Supply chain planning has never been more critical

If the pandemic has taught us anything, it’s to expect the unexpected. That lesson rings particularly true for the produce supply chain. During the past 20 months, produce buyers and suppliers have experienced shortages of everything from pallets to packaging, from drivers to dock plates. Doing what we do best as an industry, we pivot and adapt to ensure our products get to market.

By all accounts, disruptions in the supply chain will continue through the summer of 2022. But as we strive to normalize our operations, to catch up, we need to be mindful of what the future holds for our produce supply chains. 

That means not just addressing today’s challenges (there are many) but also putting a supply chain plan in place for our companies that will make navigating future obstacles easier and more cost effective. 

If there is one positive outcome of these pandemic-induced challenges, it’s that we now understand just how important supply chain logistics are to our businesses. Now is the time to focus on planning to improve in this area. But first, you must dig into your existing practices with the eye of an outsider. Always ask yourself this question: “Is this really the best way to do this — or is it just the way we’ve always done it?” 

Our industry moves at a very rapid, dynamic pace. As a result, we often devote too much time to the daily, tactical work and not enough time focused on the planning and strategic responsibilities. Consider seeking external assistance. Efficient companies also run with efficient staffing. Value can be added through a new set of eyes focused solely on your supply chain functions without the distractions of other duties and responsibilities inside your organization.

To get a big picture view, develop a supply chain working group within your company that represents a cross section of departments. 

Schedule regular meetings, at least quarterly and discuss the most pressing issues each team member has faced in the past 12-18 months. Then develop a plan for the next three to five years and a corresponding budget. 

Track the trends and changes you’ve observed and update your plan and budget often. It’s important to understand the cost effect supply chain activities have on your total cost of delivered goods and track the trends and changes.

Establish measurements (KPIs) for your supply chain. An integral part of managing your supply chain is quantifying your activities to allow for an understanding of your starting point and measuring your progress throughout the planning process. Components such as material shortages, customer order fill rates, on time deliveries, freight charges and document issues, to name a few, all impact your supply chain efficiency.
 
Collaborate with your vendors and customers. Each vendor should understand their supply chain pain points. Create regular interaction with them to better understand how their specific issues may affect your company’s workflow. The same holds true for your customers. Communicate with them early and often not only about their needs, but also how you can better serve them with more data about their supply chain model, such as order lead time, packaging flexibility and delivery windows. Advise them on your supply chain challenges and work together to develop mutual solutions. 

And finally, remember to consider external supply chain trends such as sustainability, mergers and acquisitions, and automation, among others. These and other dynamics will impact your strategic plan sooner than you may think. Regulatory changes relating to carbon emissions, driver’s hours of service and infrastructure funding will also affect both your supply chain and related budget projections. 

Monitor trade publications and other news sources for additional information and discuss them in you regular team meetings. Reach out to your vendors and customers for clarifications and viewpoints. It’s essential that your company is prepared to address these trends in real time. 

After spending 40 years in supply chain solutions for produce and perishables businesses, I can assure there is money to be saved and efficiencies to be gained throughout your operations. Just because PLAN is a four-letter word doesn’t mean it needs to be treated as one when it comes to your supply chain.

Mike Laws is the owner of Laws Logistics, a Florida-based consulting firm offering supply chain solutions for produce and perishables businesses.