Ken Moynihan of Compac believes that the produce brands that can master data will be the winners. He says that harnessing data from multiple sources is key to managing a decentralised supply chain that has to deliver high-quality, safe food 365 days a year. Understanding the technology that can deliver that is one thing though, but the complexity of the supply chain and the demands of the modern consumer are piling huge pressures on fresh brands to deliver on their value propositions
Compac is an established world leader in post-harvest integrated solutions and services to the fresh produce industry, and recently released its groundbreaking, modular and upgradeable SpectrimTM optical sorting platform into the sector. With the ability to take up to 500 high definition images of a single piece of fruit as it passes through the machine at a rate of 12 pieces of fruit a second, SpectrimTM can boast unrivalled grading accuracy and consistency. It also collects an almost unfathomable volume of data, which used properly and in conjunction with data from other technologies employed along the supply chain, could just revolutionise an industry’s view on branding.
Compac’s CEO Mike Riley believes SpectrimTM will support producers as they face ever-growing demands for consistency, traceability and packaging variations from global retailers. The platform’s design principles have also benefited from crucial input from lead customers around the world, and external research authorities in New Zealand’s Plant & Food Crown Research programme.
Riley’s chief technical officer Ken Moynihan will deliver a presentation at The London Produce Show and Conference next week on the role of data in shouldering the burden of the brand promise. He adds: “This industry is beginning to embark upon the process of de-commoditisation of commodities and branding will be a significant part of that. Some 52 million mandarins are going through just one of our machines every single day – that generates 26 billion hi-res images of the fruit and that data has incredible value to support the development of a brand.”
Looking at the global picture rather than zeroing in on the UK retail scene, he argues that consumer brands are increasing in importance, and that consumers are looking to choose food brands that have identifiable values on their packaging, something that connects them with the food and offers a tangibly different eating experience. “Fresh brands are a promise to consumers; they are expected to be safe, deliver consistent quality and have a 12-month presence on the shelves,” says Moynihan. “Most fresh produce has a seasonal geographic availability and brands must be available to win shelf space and customer share. Therefore, by necessity, supply has become increasingly decentralised. “All methods of extending the season – maybe varying cultivars, employing different storage technology or sourcing from a wider geographical base – have the potential to compromise quality and therefore brand promise. There are fewer focal points for produce and what we are seeing are virtual control centres for brands. But to meet that requirement for consistency and availability, there will need to be greater supply chain integration.
“The ability to deliver on your brand promise, while optimising quality and efficiency is no easy job. The very nature of fresh produce means that the promise of quality and consistency is hard to keep. Brands are trying to establish their ethos and values but there is a more pragmatic side of the business that says they have to deliver on price too.”
Moynihan uses figures to illustrate the dilemma. In the US, food recalls doubled from 2002 to 2015, according to this report, he says, adding that 52% of recalls cost more than US$10 million and that fruits and vegetables are the second most recalled category (15%). Multiple fatalities from issues with E.coli (German fenugreek sprouts), listeria (US cantaloupes) and Chinese milk have all hit the press hard in recent years
“With perishable products, there are many points where fruit quality can be jeopardised throughout the supply chain. Storage and distribution systems are critical and data can help to reduce some of the variations. The only way you can effectively manage is to connect all of the data at your disposal and use it to its maximum effect.”
He acknowledges that most produce companies use several types of technology and that it isn’t straightforward to combine them to best effect. “There are no clear leaders in this field,” says Moynihan. “Comments such as this are reasonably common – ‘There are 12 software groups working in my orchard, three of them are any good, and none of them talk to each other’.
“To address the increasing pressures on the global agri-food supply chain, someone needs to start the charge and provide the leadership that sees all of the bits of data talking to each other. Compac wants to be that someone. Compac technology is embedded in many areas of the supply chain, which puts us in a fantastic position to integrate the data from every part of that chain.
“A technological sea change is coming to all industries, as one of the ways of the fourth industrial revolution, as heralded by the World Economic Forum – but it is particularly relevant to food and fresh produce. The wave is coming – we can lead the charge and drive innovation through the intelligent use of software solutions. Only the vertically integrated systems truly have that ability,” Moynihan says.
“Brand managers need to understand the key data points for products that are coming from all over the world and then utilise that data to make real-time decisions – to change the flow of the fruit, for example. Continuous feedback and analysis is critical in allowing the brand to develop.
“It is our belief that big data consumer insights will drive new product innovations, that Just In Time e-commerce enables dynamic pricing, that the correct local actions will drive up global standards and raise the profile of provenance, and that the online environment can integrate all aspects of production, logistics and retail.”
Through greater integration and the virtualisation of control, which will see people being able to use data progressively to manage processes remotely, the industry can successfully handle the decentralisation of supply chains, he says.
Moynihan is leading the 3-5 technical year vision of Compac, and gets involved at a strategic level with key produce brands around the world. “This is the start of the journey,” he tells PBUK. “There are some immediate quick wins available and we are exploring those with some of our customers, but this is a long game. Integration is not actually hard, the challenge is to do it effectively on a global scale. I spend a lot of time in customer facilities – analysing how technology and the data behind it can push their processes forward and improve their business outcomes.
“Compac is beginning to transition into systems integration. Some of our more sophisticated customers have understood the challenges and opportunities of a globally integrated supply chain,” Moynihan says. “They’ve seen it coming and tried to develop solutions themselves. But the produce industry is traditionally slow to adopt new technology change as a general rule, and has often preferred to stick with equipment that has a concrete ROI than take risks.
“I don’t know that all of the technology vendors have seen it coming either. Therefore, there is a huge amount of data available, but no standard to drive intelligent integration and application of that data. The data networking industry has open standards, which makes it fairly easy to move data around, but our industry still operates with very closed standards and that is holding things back.
World of possibilities
But just what is possible with integrated data? Moynihan says it comes back to fulfillment of the brand promise. Switched on companies will be able to:
• Rely on more consistent quality through instrumentation
• Supply food that is safe, scientifically sound and traceable
• Operate a decentralised supply chain with 365-day availability
• Support their decisions with farm GIS systems with detailed production history and real-time logistics optimisation from product condition
• Connect directly with consumers through e-commerce, enabling online reviews of perishable products and associating the eating experience with measurable parameters
• Allow buyers to customise their orders with dynamic pricing
• Introduce consumer-friendly traceability (provenance)
The real-time sales and marketing elements of the job will also be enhanced, he claims, as information is fed forward from production sites to the sales desk to speed up the reaction to market conditions and marketers will have the information they need to create new products with available produce.
“I’m sure there is much more we haven’t yet thought of,” says Moynihan. “Brands need to fulfil their promise and that demands deep integration. Some still don’t have the tools available to do that successfully. Data is at the heart of this integration and while single vendor proprietary solutions will not scale, we can integrate the best-in-class elements. Interoperability requires data sharing.
“There are so many different systems out there, and no one vendor yet sells an end-to-end technological solution to satisfy every need of any produce packhouse. But there is significant overlap and it is the interconnection of the data from every process that takes place in the packhouse that holds real value. As we build our relationships with the vertically integrated brands though, we are already seeing the possibilities for systems integration that will push us in the right direction.”