6/26

This weekend I am trying to get through some accumulated reading, including an August White Paper entitled "Food Industry Logistics: Trends that Matter".  A couple of quotes:

THEN: Logistics networks have been designed with mindsets relevant to a prior era. Production and distribution efficiencies commonly drive product and placement. The infrastructure and apparatus are built around a high proportion of (and preference for) heavily processed foods with extended shelf life. Large manufacturing plants and distribution centers are prevalent, and efficiencies have been built around bulk shipments, which have often driven product assortment decisions. Lastly, outbound distribution models have been designed by large players to maximize their bottom line relying on fairly predictable demand rather than to respond optimally to consumer on-the-go needs.

NOW: Growing consumer expectations for freshness require shorter farm-to-fork times and distances. There has been major growth in small-footprint urban retail locations, as well as substantial growth in home delivery from online channels (e.g., Blue Apron). “Uber-type” on-demand deliveries in a one- to four-hour timeframe have also come to market... There is growth in nontraditional retail and foodservice channels (e.g., limited-assortment and fresh-format stores, specialized chains). Convenience retailers are actively working to deliver a broader, fresher and better variety of prepared foods to customers. Emerging channels like food trucks and farmers markets with unique offerings are also developing; many are harnessing the power of social media to reach consumers.

IMPLICATIONS: This will radically impact food industry logistics.... The increasing need to be closer to customers necessitates additional brick-and-mortar facilities (e.g., distribution centers, cross docks). To speed up cycle time even further, robots, automation and advanced technologies will be required.

I agree this is happening.  I agree it could be important in a whole host of ways including enhanced network resilience.  The proportional impact of these trends is not yet clear to me.