In agriculture and primary production alone, 1.6 million tonnes of food are wasted, which is enough to feed everyone in the UK for around 13 days. When taking the complete supply chain into account, 4.8 million tonnes of food are discarded every year, which would otherwise be able to feed approximately 2,646,000,000 people each day. Significant amounts of wasted food is also an issue on the consumer side, with UK supermarkets such Marks & Spencer, Tesco, Morrisons and Co-op scrapping use-by dates in an attempt to convince customers to use their own judgement when deciphering whether a perishable is still OK to eat.
These significantly high figures reflect the magnitude of the challenge facing manufacturers, distributors and food and beverage processors as they fight to achieve greater efficiency, agility and sustainability in their processes.
An exploration of the complex challenges
Whenever food is discarded by a food and beverage company, it’s not just throwing away the consumable itself, but also the associated energy, water and space that’s been used to grow, produce and ultimately deliver it to its needed destination. It means that while reduction of waste is rightly under the spotlight, there’s other aspects to consider in the industry.
Industry standards and stringent quality regulations are the perfect example of additional obligations. This may include constraints associated with food safety and the need to trace the origins of every ingredient used. In terms of food safety emergencies, product traceability tools are needed to track any element of a certain batch to locate the cause of a contamination and its source.
While these tasks were already a challenge for organisations, the lasting impact of Covid-19, Britain’s departure from the EU, the Russia-Ukraine conflict and the worsening effects of climate change have left a lasting mark on how consumers purchase goods. Simultaneously, supply chains have been severely disrupted as a result.
Supply and demand forecasting is especially vulnerable to these external impacts, with organisations unable to decipher demand and optimise prices as a result. The events of 2022 have exacerbated this issue, and without visibility of every area of production, organisations lack the holistic insight to be able to make informed supply and demand forecasting decisions. The knock-on effect is then detrimental to product availability and makes food wastage a more likely occurrence.
To help stop the accumulation of significant piles of food waste, food and beverage companies must take control of supply and demand. With clarity over the situation, they’ll be able to avoid sourcing from two ore more suppliers or need to have greater amounts of stock at the ready, with both measures likely to increase supply chain wastage.
Devising a solution
Devising a solution is critical for food and beverage companies to address these significant challenges. Critical solutions that organisations can utilise are enterprise resource planning (ERP) technologies. Among a myriad of benefits, ERP solutions facilitate improved supply chain integration. A linked up supply chain will allow businesses to both ensure quality and sync supply and demand requirements, therefore helping to eradicate waste.
Use of an ERP solution can also enable a more efficient stock management process. By gaining real-time insights into stocks, this can also help enable supply and demand to be matched up, while ensuring that inventories held can be kept to a minimum and waste can be further reduced. Additionally, the value of ERP also extends to anticipating and meeting consumer demand. Reporting tools driven by ERP can provide business intelligence and insights, such where high demand is coming from and when it’s going to happen.
With this data, businesses can make properly-informed strategic decisions which are aligned with demand changes. The key here is control. ERP technology provides the control to stop food from being thrown onto the scrap pile and ultimately helps to foster efficiencies and bring down costs.
Preparing for any eventuality
The current age is one of unprecedented global disruption due to a number of global factors, and this shows little sign of changing over the next few years. To better prepare for the unexpected, technologies based around automation and digitalisation can provide food and beverage firms the ability to navigate uncertain times.
At the core of making this possible is the leveraging of the latest ERP solutions. These technologies help businesses to comply with stringent and ever-evolving regulations, reduce risk and be able to forecast for transforming demand. In the context of tackling the food waste problem, they help to bring efficiencies and waste reduction to fruition, enabling businesses to scale up while ensuring that fewer consumables end up in landfill.
