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Book Review: Food Supply Chain Management and Logistics
Supply chains that are governed well will also protect the environment and create ethical behaviour not only between the transacting partners but hopefully across the network. However, developing the supply chain and the relationships requires effort and commitment from partners and help and support from governments. (p. 93)
Food Supply Chain Management and Logistics: From Farm to Fork by Professor Samir Dani is an eye-opening look at the complexity and criticality associated with feeding people the world over. Right from the outset, the book considers each topic in the context of a balance between advancements and opportunities and the consequences of failure, corruption, and manipulation.
The food supply chain is, in actuality, multiple chains: produce, grains, meat/protein. Producers are in a difficult spot as ‘input suppliers’ (e.g. equipment providers) have significant power, uncertainty lurks in weather patterns and growing conditions, and the need for controls leads to complex regulation affecting both costs and prices. Ripple effects in these chains vary, with increased demand for processed foods leading to spending on and innovation in packaging, and increased demand for protein resulting in more demand for farming output.
Food Supply Chain Management is a balance of in-depth food management specific concerns and more general supply chain content that undoubtedly has applications in the field (collaboration, supply chain risk, lead methodologies). The author’s knowledge reflects an understanding of the many perspectives that must align for optimal execution:
Procurement: Inventory management is a critical effort (such as through the limitation of SKUs), tracking for food safety, and the incorporation of food safety in bids/contracts. Dani makes a particularly interesting point about the need for careful delineation between sourcing, procurement, and buying - especially in smaller organizations. "These terms are used synonymously in the literature and in industry. However, this is not so much of a problem as the nomenclature within industry is dependent upon the size of the company and the organizational structure. Within an SME (small or medium-sized enterprise), the three roles may be conducted by a single person, whereas in a large company there will be individuals in procurement, sourcing, purchasing and supply chain roles. Hence, it is important to understand these processes and how they influence the food supply chain." (p. 115)
Logistics: The range of ‘temperature bands’ resulting from the different storage conditions required by each category of food add complexity as well as justification for innovative solutions in the food supply chain. The tradeoffs that ripening techniques allow between modes of transportation, their cost, and their lead time make for complicated decisions.
Politics: Unlike the products being moved through most supply chains, global food shipments and their perishability necessitate a unique sort of cooperation between the private and public sectors. Opportunities in the private sector are often dependent upon investments in supporting infrastructure, without having any leverage to carry them out. Global food markets bear the effects of localized issues and decision making, and local investments in education and infrastructure have the most significant impact on the import and export of food.
The number of factors affecting food supply chains and those responsible for their management is staggering. And even the factors themselves are not stable. Demand is directly affected by income levels and standards of living, land availability, and energy consumption, as well as new (competing) applications for agricultural capacity such as bio fuels. Understanding both the requirements of food logistics and supply chain management will be a critical capability for anyone in an affected market going forward.