Tag Archives: manufacturing

Food Safety Consortium Virtual Conference Series

2021 FSC Episode 3 Preview: COVID-19’s Lasting Impact on the Food Industry

By Food Safety Tech Staff
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Food Safety Consortium Virtual Conference Series

This week’s episode of the 2021 Food Safety Consortium Virtual Conference Series will examine The New Normal: COVID-19’s Lasting Impact on the Food Industry. The following are highlights for this Thursday’s session:

  • COVID & Manufacturing, with April Bishop, Treehouse Foods
  • Impact of COVID-19 on Food Safety & Quality Teams, and Strategies for Moving Forward, with Jill Stuber, The Food Safety Coach
  • The Intersection of COVID, Technology and Consumer Changes, with Darin Detwiler, Northeastern University
  • COVID & Business Continuity Planning, with Douglas Marshall, Ph.D., Eurofins
  • TechTalks from RizePoint and Bayer

This year’s event occurs as a Spring program and a Fall program. Haven’t registered? Follow this link to the 2021 Food Safety Consortium Virtual Conference Series, which provides access to all the episodes featuring critical industry insights from leading subject matter experts! Registration includes access to both the Spring and the Fall events. We look forward to your joining us virtually.

Stephen Dombroski, QAD
FST Soapbox

Regulatory Issues and Transportation: Critical Factors in the Quest for Sustainability in Food Manufacturing

By Stephen Dombroski
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Stephen Dombroski, QAD

Over the last several months, we have been exploring the details of several critical factors that are impacting the food and beverage manufacturing sector in terms of sustainability, including:

Two additional factors that food manufacturers now have to manage regarding sustainable practices are transportation and regulatory restrictions. Each can be discussed as a separate topic, but they are intertwined, as there have always been regulations regarding food transportation, and obviously food has always needed to be transported. Now that sustainability is an important topic in all areas of food manufacturing, it makes sense to discuss these two subjects both individually and collectively.

Transportation and Regulatory Joint Concerns

Ensuring that all areas of food transportation incorporate sustainable practices is a critical component of achieving sustainability in food manufacturing. To this point, however, these types of practices have not fully been implemented or even designed. This area is still evolving. From a straight transportation point of view, governments globally have been imposing restrictions for decades. These restrictions vary from country to country, province to province, region to region, and so on, and this causes confusion when inter- or intra-region transportation of food is required. There are also several regulatory differences based on mode of transportation. Land, air and sea transportation can and should have different regulations.

Another ingredient that should be added to this product mix of sustainability, transportation and regulations is food safety and the integrity of the food materials being transported whether it is ingredients, work-in-process foods or finished products. Various modes of transportation can affect the chemical composition, physical appearance, nutritional value and quality and safety of food. It could be straightforward to start implementing restrictions, regulations and new methods of how to package, manufacture and transport food to satisfy the growing trend of sustainable food behaviors. However, what cannot get lost in this is the issue of food safety and integrity.

Sustainability More than Recycling and Litter

When discussing regulations around transportation and food, many people immediately think of littering, of some uncaring individual throwing a soda pop can out of a car window. Littering regulations, laws, fines, penalties and public service campaigns have been in place globally for more than 50 years. The next time you go outside, take a look around at how effective those have been. Sustainability goes far beyond the issue of litter. One area that works hand in hand with transportation of food is climate change. Governments have been evaluating the current practices and have begun implementing changes designed to positively affect climate change. Some examples include:

  • 23 American states and Washington, D.C. limit idling by some or all vehicles.
  • The California Air Resources Board adopted the TRU Airborne Toxic Control Measure in 2004 to reduce diesel particulate matter pollutant emissions.
  • In 2020, the International Maritime Organization will implement a new regulation for a 0.50% global sulfur cap for marine fuels.

The food and beverage industry is actively embracing other changes that affect sustainability. Electric trucks fit well with the F&B distribution hub model, with clean, quiet, short-run deliveries. Fuel usage during transportation is being considered from every angle. Local and regional food systems, where farmers and processors sell and distribute their food to consumers within a given area, use less fossil fuel for transportation because the distance from farm to consumer is shorter. This shorter distance also can help to reduce CO2 emissions.

Change Starts with Money

During many conversations I have had with my wife about a variety of subjects, especially those that can be considered controversial, one of us always raises the same question which is: “When in doubt, what is it all about?” And most of the time, the answer is money. Regulations around sustainability in food manufacturing are being driven by demands made by the consumer. The purchasers of the finished food product dictate almost every aspect of that product to the manufacturer because, let’s face it, if the consumer doesn’t like it, they won’t buy it. And if they don’t buy it, what will eventually happen to the manufacturer? That’s right—it goes out of business.

Now there is a good definition of sustainability or at least of what is not sustainable. From the transportation side of things, manufacturers in almost all cases pay the freight of shipping their food products to the members of the value chain. This obviously affects the costs of goods sold, which is a direct component of the bottom line and the profitability of the business. And with margins typically low in food and beverage manufacturing, transportation costs are always on the minds of the executives. So as the drive for sustainable transportation practices rolls into food manufacturing, you can bet that in addition to meeting sustainable practices, they will fit into the financial plans of the organization as well.

Sustainability: Just Another Component in a Long Line of Disruptors in Food Manufacturing

Years ago, when the topic of disruption in food manufacturing came up, many would mention things like a customer changing an order, an ingredient not arriving on time, or a packaging line going down for an hour. Today, these occurrences are just part of the day-to-day process and reality of food manufacturing. They are going to happen, and disruptions are the things that will make a food manufacturer have to change their business model and force them to change their philosophy and begin to evaluate their business practices and systems to adjust to the world in which they operate.

Sustainability is another one of those disruptions that will impact the process of food transportation long term. Sustainability will be an area that eventually forces manufacturers to operate within new regulatory parameters imposed on how they produce and ship their food. Through these changes, manufacturers will have to ensure that food meets the current and future safety regulations while maintaining profitability. That is where real sustainability will be measured. Changes to business, movements like sustainability are adding to the disruption of the food industry at unprecedented rates of speed. In order to survive and thrive, and to meet these disruptions head on and be sustainable themselves, global food manufacturers must be able to innovate and adapt their business models.

Listeria

Virtual Event Targets Challenges and Best Practices in Listeria Detection, Mitigation and Control

By Food Safety Tech Staff
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Listeria

Next month, Food Safety Tech will host the first event in its Food Safety Hazards Series, “Listeria Detection, Mitigation, Control & Regulation” on April 15. The virtual event features Sanjay Gummalla, Ph.D., senior vice president of scientific & regulatory affairs at AFFI; April Bishop, senior director of food safety at TreeHouse Foods; and Douglas Marshall, Ph.D., chief scientific officer at Eurofins. These experts will address Listeria from the perspective of food manufacturing and preventing the introduction of the pathogen; risk based and practical approaches to address the presence of Listeria in food production and achieve key publish health goals relative to the pathogen; how to implement a strong Listeria control program; and the testing challenges from a lab perspective.

The event begins at 12 pm ET on Thursday, April 15.

Presentations are as follows:

  • Listeria Control and New Approaches to Addressing Risks, by Sanjay Gummalla
  • Managing Food Safety and Sanitation in the Digital Age, by April Bishop
  • Listeria Testing: Choosing the Right Method and Target, by Doug Marshall

The presentations will be followed by a panel discussion and a live Q&A with attendees.

Register now for the Food Safety Hazards Series: Listeria Detection, Mitigation, Control & Regulation

Niels Andersen, ThinkIQ
FST Soapbox

Supply Chain Visibility and Transparency a Key Element of Change in 2021

By Niels Andersen
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Niels Andersen, ThinkIQ

It is safe to say that 2020 was a year unlike any other. The COVID-19 pandemic brought on significant changes to everyday life across the world. It also brought some significant challenges to businesses from retail, to restaurants and manufacturing. The supply chain industry faced a challenge like no other when shutdowns began and manufacturers were left scrambling to come up with a backup plan. Although these challenges were tough to handle, it gave the industry a much-needed eye opening to make the changes needed in order to avoid this from happening again.

The food manufacturing industry was hit particularly hard and required some intervention from the U.S. government. In order to protect food plant workers, the FDA and OSHA jointly issued a 16-page checklist for use by owners and operators of food production companies in mid-August. While it did not list any new regulations, it pulled existing guidance from the FDA, CDC, and OSHA. The main focus was on employee health and food safety. The main concern was offering guidance on how to deal with resuming operations, protecting healthy workers, as well as for dealing with sick employees and those exposed to them. One of the struggles we have is that the guidelines relate to how workers behave inside a plant.

These guidelines were just the tip of the iceberg as it forced the industry to take a deeper look into two main areas: Supply chain robustness, visibility and transparency, and traceability. Highly optimized modern supply chains depend on a high degree of predictability from all actors in the chain; they are lean in order to minimize costs and working capital.

Unfortunately, this optimization has made supply chains brittle—the models did not anticipate COVID-19 and the unexpected complexity that followed. Moving forward, manufacturers need to take a closer look at how this happened.

The traditional way to increase robustness in a supply chain is to increase inventory buffers so that any breakdowns can be smoothed out over time. Inventory buffers are expensive, tie up working capital, and increase risks, because a manufacturer may not be able to sell what they have in inventory. A more modern approach is to make supply chains more agile, so changes can be implemented quickly in case the unexpected happens. Agility requires visibility and transparency in order to understand what’s happening. The struggle in manufacturing is that agility must be combined with repeatability so that quality products can be created in a cost-effective way on a large scale. Repeatability also requires visibility and transparency. A famous quote from Lord Kelvin says, “you cannot improve what you cannot measure”. This rings as true today as it did more than 100 years ago. Another key element is repeatability to ensure that the manufacturing resources produce the requested production orders. This is why it is so important to provide transparency in what is going on in your supply chain to ensure processes are stable and repeatable.

The pandemic has brought a renewed focus for manufacturers in making sure they are becoming more transparent and agile within their supply chain processes. They are realizing thanks to this disruption that suppliers can’t always deliver and a backup plan is crucial to keep things moving. One option is to implement technology that helps track visibility and transparency to better assess what is needed and to offer alternative suppliers. Having supply chain transparency requires companies to know what is happening upstream in the supply chain and communicate this knowledge both internally and externally.

Automation Can Help with Supply Chain Visibility

Automation has wrongly been perceived as just a way to kill jobs. At the same time, the idea of “bringing manufacturing back to the United States” is less about bringing jobs back and more about adding value creation. For manufacturers to be effective today, they must automate. It’s not just about being efficient, it’s about enabling manufacturers to scale up with precision. Most importantly, it’s about survival. In order for manufacturers to survive, they need to automate. This is driving a much higher demand in sensors which play an essential role in automation.

Automation systems are unbiased, and don’t have bad day. This means manufacturers can operate with high levels of repeatability and precision. Without this level of automated precision, we would not be able to enjoy many of modern life’s necessities like the car you drive or the cell phone in your pocket.

Additionally, automation reduces errors, increases the efficiency of the labor, and results in higher output with lower labor costs. This helps manufacturers reduce waste, increase sustainability, lower their carbon footprint, and reduce their energy dependency.

2020 prompted many necessary changes to the food manufacturing industry and their interaction with suppliers. It is true that a crisis spurs innovation. The pandemic has forced manufacturers to think differently about how they are conducting business. One thing will be critical to move forward: The ability to have better visibility of your supply chain. Adding visibility, transparency and collaboration tools are going to bring on lasting changes that are to manage a disruption such as a future pandemic.

Rick Williams, JPG Resources
FST Soapbox

COVID-19: The Impact on 2020 and Beyond

By Rick Williams
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Rick Williams, JPG Resources

COVID-19 has had a major impact on the food and beverage industry this year, contributing to everything from bare shelves and supply chain issues to changes in consumer behavior to plant shutdowns, and to historic grocery cost spikes. We continue to experience changes every day, along with challenges that must be overcome. Lessons from the last year can prepare us for the years ahead, but only if we learn to adapt and anticipate.

Nearly all parts of the supply chain have been impacted, from raw material sourcing and packaging shortages to manufacturing plant shutdowns to logistics capacity to bricks and mortar store operations to consumers. At the onset of the pandemic, major industry trade shows were cancelled and postponed, along with demos and in-person sales meetings, leaving the future of shelf resets with a dark cloud hanging above them. Staying in touch virtually with buyers and providing updates proved to be a best practice and will continue into 2021.

To keep things running smoothly on the manufacturing side, assets from some logistics providers were redeployed to where they were needed most, and with consumers dining more from home, the industry saw a huge move from food service to retail, which we will touch on a bit later. Moving into 2021, brands should ensure their raw materials and supply inventories, especially those that are imported, can cover any potential and unforeseen disruptions. It is critical to prepare well in advance of shortages or surges, specifically in at-risk chains.

Despite the attempts to mitigate against shortages, even the most well-known brands faced major out-of-stock issues and consumers turned to alternative, smaller brands. The shortages came from an increase in pressure from consumers stocking up on items, not from a lack of supply as many believed. Manufacturers increased hours and scheduled capacity on production lines to maximize efficiencies to keep up until things returned to normal. When possible, production lines were reconfigured to distance operators and shifts staggered to limit contact between teams. Senators even introduced the Food Supply Protection Act to help strengthen the chain, protect workers and reduce waste, as per the United States Senate Committee on Agriculture, Nutrition and Forestry. Despite these efforts to keep shelves stocked, the unprecedented time presented smaller brands the opportunity to gain new loyal customers. The transition to e-commerce became an avenue for increased exposure for brands and continues to prove to be a vital option to explore if they have not already.

The retail sector made major headlines this year. In an effort to avoid crowds and follow stay-at-home orders, many consumers began shifting their purchasing behaviors. With today’s technology, it has been easier than ever to shop via e-commerce platforms, whether grocery pickup, delivery or takeout. We experienced temporary out-of-stocks at brick-and-mortar stores and increased wait times on deliveries due to fulfillment shortages. Consumer reaction to these changes—including stocking up on staple products such as paper towels and toilet paper—caused spikes in grocery costs. April saw the largest monthly increase in food at home indexes since February 1974, according to the U.S. Bureau of Labor Statistics.

Food service has not been exempt from the impact of 2020. With less dining out and more eating at home, restaurants, bars, college cafeterias and stadiums have had to adapt with major shifts in business operations, traffic and income, and practically hit a standstill. In September, the National Restaurant Association reported that nearly one in six restaurants, or about 100,000 nationwide had closed permanently due to the pandemic. Restaurant management had to amend all aspects of operations, including their takeout procedures and other established programs.

In order to survive, restaurants have been creative, building welcoming and distanced environments, and delivering new services to diners. The use of technology will play an even bigger role, now more than ever, to limit touch points. QR codes for menus and contactless ordering and payment options will become the new norm for establishments, if they have not already. Going into 2021, some restaurants are even revamping menus and finding ways to turn them into CPG products, a new trend that is sure to take off in the new year. In April Shake Shack announced a ShackBurger Kit, complete with all the ingredients necessary to cook the chain’s signature burgers using the same ingredients as the dine-in experience, but from the comfort of home. More recently, in November, Chipotle introduced its first digital-only restaurant, which will handle only pickup and delivery orders. Many local restaurants have adopted new best practices to serve their patrons and stay in business. When in-person dining was suspended in the spring, one of our favorite neighborhood restaurants began offering takeout for the first time. Initially, they required patrons to come in the restaurant to sign their ticket and pick up their order. They evolved into a totally online ordering and payment process, including tip, and masked touchless curbside pickup. They have continued this even as in-person dining resumed. We can expect to see more tactics like these, loyalty programs and digitized experiences in the coming year.

It is impossible to be certain what 2021 will bring, but what we do know is that it will require proactive planning and preparation. Learning from 2020 will play a pivotal role in survival for some brands, companies and establishments, and mitigating against breaks in the supply chain until we return to a sense of normalcy. The good news is the food supply chain has proven to be very robust and resilient. How we react to changes in the next few months is critical to maintaining a strong and secure supply chain to ensure we continue smooth operations.

Alex Kinne, Thermo Fisher Scientific
FST Soapbox

The Importance of Metal Detection in Preventing Food Contamination

By Alex Kinne
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Alex Kinne, Thermo Fisher Scientific

Foreign object detection is a critical step for food processors, with inspection personnel experiencing increased pressure to ensure food safety regulatory compliance without hindering productivity. This pressure has only increased as food processors are faced with accelerated timelines to meet changing supply chain demands for more at-home meals, including frozen and processed, shelf-stable foods as buying habits have changed during the COVID-19 crisis.

Identifying and Understanding Contaminants

Among foreign objects, metals such as ferrous, nonferrous and stainless-steel shavings or broken pieces from equipment are among the most common foreign objects of concern in food processing plants. As part of their HACCP assessment, food processors must identify where these foreign objects could enter the process and ensure that control, such as a metal detector, is in place to reduce escapes into food products.

Overcoming Detection Challenges

Metal detection has long been used as a tool for finding foreign metal objects in food. However, until recently, metal detection had shortcomings. Mineral-rich foods like fresh salad greens, or high-salt content foods, including meat, cheese and fresh-baked bread, are highly conductive and can mimic metal signals. Metal detectors were also susceptible to environmental conditions like temperature swings and electromagnetic interference from nearby equipment in the processing plant. They also pose an ongoing challenge to avoid excessive false rejects, which increase the potential for costly scrap or rework, impacting operational efficiency.

For bread, there is a further complication from the varying densities, air bubbles and other physical characteristics of each loaf since no two are exactly the same. The variations can “confuse” metal detectors into thinking a contaminant is present when it is not, and consequently rejecting good products.

Recent Advancements in Metal Detection

Recent technological advancements are designed to overcome these challenges. Newer technology enables the operator to quickly and easily fine-tune up to five frequencies to achieve the optimal sensitivity settings to find only the metal and ignore the host product. Advancements in software have enabled the automated set-up of detection parameters, saving time. And tracking features allow the metal detector to adjust on the fly without intervention by an operator. Less-skilled line workers are able to perform these tasks versus highly skilled labor required in the past. What used to take hours can be accomplished in minutes, resulting in maximum food safety and operational efficiency.

One of the new technologies scans up to five user-selectable frequencies at a time from 50 to 1000 kHz. It enables users to identify contaminants that are up to 70% smaller in volume than previous single-frequency technology. It reduces the probability of escapes to near zero.

Providing a high probability of detection, safety and operational efficiency allows for a higher level of food safety and brand protection while meeting user processing demands. Keeping the food supply free from foreign objects is always crucial for consumer safety and brand protection. Current events and accompanying demands on food processors underscore the importance. The right technology solution for a specific application depends on application-specific requirements. Given the many factors that can impact detection results, it is prudent to request a complimentary product test performed by the inspection equipment manufacturer(s) under consideration. A product test provides a real-world performance estimate and any technical recommendations for improving contaminant prevention, helping to set up food processors for success.

Jason Chester, InfinityQS
FST Soapbox

Digital Revolution: Empowering the Remote Workforce and Resilience Post-COVID-19

By Jason Chester
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Jason Chester, InfinityQS

Around the world, countries are beginning to take tentative steps toward a return to normalcy following months of stay-at-home mandates and other restrictions in light of COVID-19. Slowly, we’re starting to see employees return to their offices, retail stores open their doors, and restaurants welcome back patrons. However, many will find themselves in a world dramatically different from the one they left before quarantine.

Namely, on top of social distancing and disinfection measures to control further spread of the virus, entire industries are re-examining their legacy processes and systems—especially ones that presented operational challenges at the pandemic’s outbreak—the food manufacturing industry included.

In truth, food manufacturers have gone to great lengths to maintain productivity and output to meet demand throughout the pandemic. But they have done so in the face of unprecedented circumstances, with many plants operating with limited workforces and key employees like quality professionals and plant managers shifted to remote work. Lacking connectivity between those on the plant floor and at home due to long-held manual processes, a growing number of manufacturers must now take a hard look at their quality and safety programs and embrace digital tools.

A Wake-Up Call for Digital Transformation

Most technological investments in food manufacturing over the past several decades have centered on electro-mechanical automation designed to scale up the physical production process. Fewer investments, however, have been made on the equally important data-driven, decision-making process necessary for ensuring optimal performance, food quality and safety.

Even in the most heavily automated plants, it’s not uncommon to find manufacturers managing quality through manually updated spreadsheets, which are often only reviewed after the fact, when it’s too late for remedial correction. There are unfortunately also those who still rely on paper checklists, making it practically impossible to take proactive action on collected process data—much less get the information in front of remote quality professionals and managers. Meanwhile, others have gone as far as adopting software solutions for quality data management and process control, but these tend to be on-premises systems that employees can’t access outside of the four walls of the plant.

We have also seen many examples where, due to workforce restrictions and availability, employees from other parts of the manufacturing business (e.g., R&D, IT, and back-office teams) have been brought in to perform plant-floor activities like quality and food safety checks. The goal has been to prevent impediments to production output, just when demand has increased substantially. But ensuring that these employees perform the checks on time and in the correct way—with little time for training or coaching—has left many plant leaders in a precarious position.

The challenges seen with these capabilities and enabling geographically dispersed teams to work together through the pandemic have been a wake-up call of sorts for digital transformation. Manufacturers are coming to the realization that they’ll need data accessibility, actionability and adaptability along the road to recovery and in the post-COVID-19 world. And with social distancing and other workplace precautions expected to continue for the foreseeable future, the imperative is all the more urgent.

The Solution Lies in the Cloud

To digitally transform quality and safety programs today, food manufacturers should prioritize investment in the cloud. Notably, cloud-based quality management systems offer a way to standardize and centralize critical process information, as well as tools to empower employees at all levels of the enterprise.

For plant-floor operators struggling to keep up on account of reduced workforce sizes, such solutions can automate routine yet important activities for quality assurance, including data collection, process monitoring and reporting. If a team member needs to cover a different shift or unfamiliar task, role-based dashboards can help them to see required actions, while process workflows can provide guidance to ensure proper steps are taken even with a limited workforce. Further, automated alerts can provide timely notifications of any issues—whether it be a missed data collection or an actual food quality or safety concern present in the data.

Perhaps most importantly during the pandemic and for the post-COVID-19 world, the cloud makes critical quality data instantly and easily accessible from anywhere, at any time. Quality professionals, plant managers, and other decision-makers can continue to monitor and analyze real-time process data, as well as observe performance trends to prevent issues from escalating—all safely from home.

The scalability of cloud-based solutions also streamlines deployment so organizations can rapidly implement and standardize on a single system across multiple lines and sites. In doing so, it becomes possible to run cross-plant analyses to identify opportunities for widescale process improvement and align best practices for optimal quality control at all sites. This ability to understand what’s happening in production—through real-time data—to enact agile, real-world change is a hallmark of successful digital transformation.

An Investment for Whatever the Future Holds

Ultimately, investments in secure cloud-based quality management and the broader digital transformation of manufacturing operations are investments in not only perseverance during the pandemic, but also resilience for the future. Food producers and manufacturers who can readily access and make informed decisions from their data will be the ones best equipped to pivot and adjust operations in times of disruption and uncertainty. And while it’s unclear what the future holds for the world, the food industry, and COVID-19, it’s safe to say we likely won’t see a full return to normalcy but the emergence of a new—and in many ways better—normal, born out of digital solutions and smarter ways of thinking about quality data collection and monitoring.

Bob Bentley, Crisp
FST Soapbox

Predictions: Planning for Increased Demand with Limited Supply

By Bob Bentley
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Bob Bentley, Crisp

We are seeing the beginning of a limited supply of certain products as containment of the COVID-19 pandemic keeps manufacturers, processing plants, and other suppliers in global stasis. But what does that mean for these manufacturers and other members of the supply chain? It means continued planning of master resources such as demand management, sales and operations planning and production scheduling, but with a greater focus on efficiency.

This process of master resource planning results in a detailed blueprint for manufacturing products to meet anticipated demand, accounting for various constraints such as limited supply of raw materials and purchase parts.

So what should manufacturers do if they run into serious shortages of raw materials or purchase parts? What can retailers do to cover operating expenses if they don’t have enough products to sell? We’ll take a look at these anticipated complications and possible methods for solving them.

Limited Supply

The current COVID-19 crisis has led to mandatory business closures that have already caused a shortage of supply. So far, we’ve gotten by with inventories that had already been sitting in various places up and down supply chains prior to the shutdowns, not just on warehouse and retail store shelves. Once all inventories within supply chains are depleted, we will start to notice more stockouts.

Some businesses can endure long-term production cessations without stockouts. For example, manufacturers in critical industries such as pharmaceuticals have a policy of stockpiling inventory in case of unforeseen events. Most businesses, however, cannot afford to miss months of production time because the lean manufacturing principles they adhere to include keeping minimal inventory.

For instance, automobile manufacturers and retailers do not hold excess inventory due to the expected annual product line changes from the previous year’s models, which are typically sold at a large profit reduction at the turn of the year. Clothing and other fashion-related businesses also keep inventory minimal due to a yearly change in styles.

Another source of upcoming shortages will be the sell-off of supplier facilities due to the downturn in revenue caused by emergency closures. Food is a particularly interesting case. Farmers are reconstructing the way their supply chains work to better serve their new target consumers—grocery retail. Some farmers may run into issues with transporting livestock or may need to repurpose crops that are nearing their harvest. Many of those that are pushing to endure and come out of the pandemic disruption with minimal casualties are starting to get creative by creating small farmers’ markets (pop-ups) or marketing directly to the consumer via direct subscription boxes.

It will take some time to re-establish farms, manufacturing plants, and other suppliers who were hit hardest during the months without revenue. However, refocusing on demand planning and forecasting could aid in spurring a regeneration of these industries.

Demand Management

Demand management is the first of three steps taken during the master resources planning process. Demand management includes demand forecasting, distribution channel planning and customer demand management.

Both suppliers and retailers need to know what demand they can expect, especially during uncertain times. After COVID-19, consumer demand will be high, supplies will be limited, and accurate demand forecasting will be especially important to getting businesses back on their feet.

Inaccurate forecasting will cause waste when businesses overestimate future demand for items that have a short shelf life. For instance, a grocery store that overestimates how much produce they will be able to sell within a certain time frame will end up throwing some of that produce away due to spoilage.

Consumer behavior during a crisis can complicate demand forecasting, though. In an earlier phase of the COVID-19 pandemic, worried customers over-purchased toilet paper and paper towels. This caused a shortage for everyone else, and the demand for those items was much higher than anticipated/forecasted. More recently, the same buyers bought up meat when they heard about the disruption in the food supply chain, and they expected the prices for meat to go up. Demand spikes like these cause lost sales for stores that don’t anticipate them.

Demand forecasting will remain tricky in the short-term for both suppliers and retailers whenever a retailer re-opens to the public with the imposed 25% capacity constraint. Overhead expenses will likely remain relatively the same, but 25% of the normal revenue may not cover expenses. Whether a full 25% of a retailer’s former customer base would return during a pandemic is also an unknown factor.

Companies will see high demand when the world opens their doors for business. The most efficient way for companies to plan during these times is by utilizing high-performance, demand forecasting software that will offer the best information available to deal with volatile demands, given the various known and predicted factors.

Sales and Operations Planning

After demand management is performed, manufacturers go through a sales and operations planning process that integrates sourcing, manufacturing, sales, marketing and financial plans, and resource planning. This process results in the creation of an approved production plan (at the product family level), purchase plan, sales plan and backlog plan that satisfies the anticipated level of demand within supply constraints.

In the early days following the end of the pandemic, some manufacturers won’t have the initial supply to meet the high demand for their goods. Some may find contingencies for creating their goods and products, while others may run into supplier issues when it comes to recreating their products and goods post-closure.

Getting manufacturers back up to speed will depend on building up the supplies of raw materials and purchase parts. Sometimes out-of-the-box solutions such as part designs can eliminate the need for some unavailable purchase parts and dependency on some suppliers. Additionally, accurate demand planning information will enable manufacturers to accommodate their retailer customers as much as possible without overpromising incoming goods.

Master Scheduling

In the master scheduling phase, the production and purchasing plans are taken from the family level into a specific product level. This process involves a computer repeatedly simulating production and purchasing as planned during the S & OP step until optimal bills of materials are created. This process includes testing of the plans against constraints of critical resources (rough-cut capacity planning) until a master production schedule is derived.

Fortunately for the retailers, manufacturers who have done accurate demand planning and have taken their production plans through the master scheduling stage will know the maximum number of goods they can ensure without overreaching.

Conclusion

The current COVID-19 pandemic required many business closures to help contain the spread of the virus. As a result, many consumer goods are in limited supply. When the crisis ends, the demand may very well overtake the supply. Businesses will need to practice patience while supplies build back up. Thinking outside the box, using accurate demand forecasting, preventing waste, and executing good demand planning will be crucial steps in reinstating a synergistic supply chain model.

Angela Fernandez, GS1

COVID-19 Puts More Emphasis on Supply Chain Visibility and Data Quality: A Conversation with Angela Fernandez of GS1 US

By Maria Fontanazza
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Angela Fernandez, GS1

The food industry is adapting in completely new ways as a result of the coronavirus pandemic. Retailers are scrambling to keep certain items on store shelves and manufacturers are adjusting their production strategies based on realistic and ever-shifting needs. In a recent discussion with Food Safety Tech, Angela Fernandez, VP of community engagement at GS1 US and FST editorial advisory board member, talks about how companies can improve relationships with trading partners in the face of COVID-19.

Food Safety Tech: What issues do you see happening in the supply chain right now?

Angela Fernandez: Our food supply chain is experiencing overwhelming demand. As an organization that collaborates with both the retail grocery and foodservice sectors to solve supply chain challenges, we’re working with industry on how we can make our supply chain more efficient in the short term, and make it more resilient in the long term.

Consumers are frustrated by empty shelves and the demand created by the pandemic is changing the movement of products. Right now, products are not always accounted for in transit, there are production issues depending on category, and food produced for foodservice outlets like restaurants, schools, and hotels can’t always be easily diverted to a supermarket. The U.S. Food and Drug Administration is lifting restrictions on the sale of food so that it is possible for items that may have been produced for foodservice “sale” to be sold in a supermarket.

FST: In what particular areas are you seeing inventory shortages that are impacting retailers and suppliers?

Fernandez: We’re seeing a couple of different dynamics. For suppliers that produce products for both retail and foodservice channels, we see a shift in reducing production on foodservice items and an increasing manufacturing on their retail product lines. We’re also seeing foodservice suppliers that have not serviced the retail channel previously are now looking to establish new relationships with retailers and recession-proof their businesses. This is not happening as fast as consumer demand for perimeter products like dairy and produce, so we see shortages and products expiring before they can be sold to these new retail customers.

Additionally, food product variation and customization is decreasing. If you think about your own experience going to the grocery store today, or arranging for a delivery, you’re seeing fewer flavors of a product available and fewer brand names you’re familiar with. Suppliers are continuing to shift back to mainstream production of their core product lines just to keep store shelves stocked. I think that’s what we’re going to continue to see—the reduction of customized and specialty items.

For retailers, they have a prioritized the focus on ramping up their e-commerce strategy to relieve the pressure on their stores and service more consumers online. This poses a particular challenge when retailers have limited IT resources and a need to set up a new item supplied from a new foodservice manufacturer that is trying to divert their products to the retail channel to support the demand. And in some cases unfortunately, foodservice suppliers maybe unable to redirect some of their products due to the fact they are not marked for individual sale with the traditional U.P.C. and other retailer requirements.

FST: Is there a better way that food companies, retailers and suppliers can work together during this pandemic?

Fernandez: Food companies can improve the way they work together if they focus on supply chain visibility and data quality. Visibility is key as suppliers are ramping up production on those mainstream products and trying to get them to the proper locations when retailers need them. That’s where I would look at GS1 Standards such as the Global Trade Item Number (GTIN) for product identification and the advance ship notice (ASN) transaction, which lets a partner know when something is ready and being shipped. Global data standards enable the visibility to what delivery a retailer can expect and when, and being able to account for that inventory once it’s inside the DC [distribution center] location so that they can update an online platform. This can help ensure that a retailer has accurate information for the consumer and ability minimize the substitutions that can occur.

The second piece is the data quality aspect—making sure we have the right information around those core items that we are trying to keep stocked on the shelves for consumers who are purchasing those items today. The retail grocery and foodservice industries have been working on making product data more complete and accurate for a number of years, but we’ve seen a heightened focus on it now, knowing that consumers are relying on digital information to be correct since they cannot see the product in person right now. Expanding the data set for the consumer is critical.

FST: What is GS1 US doing right now to help customers better navigate today’s environment?

Fernandez: GS1 US is helping trading partners work with the capabilities they have to implement greater supply chain visibility, improve data quality and ramp up e-commerce operations. Depending on what was already implemented by the manufacturer or retailer, we’re looking at how we can leverage existing capabilities to help partners work together more efficiently to meet demand. How we can help connect the physical product and the digital data, knowing how important that is online right now, not only for trading partners but also for consumers?

One example of how GS1 Standards can be extended is if a retailer is looking to shorten their supply chain and purchase from a local farm. Standards provide a blueprint for supply chain partners to work together in a consistent way. We want to help these companies leverage and extend the standards instead of proprietary systems and abandoning useful processes for item setup, data exchange and point of sale checkout. Those are the types of discussions that we’re having—how GS1 US members can extend the standards that lead to operational efficiency and more easily bring in new partners to help fulfill demand.

Maria Fontanazza, Food Safety Tech
From the Editor’s Desk

COVID-19 in the Food Industry: So Many Questions

By Maria Fontanazza
1 Comment
Maria Fontanazza, Food Safety Tech

Industries across the global are reeling from the COVID-19 crisis. Although we are clearly not in a state of “business as usual”, the food industry is essential. And as this entire industry must continue to move forward in its duty to provide safe, quality food products, so many questions remain. These questions include: Should I test my employees for fever before allowing them into the manufacturing facility? What do we do if an employee tests positive for COVID-19? How can the company continue safe production? Should we sanitize between shifts on the production line? Should employees on the production floor wear face masks and shields? At what temperature can the virus be killed? The list truly goes on. We saw it ourselves during the first Food Safety Tech webinar last week, “COVID-19 in the Food Industry: Protecting Your Employees and Consumers” (you can register and listen to the recording here). Amidst their incredibly busy schedules, we were lucky to be graced with the presence and expertise of Shawn Stevens (food safety lawyer, Food Industry Counsel, LLC), April Bishop (senior director of food safety, TreeHouse Foods, Inc. and Jennifer McEntire, Ph.D. (vice president of food safety, United Fresh Produce Association) for this virtual event.

From a manufacturing point of view, we learned about the important ways companies can protect their employees—via thorough cleaning of high-touch areas, vigilance with CDC-recommended sanitizers, conducting risk assessments related to social distancing and employees in the production environment—along with the “what if’s” related to employees who test positive for COVID-19. Although FDA has made it clear that there is currently no indication of human transmission of the SARS-CoV-2 virus through food or food packaging, some folks are concerned about this issue as well.

“The U.S. food supply remains safe for both people and animals. There is no evidence of human or animal food or food packaging being associated with transmission of the coronavirus that causes COVID-19,” said Frank Yiannas, FDA deputy commissioner for food policy and response in the agency’s blog last week. “Unlike foodborne gastrointestinal viruses like norovirus and hepatitis A that make people ill through contaminated food, SARS-CoV-2, which causes COVID-19, is a virus that causes respiratory illness. This virus is thought to spread mainly from person to person. Foodborne exposure to this virus is not known to be a route of transmission.”

As the industry continues to adjust to this new and uncertain environment, we at Food Safety Tech are working to keep you in touch with experts who can share best practices and answer your questions. I encourage you to join us on Thursday, April 2 for our second webinar in this series that I referenced earlier, COVID-19 in the Food Industry: Enterprise Risk Management and the Supply Chain. We will be joined by Melanie Neumann, executive vice president & general counsel for Matrix Sciences International, Inc. and Martin Wiedmann, Ph.D., Gellert Family Professor in Food Safety at Cornell University, and the event promises to reveal more important information about how we can work through this crisis together.

We hear it often in our industry: “Food safety is not a competitive advantage.” This phrase has never been more true.

Stay safe, stay well, and thank you for all that you do.