Did you know that 60% of pork gets processed by a mere 15 plants in the United States?
The COVID-19 pandemic seems to be here to stay in some shape or form for the foreseeable future. This pandemic has put stress on food supply chains all over the world. It’s not surprising that there are food shortages and price hikes.
With demand for delivery services sky-high, these services face surprising food logistics challenges. How can businesses tackle them head-on?
Want to learn how? Keep reading to find out how to overcome these obstacles!
What Are the Challenges With Food Logistics?
There are many logistical challenges, and they can disrupt food supply chains. These are the following roadblocks hindering them.
1. Regulatory
The first challenge with food logistics is regulatory compliance. Regulations are set in place by the food industry to guarantee food safety. The Food Safety and Modernization Act (FSMA) includes regulations that suppliers must follow.
This act demands high levels of food traceability. That means businesses must be able to track food items from farm to table. They need to know where the food comes from, the handling, and where it’s going.
This level of traceability is a challenge for many businesses. They need to have the right technology in place to make it happen.
What happens when there’s a food recall? Businesses need to identify the source of the problem fast. That way, they can take the necessary steps to remove any contamination.
Businesses that don’t follow the FSMA will face heavy penalties. For example, a company can receive a fine of up to $100,000 for one violation. That could also include imprisonment.
2. Business Risk
Litigation is a huge risk for businesses, as well. If a foodborne illness traces back to your business, you could end up in hot water. That’s why it’s critical to have a food safety plan in place.
This plan needs to include food delivery logistics. You need to make sure your food delivers at the correct temperature. That way, it doesn’t spoil and cause any illnesses.
Food spoilage is another huge risk for businesses. If food spoils during transport, proper disposal will need to happen. That’s a loss of money for the company.
Not to mention, food waste is a huge problem. An estimated 40% of food in the U.S. gets wasted.
Don’t forget about bad press and reputation. Damage to your brand can happen when food spoilage or illness occurs. All it takes is one viral social media post or news headline to bring your business down.
3. Sales and Operational Planning
Delivering products to customers can be a challenge for any business. It is even more daunting for small businesses. Acquiring and storing the products is only one aspect of the process.
You also need to manage the logistics of getting the products to the customer on time. And if you are unable to keep your promises, you run the risk of losing customers.
Managing delivery windows is one of the biggest challenges for recurring customer deliveries. You need spot-on predictions on how long it will take to fulfill each order. It’s also essential to build enough flexibility to account for unexpected delays.
Your delivery schedule needs to be realistic, and you’ll need to be able to handle any spikes in demand. If you can navigate these challenges, you’ll be well on your way to success.
Don’t forget that a successful business needs a well-run fleet of vehicles to ensure the food logistics run smoothly. That way you can transport goods or employees between locations. Allocating that fleet can be challenging even more when terrain varies between territories.
Rural areas might have unpaved roads that are tough on tires. Urban areas might have lots of traffic congestion.
Mountainous regions might need specially equipped vehicles to navigate winding roads. And all areas might have different environmental regulations to consider.
Accounting for these factors can be tricky. It’s essential, though, to have suitable vehicles in the right places at the correct times to get the job done.
Another aspect to consider is cost optimization. Rising fuel costs and driver shortages can eat your profits fast if you’re not careful. That’s why tracking your fleet’s fuel use and finding ways to reduce is necessary.
4. Delivery Planning
Order capture is the recording and transmitting of customer orders. The transmitting needs to go to the appropriate fulfilment center. It is a critical part of the e-commerce supply chain but can also be tricky.
One of the biggest challenges is validating that all orders get accurately captured. This accuracy can be difficult if customers place orders through many channels. Examples would be online, phone, and in-store.
Another challenge with food logistics is keeping up with changing customer demands. One example is if a customer adds an item to their cart but changes their mind before buying. The order will need to get updated to reflect these changes.
Order capture systems must handle large volumes of data and transactions fast. With so many orders worldwide, this can be a tall task for even the most sophisticated design.
Despite these challenges, order capture is essential for any e-commerce business. Otherwise, you run the risk of losing customers and sales.
We can have almost anything delivered to our doorstep thanks to online shopping. There’s a rise in demand for same-day and next-day deliveries.
To meet this demand, many companies are turning to recurring delivery services. With these services, companies can promise faster and more predictable deliveries in the food logistics sector.
But, combining recurring deliveries with ad hoc demand can be a challenge. Companies need a way to cut driven miles while upholding promised delivery windows.
Food safety is a top priority. That is why careful consideration must happen for food transportation.
Different types of food will need separate vehicles. For example, companies should always separate raw meat from other food items. A dedicated meat transport vehicle is essential to maintain food safety standards.
5. Delivery Execution
Food delivery is an intricate process that involves many different factors. One of the most critical aspects of food delivery is food condition monitoring.
This monitoring confirms that the food delivers fresh within the specified temperature range. Delivery companies must understand how to store and transport different foods.
Late delivery is another common issue in food logistics. Heavy traffic, weather, and equipment problems can all cause late deliveries.
Inaccurate delivery is another challenge. Sometimes deliveries don’t arrive at the correct address. Wrong items also get delivered at times.
It’s essential to have a sales team visible to customers in food delivery. Sales teams are those who work with customers on delivery quantities and timelines.
People need to see the steps their orders have to go through. Delivery glitches are bound to happen. That’s why customers call them when something goes wrong with the delivery.
How Delivery Technology Helps
Food logistics technology has come a long way in recent years. It helps solve many of the challenges faced in food logistics. Here are the ways that it can help overcome those roadblocks.
1. Strategic Planning
How to serve your customers best is at the heart of food logistics. You can look at historical patterns of past deliveries and service levels to start. It can also help to consider current, and future customer needs.
These past patterns will help you understand how to improve delivery routes. The new recurring route plans will be suitable for more extended periods. A quarter or two is how long these new plans should be applicable.
Food distributors deliver food to the same places at the same time every week. People used to plan out their distribution zones using pen and paper.
Now computers can do it. When someone new joins the company, they get assigned on the spot to an existing regular route.
This technology can help you test your recurring route plans. It’ll change the number of deliveries to meet customer service goals with fewer miles.
2. ERP Integrations
ERP integrations are vital for businesses that want to streamline their food logistics organization. Integrating different software systems can automate many processes.
This automation reduces the need for manual data entry. Delivery technology is one type of software that can integrate with an ERP system.
In the past, customers would place orders with businesses and wait for delivery. This old way often led to delays and mix-ups, as companies struggled to track all the orders coming in.
With delivery technology, businesses can now integrate customer orders in real time. When a customer places an order, it transmits it fast to the company. Then product preparation for product delivery can start.
As a result, customers no longer have to wait to process their orders. They can receive their products fast. Fulfilling orders has never been more painless.
The same goes for route plan updates. Route planners in the past had to rely on paper maps and their area knowledge to plan out routes. That was often time-consuming and led to many errors.
Then GPS and other digital mapping tools came on the scene. Now route planners can see traffic patterns, construction zones, and other potential hazards.
Add new delivery technologies to the mix, and route planning becomes more efficient. With these tools, businesses can plan the most valuable routes with little room for error.
Another benefit of ERP integrations is the real-time delivery of event feeds. Event feeds allow businesses to track every step of the delivery process. That information can improve future deliveries.
This data includes order placement, pick-up, and deliveries. With this information, companies can take steps to fix the problem in their food logistics.
3. Automated Routing and Optimization
Static routes are preset routes with the same repeating stops every time they run. These routes improve with the help of technology and strategic planning.
Creating a delivery route is no easy task. There are many factors to consider, such as traffic, weather, and construction. Keeping track of all these moving parts can be tricky.
That is where delivery technology comes in. These technologies can automate the routing process. It can also consider all the factors necessary to create an efficient route.
The benefit of automated routing and optimization is its focus on customers’ wants. If someone orders from you many times, the order will auto-assign on a route you have already created.
It identifies the best routes to put ad hoc demand on. That happens so that the promised deliveries for repeat customers aren’t affected. At the same time, it meets new demand without a significant increase in miles or hours driven.
Another benefit is vehicle allocation and automated dispatch. This food logistics technology looks at the entire fleet to find the best match for an order.
Not only does this improve efficiency, but it can also save businesses money. That is because the right vehicle will get used for the specific order.
This process can help to prevent over-dispatching and under-dispatching of vehicles. In other words, businesses won’t have to worry about too many or too few vehicles in use.
4. Real-Time Visibility and Monitoring
Real-time visibility and monitoring are essential parts of any successful delivery operation. You can verify that your deliveries are on track with real-time data at your fingertips.
Driver location and ETA information are one of the perks of real-time visibility. But it’s not only limited to that.
You can also watch for other essential data points, which include:
- Average stop times
- Dwell times
- Fuel usage
You’ll also be able to tell when food is on time or delayed. This way, you can identify areas of improvement and make changes to your food logistics operations on the go.
Another perk is being able to view onboard temperatures. This visibility is crucial for food deliveries. You’ll need to verify that the food stays at the proper temperature.
The last perk is the visibility of order status for the sales team. The sales team can decide how to inform the customer of any changes to this information.
Sometimes unforeseen events happen, such as traffic or accidents. Heavy weather conditions can also affect deliveries. That is why it’s essential to have a plan B.
Customers, of course, won’t be happy if their food arrives late. That is why it’s your responsibility to keep them updated. You can do this by sending automatic notifications.
These notifications may cause disappointment at first. Yet, taking that extra step to notify them will foster a sense of trust and reliability.
5. Customer Experience
Customer experience should be a top priority for any business. That is because happy customers are likely to come back and order again. They may also tell their friends and family about their experiences.
Unhappy customers are less likely to return. They may even leave negative reviews that could affect future business.
That is why it’s essential to give your customers a positive experience. There are many ways to improve customer experience.
One way is by improving communication. That way, customers will always know what is happening with their order. They won’t have to wonder where their food is or when it’ll arrive.
The best way to communicate is through:
- Voice
- Text alerts
You can also use a customer portal to update customers on the status of their orders.
Another way to improve customer experience is to provide real-time driver tracking. Customers will appreciate being able to see where their food is and how long it’ll take to arrive.
All these benefits unify to forge a seamless customer experience. The benefits are a game-changer, but they are becoming necessary to keep up with demand.
6. Delivery Execution
While other steps in the food logistics process are essential, delivery execution is pivotal. That is because it’s where the customer finally receives their order.
The past doesn’t compare to the modern world of technology. Wholesale food delivery is quicker, thanks to new delivery technologies.
Here are some of the benefits they offer. GS1 barcodes make it possible to track every movement of goods. This tracking helps to guarantee food safety and quality.
The GS1 barcode holds details about the product creation date and the batch number. This information is essential when there are recalls.
Do you need to search for a recall? Look for:
- Product name
- Batch number
- Manufacturing date
This information allows for quick communication and follows food safety rules.
Technology also helps by offering proof of delivery capture. Delivery capture often uses a signature capture device. This proof helps to guarantee that the customer receives their order.
Contactless delivery is another way to provide customer safety. This method doesn’t need the driver and customer to contact each other. The popularity of this method has increased due to the pandemic.
Another benefit is electronic documentation and custom workflow capture. This electronic documentation helps with billing and invoicing. It can also help to streamline the delivery process.
Return capture and item substitution are other benefits, too. These methods help to improve customer satisfaction. If these options aren’t available, customers may choose to go to a competitor.
Exception capture is the final benefit of this list. This method is where problems get solved in real time. It’s beneficial because it helps to avoid potential customer complaints.
7. Analytics and Reporting
Traditional data collection and analysis are no longer enough to meet modern needs. Delivery technology has stepped in to fill this gap. Here are some of the ways it does this.
It can create reports that show on-time vs. delayed deliveries. This data is helpful for understanding and improving delivery times.
It can also show which items get delivered the most. You can learn customer preferences if you understand which items deliver most often.
There’s also a way to track the age of inventory. Keeping tabs on the age of inventory will help manage food waste.
Another benefit is being able to observe miles driven. There’s a difference between miles planned vs. actual miles driven. Monitoring miles driven will help improve fuel efficiency.
Technology also offers a method to track driver performance. Checking driver performance can help improve driver productivity.
Spoilage/returns are the final analytics and reporting benefit. This data can help improve food quality and customer satisfaction.
Analytics and reporting tools are vital for understanding and improving the delivery process. They help to make data-driven decisions that can lead to a competitive advantage.
These reporting tools play a vital role in food logistics. Recalls are one of the main reasons.
If there’s a problem with the food, these tools can help identify it fast. This identification can help to avoid customer complaints.
It’s essential to have recall procedures in place. That way, you can quickly remove the food from circulation.
There’s a lot that goes into traceability. Here’s what has to happen:
- Record product lot numbers every time products arrive at the warehouse
- Maintain the traceability of raw materials as appropriate
- Manage the movement of every product effectively during delivery
- Identify the area of every product lot fast
Deal With Food Logistics Today
Now you know more about how technology affects food logistics. You also know some of the benefits it offers.
Wholesale food logistics is a tricky and ever-changing field. It’s best to stay up-to-date on the latest trends to be successful.
That said, food logistics technology is constantly improving. It’s not like how it was even five years ago. The delivery process is more efficient and cost-effective than ever before.
Do you want to stay ahead of the competition? Then, it’s time to invest in the latest delivery technology. Schedule a demo today!
