Because consumers have been increasingly working, schooling and cooking from home during stay-in-place measures related to the COVID-19 pandemic, purchase and consumption of chilled and frozen foods is at an all-time high.
As a result, the use of e-grocers has reached unprecedented levels; traceability compliance is more important than ever; and labor recruitment and retention issues are ongoing, despite unemployment rates being much higher than normal. What’s more, cold storage has been named an absolute energy hog, and companies already know that if they can decrease these costs, they will increase profits. Finally, the need for automation is huge, but often, companies don’t know how or where to start. Automated mobile robots (AMRs)? Voice? Palletizing solutions?
These topics and more were addressed during Cold Storage Trends, Körber Supply Chain’s second five-session Master Class Series that took place June 9-23.
Read on for a brief synopsis of each Master Class session. And if you missed a Master Class or want to replay one of particular interest, click here.
Session #1 ‒ Cold storage and e-grocers: Changing environment
Today is an exciting time to be a part of the growing, thriving cold chain market. According to the 2020 Cold Chain Business Impact Survey, the COVID-19 pandemic will prompt a 58% growth rate in the cold chain industry. Changing consumer preferences and social distancing measures have increased demand for e-commerce frozen foods. Frozen foods have a longer shelf life than fresh foods; plus, they offer a large variety of meal options and are less expensive than fresh foods.
However, several trends present challenges to the cold chain industry, including:
• Driver/workforce shortages
• Outdated refrigerated warehouses
• Keeping pace with technological improvement
• eCommerce growth
As such, the industry will likely see partnerships between third-party logistics (3PL) companies and others to meet the growing demand for cold chain products, which require specialized cold chain infrastructure.
Session #2 ‒ Traceability and food safety in cold storage
Maintaining food integrity across the cold chain is an ongoing challenge – with the biggest “hot spot” being transportation. The Food Safety and Modernization Act was enacted to regulate food safety from origin to the consumer and requires documentation, standardization and traceability. Cold chain shippers are required to provide documentation to ensure products are transported safely.
Despite these precautions, temperature misses can occur. That’s detrimental to consumers who might get sick or worse, as well as to retailers, grocers and producers of recalled food. For instance, in-transit temperature abuse of poultry products sold to consumers in two New York Target stores in June 2019 prompted the FDA to recall certain chicken products, resulting in loss of inventory, reputation (to the retailer and chicken producers) and, ultimately, business. From a financial perspective, each recall translates into costing companies up to $30 million, according to the FDA. But with the right traceability measures in place, events like these can be prevented.
Session #3 ‒ Labor recruitment challenges in cold storage
What’s your greatest labor challenge in the cold chain industry? If you are like 67% of the attendees in this session, driver and workforce shortages top the list, according to an online poll taken during the session. And a survey by the Global Cold Chain Alliance backs this up, reporting that turnover in the cold storage industry averaged 32.6% in 2019.
It should come as no surprise that the cold chain industry’s harsh, frigid working environments play a part in retaining employees. In addition to offering standard incentives like higher-than-average pay rates and benefits, companies can also look to blend process and technology to overcome this issue. The right technology – such as voice – enables employees to be more productive without having to decrease their comfort level. For instance, workers can use voice-enabled technology workers to push a button rather than remove a glove.
Session #4 – Improve energy efficiency in cold storage warehouses
An article published in Progressive Grocer reports: “Globally, cold storage facilities have the highest energy demand per cubic food and the third highest energy consumption of any industrial category, spending over $30 billion annually.”
Given this, what can companies in the cold chain do to save energy? Increasing efficiencies in the routine planning and execution of warehouse activity and broader supply chain activity, will allow companies to save time and money, while reducing energy consumption and the carbon footprint. For instance, by decreasing the travel time of shunter drivers, fuel and labor costs go down while sustainability goes up.
Solutions that can help rein in costs while lowering energy consumption include automated transportation management, yard management, warehouse management and distributed order management (DOM) systems.
Session #5 – How does automation drive cold storage efficiencies
There’s no doubt automation can increase efficiencies in the cold chain. While some companies are large and handle enough cold storage items to fully automate all processes, others might only need automation in areas like palletizing or storing chilled or frozen goods.
Consider a sample of three trends taking place right now:
- The frozen foods market is growing as more people cook from home
- More frozen food variances are available than ever before. For example, shoppers can often choose from 25 frozen pizzas, whereas in the past perhaps only a handful were found in a store
- Product traceability–from farm to fork, is getting more important every day
Automation that’s customized to fit an organization’s needs can help companies keep up with and even thrive with these growing trends and others.
If you missed a Cold Storage Trends Master Class or want to replay a session that piqued your interest, check it out here. Collateral downloads can be found by selecting the “Watch on Demand Button.”
If you are interested in the Addressing Labor Challenges Master Class sessions that took place before Cold Storage Trends, click here.
More Master Classes
The next series on Warehouse Technology Excellence will address ways to stay competitive to meet your consumer’s needs and thrive in an ever-progressing, challenging warehouse environment. Take a look at the lineup:
- July 14 – 10 critical capabilities of a WMS
- July 16 – WMS in the cloud
- July 21 – Getting your ROI in an enterprise or SMB WMS implementation
- July 23 – From production to last-mile deliver: WMS as the integration point
- July 28 – From a manual to a fully automated warehouse
Get more details and sign up here.