Managing stock, shelf life, food safety and product quality are just some of the hurdles that food companies must overcome. That’s why an industry-specific enterprise system is key to the success of any business operating within the food industry. It ensures processes and controls are in place to guarantee produce is up to standard, but it can do even more. Simon Noakes, SMB Director,Columbus UK, explores the challenges that the food industry faces today, and how a food company’s enterprise resource planning (ERP) system can improve compliance and enhance business processes.
ERP functionality should help solve the challenges that many different types of food businesses face. It must ensure high quality, resource-efficient production and distribution, providing product innovation that has profitability potential while helping a business stay up to date with the latest customer demands. This is how food companies can meet food safety regulations, reduce waste and gain flexibility in terms of the ingredients and raw materials they source.
A must-do – meeting food safety requirements
It is essential for food companies to understand and ensure that all operational processes meet the relevant legal standards. They also must establish that the appropriate documentation and controls are in place to address food safety, food hygiene, food inspection and, in the worst-case scenario, be reactive to any incidents. Recent high-profile examples relating to food allergens, for instance, have highlighted the need to have a robust approach in the areas I have mentioned, or else businesses will have to deal with the damaging consequences that come with failing to meet legal requirements.
Optimising the supply chain while cutting costs
As a result of the constant pressure of maintaining margins, there is a continual need for food companies to prioritise waste reduction and streamline processes to help drive unnecessary costs out of a business. In addition, with the current and future uncertainty surrounding Brexit in the UK and the potential impact of tariffs on costs, the need to reduce waste now has greater significance in the quest to remain competitive in the future.
Creating a value proposition to stay competitive
Due to this, today’s marketplace means that it is even more critical than ever before to maintain a competitive edge. Food companies must be transparent on their value proposition, not just in terms of product placement and promotional activities, but also in their delivery reliability, distribution capability and customer service offering.
The ‘loyal buyer’ is no more
The companies that deliver fastest with the best customer experience are the real winners within the food sector today. Food companies are now under increased pressure to keep tabs on market trends and quickly respond to changing consumer behaviour, creating strategies to aid efficiency and customer experience.
The war on plastic – meeting environmental expectations
Consumers have also become more environmentally conscious – the current ‘war on plastic’ being a case in point. From packaging to production, food shoppers are now willing to pay more if they feel they are helping the environment. Therefore, the implementation of sustainable business practices across the food industry has become commonplace. Food companies have started to change their approach – again, with the goal of driving their competitive edge, bettering their profits and of course, in this scenario, helping the environment.
Focus on the whole business operation – not just compliance
Food companies need to implement a solution that can address these challenges – not purely through enabling compliance but by improving overall business processes. As I have pointed out, reducing waste is one of the core aspects of achieving success in the food industry. Margins are often very tight and the need to provide efficient ways of working to enhance food yield are vital to ensure ongoing business viability.
The implementation of ERP solutions for food companies guarantees the accurate traceability of every ingredient through processing, packaging, warehousing, transportation and storage at the end retailer. By having a solution in place able to manage these processes, a business can ensure its operations are not only efficient and compliant, but that productivity is improved, waste is reduced and, subsequently, their profits increase.