For food service companies, supply chain management has always been a high priority, both in terms of its importance to the day-to-day running of the business - and in terms of the potentially dire consequences that can result from getting it wrong.
A well-run supply chain provides an organisation with a reliable, steady flow of high-quality ingredients, with quantities scaled to meet demand, and supplies purchased from ethical and sustainable sources. Mistakes in this area can therefore lead to a business grinding to a halt, or running into the kind of food safety scandal that can irrevocably tarnish an organisation's reputation.
With evidence suggesting that consumers are paying more attention to supply chain standards and ethics than ever before, it's never been more important that businesses invest the necessary time and resources into learning and development to make sure that the most common supply chain failings can be reliably avoided.
The serious impact of this kind of problem has become widely publicised in recent months due to a number of high-profile supply chain breakdowns that caused leading brands to suffer significant damage to their reputation.
Pub chain Wetherspoons was one of the most notable companies to fall victim to this trend, with the firm having to remove a number of steak dishes from its menus in January 2018 after meat supplier Russell Hume was found to be in breach of food hygiene regulations following a Food Standards Agency inspection. Hilton Hotels and Jamie's Italian were also among the chains forced to remove menu items and change suppliers due to their links to Russell Hume, which has since collapsed.
Meanwhile, fast food giant KFC experienced problems of its own in February after a mishandled switch in supply partners led to a nationwide shortage of its core product, chicken, resulting in the temporary closure of two-thirds of its restaurants and a widely-reported PR crisis that took several weeks to put right.
Combine these recent incidents with lingering memories of the 2013 UK supermarket horse meat scandal, which saw significant quantities of horse meat discovered in products advertised as beef, and a climate has emerged wherein food industry supply chains are under greater public scrutiny than ever before.
Perhaps as a result of these high-profile brand crises, consumers seem to be paying an increasing amount of attention to supply chain management issues, and are prepared to vote with their wallets to hold companies to a high standard.
A survey of around 1,000 consumers from 2016 indicated that 92 per cent believed it is the responsibility of food companies to ensure food production is fair and sustainable, with around two-thirds of shoppers harbouring concerns that farmers are not paid a reasonable rate for their produce.
It was also shown that 58 per cent of those polled would be willing to pay more if they knew the products they were buying provided a better price and fairer wages for farmers and workers, while 53 per cent said they would do the same for food items produced within high standards of environmental protection.
Meanwhile, a separate survey from 2016 by WE and YouGov offered evidence that two-thirds of UK consumers would be willing to pay more for products that deliver positive social or environmental impact, with 12 per cent saying they would pay a premium of as much as 25 per cent or more. This suggests that food buyers are educated about supply chain matters, and will offer their support to businesses they perceive to be going above and beyond to improve their standards.
All of this means it should be seen as a practical, financial and ethical imperative for food service companies to review their current supply chain arrangements, address any potential vulnerabilities, and reinforce a company-wide commitment to best practice.
Businesses should audit their current supply chain arrangements in accordance with the highest possible ethical, environmental and hygiene standards. This could involve doing additional research into the credentials and reputation of partner organisations and their key suppliers, or implementing new checks to ascertain the quality of the produce being handled.
For firms that have not previously invested heavily in this area of improvement, this may require a significant shift in professional culture, which is why ongoing staff training and development will be essential to making sure this change sticks. Workers at all levels of the company need to be educated about and alert to potential supply chain risks, and able to recognise the signs when best practice guidelines are not being followed. This will help to put a culture of excellence in place that generates significant value for the organisation.
In this context, the supply chain challenges faced by the food sector could be seen less as a warning, and more as an opportunity for companies to nip potential problems in the bud, allowing them to foster healthy long-term relationships with both their supply chain partners and their customers.
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