Seven Major Trends Influencing Food Service Supply Chains
In the United States alone, restaurant industry sales are skyrocketing, reaching almost $799 billion last year. The number may continue to grow and this means that food supply chains both in the U.S. and Canada should be prepared to boost their supply chain management to keep up with the competition. Third-party logistics (3PL) distribution companies can help you operate your best, as they can easily adapt to current trends. Here are the seven major trends influencing the industry that you should know about and where you can get the best supply chain management in Toronto.
1. Diversification of Consumer Preferences
As consumers become more aware of the quality and production of their food, food/meal customization has become increasingly popular. Consumers will continue to seek foods that meet their personal preferences, and nutritional needs and values. This includes food types such as organic, non-GMO, farm-to-table, gluten-free, dairy-free, etc. Sales for organic foods has reached record heights, and the global gluten-free food market is projects to reach $4.89 billion in the next three years. The need for transparency about where food is sourced and how it is processed has become more valuable to customers than ever before. To meet this increasing customer demand, supply chains will need to expand their reach to be more global, collaborative, and flexible. Visibility has become more valuable end-to-end along the supply chain. This is crucial to provide customers details about suppliers and production, to enable businesses to respond to the ever-changing demands, and to optimize inventory levels.
2. Technology in the Supply Chain
Supply chain technology is giving brands more opportunities to personalize customer experiences, as consumers continue to personalize the way they shop. Some ways businesses are personalizing the customer experience include anticipating purchases, making suggestions and recommendations, remembering preferences, etc. Technology in the supply chain also allows brands to collect and analyze data instantly. Brands must ensure that all parties in the supply chain can see this data (ie. marketing and sales teams, suppliers, distributors, retailers and their partners, etc.) Visibility at each level will allow for increased collaboration and a clearer understanding of processes, that will make communication and flow much smoother. Aside from data management and analytics tools, supply chain tech allows for predictive analysis and simulation modelling. This provides businesses with more accurate forecasting and demand planning. Other benefits of implementing technology into the supply chain include tracking, optimization, and more efficient production and product movement.
Traceability in the supply chain is helpful for restaurants, farmers, and food processors, as it aids them in meeting FSMA requirements, mitigating recalls and food-borne illness outbreaks, meeting customer demands, and supporting cleaner eating trends. Brands who implement supply chain technology will improve traceability as these tools help automate data collection and management.
4. Sustainability/Circular Economy Efforts
To succeed as an organization, sustainability is a trend to follow, as it may never go away. Both customers and business partners are being more considerate of waste management and environment protection. Circular economy efforts are being put into place to tackle product recycling, and food waste reduction. This system closes material and energy loops to conserve resources and reduce the final cost of the product. It is closely tied in with increased environmental efforts to recycle and reduce waste. Companies and consumers have become more aware of the long-term resource and environmental impact, as well as the cost savings and long-term benefits and gains toward their bottom line when using a circular economy approach. Additionally, customer perception is much higher when a brand is aware of its impact on the environment. Some ways brands are implementing a circular economy approach include designing packaging in the supply chain that is more environmentally friendly.
5. Labelling Trends
Customers today are more interested in buying natural foods than ever before. This ties into the quality of food that brands supply, as well as their labelling methods. These trends are important to watch and research has found that in 2017, clean and clear labels were an important part of ensuring customers can see what is inside their products. Clean living, natural goods, and organic products are more valuable to customers and are important for brands to supply in order to gain their trust. Brands that claim their packaging or products are environmentally friendly see a much higher success rate than those who do not. The new global standard is for the labels to be clearly written, and clean, so customers can easily find the information they are looking for.
6. Packaging Industry
Better labels and increased transparency and traceability are also impacting the packing industry. Consumers generally want more local, organic, and traceable food products, which means your enterprise should incorporate technology such as cloud-based services and logistics management tools that strengthens visibility from the source to the distribution site.
7. Energy-Efficient Products
As alternative energy sources are becoming more affordable and efficient such as solar and wind power, more food service operators are looking to become users of non-carbon-based energy. Many chains have already become energy independent as alternative energy sources and technology make these goals attainable.
Get Help from Lean Supply Solutions
If you are looking for an experienced third-party logistics partner (3PL) to help you improve your supply chain strategy, give Lean Supply Solutions a call. We make ourselves aware of the rising trends in supply chain services and always strive to stay up-to-date. We commit to being aware of our clients’ operational challenges as they arise and help them get the most out of their processes. Our 3PL, packaging, and supply chain management can streamline your processes for better success. Lean Supply Solutions can offer consistent, accurate, and quality results by striving to ensure that the right products are provided to the right customers at the right time, while saving you money. To learn more about outsourcing to our 3PL distribution team, or to ask any questions, contact us at 905-482-2590