The efficiency of Logistics & Supply Chain process in Fresh Fruits and Vegetables.

Future trends: Fresh fruit and vegetable markets — In order to understand where fruit and vegetables are likely to be sold in the future, we modeled fresh produce expenditure along three dimensions: by geography, by consumption occasion (at home versus out-of-home), and by chance.

Consumer spending on fruit and vegetables Geography and channel, by 2030 (trillion euros). Source: Passport Euromonitor, Oliver Wyman research and analysis

Introduction:

The Coronavirus crisis has redefined consumer shopping habits and established some new trends in retail and consumer goods markets. Stockpiling of essentials, online shopping of consumer goods, and convenient contactless deliveries are some of the most talked-about topics these days. One of the biggest trends seen in the retail market this year is the growing demand for fresh foods — fruits and vegetables, meat, seafood, fish, dairy, baked goods, deli products, and more. Over the past couple of decades, there has been a dramatic movement towards out-of-home consumption. This has been a big driver of overall demand and profitability. While we expect this trend to continue, the pace of change is likely to slow, Currently, online sales of food in general — and fresh fruit and vegetables in particular — start out with a low share of the overall food retail market. There are significant regional differences, variations driven mainly by consumer sentiment (local online adoption rates) and the profitability of retailers. At the same time, some growers have begun to appreciate the channel, The aim of the EU fruit and vegetable market observatory is to provide the EU fruit and vegetable sector with more transparency. More of the exporters target to supply in the European region because the European market is its sheer size. Europe has a population of more than 500 million consumers and is responsible for 44% of the global trade value of fresh fruit and vegetables. One of the most important things to learn in Europe, Europe is a mature and diverse market for fresh fruit and vegetables. There is a risk demand is relatively stable, although short-term needs and prices change regularly. Before entering Europe Be aware that local production normally has a preference over imported fruit. Spain and Italy are the leading producers of fruit and vegetables in Europe, especially for citrus fruit, stone fruit, watermelons, table grapes, peppers, and tomatoes. Although We expect the online’s share of global fruit and vegetable sales to grow to 7% by 2030, though distinct regional differences will remain. The bulk of this growth will occur in Europe and Asia, and only to a lesser extent from the Americas.

Supply Chain: Concepts:

Supply chain management (SCM) may be defined as a set of approaches utilized to efficiently integrate suppliers, manufacturers, warehouses, and stores, so that merchandise is produced and distributed in the right quantities, to the right locations, and at the right time, in order to minimize system-wide costs while satisfying service level requirements. Having looked at where fruit and vegetables will be sold in the future, As with other supply chains, the one for fresh fruit and vegetables has long been commoditized. As a result, in the past this supply chain has been characterized by an overwhelming focus on cost reduction; until recently, it has been considered to be of limited strategic value. The supply chain is the network of organizations that are involved, through upstream and downstream linkages, in the different processes and activities that produce value in the form of products and services in the hand of the ultimate customer. It is the planning and control of the flow of total material from suppliers to manufacturers to distributors and finally to the end-users, Already, a number of actors have started to recognize the emerging value, and have taken the first steps to gain control over their fresh produce supply. While cost and efficiency will continue to play a significant role in driving the fruit and vegetable supply chain in the coming years, It aims at providing high value to customers with appropriate resource utilization and building a competitive advantage.

According to the study of Oliver Wyman and market survey 4 key developments that meet the requirement :

A. Flexible Supply

B. Transparent Supply

C. Rapid Supply

D. Precious Supply

The availability of fresh foods is a key driver of in-store traffic in supermarkets and convenience stores.

The most important attributes shoppers say when selecting their primary stores include high-quality fruits and vegetables. A number of fresh food start-ups have sprung up since the onset of the pandemic, getting investor attention as well as popularity among consumers. While the fresh foods market is soaring high, it is also one of the most complex supply chains to manage. The perishable nature of fresh produce makes their storage, transportation, and shelf-management a tightrope walk for fresh foods retailers. Every supplier relationship should be based on the product’s supply volatility — in quality and volume. Products with high supply volatility are best sourced primarily through stable suppliers, whereas products that are less volatile, can be sourced through transactional or even spot-market purchasing, which allows retailers to respond to changes in demand.

Logistics and Technology:

Increasing the speed of the supply chain, the objective is to enhance the freshness of the produce in order to deliver quality in line with growing consumer expectations. If other players are to meet the challenge this presents, they will need to get better at managing the supply chain. This means taking actions to optimize the chain and eliminate inefficiencies, developing an end-to-end view along its entire length. The challenge is to target and eliminate duplication of work, ensure well-orchestrated schedules from order to delivery. As part of their efforts to speed up the chain, players will also need to consider moving towards more collaborative working arrangements. Collaboration would make it possible for the different players jointly to perfect all of the links in the chain, This would have several benefits, including enabling them to move away from time-consuming negotiations, while at the same time superseding the isolated optimization efforts of the past.

Cold Chain Provide a vital role in the Supply Chain:

A cold chain protects a wide variety of F&V produce to get deteriorate in the whole supply chain by providing a temperature-controlled facility. It is a logistic system that provides a series of controlled temperature storage and transport conditions from the point of origin to the point of consumption, i.e. from farm to fork. . Any disorder in temperature or time-distance in the cold chain could hamper the net present value and their added value, The cold chain starts at farm level and covers up to the consumer level in a temperature-controlled practice and behavior. Cold chain infrastructure generally consists of grading, sorting, packing. Highly inefficient supply chain results in High wastage of fresh Produce, Instability in prices, farmers not getting remunerative prices as the differential between the farmer’s realization and the final consumer price and highest in the world even in the fresh produce, rural impoverishment resulting in farmers’ frustrations and suicides and increased additional costs in the supply chain which ultimately enforces the final consumers to pay high charges from his pocket and which is not possible for everyone.

Conclusion:

The fruits and vegetables (F&V) sector in the case of agriculture and allied sector in Europe account for a significant share in the world production. Addressing the problem of supply chain losses and wastage, transportation and storage can be the area of focus. The supply from countries within a close distance to Europe has become an attractive and economical option, especially early in the season. This offers opportunities for nearby suppliers such as Egypt, Morocco, and Turkey, which often overlap with the European harvest. Europe is a dynamic market with different opportunities and characteristics. According to the study, Belgium and the Netherlands are very relevant for the trade and distribution of fresh fruit, while the vegetable trade consists mostly of locally grown produce from greenhouse horticulture.F&V sector in Europe is a very growing sector and presents a huge opportunity to the stakeholders and entrepreneurs through setting up the cold chain infrastructure and food processing units.

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