Continuous replenishment drive will be 'key challenge'

By Rod Addy

- Last updated on GMT

Related tags Supply chain Supply and demand

Increasing demand for cross-category continuous replenishment and flexibility and growing calls for sustainability are core challenges that manufacturers must face to add value to the supply chain, according to General Mills.

"One of the key challenges facing manufacturers is the increasing requirement from retailers for continuous replenishment,"​ said David Howorth, supply chain director for the multinational food processor. He was speaking at the annual Scala Logistics Debate at Wroxall Abbey in Warwickshire last month.

"Ideally retailers would look to move ambient towards chilled day one for day two deliveries. Retailers are looking to see manufacturers being more proactive in other temperature channels."

However, the ambient category was tough to crack, he said. "It is more volatile and more complex, there are slow and fast moving depots, and I think service providers are not thinking strategically enough in this area."

In addition, promotions were getting "deeper and deeper"​ and lead times were getting "shorter and shorter".

Howorth said processors also needed a more co-ordinated approach."I hear and see different responses and I don't think there is consistency from manufacturers."

Supply chain collaboration among competitors was improving, but there was still room for further improvement. "We need three-way conversations between retailers, manufacturers and service providers based on trust and transparency."

Collaboration had to go a stage further and look not just at rival firms sharing trucks, but at building mutually beneficial suppy chain networks, said Howorth. "Logistics needs to work in a smarter, not harder way."

The sustainability agenda would continue to grow in momentum in areas such as road miles and empty running and vehicle utilisation and much more could be done in these areas, he said. "25% of vehicles are still running empty. That's a pretty shocking number."

Related topics Supply Chain Ambient foods Bakery

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