How Tech is Revolutionizing The Produce Supply Chain

Operating in the produce supply chain can be difficult, as businesses often deal with staff shortages, increased competition, and high demand. Businesses must therefore work harder and find ways to get by.

So how can you bring products to market, create a retail and distribution plan that leads to more sales without more difficult logistics, increase efficiency, and decrease costs—all at the same time? The solution is simple: implement technology. 

This blog post will get into the challenges that produce businesses face and what technological solutions are available to remedy them. With technological solutions, businesses can make better decisions that lead to more effective operations, lower costs, and higher profit margins.

Why technology is needed to sustain and fuel industry growth

Even prior to the COVID-19 pandemic, farmers and processors had already been facing a plethora of difficulties. The pandemic magnified these challenges, with delays in shipments resulting in premature ripening during transit or storage, expired products, and shortages.

Economic downturns widen vulnerabilities in the supply chain, making technological solutions a necessity to address problems before they worsen.

In general, the United States Department of Agriculture (USDA) estimates that 30 to 40% of food is wasted, of which 31% happens at retail and consumer levels, equating to 120 billion pounds or 325 pounds of waste per person. At the retail level, it’s often caused by faulty food storage, over-ordering, and culling of blemished or imperfect produce. At the consumer level, it’s the result of overbuying. 

For businesses, the result is a significant decline in net income and revenue.

Combatting this means finding new and innovative ways to optimize your business process in regard to supply chain management and production. Technological solutions have been built out to combat spoilage in transit and storage, and companies can now use data and information technology to extend the life of the food and preserve quality.

The challenges that technology can address

Let’s discuss the primary challenges that supply chain businesses face that technology can help address.

Temperature regulation and humidity 

Dealing with fruits and vegetables necessitates cold chain management and proper refrigeration. Produce must abide by cargo storage regulations for safety reasons and to keep products fresh.

Of course, different types of produce require different temperatures, climate conditions, and humidity levels. For example, transporting oranges requires temperatures above 10 degrees celsius. On the other hand, spinach needs to be transported at about 0 degrees celsius.

Proper planning and coordination is therefore a must to sufficiently deliver products, with technological solutions simplifying and facilitating this.

Packaging 

Produce goes through a lot traveling from one end of the country to another or even across continents.

Most products require special packaging and labeling to prevent spoilage and contamination. Packaging must offer temperature and humidity control and be sturdy enough to withstand preparation, damage, and cargo loss. Even a small rip or tear can affect the product’s quality or freshness. 

Safety

Supply chain businesses are required to follow rigorous food safety practices to adhere to government regulations.

Neglecting sufficient packaging, shipping, handling, and water quality control is not an option, as it can cause products to prematurely spoil, come in contact with unwanted bacteria, or suffer cross-contamination.

Following the right practices ensures proper risk management and food security, safeguarding your business' reputation while preventing financial and legal issues. 

Businesses have further utilized technological solutions to effectively apply safety practices.

Competition

Customer loyalty can make or break a business. While customer retention can be costly initially, it’s an important investment that ensures larger future returns.

With high consumer demand for nutrition and a myriad of options available, produce businesses must consistently supply high-quality products to retain customers. Businesses must find the intersection between innovation, supply chain efficiency, and cost reduction to keep customers loyal and keep operations running smoothly.

Inventory management

The limited shelf life of produce means inventory management is crucial. Inventory tracking and traceability allow fresh fruits and vegetables to be in circulation for longer.

The problem, however, lies in inventory management involving a lot of factors to keep track of—how much stock is available, where products are located along the supply chain, product placement and delivery dates, and more.

Tracking becomes easier with technological solutions, which allow easy and organized access to data and analytics, allowing users to review historical data and identify trends for better decision-making.

Silo: the best ERP solution on the market

Looking for an Enterprise Resource Planning (ERP) solution to boost your supply chain business’ operations? Silo offers the best all-in-one ERP solution on the market.

With Silo, you can make data-driven decisions to improve inventory sales and ensure smoother payments. Track inventory with ease, with access to historical insights and market data. Plus, communication features make information exchange with vendors and service providers a breeze.

Need the funding to invest in new solutions? With banks often favoring large corporations, many are opting for alternative funding sources. Consider Silo Capital! Our financial solutions are tailored to small and medium-sized supply chain businesses, providing working capital upfront.

Silo Instant Pay provides users with funds immediately after a sale so that they can skip the waiting period of having to wait for their customers' full term length to be paid. With Silo Instant Pay, you won’t have to wait for your customer to pay their invoice. Instead, Silo will pay up to 90% of the customer’s invoice instantly to free up cash that you can then use to reinvest into your business.

Book a demo with Silo today to learn more about how Silo can help you optimize your business operations and thrive in the modern supply chain.