An Introduction An FMCG Company having 57 warehouses is managed by 50 service providers in India, thereby increasing operational complexities & communication issues. The company believes in “Performance with Purpose” – a goal to deliver top-tier financial performance while creating sustainable growth and shareholder value. Their products are enjoyed by consumers one billion times a day in more than 200 countries and territories around the world. Generating in 2015 more than US $63 billion in net revenue, they are also driven by a complementary food and beverage portfolio, including 22 brands that generate more than US $1 billion each in estimated annual retail sales. The Challenge The FMCG Company had recently found itself under a lot of pressure to achieve the desired growth and profitability in India by maintaining such a large organization structure for ensuring standardization of its processes and to improve efficiency across its supply chain ecosystem. The Solution By implementing the technology tool at their units, the FMCG Company can now: Success Factor The technology tool was implemented at the FMCG Company unit through a structured ten weeks engagement program to ensure adoption of the ‘Planet Way of Working’ at the unit. The engagement ensured that everyone was aligned to the common goal of making this implementation a success. Reduction in the risk generated by 36% after just three months of implementation of the tool.Increased the probability of task getting completed on time by more than 60%.Unit Managers with a complete toolkit can manage the unit and all the other touch points within the Unit’s ecosystem.Real-time feedback and suggestions improved the overall efficiency of the unit.Peace of mind that helps each employee concentrate on their job instead of fire-fighting all the time.
Many organizations begin with small-scale warehousing and transportation activities and naturally handle their own supply chain. However, there comes a time when partnering with an outsourced supply chain provider makes sense. It could be a result of increased complexity, quick expansion in revenue, planning for future growth, or the introduction of additional distribution channels. Working with a 3PL expert can increase performance and help respond to market changes. In terms of efficiency the partnership provides, the benefits include lower costs, reduced inventory, shorter lead times, and greater resource utilization Longer-term efficacy improves customer service, market share, and revenue. Capital investment is frequently considered to be a barrier in developing an internal supply chain and its infrastructure. Perhaps it is more prudent to manage a greater portion of this function as a variable cost. According to a Deloitte survey, 79% of organizations with efficient supply chains outperform their competitors. Businesses with optimal supply chains also have 3x faster cash-to-cash cycles and 15% cheaper supply chain costs while storing 50% less inventory than those with sub-optimal supply chains. Supplementing the statistics here are a few key benefits that food brands can reap by outsourcing their supply chain to experts. Defined Processes Supply chain outsourcing organizations provide a variety of solutions for food brands to efficiently service their end customer. This includes inventory management and operational optimization of the entire supply chain. Supply chain experts can manage stock, invoices, deliveries, and refunds through well-defined processes. Organizations handling supply chain outsourcing are experts at measuring performance, determining which areas to prioritize and how to implement improvements most effectively while planning to grow the business. Clear controls will increase operational efficiency and help businesses prevent unanticipated expenses. Strategic Alliances A supply chain partner’s network is a crucial resource for moving finished products. Finding the right equipment, insurance, and other credentials might be difficult. However, supply chain partners filter their network to ensure only qualified service providers are included. They can also use their relationships to achieve total cost reduction and improve service. A 3PL provider’s network of partners enables businesses to expand their geographical presence by being able to manage inventory in a potential market without having to invest in vehicles, equipment, or staff. Along with a well-outlined route to market strategy investing in the services of a supply chain provider can save both time and money. Focus on core business activities With an outsourced supply chain taking care of the end-to-end fulfillment, businesses can concentrate on their core competencies to innovate, produce new ideas, products, and business offerings. Outsourcing the SCM to a reputable partner with extensive knowledge and experience can result in significant time and resource savings. This would make food brands more productive and assist their long-term success. Consequently, processes like marketing, customer relationships, and support are enhanced. As the business scales across the country, supply chain outsourcing experts can offer insight into how to expand their fulfilment strategy and optimize inventory, whether it can be executed through the addition of new fulfilment centres, or the expansion into new markets and sales channels. Advantage of knowledge and expertise It is difficult to predict and accommodate internal expertise in all the capacities and geographies required in today’s complex market environment. A 3PL partner will have expertise and experience in a variety of areas, including transportation and its paperwork, sourcing, compliances, and economic rules, to name a few. The supply chain expertise and know-how that a partner can provide to a business wanting to grow across the country can reduce costly delays, shorten the cycle time, and smooth the introduction into a new territory. Access to state-of-the-art infrastructure A significant benefit of partnering with a firm providing supply chain outsourcing is the ability to leverage its existing infrastructure. A 3PL provider will have a broad network of interconnected routes that enables them to maximize efficiency when transporting various clients’ things around the country. Additionally, they will have access to warehouses and distribution centers in strategic locations to facilitate fulfilment and delivery. When a supply chain provider is hired, they can harness this network to determine the most cost-effective methods of transporting your products or materials around the supply chain. If any obstacles or issues develop, they already have a good grasp on alternate routes and solutions that will meet the complex needs of a food brand. Meanwhile, without pre-existing infrastructure, the in-house supply chain would have to address these difficulties on the fly. Enable futuristic technology According to the 2018 Annual Third-Party Logistics (3PL) Study, businesses desire increased analysis to enable them to make more informed supply chain decisions. A technologically driven outsourced partner delivers expanded visibility, offering users more insight into relative data that impacts their operations. Businesses are able to aggregate data and improve their organization’s decision-making process. Futuristic technology like artificial intelligence, machine learning, and automation play a large role in increasing the processing and output capacities of the workforce along the supply chain. Regardless of the scale or industry, integrating automation into supply chain management can be extremely advantageous for operations such as order tracking, data analysis, transportation, and warehouse management. Automation enables businesses to make more informed decisions by lowering costs and eliminating errors along the value chain. Organizations can better allocate critical products and supplies while saving money, time, and resources with a technology-enabled supply chain. With numerous benefits associated with outsourcing to a 3PL provider, including cost savings, increased flexibility, access to a robust supply chain, and ultimately more time and energy to focus on business, it is a strategic investment food brands should consider if they intend to scale their business across the country.
India is now the world’s third-largest startup environment, after the US and China, and development shows no signs of slowing. According to ResearchAndMarkets, the Indian foodtech sector will develop at a CAGR of 39% from 2021 to 2025, reaching INR 1,868.19 Bn. Growing consumer demand for an intriguing new food product necessitates increased production volume. Adding people and equipment to the operations and supply chain can help meet the rising demand. While sales volume increases, supply chain costs increase proportionately. A supply chain architecture that requires constant resource expansion to keep up with sales growth is unsustainable in nature. A scalable supply chain’s objective is to grow capacity while maintaining or improving efficiency, hence lowering supply chain costs per unit. We have outlined a few ideas for young food brands to build a scalable supply chain. We know from our extensive industry experience that not every entrepreneur wants to grow their business beyond a certain size or reach initially. Supply chain consolidation requires short-term sacrifices to scale the organization. If growth is a priority for the organization, it must commit to scaling, establish a reasonable growth objective, and develop a strategy and action plan to accomplish it. Standardize and automate processes While a startup must be agile and innovative, consistent processes help it scale. Standardized processes facilitate automation. Hands-on approaches and manual processes are difficult to scale without extra manpower and infrastructural resources. Standardization is the foundation of a robust supply chain management. Standardization specifies the manner in which a task or group of tasks should be completed. Every task needs scope, quality, and technique standards. For a competitive advantage, these rules can recognize and capture supply chain data using the appropriate tools or technology. With standardization, a part or process may be developed and measured more efficiently, resulting in a more sustainable supply chain that benefits all entrepreneurs. It saves time and money by keeping everyone on the same page. Automating back-office and operational procedures inside the supply chain is critical to cutting costs, speeding up time-to-market, and fostering innovation. A more technology approach will improve supply chain management, safety, and efficiency. Automating the back office reduces human error and streamlines processes. Modernizing the back office and automating will help reduce stress on people and processes. Outsourcing Given the necessity of these procedures, most companies concentrate on product development, fundraising, marketing, and sales. The lack of in-house logistics professionals creates a vacuum and a risk for startups. 74% of logistics leaders anticipate boosting logistics outsourcing spending in the next two years, according to Gartner Inc. A supply chain specialist may assist in filling that gap and acting as an extension of their team, providing the organization with a competitive edge. Outsourcing fulfilment to a 3PL saves initial capital. A startup usually manages fulfilment first to learn about the process and how to optimize it. From the start, a business must be hands-on, from packaging to returns. As the business expands and orders increase, outsourcing fulfilment may be more cost-effective and time-efficient. A supply chain specialist can help startups save money on warehouse space and personnel, source raw materials, move processed foods while maintaining product integrity, and most significantly, can guide startups with their expertise in the Domain. Expansion All food startups want to grow their business in a way that is sustainable. A Supply Chain Specialist can help a food startup scale by allowing for business and operational flexibility. Their fulfillment centers allow food entrepreneurs to expand without having to manage and operate their own facilities. A supply chain specialist’s national fulfilment network can also be leveraged to deliver orders as food startups develop new products and versions. A well-defined network allows start-ups to reach remote and potential markets faster. In addition to finding new sales channels, and an established Supply Chain Specialist may help organizations reach a larger consumer base. They can also help a food business better deal with seasonal demand while continually ensuring that the brand’s final product is transported to market in a temperature-controlled environment. A supply chain professional is better positioned to address any issues that arise during the transportation of the finished product. Collaborative Approach At the start of a food brand’s growth journey, often they struggle with their volumes due to variations in demand, which can be a cause of concern for them. Transporting low volumes of finished goods through a dedicated carrier can be expensive for a startup. Hence, it is advised for startups to opt for a more collaborative approach, where they can share their resources through supply chain specialists enabling them to transport variable volumes of products to different markets according to their demand. A collaborative approach will also give the food startups information about how a specific market is reacting to a product produced by another food brand, helping them string a better strategy for that specific market. A collaborative approach can save organizations 5-10% on costs and increase revenue by 7-10%, according to a report by McKinsey’s. Collaboration helps food brands to harness the collective intelligence of numerous stakeholders in order to plan and meet consumer demands. This primarily entails the sharing of real-time demand information among supply chain partners. Supply Chain as a Service (SCaaS) Investing in the Supply chain as a service module benefits startups by providing them with technology-driven, end-to-end supply chain management solutions. The SCaaS module is expected to grow at a 7.5% CAGR from 2018 to 2025, led by the expansion of mobile devices and internet penetration in emerging markets. This highly adaptable supply chain approach leverages a SCaaS provider’s experience and skills to assume responsibilities for production management, manufacturing, warehousing, inventory tracking, order fulfilment, and transportation. Finally, SCaaS provides the infrastructure and technology necessary to reduce the total value chain costs by offering customizable fulfilment solutions and adopting technology and automation to increase speed, visibility, and accuracy throughout a whole supply chain network. Around half of startups fail during the first five years of business, according to some estimates. There are numerous reasons for a startup to fail, but the majority of the time it boils down to...
Supply chain management is often acknowledged as a section that demands attention, integration & standardization. It takes strategic planning and smart execution to manage the smooth functioning of a business when it involves supply chain management. The level of difficulty advances a bit when the business keenly deals with perishables, food items and edibles. However, a minute change in the functioning of the business and outsourcing of supply chain management can ease the pain making the process hassle-free to a greater extent. Especially when it comes to the food service supply chain, outsourcing becomes prominent. Many supply chain companies in India, dealing with food & perishable edibles, find a need for systematic supply chain management. With top-notch cold storage facilities, flexible working & services with the fastest turnaround time; supply chain outsourcing highlights increasing the productivity of the business in all aspects. Outsourcing as a Business Aid Since outsourcing involves dealing with third-party for smooth functioning and integration of the business activities, it shifts the load from in-house management to the outsourced team. It mitigates the invested human hours, resources, & efforts with an easy functioning that works on command. Outsourcing is one of the most recognized things performed to lessen the in-house management pressure, thus, when aligned with supply chain management precisely complements the business with ample benefits. It plays a significant role in providing the business with a minimal overall cost, improvising the core competencies, fulfilling the customer requirements, focusing on a strong customer relationship & getting hands-on flexibility when it comes to maintaining a smooth supply chain. There are various ways supply chain outsourcing profits the business, it encourages smooth functioning and takes care of the additional effort that can benefit the business in another notable way. Various supply chain companies in India especially the ones that deal with the food service supply chain ought to switch to outsourcing if not done yet. It is significant for the business as it gives, Outsourcing the functioning of supply chain management gives an edge over competitors. This can be leveraged when it involves offering services aptly for customer satisfaction. Once you outsource the supply chain management, your operational costs reduce which effect in lowering the graph of overall costs. The resources saved over supply chain outsourcing will aid you with improving in-house facilities-in turn increasing revenue. Having a separate team that looks after the supply chain management shifts the burden from in-house teams and provides them with the flexibility to work at their pace and improve the core competencies of the business. The foremost & crucial factor that impacts the decision of supply chain outsourcing is the expertise the service renderer possesses. Supply chain management requires strategically planned execution and thus, is not an easy job. However, when you get industry experts with top-notch services to provide onboard, half of your job is done. The outsourcing company takes care of the important factors that aid the growth of your business. The motive of having a supply chain management is to maintain the balance between demand & supply. Outsourcing the supply chain gives an insight into the demand and supply, allowing the business to learn about the backsets and firmly set a strong foot to leverage this point against the competitors. Businesses Fail to Manage the Supply Chain Thoroughly as it Takes Expertise to Manage. Supply chain management is an essential part of business, hence needs to be taken care of keenly. Outsourcing works like a complement that benefits the business with end-to-end integration and smooth functioning. As a consolidated end-to-end supply chain development, outsourcing is not just a requirement but the ultimate need for smooth business functioning. Looking forward to outsourcing your supply chain management? Let’s talk and collaborate for the smooth functioning of your business!
Imagine a future where your food supply chain goes beyond just being fast and cost-effective, to also being green, fair, and resilient. This is the power of an ESG-driven supply chain strategy, where sustainability is not an afterthought, but a core principle woven into every aspect of your operations. Be warned, focusing solely on compliance is not enough. It’s about integrating ESG into your business DNA, creating a ripple effect of positive impacts. This commitment doesn’t just enhance your brand value and stakeholder trust, it propels your business towards long-term viability. This article delves into the multi-fold benefits of a true ESG commitment, showcasing how it can: Ready to unlock the true potential of ESG and take your Indian food business to the next level of sustainability? 1.Environmental: Preserving Our Planet CXOs and SCM Heads in the Indian food industry are continuously tackling challenges: rising costs, resource scarcity, and increasingly stringent regulations. But what if there was a strategic approach that not only mitigates these risks but also unlocks hidden benefits? Uncover the power of eco-conscious practices. This core aspect of ESG strengthens both your business’s sustainability and the well-being of the planet. Waste Reduction: From Burden to Boon Imagine your supply chain as a well-oiled machine, where efficiency and sustainability go hand in hand. Reducing waste is not solely about ecological preservation (important as that is); it’s also about streamlining your processes. Astonishingly, up to 45% of produced food never reaches consumers due to supply chain inefficiencies, underscoring the need for targeted interventions. By implementing advanced analytics for better demand planning, minimizing food spoilage through improved forecasting, and streamlining logistics, you can: Warehousing: Where Energy Savings Meet Efficiency Think of your warehouses as mini power plants, but with hidden inefficiencies lurking in every corner. By adopting automated inventory management systems, integrating IoT sensors for real-time monitoring & control, implementing green insulation materials, and using electric or hybrid forklifts & vehicles for internal logistics, you can: Bio-Diesel Conversion: Fueling Progress, Not Pollution Transportation is the lifeblood of your supply chain, but traditional fuels leave an environmental scar. Bio-diesel conversion offers a cleaner alternative, replacing fossil fuels with sustainable options like used cooking oil. This translates to: Discover how we transformed a challenge into an opportunity for a leading QSR brand, turning waste into a valuable resource. These are just the first steps on your journey towards a sustainable and profitable food business. Remember, ESG isn’t just a box to tick, it’s a strategic investment. By embracing these environmentally focused practices, you’re not just saving the planet, you’re securing a future where your business thrives. 2. Social: Nurturing Communities and Workforces In every business, the true foundation of success lies in its people. The social pillar of ESG highlights the imperative need to empower these individuals & communities as 58% of employees consider a company’s social and environmental commitments when deciding where to work. Achieving this involves: Employee Welfare: Cultivating a Thriving Garden Imagine your employees as vibrant plants, needing the right conditions to flourish. Employee welfare isn’t just about offering benefits, it’s about creating a healthy, inclusive, and equitable workplace. By: Skill Development: Sharpening the Tools of Your Trade Think of your workforce as skilled artisans, needing the right tools to excel. Skill development isn’t just about training, it’s about enhancing capabilities and operational efficiency. By: Community Engagement: Building Bridges, Not Walls Imagine your business as a part of a larger ecosystem, where everyone thrives together. Community engagement isn’t just about charity, it’s about building strong relationships and enhancing your corporate image. By: This is just a glimpse into the social pillar of ESG. By investing in your communities and workforce, you’re not just doing good, you’re investing in the future of your business. 3. Governance: Managing Ethically and Effectively The Indian food industry, a vibrant tapestry of flavors and aroma, thrives on trust and integrity. But in today’s world, these qualities go beyond mere slogans – they are the bedrock of good governance. By managing ethically and effectively, you’re not just doing right thing, you’re building a resilient and successful business. Ethical Practices: Building a House on Solid Ground Imagine your supply chain as a house. Ethical practices are the strong foundation, ensuring transparency, fairness, and integrity at every step. This means: Transparency and Accountability: Shining a Light on the Path Ahead Think of your operations as a complex map. Transparency and accountability are the guiding lights, ensuring accurate reporting and performance monitoring. This involves: Regulatory Compliance: Navigating the Landscape with Confidence Imagine your business as a ship sailing across a vast ocean. Regulatory compliance is the compass, ensuring you navigate the legal landscape safely and responsibly. This means: Remember: ESG isn’t just a box to tick, it’s a journey of continuous improvement. By embracing the governance pillar, you’re not just building a responsible business, you’re building a future where your food business thrives ethically and effectively. Interested in making your food supply chain more sustainable with ESG? Our experts are here to guide you through every step. Related Content | Foodland’s Resources ESG preparedness survey report Supply chain trends 2024: The digital shake-up The Net Positive Manifesto Why ‘Growing the Pie’ Can Help Firms Deliver Purpose and Profit
There has been a radical shift in the way the Fast Moving Consumer Goods (FMCG), Quick Serve Restaurants (QSR), and the Food and Beverages (F&B) industries operate to meet the growing needs of today’s consumers. B2B food trends like the growth of QSRs, the need for centralized kitchens for large enterprises, and increasing demand for cold chains are high capital-intensive markets that open up new investment opportunities.