Supply Chain Visibility: Helping You Get Ahead - 3 Predictions for Grocery Supply Chains in 2022
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GR O C E RY E - B OOK /
Supply Chain Visibility:
Helping You Get Ahead
3 Predictions for Grocery Supply Chains in 2022
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FUTURE-PROOF YOUR GROCERY SUPPLY CHAIN
2021 was one of the most disruptive years on record for grocery supply
chains. Between unpredictable demand spikes during the pandemic,
product shortages stemming from factory shutdowns in Asia, port delays on
imports into the west coast and extreme weather events across the country,
many grocery supply chain leaders are looking for ways to transform their
operations from reactive to proactive.
While we’re likely to see pandemic-related disruptions spill over into 2022,
savvy grocers are looking ahead at potential disruptions later in the year
and preparing now. The labor market will continue to wreak havoc on supply
chains, and momentum around new, digital-centric shopping habits and
sustainability are reaching a critical turning point as grocers race to keep up
with rapidly evolving consumer preferences.
Read on to learn about our three predictions for grocery supply chains in
2022, and how real-time visibility gives grocers the insights they need to
navigate them successfully.
3 3 PREDICTIONS FOR GROCERY SUPPLY CHAINS IN 2022
1 LABOR VOLATILITY
No grocery retailer has been unaffected by the labor shortages brought on
by the pandemic. The labor market has impacted every node of the supply
chain: farm labor, manufacturing, truck drivers and retail operations have all
been operating under-staffed, putting enormous stress on grocers to keep
products on shelves and store operations running smoothly.
85% 80% 58%
Of food retailers surveyed Of food retailers said Turnover rate in the food
leveraged higher wages in hiring challenges retail industry.
2020 to help with hiring negatively impact their
and retention of full time business.
employees.
Forecasts suggest the labor shortage will continue into 2022. Grocers will
need new strategies to adapt, and will have to uncover new efficiencies to
make up for lost workforce. Real-time visibility platforms can be used up and
down the supply chain to alleviate the effects of the labor shortage:
• Real-time visibility platforms leverage AI to flag exceptions on early and
late loads or missed pickups, so supply chain teams can proactively
implement a recovery plan.
• Retailers can provide real-time tracking and predictive ETAs to store
managers, so they can see when trucks will be arriving and allocate
labor efficiently.
• Alerts can be sent to dock schedulers notifying them to prepare for a
truck’s early or late arrival, which prevents warehouse and dock staff
from having to move a load multiple times to free up dock space.
RESOURCES:
https://www.fmi.org/docs/default-source/research/speaks-2021-key-takeways.pdf?sfvrsn=56fc17fa_2
https://www.grocerydive.com/news/fmi-80-of-food-retailers-say-hiring-issues-are-hurting-business/606695/
https://www.fmi.org/docs/default-source/research/speaks-2021-key-takeways.pdf?sfvrsn=56fc17fa_2
https://www.businessinsider.com/labor-shortage-permanent-new-survey-great-resignation-antiwork-2021-12
4 3 PREDICTIONS FOR GROCERY SUPPLY CHAINS IN 2022
EMPOWER AND ENGAGE YOUR WORKFORCE WITH TECHNOLOGY.
As the labor shortage has been dominating the headlines for the past year,
experts have identified meaningful opportunities for career growth as a retention
strategy for companies struggling to fill roles. One of the biggest benefits of
supply chain visibility platforms is that they help automate tedious, manual tasks,
so employees can dedicate their time to more engaging and complex projects.
“Real-time visibility is replacing very manual and mind-
numbing tasks that our teams have to do. Instead of being
on the phone with a customer or carrier for half an hour, they
can just look [at FourKites] and see what happened... so our
teams feel like their time is more productive than simply
being a telephone operator, when in reality they should be
leading our transport planning. They can do more valuable
things with their time.”
ANDREEA CALIN
LO G I S T I C S T R A N S F O R M AT I O N M A N A G E R E U R O P E
ABINBEV
5 3 PREDICTIONS FOR GROCERY SUPPLY CHAINS IN 2022
2 OMNICHANNEL FULFILLMENT
During the COVID-19 pandemic, online ordering, curbside pickup and
grocery delivery became the norm for many consumers, and that momentum
isn’t slowing down any time soon. One study projects online sales to make
up 20% of the grocery market by 2026. Curbside and in-store pickup
remain the dominant model for now, but grocery delivery continues to
gain traction in urban areas; some companies have even begun pilots of
15-minute delivery assurances. Omnichannel fulfillment is here to stay, and
grocery chains that can master this new digital landscape will gain a crucial
differentiator in an increasingly competitive market.
NEW BUSINESS MODELS BRING NEW CHALLENGES.
In response to the boom in online grocery orders, grocers are investing in
dark stores and micro fulfillment centers around the country, particularly
in densely populated areas. These new fulfillment models significantly
reduce the time it takes to fulfill online orders, but they come at a cost,
and many analysts have raised concerns around long-term profitability of
these operations. The added labor, real estate and technology investments
needed to successfully execute many e-commerce strategies can tank profit
margins, especially when it comes to low-value orders.
The increased demand from consumers for new fulfillment models combined
with riskier outlooks for profitability has grocers looking to find efficiencies
across the supply chain to help boost profit margins.
As grocers expand their supply chain networks to accommodate new
e-commerce business models, real-time visibility empowers them with the
agility they need. By unlocking valuable data on in-transit inventory, real-time
visibility helps grocers to reduce product spoilage and optimize inventory
levels to keep costs down, even when disruptions arise
RESOURCES:
https://www.supermarketnews.com/online-retail/e-commerce-account-20-us-grocery-market-2026
6 3 PREDICTIONS FOR GROCERY SUPPLY CHAINS IN 2022
NEVER MISS A SALE DUE TO A STOCKOUT.
The rise in online grocery ordering has exposed the massive impact out-of-stock
inventory can have on sales. One study of food, drug and mass merchandisers
found that there were $505 billion sales lost due to out-of-stocks amid the
pandemic, and that $75 billion of that was newly discovered due to the rise
in digital orders. The increased stockouts of key goods at the beginning of the
pandemic has changed consumer shopping habits for the long-term; 64% of
consumers in a recent survey said product availability will be most important to
them when grocery shopping after the pandemic ends.
Real-time visibility provides grocers with the insights they need to keep inventory
on shelves, even when disruptions arise. With predictive, machine learning-
enabled ETAs, Walmart Canada has been able to make fast, well-informed
decisions when responding to unexpected disruptions, including a recent
snowstorm. These predictive insights, combined with real-time data, enabled
Walmart as an organization to more reliably and effectively balance inventory
availability, driver safety and customer satisfaction.
“We’re getting so much different data – live,
dynamic data – that we didn’t have before, and
that visibility is mission-critical for us.”
FR ANCIS L ALONDE ,
V P T R A N S P O R TAT I O N ,
WA L M A R T C A N A D A
RESOURCES:
https://progressivegrocer.com/age-micro-fulfillment
https://www.supermarketnews.com/online-retail/increased-use-online-grocery-shopping-here-stay7 3 PREDICTIONS FOR GROCERY SUPPLY CHAINS IN 2022
3 SUSTAINABILITY
Extreme weather events compounded the effects of the COVID-19 pandemic
in 2021, culminating in one of the most disruptive years in supply chain
history. According to the National Oceanic and Atmospheric Administration,
in 2021 alone there have been 18 disaster weather events with losses
exceeding $1 billion each to the United States. Supply chain leaders have
seen the impact of this firsthand, as these events disrupt almost every node
of the supply chain, from sourcing and production to logistics and labor
operations.
These events are expected to become more frequent unless significant
action is taken to reverse climate change. And while supply chain leaders
are some of the most impacted business stakeholders when it comes to
climate change, they also hold the key to improvement. McKinsey estimates
that 90 percent of companies’ impacts on the environment come from
supply chains.
Supply chain sustainability initiatives have moved from a nice-to-have to a
priority. Businesses need it for longevity, and shoppers are demanding it:
48% of U.S. consumers said they are “definitely or probably” changing their
consumption habits to reduce the impact on the environment according to a
recent Nielsen survey.
RESOURCES:
https://www.supplychainbrain.com/blogs/1-think-tank/post/34164-supply-chain-trends-what-to-expect-in-20228 3 PREDICTIONS FOR GROCERY SUPPLY CHAINS IN 2022
REDUCING WASTE WITH REAL-TIME VISIBILITY.
The Food and Agriculture Organization of the United Nations indicates supply
chains cause 40 percent of all food waste in North America. Logistics teams
can play a key role in reducing waste in the supply chain. Having an accurate
carbon footprint measurement on every single shipment has been an out-of-
reach goal for many companies, but new advancements in real-time visibility
are finally making this possible by unlocking the detailed transportation data
needed for these calculations. Real-time visibility also provides valuable insights
on inventory in transit, ensuring products stay fresh with temperature monitoring
along each leg and order.
GLOBALTRANZ USES REAL-TIME VISIBILITY TO REDUCE
THEIR CARBON FOOTPRINT.
GlobalTranz is using FourKites data to provide detailed transportation routing
optimization strategies that can reduce the number of trucks used on an annual
basis, and consequently their environmental impact. Working with a large
consumer packaged goods customer, GlobalTranz reduced annual truckload
shipments by an estimated 30%, resulting in 26 million fewer miles driven, 5
million gallons of diesel saved and an estimated 58,000 fewer tons of carbon
dioxide emissions.9
BE PREPARED FOR WHATEVER COMES NEXT.
Heading into 2022, grocers will continue to grapple with
the existing supply chain disruptions brought on by the
pandemic, and must also navigate a rapidly evolving
industry of digital-first business models and changing
customer preferences. Having visibility into real-time data
allows grocers to build an agile and adaptive supply chain
that can help increase efficiency and productivity, reduce
costs and win shopper loyalty.
FourKites is the largest predictive supply chain visibility
platform, delivering real-time visibility and predictive
analytics for the broadest network of Global 1000
companies and third-party logistics firms. Using a
proprietary algorithm to calculate shipment arrival times,
FourKites enables customers to lower operating costs,
improve on-time performance and strengthen end-customer
relationships. FourKites’ network spans millions of GPS/
ELD devices in 176+ countries and covers all modes,
including truckload, LTL, ocean, rail, air, intermodal, courier
and parcel, and extends real-time visibility into the yard.
FourKites has 2 million loads and over $100 billion in
freight under management at any given time. The platform
is optimized for mobile and equipped with market-leading
end-to-end security.
Learn More
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