Articles
QUALITY IN HANDLING IN FRUIT AND VEGETABLE CHAINS – A CHALLENGE FOR RETAILERS
Article number
604_19
Pages
201 – 210
Language
English
Abstract
Worldwide, the food retailing sector is becoming more concentrated, more
competitive, and more demanding of its supply chains.
The paradox for managers is that in such an environment, large transnational food retailers have more to offer their suppliers, but they also have more to lose when suppliers fail to deliver, so both retailers and suppliers are under increasing pressure to perform (Fearne, 1998). To many retailers, the fresh fruit and vegetable category is a key driver of profit, but it is also a category that is diverse, dynamic and among the most difficult to manage.
Fresh may be best, but fresh is also seasonal, perishable, subject to weather, and produced by a large number of operators using a vast array of different systems.
Take this variability and multiply it across the range of different countries from which product is
sourced, and it is clear why retailers that are expanding globally face a particular challenge in ensuring the performance of their fresh produce supply chains across a broad sweep of markets.
In spite of some integration between the two sectors, food service is well ahead of the retail sector in resolving its fresh produce supply chain issues (Kaufman et al. 2000). The fast food sector is a good example.
Like the retail sector, it is dominated by a relatively small number of highly competitive global operators, yet it is able to achieve consistently very high levels of physical and economic performance in fruit and vegetable supply chains that handle millions of tonnes of product annually (Kaufman et al., 2000). For example, membership of a MacDonalds supply chain for a perishable product such as lettuce is driven by very tight product specifications, the achievement of exacting levels of handling and processing efficiency, and very low margins, yet it is regarded as very rewarding from a suppliers perspective.
These levels of reward and performance are in sharp contrast to the average levels of performance and variable relationships that typify the fresh produce retail sector.
While retailers are beginning to learn valuable lessons from food service operators, there are also important differences between the two sectors and the lessons do not transplant directly.
Fresh produce handling systems unique to retailing are being developed, but evidence from around the world suggests that they are not yet meeting the needs of producers, consumers or retailers with anything like the
reliability achieved by food service operators.
competitive, and more demanding of its supply chains.
The paradox for managers is that in such an environment, large transnational food retailers have more to offer their suppliers, but they also have more to lose when suppliers fail to deliver, so both retailers and suppliers are under increasing pressure to perform (Fearne, 1998). To many retailers, the fresh fruit and vegetable category is a key driver of profit, but it is also a category that is diverse, dynamic and among the most difficult to manage.
Fresh may be best, but fresh is also seasonal, perishable, subject to weather, and produced by a large number of operators using a vast array of different systems.
Take this variability and multiply it across the range of different countries from which product is
sourced, and it is clear why retailers that are expanding globally face a particular challenge in ensuring the performance of their fresh produce supply chains across a broad sweep of markets.
In spite of some integration between the two sectors, food service is well ahead of the retail sector in resolving its fresh produce supply chain issues (Kaufman et al. 2000). The fast food sector is a good example.
Like the retail sector, it is dominated by a relatively small number of highly competitive global operators, yet it is able to achieve consistently very high levels of physical and economic performance in fruit and vegetable supply chains that handle millions of tonnes of product annually (Kaufman et al., 2000). For example, membership of a MacDonalds supply chain for a perishable product such as lettuce is driven by very tight product specifications, the achievement of exacting levels of handling and processing efficiency, and very low margins, yet it is regarded as very rewarding from a suppliers perspective.
These levels of reward and performance are in sharp contrast to the average levels of performance and variable relationships that typify the fresh produce retail sector.
While retailers are beginning to learn valuable lessons from food service operators, there are also important differences between the two sectors and the lessons do not transplant directly.
Fresh produce handling systems unique to retailing are being developed, but evidence from around the world suggests that they are not yet meeting the needs of producers, consumers or retailers with anything like the
reliability achieved by food service operators.
Publication
Authors
R. Collins
Keywords
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