The COVID-19 pandemic has had an enormous impact on the cold food supply chain in just a few months, forcing it to re-direct its foodservice inventory away from shuttered restaurants, bars, hotels, and other volume F&B clients, and toward unprecedented demand for retail refrigerated and frozen foods. Some estimates say 30% of the nation’s food supply is destined for volume foodservice, so the shift in the supply chain has been seismic.
While recent statistics show retail sales of cold foods are still very high compared to last year, the panic buying fueling demand and emptying store shelves in early March has leveled off. During that initial chaotic time in the supply chain, I spoke with Lowell Randel, VP, government & legal affairs at the Global Cold Chain Alliance (GCCA) for an episode of Refrigerated & Frozen Foods’ From the Cold Corner podcast.
In this excerpt from that podcast, Randel details some of the efficiencies created in the supply chain due to demand for retail products and the shift away from foodservice, as well as technological measures taken to protect frontline truck drivers from infection. What follows has been edited for clarity, but to hear the entire interview, CLICK HERE to stream online or download to your preferred podcast app.
R&FF: What are you hearing about the supply chain shift from foodservice distribution into retail, grocery, hospitals and other areas more in need? How long until that part of the supply chain is running smoothly?
Randel: As long as we're social distancing, we believe this demand at the retail level is going to remain very high. Let me point out that when you go into a grocery store and you see, maybe not the full selection that you're used to at a given moment in time, that is not an indication there is a problem with the supply of food in this country. It's more of a short term disruption based on the volume of demand. At a retail location, it does take a little bit of time for the supply chain to catch up and replenish. Having said that, our member facilities are largely full across the U.S. and that's full of both product that was originally destined for food service as well as an increasing volume of product for retail channels. And that is going to maintain as long as we're social distancing.
I was working with a member who deals in meat and poultry, and one of their customers had been supplying a lot of products into foodservice. They asked our member to work with them on modifying, labeling and doing some additional processing like blast freezing of product, which would enable it to go into retail markets. So I think we're going to see more situations like that in the future as companies adapt and the supply chain adapts to ensure that we have an adequate supply of food.
R&FF: What are some of the best practices the GCCA is working on with its partners in the cold chain related to the pandemic?
Randel: We've got a huge driver community out there that’s doing a tremendous job of keeping food moving. I know a lot of our members are adopting new practices to support drivers and also provide additional social distancing. So one really innovative solution is going to contactless driver interaction. They’ve installed scanners where the drivers would normally come in and have personal interaction with someone from a warehouse facility. They can scan in bills of lading and any other documents, and those are transmitted electronically. They even put in a video on a loop describing how the new process works, and they've received really positive feedback from the drivers. I know members are putting in additional portable hand washers, additional bathroom facilities, providing food for drivers, as well as providing food for their own employees that are out there on the front lines.
Inside their facilities, there’s best practices on staggering shifts, staggering breaks, making physical changes to common areas. In a break room, for example, some of our members are physically removing chairs or blocking the seating arrangements so that maintains social distancing in an appropriate way. We also have members providing recognition for employees. like financial recognition or other kinds of recognition about their critical work in supporting the food supply chain. I think there are a lot of companies going that extra mile to keep employees safe, support social distancing and also recognize the critical work being done to feed the country.
R&FF: What supply chain efficiencies have been created because of COVID-19 and the movement of product due to high demand?
Randel: Some manufacturers and retailers working with our members are decreasing the amount of case picking. This is a labor intensive industry, and as we see this tremendous increase in demand at the retail level, we need to move that product quicker. So we've seen moving of full pallets into our facilities, and full pallets out of our facilities, and that enables the movement of products to be much more efficient. We're also seeing some manufacturers reduce the number of SKUs that would be going out on a particular shipment. I think we'll continue to see companies work on innovations like these so the supply chain continues to perform well and keeps food moving.
Recent guests on From the Cold Corner sound off about COVID-19 and its effect on their operations.
Roberto Peregrina, manager, Hiperbaric USA
“We have been communicating with our freight forwarders and making sure that those who deliver our parts around the world are able to continue their services. We’ve been very lucky to have people go the extra mile to help us deliver parts. We have been affected [by COVID-19] but not as bad as other companies, so we continue to operate, we still have manufacturing and processing, and we still have people in our factories taking precautions as recommended by the authorities, so we’re still operating.”
Tom Swovick, market development manager, protein, Dematic
“We made a pretty tough decision regarding tradeshows in the States and in Europe that were scheduled in early March, and as you can imagine, there’s a lot of investment and a lot of preparation that goes into being at a tradeshow. We decided not to send our people to those shows. It was far too important to keep our people safe, and we felt it was important to ensure the safety of our customers too. In response, we’ve created virtual tradeshows that we can walk our customers through, so we can assure both their safety and ours in these troubled times.”