Advanced technology the difference between profit and loss in the dairy industry

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To succeed, dairy businesses need the ability and the agility to respond quickly and effectively to changing market dynamics. However, for an industry known for its complexity, not to mention the added complications that the inevitable short shelf lives of products bring, as well as the pricing pressure put on manufacturers by ongoing supermarket price wars, this is no easy feat.

Simplifying complexity with the right technology

All is not lost, however. The implementation of advanced technology solutions can determine the difference between a profitable dairy business and a non-profitable one. It is essential to put the right systems in place to plan for, and indeed achieve, the necessary levels of growth at the right time. However tempting it might be to rely on old, familiar systems, this can often lead to incorrect or incomplete answers. Information from disparate systems can have disastrous consequences for a business, for example, when it comes to a global distribution and traceability. Industry-generic, siloed applications can’t compete with business systems which provide enterprise-wide visibility at the click of a mouse.

By implementing the right, integrated business management solution, complexity can be made simple. This will address the very specific needs of the dairy industry, solving the challenges that short shelf life products bring, such as warehouse management, production forecasting, and inventory management, not to mention the issue of traceability and effective distribution. However, one-size-fits-all business applications are not good enough; they aren’t capable of dealing with the nuances and unique requirements of the industry.

Unique systems are now available which extend along the entire length of the dairy supply chain, managing the design, manufacture, and distribution of dairy products. It’s possible to optimise production plans fully, with a comprehensive, clear picture of order patterns that are based on accurate historical data and forecasts. With this information, production managers can make intelligent choices regarding production, making necessary changes quickly and effectively. This accuracy of forecasting and demand planning is vital in an industry where it’s all too easy to either waste or under-produce a product if production planning isn’t on point.

Traceability issues keeping dairy business owners awake at night

Traceability is another area in which dairy businesses can benefit from having the right solution in place. The pressing need for a rapid response to a recall, as well as the ability to monitor batches (both forwards and backward along the supply chain), are just two of the traceability issues which keep dairy business owners awake at night. The right track and trace business management system can more than handle all the necessary information (to include batch number, department, date, product characteristics, ingredients, testing, nutritional information, best before date, for example) - improving control and visibility over production, products and manufacturing and ensuring that vital speedy response to compliance requirements.

Recipe management

When it comes to recipe management, the right software solution can save the business a lot of hard work and needless worry too. Systems are available that can handle recipes to such a level of detail that if for example, there is a change to a formula, it can re-calculate that more of that ingredient will be needed to maintain the specifications of that product. This allows manufacturers to not only track precise costs but enables the provision of accurate nutritional information too, providing all-important visibility for both retailers and consumers relatively easily. The most comprehensive solutions will then assess how this change will impact not only inventory but also production and planning, enabling any necessary alterations to be made to schedules to accommodate this change.

Optimising processes and costs

It’s not only in the realm of production that these dairy-industry specific solutions can make a real difference. The pressure of cutting costs without impacting quality looms large over the dairy industry, forcing all-important efficiency savings. The joy of the new generation of business management systems is that they transcend departments, integrating the business completely by facilitating the real-time sharing of information between production, finance, warehouse, sales, and inventory. It’s only with this level of visibility across the organisation, that dairy businesses can optimise processes and costs, seeking out those valuable efficiency savings without sacrificing quality.

The agility afforded by the real-time availability of business-wide information is vital for growth. Not only does it enable a dairy business to respond to (or even predict) changing market dynamics in a timely and efficient manner, but it gives the business the agility necessary to outperform its rivals, paving the way for the introduction of new products at a faster rate than ever before.