020 compared to 2019 likely due to pandemic, likely due to the growth of consumers staying at home.

To keep up with the instant growth, the Consumer Brands Association (CBA) suggests that CPG companies improve the hours-of-service rule for truck drivers to increase produce movement, and maintain food labeling flexibility so products made for restaurants can be quickly redirected to grocery stores when consumer demand spikes.

In addition to flexibility, CPGs need to focus on safety and tamper-proof in their packaging to cater to new needs.

Technology offers transparency Before COVID-19 took hold, the CPG sector transformed its packaging to keep up with shifting demands.

Consumers are often drawn to unique experiences that bring them closer to the product and its history as well as a clean label. Shoppers want to know what they are buying, where it came from and its effect on the world and their bodies.

For instance, THX Dreams explains that using non-traditional tactics, as well as incorporating a “for-good” component

www.foodlogistics.com

FLOG0321_39_[SR]Packaging.indd 39

BY BRIELLE JAEKEL, ASSOCIATE EDITOR

CPG PACKAGING NEEDS SAFETY, TECHNOLOGY SUSTAINABILITY

is imperative in packaging to engage consumers. That’s why the produce wholesaler added a QR code to its packaging, and created an app to show customers where the produce comes.

The integration of digital components into CPG packaging is helpful throughout the pandemic and beyond, as consumers are interested in more information about the products they buy.

Se rge y Ry z h ov

Greener packaging is now more popular in CPG food products..

“Consumers are craving more transparency from CPG brands and they want to be able to access product information directly from the package,” says Melanie Nuce, SVP of corporate development, GS1 US. “Currently, there is not a seamless, non-proprietary way for brands and retailers to communicate product data to consumers, and having multiple codes on product packaging causes confusion for consumers and trading partners. Backed by new standards,

more robust data carriers and optical scanning technology, we’re on the verge of a new era where packaging is a portal to multiple, ever-changing experiences beyond the UPC’s original price lookup function.

“In 2019, GS1 US found that the majority of brands and retailers were in favor of this move toward a more robust, single code on product packaging, and are planning to migrate away from the traditional UPC system. The study, titled ‘Powering the Future of Retail,’ revealed that 82% of retailers and 92% of brand owners support transitioning from the UPC to a data-rich two-dimensional (2D) barcode (e.g., QR code, digital watermark and/or RFID) in the next five years,” Nuce adds.

Alongside an interest in transparency and wellness is the growth of sustainability and ecofriendly packaging.

Before the pandemic, an Evergreen Packaging report found that 68% of consumers look for “responsibly packaged” foods and beverages in the CPG space.

Consumers look to avoid single-use plastics and want something biodegradable.

An increase in innovation allows this to be more accessible, but also drives consumers’ expectation in this area. The more innovative and sustainable packaging options that hit the CPG market, the more consumers will come to expect this from their CPG foods.

Competition in this space and the growth of the direct-to-consumer market means that CPG brands need to pay more attention to these new packaging needs moving forward.

MARCH 2021 | FOOD LOGISTICS

39

3/1/21 9:03 AM

SECTOR REPORT

SOFTWARE & TECHNOLOGY

MOBILE ROBOT

WORKFLOWS

ADDING VALUE ACROSS THE PRODUCTION LINE Expect to see more CPG companies deploy AMRs across multiple facilities to help shorten lead times, reduce bottlenecks and improve workplace safety.

C

onsumer product goods (CPG) companies are increasingly automating material handling and other warehousing processes by deploying flexible, adaptable and safe autonomous mobile robots (AMRs). According to a recent survey conducted by Mobile Industrial Robots (MiR), by 2024, 79% of these companies plan to use AMRs to optimize internal material handling. That’s because it’s become evident that AMRs benefit the full value chain of the CPG production line with built-in sensors, cameras and intelligent software to navigate efficiently and safely around workers and equipment, even in areas unavailable to other technologies like fork trucks and automated guided vehicles (AGVs).

As CPGs see shortened lead times, reduced bottlenecks and improved workplace safety from even one single robot deployment in one workflow, they’re evaluating their initial investment for the potential to roll out fleets of robots across

40

FOOD LOGISTICS | MARCH 2021

FLOG0321_40-41_[SR]Software/Tech.indd 40

multiple sites and myriad workflows.

Let’s focus on three workflows proving most successful at meeting CPG company objectives for deploying AMRs today:

1. Inbound/outbound components delivery to production CPG components are stored in intermediary storage warehouses or other preparation areas before moving to production facilities. Traditionally, fork trucks or AGVs, which move along a set path with infrastructure such as magnetic tape or more recently, laser-based navigation, have been used to transport the components. Either due to significant risks of injury or lack of space to navigate for AGVs, many companies have been looking to limit their use and find safer, more agile alternatives for repetitive and “last meter transport.” AMRs with integrated pallet lifts or specifically designed cart solutions can autonomously transport pallets or

low-volume consumables to the production line and are a safer alternative to AGVs or manual tuggers. This is especially true as they travel through populated areas and dynamic environments where people, stacks of goods and other equipment must be safely navigated.

In addition to enabling the company to relocate their employees for more

val the cha dif F pri com is d dri as Th no

AMRs benefit the full value chain of the CPG production line with built-in sensors, cameras and intelligent software to navigate efficiently and safely around workers and equipment.

www.foodlogistics.com

3/1/21 4:03 PM

ww

on

e, st

as a result, need to be replaced for the production of new SKUs. Automating the movement of these components, either on the pallets or in bins, have long been a challenge due to typically small spaces and highly populated environments. However, with the emergence of these more agile and collaborative AMR solutions that can work around the clock, CPG supply chains are moving toward becoming “lights off” factories of the future as many have long envisioned.

Some especially innovative CPG companies are already deploying fleets of AMRs—a mix of both high and low payload versions—to deliver different components on the pallets or carts to the production line and remove unused components from previous production runs. Deploying AMRs for this application can benefit multiple production lines simultaneously, resulting in substantial productivity gains and cost savings, whether in capacity or humanworker hours.

2. Quality sample handling during production runs value-added tasks, AMRs actually help them increase throughput by reducing changeover cycle between production of different stock-keeping units (SKUs).

For example, companies have myriad primary and secondary packaging components for each production run. This is due to the increased customization needs driven by consumer or retailer demands, as well as global trends like sustainability.

The majority of these components will not be re-used in the next batch, and

ate

Mobile Industrial Robots (MiR)

om

www.foodlogistics.com

FLOG0321_40-41_[SR]Software/Tech.indd 41

Traceability is critical, especially in the food industry, as the FDA requires most food manufacturers to follow the movement of food products and their ingredients through all steps in the supply chain.

Continuously improving the quality process among retailers puts additional pressure on the traceability demands of manufactures on both their own brands as well as private label brands. Again, due to external consumer and market trends, likely exacerbated by the Coronavirus disease (COVID-19) pandemic, the amount and frequency of quality sample retention from production is exploding. As a result, engineering teams are using collaborative robots technologies like robotic arms (cobots) for “pick and place” and AMRs to handle the workload. Companies are even using AMRs alone to shuttle samples from between the lines to storage or using AMRs with cobots installed on top to pick samples straight from the live production line and take them to storage or labs for analysis.

3. Integrating AMRs into end-of-line palletizing solutions As CPG companies continue to realize the benefits of using AMRs in their production/packing halls, they continue to look for ways to further expand their AMR footprint. Naturally, the focus falls on expanding pallet movement applications from delivering components to transporting finished goods to end-of-line/ warehouses.

Space and human activity continue to be a challenge at the palletizer. To solve this problem, some companies have deployed AGVs with the magnetic strips or laserbased navigation, but in both cases, those require significant investments to establish and change infrastructure.

AMRs with open-source capabilities are an ideal alternative, as they can easily integrate into modern palletizing systems. AMRs offer considerable savings over AGVs for this workflow. The robots themselves are less expensive; they do not require infrastructure built into the facility floor; and consequently, they can be quickly—and easily—programmed and deployed.

As a result, integrating AMRs into palletizers is on the rise. Companies are integrating AMRs into existing palletizer installations, and working with palletizing system manufacturers to bring turnkey solutions from the onset. Many palletizing and material handling companies see AMRs as “game changers” for their businesses, drafting plans to phase out their conveyer systems and replace with AMRs for pallet transfer.

Expect to see more CPG companies, especially within the food industry, deploy AMRs for these three workflows, and expand them to other workflows across multiple facilities as they continue to realize the tremendous value they bring to the entire production line.

ABOUT THE AUTHOR VOLODYMYR VOVK global account director, FMCG, Mobile Industrial Robots (MiR)

MARCH 2021 | FOOD LOGISTICS

41

3/1/21 9:36 AM

SECTOR REPORT

FOOD SAFETY

4 KEY FOCUS AREAS

FOR FOOD AND BEVERAGE MANUFACTURERS Having the right technological capabilities will aid organizations in minimizing risk, maximizing efficiency and ensuring the right processes and procedures are in place.

E

nsuring food safety and quality and staying compliant with everchanging regulatory requirements are chief business concerns for food and beverage manufacturers and processors.

Food and beverage companies are required to adhere to strict regulations in addition to achieving certain levels of certification. Some examples of groups and documentation that detail these regulations and certifications include: • British Retail Consortium (BRC). The BRC Global Standards provides food retailers with a common approach to supplier auditing.

• FDA’s Code of Federal Regulations Title 21 (CFR). Title 21 is the portion of the Code of Federal Regulations that governs food and drugs within the United States for the Food and Drug Administration (FDA).

• Food Safety Modernization Act (FSMA). Signed into U.S. law in 2011, it was the first major overhaul to food safety legislation since 1938. The act covers all aspects of data capture, retention and inspection capabilities.

The FDA is proposing to establish

42

FOOD LOGISTICS | MARCH 2021

FLOG0321_42-46_[SR]FoodSafety.indd 42

additional traceability recordkeeping requirements (beyond what is already required in existing regulations) for organizations that manufacture, process, pack or hold foods designated for inclusion on the Food Traceability List.

• Global Food Safety Initiative (GFSI).

The GFSI is a private organization based in Belgium that maintains a scheme to benchmark food safety standards.

• Good Manufacturing Practice (GMP).

GMP regulations are set by the FDA. • Safe Quality Food (SQF). SQF is a rigorous and credible food safety and quality certification program recognized by retailers, brand owners and foodservice providers worldwide.

Processes and procedures must be in place to manage food safety and traceability, and to reduce the risk of costly food safety recalls or regulatory infractions. But, organizations also must have the flexibility to respond to changing regulatory requirements.

The ability to track products and ingredients both upstream and

downstream—from raw ingredients to the finished goods and back—is imperative.

Data from every point in the supply chain must be recorded to provide an audit trail.

Modern enterprise resource planning (ERP) systems can help organizations succeed in this regard, and key capabilities in five key areas of focus will help food and beverage processors succeed.

Recipe management Each recipe ingredient not only impacts the taste of the product, but also the nutritional value—a metric monitored strictly by numerous governmental regulatory agencies. A unique feature food and beverage processors need from their ERP system is the ability to identify specific nutritional values that result from the composition of a recipe, referred to as a Bill of Material (BOM). Think of this in terms of the nutritional label required on all food products.

For some companies, this is “simply” a matter of composing a formula and determining the nutritional values based on the ingredients in the formula. For others (further up the food chain), the

www.foodlogistics.com

3/1/21 9:07 AM

V

•

•

•

YOUR FAVORITE

NEWS & RESOURCES AT THE TIP OF YOUR FINGERS.

S

nd

e

l.

RP) n y e

od

fic

Bill

d

VISIT

FOOD LOGISTICS ONLINE FOR:

• Digital editions of the magazine • Content channels specific to software & technology, sustainability, safety & security, risk/compliance and more • Upcoming Supply Chain Network webcasts

www.FoodLogistics.com

• Nomination information for the following industry awards: Rock Stars of the Supply Chain, Top Green Providers, Top 3PL & Cold Storage Providers, and Top Software & Technology • Newsletter subscriptions • And more!

om

FLOG0321_42-46_[SR]FoodSafety.indd 43

3/1/21 9:07 AM

SR: FOOD SAFETY continued

Ultra Consultants

 Inventory control addresses the visibility of material transfers, matching the physical movement of product between locations in as close to real time as possible.

companies must develop a formula based on target nutritional levels provided by their customers. This is a significantly more complicated exercise since different raw materials have different nutritional potencies and may react differently with various ingredients. To this end, food manufacturers use a combination of the BOM along with individual lot identifiers to determine variations across batches.

Formulation helps manage which ingredients are being used to create the product, meeting any requirement to calculate nutritional values that result from the formulation.

Alternate and reverse BOMs assist manufacturers in quickly and efficiently identifying which raw materials can be substituted if an out-of-stock is encountered.

Alternate routings (how product moves though a facility) provide a means to predefine multiple ways of manufacturing an item. These alternative ways can be driven by factors such as batch size, capacity of a work center, etc.

Another unique ERP feature used by food processors are automated unit of measure conversions (e.g., pounds

to kilograms, each to case, milliliters to ounces). This assists with keeping inventory and recipes accurate, and with avoiding offline calculation or errors.

Examples of this include selling in a specific unit of measure (e.g., in pounds) vs. purchasing (e.g., in kilograms) vs. warehousing (e.g., in cases). The ERP system must be able to handle this level of recipe and formula management.

Also important is what is referred to as a multi-level BOM or formulation (preblend added to a main blend), in addition to closely monitoring allergens and Kosher item labeling requirements.

The ERP system must offer ways to monitor potency, volume and variable weights when developing formulas, as well as the ability to adjust formulas on the fly to account for concentration or natural product grade variations. Barcoding, in-line code readers and handheld technology are increasingly used to capture these complex transactions.

Inventory control Inventory control addresses the visibility of material transfers, matching the physical movement of product between locations in as close to real time as possible in the ERP. It is particularly important for a food and beverage ERP solution to provide a record of where the product was located and when. For example, this could be used to trace back an allergen or other cross-contamination incident, giving the modern ERP user visibility to all materials that passed through and were potentially impacted by that location.

S •

• • • I pre fro an red

Pl

Fo wh the con the un wh in t as inv san act An req

Fo

Fo ma an the • sea thi as • the the cus pla cur

Em su

Fo an sho of be Ha

44

FOOD LOGISTICS | MARCH 2021

FLOG0321_42-46_[SR]FoodSafety.indd 44

www.foodlogistics.com

3/1/21 9:07 AM

ww

f

er

ell

ne re ex

cal

d

s

t

om

Some additional inventory tracking tools include: • L ot control. The ability to trace raw materials from suppliers as well as finished goods to customers.

•F EFO/FIFO. First expiration first out/first in first out.

•E xpiration date management of raw materials • S helf life or expiration date of finished goods In addition to these items, kitting—the grouping together of a pre-defined group of items—is also a process that requires support from a modern ERP. The ability to create and track kits in a food and beverage ERP system is imperative to maintain traceability and reduce duplicate entry.

technological capabilities will aid organizations in minimizing risk, maximizing efficiency and ensuring the right processes and procedures are in place.

Planning and scheduling Food and beverage manufacturers must consider multiple tasks when planning and scheduling manufacturing runs. For one, they need to have the ability to manage runs based on the many constraints, such as sequencing products containing allergens at the end of the shift and including time to changeover equipment unique to food and beverage production. A changeover occurs when the processor moves from making one product to another in the same work center. Sometimes this changeover could be as simple as washing down the machine. Frequently, however, it involves taking all the equipment apart and washing it down to sanitize it. Accounting for the time involved in these changeover activities is often subject to above-mentioned documentation.

An ERP solution must be nimble enough to accommodate these requirements.

Forecasting Forecasting is important for many reasons, but especially for manufacturing companies to allocate an accurate budget. Food and beverage ERP solutions need to address this area while taking these issues into consideration: • Seasonality. The demand for certain products changes with the seasons, and a food and beverage manufacturer must account for this fluctuation. Seasonality can also impact agricultural processors as their operations pivot around harvest.

• Customer forecasts. Manufacturers need to be aware of the forecast cycles of their customers to know how much of their product to produce. A right-fit ERP system must integrate customer forecasts provided by the retailers into the processors planning engine. This helps keep processors ahead of the demand curve and anticipate peaks and valleys.

Empowered to succeed Food safety, quality and compliance should always be top of mind with food and beverage processors.

Having the right

www.foodlogistics.com

FLOG0321_42-46_[SR]FoodSafety.indd 45

ABOUT THE AUTHOR AARON OLIN senior consultant, Ultra Consultants

ADVERTISER INDEX ADVERTISER.......................................................................................................PAGE

Controlant.................................................................23

DSC Logistics.............................................................5

Great Dane Trailers Inc.............................................46

Isuzu Truck.................................................................2

Jarrett Logistics Systems.........................................12

PLM Trailer Leasing..................................................13

Uline.........................................................................11

MARCH 2021 | FOOD LOGISTICS

45

3/1/21 9:07 AM

Confirm trailers carrying full or partial load in real time.

Easily search your yard for trailers untethered for extended periods.

Alert: Door Open event outside of normal operating hours.

More control, mile after mile Alert: Tire Inflation System has been demanding air for more than 10 minutes.

“I see your shipment’s location and can confirm the delivery ETA is on schedule.”

More often than not, managing your fleet means dealing with the unexpected disruptions that take over your day. But there’s another way. Our OEM-developed trailer telematics platform gives you real-world, real-time visibility into your entire fleet.

With its built-in sensors and user-friendly interface, the FleetPulseTM platform gives you the information you need, when you need it, to make faster, better decisions for an optimized fleet.

Learn more at www.fleet-pulse.com

Monitor entire fleet in real time

FLOG0321_42-46_[SR]FoodSafety.indd 46

On-demand trailer level data

Time-saving automated alerts

3/1/21 9:07 AM