How Food & Beverage Manufacturers Can Minimize the Risk of Bare Shelves

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Hurricane season has started, and with it the potential for significant supply chain disruption. The COVID-19 pandemic, power outages in Texas and a cargo ship getting stuck in a narrow channel have all illustrated how quickly unexpected situations can have a severe impact. Droughts, fires and floods also have a significant impact on food and beverage supply chains.

Even the day-to-day as a food manufacturing business requires a careful balance and maintenance of dozens of variables, including visibility and availability of inventory, compliance with federal and state regulations, labor shortages, and making sure production processes are running smoothly.

No matter the cause of the disruption, no one wants bare shelves and unhappy customers due to poor planning and unreliable systems.

In a survey by Bain & Company and the Digital Supply Chain Institute, manufacturing executives put resilience at the top of their supply chain goals over the next three years. Executives defined that as increasing flexibility, agility and visibility. The survey also found that the pandemic-related disruptions of 2020 have shifted executives’ priorities to risk mitigation. That’s a move away from customer-centric concerns, as identified in past surveys.

Executives in the survey expect that disruption will continue to affect operations throughout 2021. That means putting into place a solution that can help mitigate that uncertainty is important.

Having a reliable Distribution Requirements Planning process – or determining what you need and when to meet your customers’ needs – is critical to improving resiliency. That means that in the event of inevitable disruptions, you’ll be able to shift gears quickly.

An efficient and adaptable master planning solution in the food and beverage industry means that manufacturers can deftly juggle multiple variables, including:

  • Stakeholders from growers and harvesters to processors
  • Sourcing ingredients from local and global brokers that often require particular certifications
  • Managing the storage of raw materials throughout the supply chain to maintain freshness and quality
  • Batch control
  • Allergen and/or organic requirements
  • Temperature of materials and final product

The goal of a Distribution Requirements Planning process is to:

  • Optimize workflow to get your products from point A to point B efficiently and on time.
  • Gain confidence in setting accurate delivery dates so your customers and partners can meet their own demands.
  • Minimize shortages or overstock because you know what’s in your warehouse and where it is destined at any given time.
  • Reduce transportation costs by optimizing inbound and outbound shipments, allowing for efficient staff scheduling, and proper load building.

Without a formal process in place, and the right technology to manage it, manufacturers leave themselves vulnerable to inconsistent product quality, food waste, upset customers or vendors, and the possibility of safety or compliance risks due to lack of visibility into the supply chain.

How Microsoft Dynamics 365 Supply Chain Management Helps

It’s far too difficult to keep track of these nuances in a spreadsheet. And anything in the supply chain that requires someone to stop and think adds time and the possibility of mistakes being made.

In Dynamics 365 Supply Chain Management, you can:

Optimize the useful life of ingredients. You’ll be alerted to rotate inventory, so you never miss an expiration date. Storage requirements are also critical, not just in your own facility but along the supply chain, including climate-controlled, refrigerated, humidity-controlled or frozen environments.

Prepare for unexpected scenarios. A master planning solution can help you model scenarios and responses to minimize downtime in the case of an unexpected event.

Ensure on-time delivery. With improved AI-enriched demand forecasts, you can minimize the accumulation of unwanted inventory and avoid supply disruptions. Advanced Warehouse and Transportation modules allow for handling and shipping your products with the greatest efficiency while providing total visibility.

Track and manage vendors. A solution such as Microsoft Dynamics 365 Supply Chain Management can help you communicate and collaborate with vendors. Plan supply and production, and ensure the right resources are in the right place.

Maximize capacity utilization. Allocate and get the most from your resources, such as workers, machines, work centers, plants and more to reduce downtime and speed delivery.

Don’t risk inconsistent product quality, production delays, food waste or shrinkage, and the inability to adapt quickly to unexpected disruptions. Microsoft Dynamics 365 Supply Chain Management can support the most sophisticated supply chain by using multiple criteria, such as product tracking, storage space and quality control. Master planning with Dynamics 365 Supply Chain Management allows you to determine and balance the future need for raw materials and capacity to meet company goals.

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