This blog was originally published by Aptean on May 25, 2021.
It has been clear for many years that for food businesses to achieve true excellence in their supply chains, they must embrace technology. And doing so requires a full digital transformation including improvements to business processes, technology and culture. This isn’t an overnight process — it takes a minimum of 2-3 years for a business to fully implement a digital transformation strategy. But despite this, 40% of food companies either haven’t begun the process, or are still in the very early stages.
When it comes to the complexities inherent in modern supply chains, it’s more important than ever to have true, bidirectional traceability — and this isn’t just vital for mitigating risk as it once was. Read on to discover how purpose-built ERP can help your food business achieve greater levels of efficiency, quality and therefore increased profit margins.
Why is food supply chain traceability so important?
Ensuring rigorous food industry traceability has traditionally been seen as an exercise in risk management. The cost — financially, reputationally and in production hours lost — of a mass product recall or a failed safety audit was the main driving motivation behind putting traceability infrastructure in place.
A new era of tech-enabled safety is being created by industry regulators, but there’s a growing realisation that the potential of strong traceability and supply chain excellence goes way beyond risk and compliance. In fact, the positive impacts it can have on the overall direction of your food business are arguably more valuable when it comes to delivering return on investment:
- Improving supply chain efficiency with end-to-end data. Leveraging traceability data to improve inventory management, stock location, trend forecasting and return on investment.
- Cost reductions. The power of Business Intelligence (BI) tools give greater insights into production bottlenecks and the hidden drains on resources that pen and paper or spreadsheet management can’t show.
- Increased customer satisfaction. A firm grasp on supply chain data enables companies to forecast and meet demand better, cut the time taken to complete traceability exercises and bring more transparency to the chain.
Beyond these primary benefits, better food supply chain traceability also allows you to respond to increased consumer awareness. It can help you guarantee your customers:
- Sustainable products and increased environmental awareness and transparency
- Responsible sourcing through initiatives such as Fair Trade
- Closer connections with the people producing food products (e.g. “meet the farmer” campaigns)
These kinds of results can’t be achieved instantly, and the technology you implement to enhance food traceability must become an integral part of your business, rather than simply being an add-on. This is where a tailored food ERP comes in.
Unlock True Supply Chain Control With a Food ERP
With the potential upsides of enhanced food traceability clear, the difficulty comes with making it a reality. There is a particularly apparent “technology gap” in the food industry—with a surprising number of businesses still relying on record-keeping by pen and paper, Excel or legacy systems.
Every business has a traceability system in place—even if it’s just a manual one. The role of technology is to make the process more powerful, more accurate, safer and quicker, as well as to enable extra benefits such as the ones we touched on earlier. Before you can get to this point, your business needs to implement a digital transformation “backbone.” This backbone will enable you to embrace:
- Cloud computing. A lifeline for maintaining a single point of truth in multi-site organisations, as well as ensuring any outages don’t cause havoc.
- Real-time paperless data collection. This is about more than just barcode scanning. Harness the power of the Internet of Things to make data more accurate and timely.
- Better business insights. Sustainably eliminate inefficiencies and bottlenecks, improve on-time shipment rates and carry out better product and customer profitability analyses.
- Predictive analysis. Improve your resource utilisation and trade spending while reducing wastage and giveaway.
The perfect technology for creating this backbone is food and beverage ERP.
Specialised food ERP (or enterprise resource planning) is a system that creates one source of truth your food business by integrating every department under a single interface. Food and beverage ERP allows you to move from a “point-to-point” system where each piece of software or hardware works independently creating siloed data, to a “hub and spoke” model where there is one source of data entry and every module feeds into a single platform.
The Microsoft Dynamics Food & Beverage ERP is built specially for the food industry and is customisable to the needs of your business. That’s why it has advanced traceability capabilities built in. It systemises your traceability records to allow them to work smarter for your business.
This Solution helps you:
- Achieve automated stock rotation
- Re-order products based on stock levels and enable automatic purchase orders
- Gain On Time and In Full (OTIF) insights into supplier performance
- Apply “book in/book out” process to preparation, mixing, cooking, packing and the finished product to attain end-to-end control
Microsoft Dynamics 365 Food and Beverage ERP is also extremely adept at allowing businesses to focus on particular areas of need in their supply chains. For instance, the preparation stage may require extra care in controlling wastage, or the cooking process may require closer measurement of batch yields. Whatever the specific needs of your food business, you can configure our food ERP to negotiate them quicker and more effectively than your current manual processes allow.