The food industry has recently come under heavy criticism following a stint of supply chain scandals that have shaken consumer confidence. But is a bit of horseplay the only hurdle the food industry must confront?
New research from Radobank Group suggests businesses operating in the food sector are faced with a challenge of epic proportions: feeding a booming global population which will oblige supply chains to deliver enough food to nourish 9 billion people. Given that current inefficiencies lead to a huge 1.3 billion tons of wasted food every year, it seems difficult to imagine how today’s supply chain will cope with future demand.
At present, businesses in the food sector contend with an array of environmental issues ranging from rapidly increasing global populations to evolving purchasing behaviors. The combination of these volatile ingredients makes for a melting pot overflowing with risk and uncertainty. Furthermore, as the global population increases, it seems likely these factors will only be intensified. While in the past businesses have (mostly) been successful in managing this risk, in light of recent scares, it is difficult to comprehend how current supply chain practices that are inadequate to cope with the challenges today will cope with the looming challenges in the future.
As a result, it is crucial businesses find ways to become more flexible and responsive to risk. However, given the size and complexity of supply chains in the food sector, for many businesses achieving transparency could be a daunting challenge. Nevertheless, the importance of understanding exactly how supply and demand operate is vital in order to mitigate the impact of volatility. Furthermore, through improved risk management, the food industry will not only enjoy huge strategic advantages today, but also achieve improved versatility to tackle future challenges.
Through adopting tools and technologies businesses can improve transparency and become more resilient to events that threaten to completely change the demand landscape such as sudden shifts in commodity prices or the impact of a rapidly growing population. In addition, such technologies could slice through waste and improve efficiency across the entire supply chain, enabling businesses to take full advantage of the rapidly increasing demand.
While recent food supply chain shortcomings may have left many with a sour taste, failure to prepare for future challenges could hold much greater consequences. As a result, it is critical businesses take a proactive approach and drive efficiencies throughout their supply chains in order to both satisfy future demand and reap the rewards that an accelerating global food market present.
In your opinion, what are some things businesses in the food sector can undertake to reduce waste and address the population boom? Feel free to leave your comments below.