SEA ISLAND, GA. — Supply chain issues have improved in recent months, but a long-term labor shortage and other systemic issues that had accelerated during the pandemic will challenge the state of logistics and the delivery of snack foods, key ingredients and other products for the foreseeable future.
That was the key conclusion of a panel discussion of supply chain experts during SNAC International’s Executive Leadership Forum, held Sept. 11-13 in Sea Island, Ga.
Overall, US logistics costs are up dramatically from prior to when COVID-19 hit in 2020, but investments in technology and enhancement in efficiencies are among the initiatives bringing expenses down to more relative historic levels, said Chris Adderton, vice president, Council of Supply Chain Management Professionals, who moderated the panel discussion.
“We are returning to the mean so there is some good news in that activity,” he observed.
Coreen Frolish, regional vice president of manufacturing for Campbell Snacks, a part of Camden, NJ-based Campbell Soup Co., noted companies saw a “massive acceleration in some of the disruptions” such as in the driver shortage that had existed prior to the pandemic. Logistics divisions have developed contingency plans to better ensure that products like Campbell Snacks’ popular Goldfish snack crackers and Milano cookies get delivered to customers on time.
Mr. Adderton pointed out that just-in-time deliveries have been replaced by a “just in case” approach to logistics.
Heather Hawkins, vice president of operations at Transplace, a provider of advanced technology and logistic solutions, described how distribution costs "had gone through the roof" during the past few years in efforts to retain drivers who increasingly became in short supply.
“We had to go out and inflate our drivers’ pay to get those guys to stay in their seats,” Ms. Hawkins noted, adding that the escalated pay levels “will not be going away any time soon.”
She recommended that snack companies need to rely on change management that enables customer service to use digital technology to gather information to more effectively manage logistics and provides them with the necessary control to identify areas where drivers be better used to increase systemwide efficiencies and lower distribution costs.
Rob Miller, vice president of supply chain and operations, Eagle Family Foods, pointed out that the logistics industry still needs millions of additional workers in the future to keep the delivery of products and ingredients running smoothly.
Together, the panelists concluded new problem-solving managers, more effective use of information technology and thinking out of the box are the most effective tools alleviating supply chain delays and other issues going forward.