The early days of the Internet, with the dotcom boom and bust, have provided many a cautionary tale for B2C ventures. But, says just-food.com’s Bernice Hurst, B2B enterprises still boast great potential. From realtime product development to comprehensive supply chain management to computer-controlled vineyards, Hurst highlights the myriad online opportunities.
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If collaboration is the new black in food manufacturing, then the Internet is the tool that transforms the fantastic into the achievable. Time zones can be superseded as supply chains transcend national barriers to create new partnerships in the production cycle as well as new markets and customers. Enabling buyers and suppliers to have equal access to specifications and schedules, as well as ensuring they that can contribute ideas and solutions to problems in realtime, is one of the great added-value aspects of the Internet.
One of the first companies to exploit these opportunities was QSA, which was founded in 1994 by Tim Winfield and Paul Byfleet. The partners, formerly employed by UK multiple retailer Sainsbury’s as technical product managers, started their business with the ambitious goal of harnessing the power of the Internet to automate the process of product development as well as increasing its overall efficiency, speed, safety, quality and reliability.
Reduce development time
Early links with Sainsbury’s have stood QSA in good stead. The supermarket was the first to trial the company’s ProductVine software, an internet-based collaboration tool designed to reduce development time on new products by up to a third. By facilitating online communication, ProductVine ensures that everyone in the supply chain has the same information and knows what needs to be done when.
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Hosted by GlobalNetXchange, the business-to-business e-commerce exchange comprises of Sainsbury’s and other retailers such as French giant Carrefour and US-based Sears, whose activities are aimed at increasing collaboration across the supply chain. ProductVine, QSA says, “assigns responsibilities, ensuring process steps are adhered to and the key activities of product development are not compromised.”
Increase food safety
Furthermore, QSA maintains that ProductVine has “particularly important ramifications for food safety”. By increasing control of development, composition and the production environment, labelling can be more consistent and the amount of information provided to the consumer maximised.
Kraft Foods Europe has also adopted one of QSA’s solutions, this time a web-based specifications management system, which will link more than 50 sites across Europe. According to Peter Hennessey, senior director corporate quality, regulatory and scientific services at R&D, Munich: “Ease of use, rapid data retrieval and meeting our varied business requirements across multiple product areas are key criteria for a leading edge specification management system.”
QSA explains that it developed the system to “provide integrated recipe development, effective raw materials management and specifications control, as well as comprehensive process management to ensure consistent documentation and communication of finished product safety and quality standards across multiple international manufacturing operations”.
Easier purchase orders
One non-food organisation experimenting with realtime supply chain management is Gower Chemicals, a Swansea-based management company, which has a telemetry link-up between its computer network and Sony’s chemical storage facility in South Wales. Nine storage tanks are monitored remotely by Gower, who manages and replenishes stock, Just-In-Time, without the need for purchase orders. Gower’s internal computer system monitors its own chemical stocks. Sony’s system used to generate up to 100 invoices a month and it needed a team of warehousemen to constantly troll around the tanks checking levels. Now the system is completely automatic, generates one invoice and saves Sony £100,000 (US$145,000) a year (on £400,000 worth of product).
On the food retailing front, supermarkets have discovered that technology can help with stock rotation in refrigerated cabinets. Chips embedded in pallets make the production process more transparent so that retailers can track every step of the distribution cycle, including the temperatures at which food travelled to reach the store shelves, making it simpler than ever before to monitor quality and expiry dates. There is less chance of stocking bad food and more chance to reduce wastage.
Collaborative Planning, Forecasting and Replenishment (CPFR) also helps reduce overstocking. Direct links between manufacturer and retailer mean that the amount of product per store can be monitored and replacements ordered as needed with less need for staff time to be spent taking a manual inventory and estimating purchase requirements.
Wine wonder
In Australia, vineyards in the Hunter Valley are using technology for gathering data in realtime to ensure the quality of their crops. Kurrajong Vineyard has 25 acres of Verdelho, Semillon, Shiraz, Cabernet Sauvignon and Merlot grapes wired to a shed full of radio telemetry equipment. Soil moisture probes are scattered amongst the vines while leaf wetness sensors nestle alongside the fruit and a compact solar powered weather station monitors rainfall, temperature, wind speed, humidity and a host of other conditions that affect grape production.
Data from the various devices is transmitted to an Adelaide-based control centre which converts the statistics into management information presented graphically on a website. By accessing the website, the health of the vines can be checked in realtime and early warnings of possible infections or frost detected. Using the Internet, instructions can be transmitted on what pesticides to spray and in what quantities to avoid high-risk diseases. Similarly, the system advises on when, and how much, water is needed.
If water is short, which it frequently is, more can be accessed via a community-owned computer-controlled pipeline system, which feeds into Glennies Dam on the Hunter River. Vineyard owners simply leave a telephone message with the pipeline’s operations manager who opens the appropriate valves using his laptop computer. From his home in the Lower Hunter, the manager remotely controls the delivery of some 5000 million litres of water (equivalent to two major storms) to 384 vineyards, golf courses and other properties in the Hunter Valley.
Community owned and officially known as the Pokolbin Pipeline Project, the entirely computer-controlled system schedules, controls and monitors every property connection. Each participating farm has its own transmitter sending information back to a central computer. A continuous stream of data is fed into the system on flow rates, water levels and salinity, pump temperatures, pressure and water quality. The system can control the pumping stations, open and shut valves on individual farms, adjust flow rates, detect leaks and even shut itself down and produce monthly water bills.
Applications for using increased and improved means of communication are crossing both horizontal and vertical supply chains. And while the so-called dotcom crash may have slowed down business-to-consumer e-commerce, there are still vast opportunities being created in a business-to-business context.
By Bernice Hurst, just-food.com correspondent
