Fresh Ideas in Distribution
“Executive Insights” produced by Retail Leader
Issue 1, January 2014
As fresh products continue their explosive growth in the retail food marketplace, pulling ahead of your competition increasingly means being able to meet the challenges of refrigerated fresh distribution through end to end supply chain product management. Consumers’ craving for fresh produce helped push higher 2012 year-over-year sales in the $100 billion U.S. fresh produce category and at the supermarket deli, according to Nielsen data. And Walmart’s $25 billion target for annual fresh sales means consumer expectations for fresh availability and quality levels at retail stores will only continue to rise. The payoffs for retailers who can provide top-quality fresh items for their shoppers, however, are rich. A successful fresh prepared foods program, for example, has the potential to drive traffic, emerge as a store profit center and differentiate a retailer from competitors, suggests new research and analysis from Technomic. Fresh prepared foods is a $26 billion market, according to Technomic, and its growth is projected to top that of retail packaged goods and foodservice.
Adding flexibility to the supply chain
Adapting your distribution to handle a greater variety of perishable items demands flexibility above all. “For each specific [fresh] product, the requirements for temperature, humidity and odor are very different,” says Ed Treacy, vice president, supply chain efficiencies for the Produce Marketing Association. “Cold chain management is probably the toughest thing to do, because it directly affects the quality and safety of the product. [But] if you’ve got a very good cold chain management process, you can push the envelope a little bit on the variety of sensitive or fragile items handled.” Managing the cold chain effectively may require more sophisticated planning tactics so that truck loads can be maximized for specific temperatures, for instance. Being able to take advantage of the latest technology innovations in GPS monitoring and sensors is essential to driving down waste and spoilage in the fresh distribution process.
“You need to know that the folks you’re [getting] product from are adhering to risk- and science-based food safety programs.”
Dr. Bob Whitaker, Chief Scientific Officier, Produce Marketing Association
In fact, emerging science is leading to the development of risk- and science-based food safety programs that simply weren’t possible even five or six years ago, explains Dr. Bob Whitaker, chief scientific officer for the Produce Marketing Association. Food safety liability issues are in the forefront today, he adds, as victims of food contamination outbreaks increasingly look for the deepest pockets in the supply chain when they file lawsuits.
“What we’ve seen emerge in the last two to three years is the legal and financial ramifications of not understanding the food safety system,” he says. “You need to know that the folks you’re [getting] product from are adhering to risk- and science-based food safety programs.”
Regulatory compliance is also a significant consideration in today’s refrigerated supply chain. The Food Safety Modernization Act, HACCP and Country of Origin Labeling are examples of a growing maze of government regulations that must be navigated to optimize the fresh supply chain. This requires an experienced and knowledgeable staff to manage successfully, says Mike Bargmann, retired chief logistics officer for Wegmans Food Markets.
The outsourcing opportunity
Working with customized solution provider Burris Logistics can offer retailers the best of both worlds: You can cost-effectively maintain a high level of control throughout the supply chain, while Burris handles procurement, warehousing and transportation. That leaves more resources for you to concentrate on your core competencies as a retailer and grow your business.
As one of the largest temperature-controlled logistics providers in the nation, Burris moves millions of cases each week to major supermarket/retail operators. Burris’s Custom Retail Distribution offers retailers:
- Nearly a century of perishable supply chain experience
- Multi-temperature, climate-controlled warehouse solutions including existing and built to suit facilities
- Fresh product procurement expertise
- A company-owned and managed transportation fleet
Fresh Distribution in Action: BJ’s Wholesale Club
BJ’s Wholesale Club, Inc. is a leading operator of membership warehouse clubs in the Eastern United States. Headquartered in Westborough, Mass., the company currently operates 201 Clubs in 15 states from Maine to Florida.
The challenge: BJ’s has expanded its selection to include fresh prepared food offerings, sushi, raw and cooked take-home solutions, and more organic offerings in poultry, produce and fresh meats. That makes it vital for BJ’s to maintain “speed to market in a rapidly changing perishable industry,” says Jeff Parsons, BJ’s vice president, logistics operations. “This includes ensuring the highest product quality for our members, accuracy of distribution, salvage reduction, and high service levels.”
The supply chain solution: BJ’s outsources all of its perishable product categories to Burris Custom Retail Distribution through three dedicated Burris distribution centers and a dedicated fleet and drivers. “Burris is exceptional at adapting process flow to support our business,” explains Parsons. “Burris consistently executes to meet the demanding perishable challenges by shipping and receiving off hours and processing last-minute order changes for unplanned events.”
Based in Milford, Del., privately held family business Burris Logistics is one of the largest temperature-controlled logistics companies in the nation, with facilities serving America coast to coast. The Burris family’s commitment to exceptional customer service and a culture of honesty and integrity goes back five generations to the company’s founding in 1925. Today, Burris continues to expand and evolve, constantly reviewing its operations to ensure that what its customers need will be on time, in stock and accurate. Burris uses advanced technology to drive down costs at all levels of the business, making it easy for technologies to meet and connect on virtually any platform and environment.