Supply Chain Management Within the Food Sector

Running Head : Supply Chain Management Within the Food Sector

Introduction

Supply chain management [SCM] is the management of the entire value-added chain , from the supplier to manufacturer right through to the retailer and the final customer . SCM has three primary goals : Reduce inventory , increase the transaction speed by exchanging data in real-time , and increase sales by implementing customer requirements more efficiently (x-solutions .poet .com . In the global context , SCM is even more important considering that more than 90 of world trade involves containers aboard ships , amounting to about 20 million containers

trips annually . For the US , 17 ,000 containers arrive at US ports each day (Cuneo , 2003

For any organization to be profitable it must endeavour to keep its operating costs as low as possible . For companies in the food sector this is especially so since margins are not very high . Also , today 's shopper is very health conscious . He /she demands fresh products (fruits and vegetables ) on a daily basis . Being able to know how much to by daily to satisfy your customers and have no surplus is achieved by efficient supply chain management procedures

In to respond to the discerning consumer 's expectations , new approaches to supply chain management with emphasis on safety and quality assurances are needed . Hence , SCM involves the entire process of planning , implementing plans , and controlling the activities involved in a supply chain of any product to achieve efficiency . It is critical to track the movement of a good from its production point to its consumption point . Emphasis need to be placed in the handling of the products ' raw materials [especially its storage] , the work in progress inventory , as well as the finished good in to guarantee a balance between the demand and supply of the product in the local market Governments and industry have already responded with proposals to create more confidence in supply chain security , while maintaining smooth flows of goods and services in a global supply chain [Hau , 2004] . Some of these proposals call for increased information exchange among trading partners , ports , shipping companies , and the governments . Some call for heightened inspection and scrutiny of the goods flowing through a supply chain . These measures can add cost , delays , and uncertainties in the supply chain [Hau , 2004]

The European Union is funding a novel technology in this regard expected to consist of the following (teagasc .ie ) elements

a system to collect , manage and store data for the validation and verification of food safety and quality downstream from the farm to sales points

active participation and co-responsibility of all players in a supply chain community

an electronic platform (e-platform ) capable of connecting stakeholders via computer interfaces and co-ordinating communication within agro-food supply communities

a framework for harmonization of quality assurance (QA ) protocols along the entire food production and processing chain

computer software to maintain security of information circulating in the e-platform (teagasc .ie

It is therefore necessary to track the movement of a good from its production point to its consumption...