Moving food around the world
Grains, sugar, canola, oilseed, cotton and other ingredients don’t just magically appear on grocery shelves or in the products you consume. There is a massive industry moving those commodities around the world in trucks, ships and trains so food manufacturers and countries alike can provide high quality products to consumers. The companies operating in this $225 billion food commodity trading industry are the backbone of the world’s food supply they have to be masters at planning, managing disruptions and taking advantage of pricing opportunities to make the operation run smoothly and profitably.
The key challenge is to get these commodities from the farm to the end consumer as efficiently as possible. Industry players face complex tactical planning decisions every single day. For example, from which port will you ship a vessel of oilseed to the UK? How much food-grade grain will be made available at the port of Odessa next month? What changes will you make due to geopolitical instability in a region that provides large amounts of sugar?
Finding the right planning solution
To unlock opportunities that increase margin, food commodity traders need a solution with the following capabilities:
1. End-to-end visibility
By capturing a real-time view of the global supply chain position, your organization’s trading function will have full visibility on a global scale of all open orders and currently booked shipments. Based on that information, the trading function can best determine where in the world to source each order, and operations can put the best plan into action.
2. Transport asset planning
The most advantageous use of assets occurs when all data are working in parallel to optimize the movement of freight for the lowest cost per ton. This is particularly vital when moving perishables, as there is simply no room for error. With the right solution, your local planning teams can understand the harvest and crop expectations and plan the usage of owned and third party fixed and mobile assets, including silos, transport resources and port terminals.
3. Supply option benchmarking
Companies know that every decision made comes with a cost and an impact. The better you understand those details, the better you can compare plans against one another to select the best one. The right solution can provide an overview of the quality of all the options based on their impact on your margin, cost drivers and other business areas. You can benchmark your choices against one another to arrive at the best option.
4. Real-time KPI monitoring
The proper mapping of the supply chain in a digital logistics model buys you precious time and provides critical decision support. When the quality of every scenario, adjustment or disruption to a plan is visualized against your KPI’s in real time, you can understand the impact of decisions and drive best in class operations. It moves you away from solving problems based on gut feeling.
When you have got technology that gives you the right information at the right time, and more than that, enables you to manage your resources extremely efficiently… that’s a magic formula.”
– Executive & CEO, Dassault Systèmes customer
5. Advanced scenario planning with the virtual twin
When supply chain information is available in real-time and all resources are properly mapped in a virtual supply chain twin, you’re in a much better position to respond to disruptions. The virtual twin enables earlier detection of issues and helps you understand more options for response. If a vessel is delayed, for example, the system can understand all the downstream permutations the delay will cause. With this knowledge, your operations team can assess the potential delays in orders and how to best address them.
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Brian Carboni is the Global Marketing Director for the CPG-Retail Industry at Dassault Systèmes.