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Where the Fast Food Industry Can Find Inspiration for Better Supply Chain Design

Posted by Jeff Cowles

May 6, 2016 12:00:00 PM

Specialty grocery store

At the store level, the many metrics that determine a QSR's success or failure are predicated on the movement of the supply chain. Most business decisions are made with the assumption that product cost and supply chain speed will remain a constant, barring any unforeseen supply or distribution issues. This stability — something of a rarity in an industry that seems to change from moment to moment — is a benefit that C-suite decision-makers are understandably reluctant to tinker with. Innovation, however, must be incorporated into any supply chain design that hopes to stay competitive. Imagine that generations past had failed to innovate. Meats and produce might still be arriving by horse-drawn carriage in sawdust-packed glacier chunks. But if change doesn’t come from within, where can the fast food supply chain — essentially unmatched in terms of speed and varietal demands — look for inspiration?

Industry Leading Competitors

Even for QSR-Plus segments, looking to fast food industry leaders like McDonalds is the best move for discovering ready-made solutions. Sometimes these solutions are complex, such as formulating intricate plans to distribute around potential natural disasters like hurricanes. Sometimes they're exceedingly simple, like requiring delivery drivers to call ahead to restaurants so that employees are ready to unload and send the truck to its next location as soon as possible. 

In-Depth Data Management

Analyzing data for trends to determine market moves is a familiar technique for the fast food industry, but surprisingly few companies turn that scrutiny on their own food supply chain. Specialty-field data — locations of producers, minimum volumes, methods of production and so on — should be gathered and kept by companies looking to innovate their supply chains, even if it doesn't have a current use. Keeping the ability to examine and sort that data on hand is not only useful for operational goals like compliance and transparency, it enables quick-trigger changes in the event of an issue, such as a supplier recall or producer employee strike.

The Jack-Of-All-Trades

Amazon has the distinction of hovering near the peak, if not resting on top, of Gartner's top 25 best supply chains for several years running. While the incredible volume of the company's e-commerce kingdom is impressive, they're climbing this particular ladder on the strength of their ideas and implementations. From drone delivery plans to their commitment to eliminating the obstacles that stand between their product and a happy customer, Amazon does not rest on its laurels when it comes to supply chain design. This corporate culture of continuous improvement is definitely a model for other supply chains to emulate. Far too many food-based supply chains are concerned with consistency, even at the cost of potential cost-savings and new inroads of competition. If Amazon's supply chain had a message for the QSR industry, it would be an admonishment to never be satisfied, but not to push forward at the cost of consumer satisfaction. 

Environmental Matters

A fast food supply chain that's built to last is one that takes the world around it into account, both from an eco-friendly perspective as well as one of customer perception. The environment in which a supply chain exists can't afford to take too heavy a toll on either, even if it means sacrificing efficiency or lower unit prices.

Cerasis' Amber Markim cites sustainability as one of the top traits that a supply chain should have, and with the waste inherent in the food industry, that's sound advice indeed. While most non-food industries agonize over letting even a pallet of product go to waste, it's commonplace for the QSR industry to discard a great deal — notably, perishables — and chalk it up to operating costs. Sometimes, a little tweaking in supply chain design can help prevent these waste issues, ultimately driving consumer-facing prices down and reducing environmental liability for a fast food company as a whole.

The fast food supply chain only works well if the professionals managing it are pledged to a blend of corporate efficiency and brand integrity. Looking to other industries and companies that have succeeded in overcoming common obstacles is an excellent first step in that journey. This way, your company receives the benefits of others' risks, allowing you to take innovative steps of your own later, with plenty of smartly-managed resources and honed expertise cheering you on.

How Quick-Service Restaurants Can Find Balance

Written by: Jeff Cowles

Topics: Food Service, Supply Chain, QSR