Processors crack down on supply chain inefficiencies

By Rod Addy

- Last updated on GMT

Related tags Supply chain Logistics

By rod Addy
The vast majority of manufacturers reported having boosted supply chain efficiency in the past year – some by as much as 25% – in a new industry survey conducted by Culina Logistics.

Primary transport was the top area in which efficiency gains were made, by almost half the food and drink processors quizzed. This was followed by secondary transport and warehousing, which more than a quarter cited, then waste management, cited by one in five.

The same areas were listed in the same order as priorities for slashing inefficiency further in the coming year. Waste management was reported as increasing in importance.

However, some of the areas performing best in the past year were also seen as underachieving, suggesting those questioned felt they offered significant opportunities for further improvements.

Warehousing was seen as the biggest underachiever, followed by secondary transport, then waste management and then pallet management and IT systems.

Overall, most respondents were positive about the prospects for the year ahead. Two- thirds aimed to generate cost efficiencies in the next year to build on their businesses' success in the past year, despite the recession. More than one in five believed efficiency gains they had made would put them in the best position when the economy began to recover.

That said, more than one in 10 reported driving efficiencies just to keep afloat.

"The tough economic climate for the last two years and continuing uncertainty has put an ever-increasing focus on efficiencies in the supply chain," said Thomas van Mourik, chief executive of Culina Logistics.

Maintaining competitiveness, pressure from retailers and downward pressure on prices were also motivations for improving efficiency.

A third of food and drink processors quizzed claimed efficiency gains of between 15%; more than a fifth claimed gains of 610%; and more than one in 10 claimed 1115% improvements. A total of 15.6% said their organisations had achieved efficiencies of between 1625%.

"The Food and Drink Supply Chain Health Index provides a barometer for supply chain efficiencies across the food and drink sector, allowing manufacturers to benchmark their own performance," said van Mourik.

Culina surveyed 50 leading food and drink manufacturers online.

Related topics Supply Chain

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