Food Industry Three Risks in Supply Chain Daniel Wall - MGT 628 Final Project

Food Industry- (Consumer Packaged Goods) supply chain makeup

  • Suppliers- Manufacturers who supply others with raw materials in order for the third party to produce a finished product
  • Retailers- Re sellers of consumer packaged goods
  • Food Service- Restaurants

Manufacturing

  • Suppliers - Manufacturers who supply others with raw materials in order for the third party to produce a finished product
  • Machinery/ Software/ Food Technology
  • Manufacturing Standards/Quality Control - standards
  • Logistics - Distribution Network
  • Reseller's - (A) Retailers or (B) Food Service

Three Supply Chain Risks

Equipment/ Technology Risk Management
Quality Control
Logistics

Equipment/ Technology Risk Management

  • Maintaining/Insuring equipment during production enables optimal functionality and efficiency throughout the supply chain
  • Technology risk management uses patents to protect innovative technology used to differentiate manufacturers and its processes. Protecting financial transactions and parties information.

Examples

  • Machine breaks to manufacturing processes stops functioning correctly by not sealing caps on to bottle correctly. This would delay the manufacturing process as technicians would have to address problem, find solution, and manage wastes. All while, insuring and maintaining quality standards. Operator error, and power surge can be other example
  • Company being able to obtain special technology used to produce specific items/ EX: extract certain vitamins to help produce/flavor energy drinks.

Quality Control

A manufacturer must ensure certain food safety standards by implementing quality control mechanisms. This practice is essential to producing a reliable product for buyers and essential in managing the risk and liability of the company owes to the end consumer. Bad quality control can hurt the supply chain in its entirety and ultimately result in possible recall of products and loss.

Examples

Logistics

In order to maintain the efficiency of the supply chain, a strong distribution network is essential. A warehouse and vehicles to transport finished goods in a safe and timely manner to customers is vital, as well as proper inventory management.. By the logistics not running properly, it ultimately hurts the supply chain in its entirety, and hinders relationships with retailers

Examples

  • Natural catastrophe, goods tarnished, delay in shipping, delivery and processing, andinventory shortage
  • Nintendo Entertainment System - Didnt Expect Demands

Remedies to Supply Chain Risks

Equipment/ Technology Risk Management

  • Equipment Insurance, regular maintenance on machines, adequately trained staff
  • Securing/protecting patents, maintaining/updating technology and its systems, implementing monitoring sysytems/barometers to ensure optimal performance

Quality Control

  • Ensure compliance with manufacturing and FDA Standards
  • Ensure food/products quality
  • Ensure technicians and employees are following proper procedures in regards to food service industry
  • Ensure all precautionary measures, and testing is done to ensure accuracy and quality.
  • In Chiptole's case, they featured a 4 hour company wide meeting in each location to better inform/teach its employees proper conduct to mitigate future risks. They also featured mass promotions in hopes to restore its brand image

Logistics

  • Ensure proper software inventory management is in place to enable the company to strive logistically.
  • Maintaing equipment and vehicles are running properly for safe storage, and transfer of products

Credits:

Created with images by Free Grunge Textures - www.freestock.ca - "Sepia Grunge Sign - Snack Bar"

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