7 Benefits of Short Food Industry Supply Chains

Short food supply chains are characterized by few intermediaries and shorter physical distances between producers and consumers. These supply chains are good for increasing profits of farmers and other producers, revitalize rural economies, and give consumers access to fresh, fairly-priced foods. Short food supply chains are garnishing more attention as consumers are concerned about the spread of foodborne diseases as well as issues such as the horse meat being identified in packaged foods in Europe. In this article, we have talked about some of the greatest benefits that the use of short food industry supply chains offers:

Benefits of Short Food Industry Supply Chains

#1. Improved negotiating positions for farmers

These short food industry supply chains offer farmers greater power during negotiations, especially during those with retailers. Using short food industry supply chains that do not consist of multiple processors, traders, and wholesalers give farmers and small producers more direct access to the market.

#2. Increased communication between producer and consumer

Short supply chains can lead to job creation, especially in rural areas, which also helps to increase the farmer or producers reputation and the trust that consumers place in them. Operating locally allows producers and consumers to have more direct communication and interaction, which also helps to build loyalty and trust.

#3. Reduced transportation costs

Short supply chains typically serve a local area, reducing the energy costs, transportation costs, and CO2 emissions used to transport goods in longer supply chains. Because of this, these supply chains have a greater potential to be made sustainable and to remain sustainable over the long term.

#4. Increased transparency 

Its easier to make short food industry supply chains with few or no intermediaries transparent than it is longer and more complex ones. Producers are also able to offer more detailed information about their business and practices, helping to build their reputation, increase customer retention, and build loyalty. It also makes it easier to make procurement decisions.

Continue reading to know more about the benefits of short food industry supply chains or request a free demo below

#5. Reduced risk

Short food industry supply chains reduce the risk of damage, contamination, or theft of the products during transportation, packaging, or production. Minimizing the number of players involved in the supply chain helps to make it safer and more secure, which helps to protect farmers and producers as well as their end-users.

#6. Increased quality

Doing business and transporting goods locally increases their overall quality by reducing the need for freezing and use of preservatives, allowing customers access to a fresh food supply. Additionally, short food industry supply chains reduce food waste and disposal costs for farmers and producers.

#7. Greater profits

Short food industry supply chains offer farmers with greater profits while keeping the end-price more or less the same for consumers. By eliminating middlemen, reducing the length of the food industry supply chains, and operating on a more independent basis, farmers and small producers are able to keep more of the resulting profits for themselves rather than share them amongst other suppliers.

Logistics strategies in short food supply chain

Inventory Management: Keep optimal inventory levels by closely monitoring product turnover rates, minimizing spoilage, and ensuring products are available when needed.

Collaborative Relationships: Build strong relationships with suppliers, distributors, and retailers to improve communication, coordinate efforts, and respond to changes effectively.

Cold Chain Management: Maintain temperature-controlled environments to preserve food quality and safety, especially for perishable products.

Value of simple communication in short food supply chain

In short food supply chains (SFSC), the value of simple communication strategies is significant. Clear and concise communication among producers, distributors, retailers, and consumers fosters transparency, reduces inefficiencies, and enhances trust. By sharing information about product availability, quality standards, and delivery schedules, SFSC stakeholders can coordinate effectively, reducing waste and ensuring timely access to fresh products. Moreover, straightforward communication aids in conveying the sustainability and local sourcing aspects that SFSC often emphasise, resonating with environmentally-conscious consumers. Ultimately, these uncomplicated communication strategies bolster the resilience and success of SFSC by nurturing strong relationships and meeting the demands of an increasingly conscientious market.

Want to know how short food industry supply chains can help your business or interested to gain better insights into our procurement market intelligence solutions?