Temperature-Controlled Supply Chains
David Smith and Leigh Sparks
Introduction
Consumers expect food in retail stores to be of good quality, to have a decent shelf life and to be fit for purpose. If a retailer can present products attractively and provide good shelf life, then there is more chance of the products being purchased and satisfying consumer needs. Managing the supply chain to maintain quality and ‘fitness’ of food products therefore has direct cost and service implications. Many dimensions have to be managed. One of these dimensions is the need for an appropriate temperature regime. Many food stores contain products supplied and retailed at a number of different temperatures. Failure to maintain an appropriate temperature control can adversely affect the product’s appearance or shelf life at one end of the spectrum, or could potentially make consumers ill or even kill them at the other end. Temperature-controlled supply chains (TCSCs) could be said to be a matter of life or death.
What is a Temperature Controlled Supply Chain?
At its simplest, a TCSC is a food supply chain that requires that food products be maintained in a temperature-controlled environment, rather than exposing them to whatever ambient temperatures prevail at the various stages of the supply chain. This basic description hides however an essentially complex and potentially expensive process. The length and complexity of such supply chains are determined by the natures and sources of the products, the legal and quality assurance requirements on food safety, and the distribution facilities available from production to consumption. Recently they have been affected by the need to deliver food safety and integrity throughout the supply chain (Deloitte/Cmi, 2003).
There are several food temperature levels to suit different types of products: for example we could identify frozen, cold chill, medium chill and exotic chill. Frozen is –25° Celsius for ice-cream; –18° for other foods and food ingredients. Cold chill is 0° to +1° for fresh meat and poultry, most dairy and meat-based provisions, most vegetables and some fruit. Medium chill is +5° for some pastry-based products, butters, fats and cheeses. Exotic chill is +10–15° for potatoes, eggs, exotic fruit and bananas. If a food supply chain is dedicated to a narrow range of products, the temperature will be set at the level for that product set. If a food supply chain is handling a broad range of products, an optimum temperature or a limited number of different temperature settings is used. Failure to maintain appropriate temperature regimes throughout a product’s life can shorten the life of that product or adversely affect its quality or fitness for consumption.
It should be immediately obvious that the management process in TCSC is a complicated one. Chilling and freezing products is in itself hard, and maintaining appropriate temperatures throughout a product’s life, in both storage and transit, is complicated. How, for example, can a retailer ensure that products are always under the appropriate temperature regime when they travel from a field in New Zealand to a refrigerator in a shop in Tobermory?
The Importance of Temperature Controlled Supply Chains
The TCSC in food is a significant proportion of the retail food market and one that has been increasing steadily (McKinnon and Campbell, 1998). CH Robinson/Iowa State University (2001) suggest that over half the spend in American supermarkets is on temperature-controlled products. Frozen food in the UK has been increasing in volume by 3–4 per cent on average per annum for the last 40 years. Developments in products such as ready meals and prepared salads have further expanded the market.
Analysts see the meal solution sector continuing to increase very rapidly (Gorniak, 2002). ‘Fast food’ chains have captured a huge market share and are reliant on frozen product. The importance of products requiring temperature control, to both consumers and retailers, has thus been increasing, and seems set to increase further.
Even products that we often take for granted may require some form of temperature control. Prepared sandwiches for example require chilled storage of ingredients. These are then combined to make the finished product, which in turn requires temperature-controlled storage, distribution and display (Smith, Davies and Bent, 2001). Failure to maintain adequate control (for example placing prawn sandwiches in the sun) generates obvious risks. More subtly, an inability to maintain temperature control will reduce shelf life in the product, which is any case often very limited. This increases wastage and complicates the supply dynamics, adding costs. Similarly, much of the bread in supermarket in-store bakeries is brought to the store frozen, and baked/heated on the premises.
On the supply side, changes in the location of product sources and the removal of wholesalers from the channel have had major effects. Technological changes in production and distribution have also allowed a transformation of the supply network. As production and distribution technological capabilities have developed, so the ability for national and international, rather than local, sourcing and distribution has emerged. Products can be brought across the world to satisfy demands for products ‘out of season’ or of an exotic nature, as well as for reasons of lower purchase or cost price. Internationalization of supply of even indigenous products is common. The system developments needed to meet the demands for quality and consistency, including temperature control aspects, do impact on the channel composition (eg Dolan and Humphrey, 2000). The handling systems to manage the air freighting of for example tomatoes from the Canary Islands, baby sweetcorn from Egypt or flowers from Malaysia require a considerable technological development. They also however represent a fundamental organizational and relationship shift.
CH Robinson/Iowa State University argue that TCSC are more important than ‘ordinary’ retail supply chains as they have inherently more complexity and complications:
The (Logistics) challenge is more formidable when the materials and products require temperature control. The shelf life is often short for such products, placing even greater importance on the speed and dependability of the transportation and handling systems. Temperature controlled products also require specialized transportation equipment and storage facilities and closer monitoring of product integrity while in the logistics system.
Adding to the logistics complexity is the seasonal demand for many temperature controlled products ... arising from natural production conditions and consumer demand.… In addition, carriers of temperature controlled products confront unique requirements and incur greater costs than carriers of dry products.
(CH Robinson/Iowa State University, 2001: 1–2)
Some of the uniqueness and increased costs derives from this need to ensure temperature control. There is extra cost incurred in the requirements for handling temperature-controlled products, and also in the need to monitor temperature regimes in the supply chain.
As the number and range of temperature-controlled products have increased, and a number of market failures have occurred, so the issue of food safety has become more central (Henson and Caswell, 1999; Lindgreen and Hingley, 2003). Failures of food safety in the UK (not all of course associated with failures of temperature control) are common on a localized and individual level. For example there is a high level of personal food poisoning in the UK, although the extent to which this is a result of product or channel failure rather than an individual consumer’s lack of knowledge or care is unclear. More publicly notable however have been national events (‘food scares’) such as Listeria in cheese, Salmonella in eggs and chickens, BSE in cattle and E coli 157 in meat. These national events raise concern and comment about food safety. There is thus a perception over the safety of supply of food and food chains, which in turn has focused attention on risk assessment and risk management. Such concerns are not of course restricted to the UK. Deloitte/Cmi (2003) point to similar issues in the United States, and note that the issue of food safety has been ranked first in a CIES survey of food retailing issues in 2002, compared with not being ranked at all in 1999. TCSCs gain importance therefore from the risks associated with failure and from the steps necessary to minimize these risks. Some of the steps are voluntary and company-specific, others are required by recent legal developments (see later).
As a consequence of risk assessments and the major problems in food safety, TCSCs have become a focal point for the development of food safety legislation across Europe. Although such legislation introduces requirements that cover a broad range of issues, one key aspect is the temperature conditions under which products are maintained. Such legislation combined with increasing retailer liability for prosecution has put great pressure on the standards of control throughout the food supply chain, particularly in the case of temperature control. For these reasons, TCSCs are often seen as a specialist discipline within logistics. To some extent this is understandable given the need for specialist facilities such as warehouses, vehicles and refrigerators to operate chilled or frozen distribution channels. This specialist market however is itself increasing in scale and scope, both as the market expands and as operational and managerial complexity increases.
However, it is not all cost and regulation, as there are operational and commercial benefits to be gained from proper TCSC management. These benefits might include an increase in shelf life and freshness and thus better customer perception of products and the retailer. This increase in product quality and perception is the direct result of maintaining the correct temperature for that product group steadily and constantly throughout its supply chain journey. One major effect of an increase in shelf life and freshness has been that consumers can notice the difference between product supplied through a fully temperature-controlled supply chain and that supplied through a partially temperature-controlled supply chain, and make product and retailer choices accordingly. While it is generally the case today that the major food retailers maintain chill and cold chain integrity and thus have totally controlled TCSCs, this has not always been the case.
Changes in Temperature Controlled Supply Chains
The TCSC has developed and changed since the 1980s. In the past in the UK, the supply chain often consisted of single temperature warehouses dedicated to narrow product ranges of food, such as butters, fats and cheeses at +5° Celsius, dairy-based provisions, meat-based provisions, fresh meat and poultry, fruit and vegetables and frozen products. The design, equipment and disciplines were only partially implemented so that there was incomplete integrity of the temperature control. Products were exposed to periods of high ambient temperature, which affected the shelf life and the quality of the product. Single temperature systems also meant that many more deliveries were needed. Such systems were essentially inefficient and ineffective.
Such a situation existed in the 1980s in Tesco (see Sparks, 1986; Smith and Sparks, 1993; Smith, 1998). In the mid-1980s the Tesco TCSC consisted of a large number of small single-temperature warehouses, each specializing in the storage, handling and delivery of a narrow product range. Examples of these sets of product ranges were fresh produce; fresh meat and poultry; butters, fats and cheeses; chilled diary provisions; chilled meat provisions; and frozen foods. Each set was managed by a different specialist logistics service provider organized on behalf of the manufacturer and supplier. The deliveries to the retail stores took place two or three times a week, with the temperature-controlled vehicle going from one store to another delivering the appropriate number of pallets of products. The delivery notes and product checking were conducted at the back door of the store, and the cost of delivery was included in the price of the product. Fresh meat and poultry was controlled on an individual case basis and charged by weight as each case had a different weight.
There are several limitations of this model of a TCSC. It was expensive to expand to meet large increases in overall growth in volume as it requires the building of more and more single-temperature warehouses. The retail delivery frequency was limited. The delivery volume drop size per store was small and vehicles used were under-sized because of problems over retail access. At that time there also was not full awareness of the importance of maintaining total integrity of the chill chain.
The strategy that Tesco decided upon was to build a small number of new large multi-temperature ‘composite’ warehouses that would store, handle and deliver the full range of product sets, all from the same location. The manufacturers and suppliers of all the product sets made daily deliveries into the composite distribution centre. The composite delivery frequency to the retail stores increased to daily. The delivery vehicles had movable bulkheads and three temperature-controlled evaporators so that up to three different temperature regimes could be set on the one vehicle. The benefit was improved vehicle utilization and improved service to retail. Chill chain integrity disciplines were implemented rigorously from supplier to retail shelf.
There are other aspects to this change. Distribution and retail agreed a policy of not checking the goods at the retail back door, which improved the speed with which the goods could be transferred into the temperature-controlled chambers at the store. This improved chill chain integrity. The goods were delivered in green reusable plastic trays, on ‘dollies’, or on roll cages, which improved handling at store, in terms of both speed and quality. New store designs permitted the use of full- length vehicles, so improving efficiency.
Another major change in supply chains between the 1980s and 2000s has been the increasing pace of the order and replenishment cycle (McKinnon and Campbell, 1998). Today with many fresh products there is no stock held in the retail distribution centre overnight (IGD, 2001). Stock holding in frozen products has also declined to below 10 days (IGD, 2001). Lead times have continued to be reduced.
One of the key drivers of this increase in pace has been the development of information technology, which has enabled a large volume of data to be collected, processed and transmitted at faster speeds. Today data are collected from the point of sale and used in calculating future customer demand, which in turn forms the basis of the orders placed on suppliers. The scale, control and skill of the retail logistics operation has improved so that even distance-sourced products can be rapidly transported to their destinations at the regional distribution centres. The move to centrally prepared meat and poultry rather than having butchers at the retail stores is one example of this (Lindgreen and Hingley, 2003). Another example is the sourcing of produce from Spain direct from the growers into the distribution centres (see box). These changes, encouraged by information technology among other factors, require changes in supply chain facilities and operations to ensure chill chain integrity.
Produce Direct from Spain
Spain has become one of the major providers of produce to the rest of Europe. In the late 1990s, major UK supermarkets started to purchase produce direct from Spanish suppliers rather than through UK wholesalers. The total direct flow of produce from Spain solely to UK is over 1,000 vehicles per week.
For example, iceberg lettuce is grown in large volumes between October and May in Murcia and Almeria in south-east Spain under direct contract between the retailer and the growing cooperatives. The retailers’ quality assurance and technical departments provide the grower with the product specification and transport temperature- control requirements from Spain to UK.
There are two methods of direct delivery into the UK supermarket distribution network. The first is to fill the vehicle in Spain solely with iceberg lettuce. The delivery is split once it arrives in the UK by sending the vehicle to two distribution centres. The second method is to combine several produce products, for instance iceberg lettuce and courgettes, while the vehicle is still in its originating region in Spain. This combined product volume fills the vehicle, which then delivers the whole load to a single distribution centre in the UK.
The distance from Murcia to central England is 1,500 miles. The deliveries flow through daily. The total process from harvesting to customer is four days:
- Day one: the iceberg lettuce is harvested, cooled, packaged and loaded into temperature-controlled vehicles set at +3°.
- Day three: the iceberg lettuce arrives direct at the UK supermarket temperature-controlled distribution centre where it is checked in. Within 3 hours it is allocated and picked for a retail store, ready to go out on the next delivery.
- Day four: the iceberg lettuce is on display in the retail store, available for the consumer to purchase.
The code life on direct iceberg lettuce is one day above ‘normal’ deliveries. This extra day can be used for rolling stock in the distribution centre. The ability to roll stock means that full loads of iceberg lettuce can be delivered direct to the distribution centre. Any stock that is not allocated to a store and picked immediately (due to demand) can be rolled over to supply the next day’s orders.
The range of products delivered direct has increased from the original Golden Delicious and Granny Smith apples to now include Braeburn and Royal Gala on top fruit; white seedless grapes, nectarines, peaches, iceberg lettuce, galia melons and broccoli.
The seasons of other products direct from Spain are December/ January: soft citrus; January/May: tomatoes and broccoli; June/August: galia and honeydew melons.
Source: author interviews
Following the implementation of centralized distribution, attention turned to the condition of TCSC for the inbound product sets from the supplier and manufacturer into the regional distribution centres. The examination of the logistics of the inbound supply chain revealed that there were huge opportunities to improve transport efficiency. The increasing pace of the retail supply chain had resulted in most suppliers of temperature-controlled product sets sending their vehicles long distances, but only partly filled, to the various retailers’ regional distribution centres. So for example, suppliers’ vehicles carrying fruit and vegetables from a supplying region like Kent were following each other to distant regional distribution centres in northern England and Wales, each with a partially full vehicle to the same destination. Clearly there was an opportunity for the consolidation of supply.
This process of consolidation saw the appointment of designated logistics service providers in the appropriate regions to manage and operate temperature-controlled consolidation centres, accumulating full vehicle loads of temperature-controlled products to despatch to the composite distribution centres. These consolidation centres also conducted quality assurance testing of the product. There were two benefits of placing the quality assurance function in the consolidation centres. The first was that they were close to the suppliers so that any problems could be dealt with face to face where required. The second benefit was that these vehicles did not then need to undergo quality assurance checking when they arrived at the distribution centre. This improved the turnaround time of the inbound vehicle, increasing its productivity and profitability, and also enabled the handling operation to commence earlier and so keep the goods-in bay clear for the next set of deliveries. This was especially important in the early evening when a very high volume of produce harvested that same day is delivered.
Some of the effects of these changes to the Tesco supply chain are considered in Table 7.1. This summarizes the last 15–20 years of temperature control supply and the ways in which this has changed. Over the time period the shelf life for these products has increased considerably. In the case of vegetables, it has doubled and for top fruit the increase is even greater. This provides better product for longer for the consumer, and is more efficient for the retailer. It does, as the table indicates, require a major reorientation of the supply chain and a dedication to standards. The overall effect however has been to provide fresher product more quickly and cheaply to the retail store, and to lengthen the shelf life and quality time of a product for the consumer.
Stage |
Soft fruit |
Top fruit |
Veg |
Temperature-controlled supply chain status and improvement action |
---|---|---|---|---|
Pre-1980 |
Single temperature produce centres (three). Ambient and +5° Celsius. Code dates not a legal requirement. Shelf life managed at retail. Retail ordered from local suppliers without any technical support. |
|||
1980–6 |
Two further produce centres. Operating procedures remained the same. Suppliers normally loaded in yard or from ambient bays. Many vehicles have curtain sides. |
|||
1986 |
Notice that code dates to become a legal requirement for produce. Produce technical team established shelf life and introduced QC checks at distribution centres. 78/48-hour ordering cycle to retail. |
|||
1987 |
2 CD + 2 CL = 4 days total |
5 CD + 2 CL = 7 days total |
3 CD + 2 CL = 5 days total |
Code dates CD introduced for loose and pre-packed produce. In addition to the selling code dates there were additional days where product would be at its best. This time was called Customer life (CL). QC in produce depots to enforce specification. Two further produce centres. Code of practice introduced for suppliers included distribution centre controls and vehicle standards, eg no curtain siders. |
1989 |
2 CD + 4 CL = 6 days total |
5 CD + 9 CL = 14 days total |
3 CD + 5 CL = 8 days total |
Six composite distribution centres opened. Separate temperature chambers of +3, +10, +15 for produce. Composite multi- temperature trailers deliver at +3 and +10° Celsius loading from sealed temperature controlled loading bays. Customer life extended by 2 days for soft fruit, by 5 days for top fruit and 3 days for vegetables. No increase in code dates. Consumer demand for Fruit and Vegetables doubled as a consequence of the introduction of strict temperature control disciplines throughout the supply chain. |
1990 |
Food Safety Act: To meet due diligence HACCP (Hazard Analysis Critical Control Points) analysis introduced throughout the supply chain. The result was more consistent shelf life but no increase in days. Retail stores only allowed to buy from suppliers with technical approval. |
|||
1995 |
2 CD + 5 CL = 7 days total |
5 CD + 10 CL = 15 days total |
3 CD + 6 CL = 9 days total |
Produce temperature controlled consolidation hubs introduced. Six further hubs added over next three years. QA control introduced at hubs so quality checked before produce despatched to the composites. Hubs located close to supplier regions so prompt resolution of problems with supplier management. Shelf life review shows increase of 1 day across all vegetables, soft fruit and stone fruit. Salads become inconsistent because of harvesting during the night before dew point. But there was a greater benefit of starting despatch earlier, especially from Spain. Retail order lead time 48/24 hours |
1997 |
Composite distribution centres change produce chamber temperatures to +1 and+12° Celsius with tighter variation of +/–1° from +/–2° before. No change to shelf life because the supply chain disciplines fully in place. |
|||
1998 |
2 CD + 5 CL = 7 days total |
6 CD + 10 CL = 16 days total |
4 CD + 6 CL = 10 days total |
Technical departments given targets to increase produce shelf life. One potential improvement was to introduce US-type variety control. The benefit is only possible because of the very strict total supply chain temperature control. One extra day of code life for stores. |
2000 |
Continuous replenishment introduced. The benefit is split deliveries into retail stores with different code dates for retail without any loss of customer shelf life. |
|||
2002 |
2 CD + 5 CL = 7 days total |
7 CD + 10 CL = 17 days total |
5 CD + 6 CL = 11 days total |
Further supply chain improvements in shelf life to extend code dates by one day, no change to customer life to improve availability on selected lines: core vegetables, top fruit, stone fruit but not salads or soft fruit. Three potential methods are: a) atmospheric control especially during the three-day delivery from Spain; b) humidity control; c) ethylene control. |
Source: author interviews |
The discussion above is centred on developments in Tesco. Similar operations and developments have been introduced in other major food retailers. These have been needed to handle the massive expansion of demand in the temperature-controlled sector in recent years and to compete with the market leader.
Issues in Temperature Controlled Supply Chains
The discussion above and comments in the introduction allow the identification of a number of key issues in TCSC. Here, three are identified for further discussion: the issues of costs, food safety and HACCP, and part- nerships.
The basic supply configuration in the temperature-controlled channel is not really much different from those in ordinary retail distribution channels. The demands placed on the components however are far more extreme, and thus the issue of costs of facilities and operations is important.
TCSCs place strict conditions on the design, equipment and discipline of the operation, which makes the cost greater than for ambient products. Temperature-controlled storage facilities need to be maintained at the appropriate temperature with accurate recording equipment and cooling equipment, including the capacity to cope with high ambient temperatures especially in the summer. Vehicle docking bays need air bags that inflate around the vehicle to prevent exposure to ambient temperatures. For frozen storage facilities, the loading and unloading bays should be at 0°C.
Vehicles require appropriate insulation and refrigeration and control panels to set and to maintain the product at the correct temperature. An important facet of this transport refrigeration is that it is not designed to remove heat from the product (as in ‘normal refrigeration’), so it is essential that the heat is taken out of the product before it is loaded onto a vehicle. If not, heat will transfer to other products causing them to be exposed to a temperature outside the designated range. Some vehicles have bulkheads and several evaporators so that different sections can be set at different temperatures. The benefit of this is that vehicle utilization is improved, but operating procedures are made more complicated. This also affects costs. The cost of a multi-temperature refrigerated trailer is about £100,000 compared to around £30,000 for an ambient trailer. The cost of warehousing is about £20 per square foot compared to about £10 for ambient. Warehouse operatives and drivers must behave in accordance with the requirements for chill chain integrity to protect the product. Losing a trailer load of product through overheating is not only expensive but also severely impacts on service level to retail and the consumer, because the pace of the supply chain does not leave time to recover with alternative product. Such cost considerations have enabled niche operators to enter and develop the market for frozen and chilled distribution. There is also a specialist association in the UK to assist this sector of the logistics industry (Cold Storage and Distribution Federation – http://www.csdf.org.uk/) and to liaise with government on regulations in this sector.
As noted earlier, the integrity of TCSCs is important for food safety (see Deloitte/Cmi, 2003). This places an obligation of care and duty of implementation on the supplier, retailer and logistics. In the UK, for example, the Food Safety Act of 1990 defined the storage, handling and transportation requirements for food products, including temperature control for certain categories. One of the provisions of the Food Safety Act 1990 makes it an absolute offence to sell food that is unfit for human consumption. Food that has ‘gone off ’ due to inadequate temperature control falls into this category. The Act however allows for a defence of ‘due diligence’ against any charges. Thus a business may be able to mount a defence based on evidence that all reasonable precautions had been exercised to avoid the commission of the offence. In terms of temperature control, this implies that there needs to be a system of control, maintenance, monitoring and recording (for evidence) of the temperature regimes in the supply chain.
The Food Standards (Temperature Control) Regulations of 1995 made it an offence to allow food to be kept at temperatures that could cause risk to health. This again implied a tightening of systems in the chain. This was effectively codified by the General Hygiene Act of 1995, which required all food businesses to adopt a risk management tool such as Hazard Analysis Critical Control Point (HACCP). Loader and Hobbs (1999) see this as a change in philosophy, representing a move away from an end-product food safety inspection approach to a preventative, scientific focus with the responsibility for risk management placed on the food business proprietor. As a result, HACCP and other systems (Sterns, Codron and Reardon, 2001) have been vital to establish process controls through the identification of critical points in the process that need to be monitored and controlled (see box).
Hazard Analysis Critical Control Points (HACCP)
It is important in the application of the disciplines of an integrated temperature-controlled supply chain to understand the principles of the obligations of suppliers, retailers and logistics service providers.
All have a duty of care for the product. In order to meet this duty of care they must demonstrate that they have applied due diligence in the structure and execution of their operation: that is, that they have taken all reasonable methods to ensure the care of the product.
One of these reasonable methods is Hazard Analysis Critical Control Points (HACCP), which is central to the discipline of chill chain integrity in logistics. The Quality Assurance department conducts a survey of the supply chain under its control, with the objective of identifying those circumstances where the product might be exposed to unsuitable conditions, or hazards. They rank these hazards according to the importance of their risk, for example as high, medium or low. Procedures are then put in place at an appropriate level to prevent that risk. To express this differently: identify the hazards, analyse their importance, identify which are critical and set up control procedures at these points. Once HACCP is put in place it becomes a strong argument that due diligence is being practised.
For temperature-controlled supply chains, there are big benefits from putting the physical and operational procedures in place along the whole length of the supply chain. This investment reduces a high risk to a low risk. By stabilizing the temperature throughout the life of the product, suppliers and retailers can concentrate on other aspects that can add value to the product, such as growing varieties.
If we take the example of the movement of chill goods from distribution centre to retail stores on multi-temperature vehicles, then the risk to food safety is high and the risk of occurrence is high. The Critical Control points for loading at the distribution centre are:
- The temperature setting is stated on the load sheet and run sheet.
- The loader checks the load sheet and sets temperatures for compartment.
- The loader secures the bulkhead.
- The loader switches refrigeration on and ticks the relevant temperature on the load sheet.
- Once loading is complete a supervisor checks settings and switches against load sheet and signs off if correct.
- The load sheet is handed into the goods out office.
- The driver checks digital readings (usually at the front of unit, visible in the rearview mirror) against the run sheet and if correct, signs off and hands it in to the goods out office.
- The goods out clerk checks if the temperatures on the load sheet and run sheet match, and if correct, allows the vehicle to leave.
- The goods out supervisor undertakes daily checks to assure compliance.
Source: author interviews
These Acts in the UK were in essence national responses to approaches being recommended in Europe and codified in the EU legislation. The food scares in the UK of the late 1990s also brought forward a response. The Food Standards Act 1999 created the Food Standards Agency (FSA) in April 2000. The Act was intended to induce all those involved in the food supply chain to improve their food handling practices, including temperature control. There is no doubt that as the FSA becomes more established, it will have a stronger role to play in TCSC than we have seen to date (http://www.foodstandards.gov.uk).
This onus on due diligence and the responsibility of businesses had a major effect on systems of control and monitoring of performance. It also however had an effect on the business relationships and governance in place. If a retailer for example wishes to be protected from claims, it must ensure that its suppliers are undertaking good practices, in addition to its own practice. This is not only true for retailer brand products, but for all sourced products. As such, traceability and tracking become more fundamental and good partnerships become crucial. As costs rise in introducing new systems, increasing the depth and quality of partner- ships is both a safeguard and offers possible cost benefits. As a result, partnerships expanded considerably after 1991 in the UK (Wilson, 1996. Loader and Hobbs, 1999; Fearne and Hughes, 2000; Lindgreen and Hingley, 2003). Food retailers today are keen to have such partnerships and to use them in their marketing, as seen in the numerous ‘farm assured’ type schemes. Such partnerships and changes in organization of the supply chain are not restricted to UK suppliers. Dolan and Humphrey (2000) show how in Africa, the requirements of the leading UK retailers have transformed the horticultural sector in scale and operational terms, leaving smaller producers in a precarious position. This scale dimension is linked closely to the legal requirements and the costs of compliance and potential chain failure.
Future Developments and Constraints
TCSCs have undergone considerable changes in recent decades. This process is likely to continue, driven as it is by tightening legislation and risk awareness, the increased costs of supply and the demands on the chain from increased volume and pace of operation. A number of future issues can be explored.
First is the question of risk and integrity. There are a number of gaps in the typical current TCSC. For example, at the retail outlet, few stores have a chilled reception area that docks with the incoming distribution vehicle. The majority have an ambient delivery bay that is exposed to the outside temperature. The delivery reception area requires an operational discipline such that chilled and frozen product is not left exposed to ambient temperature for more than 20 minutes. The retail operational staff have to move the chilled and frozen pallets, roll cages and the like promptly into the relevant temperature-controlled chambers. Finally, when the product is being taken to the chilled or frozen retail shelf or cabinet within the store for replenishment, the same 20-minute rule applies. The potential for problems is clear. Another gap occurs in the ‘forgotten’ segment of the supply chain: the length of time from selection of product by a consumer to purchase and then transport home could be considerable, and affect the product adversely. As electronic commerce expands, so issues of home delivery confront much the same problem. If the home owner has always to be present, such services are more limited and/or costly. But ‘dropped’ deliveries of temperature-controlled products increase the risks for the consumer.
Second, there is likely to be further technological development. In the future, electronic temperature tagging could become the norm, so that operators throughout the TCSC will be able to monitor current and previous conditions. Such monitoring could be real-time online for some products, or could be packaging-based for others: for example, colourcoded packaging changing colour if temperatures go outside allowable ranges. Advances in packaging environments leading to enhanced shelf- life time may also accompany such monitoring advances. Associated developments in technologies such as Radio Frequency Identification (RFID) will bring additional data management and control issues.
Finally, there are issues brought about by globalization and partnership trends. While there have been benefits to the introduction of current procedures and practices, concern is mounting about the environmental costs of monocultures and the extreme distribution distances that are travelled. Given the costs of compliance to meet western food safety concerns, it might be more beneficial to look for more local sourcing. The internationalization of retailing acts as a counter to this however, and may allow retailers to build deeper partnerships across the globe and to utilize their experience to enhance the quality of the local supply chain. However consumer demands may not allow time in the supply chain for such global solutions. The future organizational shape, and the role of partnerships, remain therefore subject to change (Zuurbier, 1999).
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