Don’t we all enjoy a chilled beverage and a perfectly barbequed steak during the summertime? With the temperature rising, the demand for meat also increases, making summer one of the busiest periods for the protein industry.
As part of the fresh food business, the main hurdle is managing the complex supply chain, while ensuring freshness, maintaining quality, and dealing with price pressure from retailers. To stay competitive and keep customers loyal, producers should focus on improving supply chain and production practices and opting for smarter planning and execution.
“Meating” your objectives
The meat industry is market-driven which means that changing consumer expectations and demand can cause challenges. Orders from retailers are very unpredictable. They often arrive only a few days in advance or get revised in quantity a short time after. The uncertainty creates the need for an agile planning solution to respond quickly to fluctuations in demand.
Another major challenge in meat planning is the unpredictability of supply. You never know if the quantity of livestock ordered will arrive on time, and if their size and weight will be consistent. Planners have to identify and address any gap between forecast and actual volumes. And they have to match the demand for individual cuts against supply, while at the same time considering the capacity constraints of the plant.
Ensuring protein production is well done
Meat processors face an additional issue. Can you imagine a summer barbeque without spare-ribs, steaks, and sausages? Different seasons require different meat cuts, resulting in a surplus of remaining cuts. When protein producers have a large surplus of remaining cuts the question is what can they do with those? Running promotions or processing those cuts to other end products? As volumes are high and margins are low, every penny counts for a meat producer. Therefore, they must strive for the best planning decision and one could be to contribute to greater profits while another could be to reduce waste to a minimum. A last option could be freezing these cuts. However, that comes at the cost of freshness and hence a reduction in value. Producers need full visibility of the meat supply chain to stay in control and to make informed decisions resulting in more profitability and increased revenue.
Beef up visibility across the entire value chain
Meat processing is influenced by a variety of external factors. Consumer tastes and lifestyles greatly influence the variation of meat products produced. The recommended approach to this, is to have comprehensive visibility and consistent planning. This will help choose the most profitable option that balances supply and consumer demand. Collaboration and digital solutions are essential to realize maximum value and production potential. A fully connected supply chain ensures efficiency and provides planners with the necessary decision-making support.
An integrated planning system that supports decision-making at all levels is indispensable for understanding your company’s operations. Just as crucial is the ability to instantly calculate and comprehend the impact of various events across your supply chain. Scenario planning and creating what-if scenarios can help you strike a balance that not only increases profits but also aligns with other business KPIs. The right system enables producers to adapt quickly to market changes, customer orders, and consumer preferences.
In today’s fast-paced business environment, planning flexibility gives meat producers an edge over their competitors. They can maintain high service levels while getting the maximum value from carcasses while wastage is minimized. Full visibility of the meat supply chain is crucial for control and for making informed decisions resulting in robust growth and increased revenue.
With a solution integrating S&OP, production planning, factory and transportation scheduling, and production execution, your team can access information about your company’s entire global operations and make use of real-time insights for yield optimization.
In addition to the challenges mentioned above, environmental and social implications of meat production need to be addressed. With the increasing global population and demand for protein, it is crucial for producers to consider sustainable practices in their operations.
Embracing technology and constantly evaluating and improving processes is key to staying competitive in the meat industry. So next time you enjoy a delicious summer BBQ, please remember the complex process that goes into producing that mouthwatering meal.
Sizzling hot information
Read how you benefit from a fully connected supply chain in meat and poultry.
DELMIA Quintiq Offer Marketing Specialist