How FruPro will help solve supply chain challenges

9th December 2021
Posted in Blog
9th December 2021 FruPro

How FruPro will help solve supply chain challenges in the fresh produce sector

The fresh produce sector is in the midst of a very challenging period that is exposing the frailties of the archaic global fruit and veg supply chains. Amongst other factors, the complications of Brexit have been compounded by the economic disruption of Covid-19, which in many instances has led to supply disruptions, widespread food shortages and price inflation. [1]

There’s no simple solution to these complex macroeconomic issues, but there are opportunities to address specific issues at different stages of the supply chain. FruPro is seeking to revolutionse the way in which the sector trades fresh produce, through connecting all parties of the fresh produce supply chain on a secure, transparent and data-driven platform. As an industry, we’re efficient at moving produce but inefficient at moving information and this is where the digitisation of the sector can add huge value.

Below, we’ve taken an in-depth look at how the FruPro platform can help users overcome their supply chain challenges across four key areas:

1. Digital

The fresh produce sector is one that has traditionally been built on long-standing relationships, personal connections and family heritage. The industry is not often associated with tech or big data and whilst there have been developments in recent years, the industry still lags behind others in terms of its digitisation. In a world that is becoming increasingly digital, radical transformation of the sector is needed in order to bring it up to speed with the wider economy. This need for digital transformation has been accentuated even further by Covid-19, with much of global commerce shifting into the digital realm.

A lack of digital infrastructure and digital capabilities in the fresh produce sector prevents stakeholders at every level of the supply chain from making new connections, both domestically and in global markets. Without digital capabilities, expanding your network can be difficult and is limited to your offline personal relationships and in-person events and exhibitions. Due to the non-digital nature of the sector, the fresh produce industry also suffers from a lack of data sharing and data capabilities too, which has significant implications for the productivity and efficiency of the sector. As we’ve seen in many other sectors, data-driven digitisation allows business owners to carry out detailed analyses of their business operations and use the data to identify opportunities for efficiency improvements. From a productivity point of view, data enables fruit and vegetable growers to better plan their harvests and the allocation of the produce.

The FruPro platform, launching in early 2022, will help the sector to overcome the digital and data barriers to efficiency. We will help Growers expand their network through connecting them to new trusted trading partners, reducing risk and opening opportunities for trade. Importers can access all relevant information on orders, sales and clients in a centralised platform and streamline their communication with growers and buyers. Wholesalers and Retailers will benefit from new connections locally and internationally, allowing them to diversify and differentiate from their local competition.

[1] https://committees.parliament.uk/work/1497/labour-shortages-in-the-food-and-farming-sector/

2. Food Waste

Food waste in the fresh produce sector is an issue that is gaining more and more attention, with an estimated 6-8% of global greenhouse gas emissions occurring as a result of wasted food.[2] There are a multitude of reasons as to why wastage is so prevalent in the sector, but much of it stems from a lack of data capabilities and limited information sharing, which in turn leads to inefficient distribution and allocation of produce. As a result, fresh produce is wasted at every stage of the supply chain.

Fruit and veg Growers can’t guarantee that all of their produce will be sold, while the redistribution of surplus stock can be costly or time consuming in the current infrastructure. Importers of fresh fruit and vegetables will regularly lose a percentage of their cargo due to delays and complications with delivery timetables as well as damage that occurs during transit [3]. Further down the supply chain, Wholesalers and Retailers of fresh produce often have to dispose of a significant portion of their stock when it arrives in a different state than expected or isn’t purchased before expiry, with many businesses not having a redistribution framework in place.

How can FruPro help solve the problem of wastage in the fresh produce sector? Our data-driven platform will redistribute produce to new buyers if programmes fail and will use our automated connection technology to redistribute produce to your local food waste charities. If surplus produce has less than 20% rot, then FruPro users can choose to donate the produce and our allocation mechanism will match them with their local food bank. An automated email will be sent to the local food bank with info on the produce, which can then be accepted or rejected, once accepted Fair Share will arrange the transport and collection process. Additionally, FruPro will provide monthly impact reports to each business on the platform, which will illustrate the sustainable impact they’ve had. Increasingly, companies must demonstrate a strong CSR profile to boost their market share and marketing efficiencies.

[2] https://www.logmore.com/post/the-challenges-of-fresh-produce-logistics

[3] https://www.logmore.com/post/the-challenges-of-fresh-produce-logistics

3.Logistics

As with many sectors, Brexit and Covid-19 has been a logistical nightmare for the global trade in fresh produce. In a sector that is already high on regulation and paperwork, Brexit has added an extra layer of logistical complexity for the sector to deal with. On top of this, the increased border restrictions and constraints on movement that were put in place early on in the Covid-19 pandemic have severely impacted sector capacity and the flow of fresh produce around Europe[4].

As well as extensive regulation, the trade of fresh produce involves a lot of documentation and administration at every stage of the supply chain. As we discussed in the first section, much of this documentation and admin is carried out manually, on paper, which adds a significant time burden to trade. Each time an order is received it has to be manually checked, recorded and then matched with an appropriate driver for fulfillment. This whole process can be streamlined through the utilisation of a digital supply chain management platform.

FruPro’s future management platform will integrate systems at different stages of the supply chain so that they can share information in real time. Order checks can take place digitally and then automatically be matched with the most efficient fulfillment solution. Digitally matching orders to drivers in real-time will optimise driver schedules and facilitate the efficient collection of multiple orders in a single trip, while automated tracking will allow stakeholders in the fruit and veg supply chain to follow goods in transit with real-time GPS updates.

[4] https://committees.parliament.uk/work/1497/labour-shortages-in-the-food-and-farming-sector/

4. Labour

The UK fresh produce sector has been immensely impacted by the sequence of events that have taken place from 2019 onwards – Brexit, immigration policy changes and the Covid-19 global pandemic. As a result, the supply of labour in the sector has largely disappeared with limits on movement both domestically and internationally. Production has consequently been reduced, with less seasonal workers available to pick crops and produce harvests[5]. Similar issues have emerged within our neighbours in Europe too, with Italy, Spain, Germany and France all looking set to introduce new labour policies for migrant workers to help mitigate the widespread labour shortages[6]. The sector’s reliance on low-paid, migrant labour has again exposed a clear weakness in the fresh produce supply chain which will likely continue for some time.

As we discussed in our recent article on innovation and AI in the agri-tech space, many of these low-skilled, manually intensive roles will start to be carried out by AI-powered advanced robotics farm machinery over the next decade. The shift to robotics will enable producers to mitigate the issue of unpredictable labour supply, whilst freeing up time and capital to be spent on strategy, planning and quality checks. This however doesn’t help the sector overcome the supply chain challenges in the short-term and doesn’t help with the more technical roles of picking that requires the touch and feel of a human hand for certain soft fruits. The combination of Brexit and Covid-19 has also resulted in labour shortages further down the supply chain too, with the industry struggling with a lack of HGV drivers and other transportation staff[7].

There’s no easy solution to the ongoing issues with labour in the fresh produce supply chain and the sector requires more support from governments across Europe. However, one way in which FruPro aims to help fruit and veg growers is by enabling them to more easily forward-plan their labour requirements through our data-driven platform. Through enhanced visibility of data across the whole fresh produce supply chain and access to many more potential buyers, fruit and veg growers can better predict demand for their produce and thus more accurately match supply to demand.

[5] https://committees.parliament.uk/work/1497/labour-shortages-in-the-food-and-farming-sector/

[6] https://market-insights.upply.com/en/fresh-produce-the-latest-challenge-for-the-supply-chain

[7] https://www.theguardian.com/business/2021/jun/25/uk-facing-summer-of-food-shortages-due-to-lack-of-lorry-drivers

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