Even prior to 2020, the food and beverage industry was already witnessing major changes due to rapidly shifting consumer preferences. Today, largely due to the Covid-19 crisis, these trends have accelerated considerably. As a result, an explosion of consumer interest has occurred in locally sourced, fresh, organic, natural, and sustainable products.
In response to these new demands, disruptive innovations from the supply side have appeared, especially in the home delivery space. Many of these new offerings have been embraced by consumers, and a variety of well-funded start-ups have entered the food supply sector.
Given these new challenges in an already intensely competitive market, inventory solutions (e.g. automated expiration date tracking) remain critical. From early-stage companies to the largest food brands, the increased pressure on the demand-side calls for innovative supply-side solutions to remain competitive.
In this article, we’ll first take a look at how the industry is evolving in ways that make the food sector more dynamic than ever. Later, we’ll review some common terms used in the industry that might be confusing in regards to expiry dates and related concepts.
Shelf life is more important than ever
For decades, logistics networks were built around a demand for heavily processed foods with an extended shelf life. Large manufacturing plants and bulk shipments drove the majority of product assortment decisions. Also, outbound distribution models were designed to maximize profit relying on fairly predictable demand. Now, as on-the-go consumer demand increases daily, food businesses require more logistical efficiency and agility.
As more fresh food and wider food varieties grow in demand, along with increased health-conscious dining, keeping track of the shelf life of food has become paramount. This not only ensures customer safety and satisfaction, but it also affects the cost of doing business.
These issues can also be applied to other industries with time sensitive products such as pharmaceuticals and other medical goods.
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It’s time to check expiry date strategies
One area that illustrates the challenges facing the food and beverage industry is cold storage. Here we can see clearly why it’s important to check product expiry dates using new technologies.
Ability to Track & Trace
For food sales, food safety is rule number one. You want to know exactly where you source your supply from at all times. To do this, cold storage warehouses use custom lot numbers to track the produce source. Tracking the expiry date of inventory and the temperature of a specific lot freezer keeps food fresh and allows for proper disposal of expired goods.
Expiration date tracking can trace lot numbers, expiry dates, and best before dates automatically. This prevents expired goods from getting shipped by mistake. Additionally, it helps food businesses remain compliant with safety regulations.
Catch Weight Record
The weight of meat, poultry, plant-based, and nearly any other food product is temperature sensitive. Therefore, it’s important to track the “catch weight” as a point of reference for inbound and outbound logistics. Catch weight is a food industry term meaning the “approximate weight” for food products of various sizes. Processes that keep track of catch weight will improve inventory accuracy.
Cold storage facilities consume enormous amounts of energy. The longer food is stored, the more power required to keep it cold. Energy costs can be minimized with streamlined organization since storage times can be reduced by keeping stock for only as long as you need it. Many food brands turn to third party logistics (3PL) to manage their stock. One advantage here could be food storage consolidation with other companies which translates into shared energy costs.
Multiple Temperature Zones
Not all food can or should be frozen. Medications may require specific storage temperatures as well. In order to store each type of food at its optimal temperature, it’s important to accurately match lot numbers to temperature to keep it all organized. Automated warehouse software solutions make temperature to food matching simpler and more accurate.
This method means the goods you receive in your warehouse first are the first to be shipped out. This obviously makes sense for expiration date sensitive food, and even for the longest shelf life food this makes a difference. Perpetual inventory counting keeps track of stock in real time, and updates occur automatically each time a product sells. This level of reporting improves operations and optimizes storage times.
No matter what’s being stored, people are involved in picking, packing, and shipping. Every step involves a cost unit, and technology can help reduce how far employees have to walk when receiving goods and filling orders. For instance, warehouse layout and pick path optimization can be achieved with the help of software to find the shortest and most efficient routes.
Overstocking in the food business can damage revenue unlike anything else. Consumer tastes can change rapidly, so accurate storage and supply data is critical. If you have automatically updated data on-hand at all times, you can respond to shifts in demand more rapidly. For example, businesses can quickly offer discounts on goods where there is a surplus.
Food is moving faster than ever into ecommerce
Today’s eateries and grocers are moving into the online space faster than ever. Customers want the convenience of ordering from their smartphones, plus they want food fast and fresh. For instance, online grocery sales in 2018 were valued at $23.9 billion. In 2023, this number is expected to more than double to $59.5 billion in sales.
For food sellers, the most effective ecommerce strategy integrates the online storefront with supply chains and storage facilities. This allows for the continuous ability to deliver quickly as orders can be taken against inventory.
Integration also minimizes the chance of order error and product miscount. Plus, supply chain efficiency is optimized as orders are placed and sent automatically. Finally, automated solutions provide analytic insight which enables the detection of bottlenecks and inefficiencies.
Same and next day delivery for food
Just like ordering on Amazon (which has already moved into the food space) the companies that sell food can also benefit from offering fast same or next day delivery. Beyond keeping food fresh, this kind of service wins customer loyalty, whether they be restaurants, grocery outlets, or end consumers.
With advanced order processing in place, delivery times are reduced to the bare minimum. It all occurs largely due to integrated online storefronts, real time order processing, and advanced inventory management.
Innovative food startups can compete with the biggest brands
Given the power of new technologies and outsourced fulfillment services, even small to medium sized food companies can leverage modern expiration date tracking and technology solutions. This makes the current environment more exciting, and more uncertain, than ever.
Now, the big players must keep up with smaller, more agile and disruptive competition. Still, the larger brands are catching on fast and adopting the same advanced logistic strategies mentioned in this article
Centralized expiry date tracking
One of the biggest challenges for food delivery is coordinating delivery across diverse geographies. Organizational failure increases the risk of delivering stale or expired food. In addition to health risks, the damage to brand image and customer relations can be catastrophic.
When your food logistics is centralized and integrated, these potential discrepancies all but disappear. With lot numbers and order movement at your fingertips, you can orchestrate delivery from a central command. The largest organizations can establish geographical nodes from which orders are processed. Meanwhile, everything can tie back to a central database for reporting, analytics, and continuous improvement.
Common food industry terminology
What does “Use By Date” mean? Or what is the “Best Before Date” meaning or “Expiry Date” meaning? Here are some definitions to help make things more clear.
Expiration Date (or Expiry Date) - An Expiration Date or Expiry Date is a previously determined date after which food should no longer be consumed. This is either due to regulatory restrictions or due to exceeding the anticipated shelf life for perishable goods.
Shelf Life - This is the period of time that a food commodity may be stored without becoming unfit for use, consumption, or sale.
Sell-By Date - The date marked on a perishable product that indicates the recommended time by which the product should be sold. This is the last date stores should display the product for sale.
Best Before Date - The date by which a product’s flavor and/or quality is at its best. A product may not be expired after the Best Before Date, however, the quality is diminished. This term may also be interchangeable with “Best if Used By Date” and “Best By Date”.
Use By Date - This indicates the last day that the manufacturer ensures a product’s quality. Food products may be consumed after the Use By Date, but the quality may be diminished. Use By Date is similar to Best Before Date.
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