Why You Need to Pivot Your Approach to Your Food Supply Chain

As we (hopefully) begin to see the end of the COVID-19 pandemic near, now is an ideal time to reflect on the food supply chain, its longevity, and what comes next as a result of the significant impact the pandemic has had on consumer, retailer, and distribution behavior and best practices. 

Taken quite literally, the food supply chain can be defined as the journey food takes from farm to table. The path has changed some over the years as technology and humanity has evolved, but the beginning and end stays the same even as we experience gaps and glitches.

There's no doubt that the pandemic has impacted the food supply chain significantly in both temporary and permanent ways. But what exactly are the issues, and why has it become necessary to pivot your approach to your food supply chain even once the pandemic wanes and we move from the “new” normal to the “next” normal?

What Are the Main Issues and Concerns in the Food Supply Chain?

If you’re a shopper, when you go to the grocery store, you might notice the price of your milk or ground beef keeps changing, or that some of your go-to products either aren’t on the shelves or aren’t available in as many brand options.

As Invesco’s Chief Global Market Strategist recently said, “No matter where companies are, they are likely experiencing supply chain disruptions, higher input costs and some issues sourcing labor.”  And as with most everything in our economy, two primary things impact the food supply chain the most—supply and demand. In essence, the main issues and concerns in the food supply chain can be distilled down to:

• Labor irregularity
• Unpredictable supply and demand
• Pricing

If you’re a retailer or a distributor, you’re likely also feeling the pain of pricing. In addition, you’re mitigating to staff illness and churn, as well as unpredictable demand that can cause you to either have too much or too little product.

Why Do You Need to Pivot Your Food Supply Chain Approach?

You might be thinking about temporary shifts and pivots to get you through this tumultuous period. But the reality is, from Alpha to Omicron, COVID-19 has only aggravated and compounded existing issues within the supply chain. 

Times are changing, the pandemic just sped those changes up. Instead of putting a band aid on something that’s bleeding, consider making permanent changes that can not just heal the wound but create something even more resilient. Ask yourself some questions and research new innovations you can bring to the table in business or your area of expertise. 

If you are part of a company experiencing significant drops in demand, can you handle the slowdown by finding ways to lengthen the shelf life of your products? Can you lower your inventory costs? Can you offer frozen more or ideate fresh, new ideas that excite customers? 

Alternatively, if you are part of a company struggling with unusually high demand, can you benefit from enhancing your online capabilities and offering more through e-Commerce to move more product, faster?

How Can You Improve the Food Supply Chain?

If your food supply chain issues fluctuate and feel unpredictable, consider a few of the below tips as you work on making lasting improvements that don’t leave your processes so vulnerable.

• Be nimble with your numbers and reallocate your resources. And by numbers, we mean your cost structures. Be willing to move things around to prioritize. Maybe labor gets a little more than inventory, or vice versa. If you have lost margins, where can you make it up? How can you diversify your revenue? Invest in new, strong partnerships that fill the gaps of others. Engage more suppliers so you don’t have all of your proverbial (or literal) eggs in the same basket. 
• Open up your omnichannel. Businesses that pivot to a stronger omnichannel engagement experience a nearly 10% yearly increase in revenue. COVID-19 has sped up an existing trend of more and more of our lives shifting online. And with that, people are using multiple channels and touchpoints to engage and want the same experience on each of them. Think about how you can invest in digital innovation and take bold and thoughtful risks. What’s working and what’s not? Dig deep into your data and study all of your touchpoints.