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Perishable inventory management fruit vegetables
Perishable inventory management fresh produce packers and processors: manage perishable

Perishable inventory management fruit vegetables

Perishable inventory management fruit vegetables

handling, packing, and logistics.

Implement a simple traceability solution, or comprehensive business wide perishable inventory solution – the choice is yours….Perishable inventory management software, Reduce perishable inventory waste with FIFO and strict inventory management & monitoring.

Perishable inventory management software, Reduce perishable inventory waste with FIFO and strict inventory management & monitoring.
Perishable inventory management fresh produce

Perishable inventory demands attention. Specific inventory-tracking methods help with the job of managing and accounting for perishable inventory. Perishable refers to items that have an expiration date, such food that will go bad if not eaten in a certain amount of time. Single-period inventory control and first-in-first-out, or FIFO, inventory valuation are commonly used to deal with perishable goods.

Perishable inventory management fruit vegetables

handling, packing, and logistics.


Globally, around one-third of the edible parts of perishable food products is being thrown away by farms, factories, supermarkets, shops, restaurants and households, every year an estimated 1.3 billion (1.3 · 109) ton (FAO, 2011). According to the Food and Agriculture Organization of the United Nations (FAO, 2015), food loss is defined as “the decrease in quantity or quality of food” and comprises agricultural or fisheries products intended for human consumption that are ultimately not eaten by people or that have incurred are duction in quality reflected in their nutritional value, economic value or food safety. Food loss arises at production of raw material at the farm, at post-harvest handling and storage and at processing of the raw material (Parfitt et al., 2010). Food waste refers to food loss at the end of the food supply chain of food that was fit for human consumption and is mainly a result of retailer and consumer behaviour (Parfitt et al., 2010). Food waste occurs in two ways, either in markdowns when products are still saleable but approaching the end of their lifetime or appearing less attractive, or in garbage when products are no longer (re)saleable, useable or edible. In Europe the total food loss and waste is 31% of the initial production from which 6.1% occurs in the food processing, packaging and distribution (HLPE, 2014).Reducing the annual food loss and waste will result in benefits for companies, consumers and the environment in terms of money, volume, energy and sustainability. In this the term waste refers to both food loss and food waste. A way to reduce waste in the food supply chain is to control the inventory levels in the supply chain. Inventory control has to deal with balancing conflicting goals, like on one hand the wish to produce in large batches to make use of economies of scale and on the other hand to lower the inventory levels to save on the capital tied up in inventory (Axsäter,2006). In case of perishable products, inventory control also has to balance between product-availability and waste. This thesis studies inventory control for a perishable product at several actors in the food supply chain. Therefore first a sketch of a food supply chain of a perishable product is given. Next the impact of perishability in the supply chain is briefly discussed, including issuing of product and common demand characteristics. The supply chain of a perishable food product starts with producing the raw material at a farm. Partly the raw material (mainly fruits and vegetables) finds its way unprocessed to the consumer, in a simple package, via wholesale trade or the auction. Partly the raw material(e.g. milk, meat, fruits and vegetables) is transported to a food company where production takes place. Fig. 1.1 shows a simplified food supply chain containing the stages farm, food producer, warehouse and supermarket. In practice, the farm stage can contain several subsequent farms from breeder to fattener of animals, or from seed producer to vegetable grower. Food production can be production of raw milk into consumer packaged milk; production of cheese; production from slaughtering to a packaged meat product; washing, cutting and packing under modified atmosphere of fresh vegetables, etc. Production steps may be executed at several subsequent production companies or locations. After production, the final products are transported to a warehouse. This might be the location of a wholesaler or a logistics service provider, possibly followed by a retail distribution centre.

"We are minimizing our inventory"

In today’s challenging and competitive scenario, Indian retailers (organized sector) of fruits and vegetables need more dynamic strategies in order to provide customer satisfaction and retention. Purchasing, overstocking, stock-out, throw away, markdowns, etc. are different activities that are undertaken in a retail store selling perishable inventory, especially fruits and vegetables. These factors affect the profitability of the retail store, directly or indirectly; hence, proper control over these factors must be the primary objective of the retailer selling fruits and vegetables. This article aims to find out significant relationships within these parameters of inventory management so that retailers find it helpful in devising strategies for a better competitive edge. First, factors are identified, and then, statistical tests (chi-square and analysis of variance) are used to derive conclusions.


About 70 percent of the entire catering trade in the federal state of North Rhine-Westphalia has closed its doors in recent weeks. Savi: "We are still supplying a few restaurateurs who are continuing their business. Fortunately, we also serve many regional specialist retailers: We are seeing a slight increase in vegetable products in this area. Fruit, on the other hand, is traded comparatively less than normal."

Perishable inventory management software
Perishable inventory management fresh produce

The owner's nephew during a FreshPlaza visit in the autumn of 2017. Family business AS Obst & Gemüse was founded three years ago and serves a broadly diversified customer base. "Some of our smaller retail customers have already given up their business. Even at the nearby wholesale market, some are fighting for their livelihoods," says Mr Savi.

Rubber gloves and disinfectants
Due to the current situation, the wholesaler is looking forward to the new month of April with humility. "I am simply at a loss. Mankind has not yet experienced what is about to happen," he says. Specifically in the fresh produce sector, he says, one could only take a few precautions to keep business going as well as possible. Savi: "We work with rubber gloves, but disinfectants and protective masks are no longer available."

Perishable inventory management software
Perishable inventory management fresh produce

Right: Tomatoes are one of the long-runners at AS Obst & Gemüse Duisburg GmbH Instead of restaurateurs, more and more private customers are now buying from Duisburg's specialist wholesalers.

Restriction of product selection
Perishable products such as fruit and vegetables continue to metabolize and respire after harvest. This means that the oxygen (O₂) in the atmosphere is being consumed producing heat, carbon dioxide (CO₂), moisture and possibly ethylene gas. As a result, the produce ripens and the quality degrades. Aerobic respiration (in presence of O2) can be defined as breakdown of organic compounds to simpler molecules, CO2 and water, with the release of energy (Fonseca et al., 2002). Respiration rate is the amount/concentration of O2 consumed or CO2 produced by the produce per unit mass per unit time. The respiration rate has been identified as one of the indicators of physiological stress. One of the most crucial factors to consider in maintaining fresh produce and prolonging the shelf life is by reducing the respiration rate without harmful impact on the quality – its taste, texture and appearance.

Successful storage and packaging systems rely on maintaining conditions appropriate for the fresh produce stored inside. Maintaining optimal respiratory gas composition (O2 and CO2) inside storage and packaging of fresh produce is crucial and the best preventive method to obtain the best quality produces. To maintain optimal composition of respiratory gases, precise measurement of the same inside a storage or packaging system is really important and crucial to produce quality. However, this could be difficult as the condition inside the system keeps changing constantly due to produce respiration. Therefore, it is important to have a reliable and accurate sensing and control system to monitor the fresh produce activity.

In most of the studies published before 2001, measurement of the O2 and CO2 content was based on using a gas chromatograph (Caleb et al., 2013). This approach was time consuming, labor-intensive and expensive. However, since 2002, there has been a growing interest in employing simple and easy-to-use O2 and CO2 gas analyzers for measurement of the gas content. For the development, design, management and control of the biological processes in the post-harvest technology field, data collection is required and hence data collecting sensors are essential for real-time decision-making. Recent applications of gas sensing technologies in intelligent systems are receiving increasing attention from both industry and academia. The objective of this article is to compile information about the available sensors for measurement of respiratory gases such as O2 and CO2 and provide perspectives on their applications in packaging and storage of fresh produce.

Italy: Optimizing efficiency with end-of-line pallet handling in food processing

Unique with its integration of laser guided vehicles connecting islands of automation for robotic case palletizing, stretch-wrapping, pallet labeling and transport to the warehouse without the use of conveyors, Freeway, from Elettric 80, provides increased flexibility, reduced energy consumption, decreased labor cost and a lower total cost of ownership compared to conventional pallet handling systems – effectively redefining end-of-line pallet handling efficiency in food processing plants that manage a high volume of SKUs with high throughput requirements.

Many high-volume food processing plants are facing a growing logistics challenge – the need to package, store and ship an increased number of product SKUs to arrive at retailers, and their distribution centers, on schedule with a near zero tolerance of error. Sometimes comprising thousands of different SKUs and in a growing assortment of package types, these products need to be cased, palletized, stretchwrapped, labeled and transported to the warehouse, or for outbound shipping, with a very high level of efficiency to optimize labor usage and minimize operational costs.

Perishable inventory management software
Perishable inventory management fresh produce



The numbers of different food products with their varied primary and secondary packaging is growing continually, and becoming increasingly difficult for food processors to maintain a high level of efficiency in managing their end-of-line pallet building and pallet movement into storage or shipment, using conventional conveyor-based automated systems.

Whatever the food product, the need for preparing and transporting end-of-line pallet loads with high throughput efficiency, precise product tracking and near zero product damage is of critical importance. This need is further emphasized by the impact of rising labor costs, increasingly stricter safety regulations, and the necessity to maintain acceptable food industry standards for cleanliness. Fast, efficient and accurate packaging and shipping are necessary for a strong competitive advantage in today’s demanding food market.

Inefficiencies with End-of-Line Pallet Handling Systems Most high-throughput food processors have advanced their filling and primary packaging equipment to embrace highly efficient operations, and downstream have equipped their warehouses with automated storage and retrieval systems (ASRS), automated guided vehicles (AGVs) and picking systems to improve throughput. But between these two operations, many food manufacturers are plagued with end-of-line pallet building and pallet transport systems that are inefficient.



Most conventional end-of-line pallet handling is based on conveyors linking carton packers with palletizers, stretchwrappers and labelers, then with the warehouse or shipping, supported by manually-operated forklift trucks.

Pallet conveyors are limited in their fixed configurations. Once set, it is unlikely that they can be easily moved to accommodate changing throughput requirements. Additionally, they limit free and available space for maneuvering and load staging in the end-of-line environment.

Because pallet conveyors tend to be highly fixed, they are susceptible to downtime because of malfunction, repairs and maintenance, which will impact the line if any of these occur while production is in operation.

In food processing plants, sanitation is always a factor. Although, end-of-line pallet handling conveyors may not be located in areas of the plant where food is directly being processed, product spillage is a concern.

When it does happen, throughput is slowed and can even stop the line. Many manufacturers have their pallet conveyors rated for wash-down or heavy wash-down as a better guarantee to recover the line in the event of a product spillage.



One of the major causes of food product damage, misdirected orders and indeed facility damage in food plants is from manually-operated forklift trucks moving pallet loads through the end-of-line and warehouse operations.

This is nowhere more evident than in the handling of chilled and frozen food products, which pose definite challenges for food processors that desire to have facilities operating at a high level of efficiency.

Maintaining a high throughput rate along with fulfillment accuracy at -18.4° F is a much more difficult and costly task than in ambient temperatures.

Chilled and sub-zero facilities have a higher incidence of product damage and wrong item fulfillment which have negative impacts on production and profits.

Not surprisingly, personnel turnover in chilled and cold facilities is also higher than in ambient temperatures. While the temperature in these facilities is cold enough to maintain food product safety, it creates an extreme environment with difficult working conditions for personnel, increased safety issues, and personnel recruitment and retention problems.

Perishable inventory management fruit vegetables

handling, packing, and logistics.

Perishable inventory management software
Perishable inventory management fresh produce



Today, a producer of food products needs to track and identify each pallet – where it came from, where it was stored, what the temperature was in storage, and other critical data to keep track of its perishable inventory and ensure its product integrity. End-of-line pallet handling with manual forklift trucks leaves open the possibility of human error, and with many manufacturers is cause for the biggest error points in its shipping.

To stay competitive, food producers need to implement end-of-line pallet handling solutions that address these issues. Solutions that will accommodate ambient, chilled and deep-freeze operating environments, and that will have the flexibility to adjust to throughput changes.

A Better Solution for End-of-Line Pallet Handling An ideal end-of-line pallet handling solution for food manufacturers would encompass fully-automated robotic palletizing equipment, coupled with a flexible and mobile pallet transport system, linked to upstream processes and ERP, as well as downstream warehouse and shipping with a real-time load tracking and verification capability. In effect, an efficient pallet building and movement system capable of smoothly integrating various automated end-of-line processes.

Such an end-of-line pallet handling and transport solution has been designed, and is being used by hundreds of companies throughout the world.

It is called the Freeway Solution, manufactured by Elettric 80, who is now providing the system to the North American market.

Freeway is the world’s first fully integrated end-of-line solution combining robotic palletizers, laser-guided vehicles, label equipment, product tracking software and a PC-based monitoring system.

The Freeway system is based on a system-integrated concept. Robotic palletizing cells handle goods and optimize pallet loads at the end of the production line. LGVs transport the pallets to high-speed stretch-wrapping and labeling equipment, and then to storage, or staging on the floor to await shipping. No transport conveyors or manual forklift trucks are used.
The fully-automated systems are adaptable and completely integrated. Its flexibility makes it ideally suitable to accommodate the layout and design of any food processing plant.

Smart Laser Guided Vehicles
A range of pallet load transport tasks within the end-of-line environment can be automated and handled efficiently with Freeway’s LGVs. These LGVs achieve a uniform flow of product without rush and noise, and with a high degree of safety for the goods carried, workers and the operational environment.

The LGV system comprises one or more vehicles that move around predetermined routes to perform transport functions as directed by a stationary control system. They are equipped with navigation systems, based on laser guidance, which allows the LGVs to be free roaming within the end-of-line system layout.

The latest generation of Freeway LGVs can lift pallets up to 36 feet high for positioning in racked storage or floor staging. This reduces the rack damage caused by forklift trucks. It also reduces energy costs as the LGVs can operate in an un-lit environment.

The LGVs can reach speeds of up to five feet per-second and can carry multiple full pallets at a time. For food processing facilities, they are an ideal asset for moving ambient temperature, chilled and frozen products in unit loads.

The laser guided vehicles are quite sophisticated, combining multiple systems to ensure reliability and efficiency, including energy, safety, fork/load handling and guidance and control systems.

The Freeway LGVs are outfitted with an obstacle detection system to detect anything in their path in sufficient time so that the units can slow down and stop if necessary. Once the path is clear, the LGVs will automatically continue their trip. The system is designed to handle high-volume pallet movements on a 24/7/365 operation.

Fully Integrated System Controls Optimize AGVs with Pallet Handling Robotics The smooth functioning of the Freeway LGVs is dependent on its controls system, which has the task of coordinating the orders received from the plant’s process system or ERP, and warehouse and shipping, and then directing the work for the laser-guided vehicles.

The Freeway controls provide real-time management of the system’s operation, including management information, load prioritization, load status, productivity statistics and reports, and workload analysis.

Perishable inventory management fruit vegetables

handling, packing, and logistics.

Perishable inventory management software
Perishable inventory management fresh produce

It allows associated functions to be automated, such as case stacking in the robotic palletizers, empty pallet inspection and delivery, finished pallet transport, finished pallet stretch-wrapping, finished pallet labeling, and finished pallet transport to storage or shipping. It is a Windows and SQL database architecture that is able to uniquely operate within a single platform.

The positional status is continuously being updated through the controls system, at least once per second, regarding such factors as whether it is loaded or unloaded, emergency stopped or soft stopped, operating in manual mode and battery level. A simulation module simulates the LGVs in the system. An HMI graphical interface gives the operator a graphical overview of the LGV locations in the system and monitors each in real-time.

The system’s controls monitor and guide the complete end-of-line pallet handling process, and optimize the use of different machine groups in relation to the logistic process and production management. Its modular design is tailored to meet the needs of specific food processing plants and their existing processes and ERP, such as containing software for scheduling, routing, monitoring and visualization of the complete end-of-line process for a particular plant. The food sectors’ special requirements for hygiene, safety and data tracking are leading components of this system design.

A New Benchmark in Automated End-of-Line Pallet Handling An end-of-line solution in food processing plants must go beyond typical measurements of cases-per-minute. It must include availability and efficiency, product damage, finished pallet throughput, finished pallet integrity throughout the supply chain, product traceability, staffing and maintenance.

Consideration must not only be given to case preparation and case stacking onto a pallet, but must also include empty pallet inspection and delivery, finished pallet handling, pallet stretch-wrapping, pallet labeling and pallet transport and storage.

With the emergence of Elettric 80’s Freeway, a new level of flexibility and efficiency above and beyond the capabilities of conventional automated palletizing and pallet transport systems has been realized for end-of-line production. For food processors, improved productivity, increased accuracy, better safety, less maintenance and reduced labor requirements are but some of the key benefits of this system.

Freeway has enabled a truly comprehensive and integrated end-of-line, system-wide pallet handling solution, which has set a new benchmark for streamlining end-of-line efficiency in high-volume/SKU food processing plants.

Partnering up to provide real-time shipment monitoring

RedLine Solutions, a company dealing in inventory and traceability solutions, and Roambee Corp., supplier of high-quality tracking services, have announced a partnership to provide customers with real-time tracking and monitoring solutions of produce shipments.

Roambee chose RedLine Solutions to offer customers in fresh produce full in-transit visibility and condition monitoring for shipments of perishable goods. RedLine already offers a comprehensive lineup of products and services to enable produce traceability and inventory management.

“RedLine chose Roambee because it is the most flexible, innovative, real-time shipment tracking solution out there. Combined with our complete traceability solutions, RedLine now can offer improved tracking.” said Todd Baggett, CEO at RedLine Solutions.

Sanjay Sharma, CEO at Roambee, underscores: “Fresh produce companies have large activity swings based on the seasonality of their products. We feel that Roambee’s pay-as-you-go service is uniquely positioned to provide real-time monitoring to produce companies in a cost-effective manner. With zero investment in hardware, our clients only pay for tracking when they actually track something.”

Innovative predictive shelf life tool and Gap Analysis Capability unveiled at PMA

Inteligistics, Inc., a leading provider of temperature visibility and food safety solutions for the fresh produce industry, successfully unveiled two innovative offerings at the 2015 Produce Marketing Association Fresh Summit Convention and Expo.

InteliLife™ Predictive Shelf Life model is a scientifically-based tool that extends and analytically confirms shelf life of food products at any stage during the active food distribution chain.

Perishable inventory management fruit vegetables

handling, packing, and logistics.

Perishable inventory management software
Perishable inventory management fresh produce

The result of collaboration with leading food quality experts, InteliLife™ Predictive Shelf Life model effectively analyzes alternative scenarios to manage sales and inventory based on estimated quality and remaining shelf life at any juncture in the distribution chain. The tool combines kinetic data of changes in quality attributes with accurate measurement of environmental conditions – time, temperature and humidity – and handling methods. The kinetic data provides the necessary mathematical coefficients to develop a reliable predictive model.

According to Inteligistics Chairman and CEO Rao Mandava, “This innovative predictive model enables inventory managers and stakeholders in the distribution chain to quantify the impact of temperature excursions on the product’s quality and shelf life, providing critical management inputs.” The InteliLife™ Predictive Shelf Life approach benefits growers, shippers and retailers by providing a reliable means to minimize losses due to spoilage, shrink and use-by dates.

“In addition,” Rao continued, “the predictive shelf life model from Inteligistics promotes the ability to develop an inventory policy that enhances consistency in the quality of perishable foods, provides actionable information and helps users achieve greater revenues by gaining a larger percentage of saleable products.”

A second capability launched by Inteligistics is its unique food safety Inteligistics Gap Analysis Capability that translates the new “Hazard Analysis Risk-based Preventive Controls” (HARPC) required in 2016 by the Food Safety Modernization Act (FSMA) into a comprehensive and highly detailed gap analysis package.

“Under the 2016 FSMA rules, an effective HACCP Plan is a thing of the past,” Inteligistics Board Advisor and industry food safety expert, Michael McCartney, said. “The new paradigm created by FSMA’s HARPC requirement demands that food companies demonstrate, address and verify an unprecedented set of risk-based controls across the supply chain.” The Inteligistics Gap Analysis Capability is uniquely designed to identify, document and provide direction for compliance from the field through the entire food supply chain. The pertinent food safety information is collected in Inteli-Cloud and can be made available in the event of a food safety internal or external audit or by mobile device.


For Information Contact:

Donna Watkins:

(+1) 512-848-1698

info@inteligistics.com

www.inteligistics.com

AR Systems develops ‘Micro Store’

California's Corona-based AR Systems is rolling out the FreshFirst automated kiosk that delivers consumers immediate access to a variety of farm-fresh salads and produce.

The company said growers, restaurateurs, vending operators and entrepreneurs can use the kiosk to sell farm-to-table foods directly to consumers in areas that are difficult to reach, such as offices and business parks, airports and transportation centers, colleges and universities, hotels and shopping malls.

The system also features AR Systems' patented ARS Kiosk Manager, which gives instant insight into system functions, sales reports, inventory levels, plus control of system parameters including service lock and unlock, perishable product detection, and temperature control. The app is available on the Apple App Store.

Perishable inventory management fruit vegetables

handling, packing, and logistics.

The fresh produce supply chain was once pretty much invisible, but today’s consumers are eager to know the story of how and where their food is grown and packaged.

A recent report from Innovative Fresh and Pink Sky stated: “It is increasingly important to talk to customers about food production, food miles, ingredients, health, ethics and value. Innovation in supply chain management from field to fork will form an enormous part of the future of food production”.

Perishable inventory management software
Perishable inventory management fresh produce

Freshtalk Daily has taken a look at the many innovations surrounding the fresh produce supply chain and has selected three use cases that we feel will most impact the industry in the coming months.

1. Produce tracking through ‘Big Data’
The confusion surrounding the fresh produce supply chain under the cloud of Brexit has meant that the volatility of goods, in terms of logistics, has never been greater.

Keeping track of the freshness levels of perishables is vital, so innovations that use data (in the form of digital records) are set to make a huge impact upon fresh produce inventory.

Companies like IBM are investing heavily in product tracking innovation and ‘Cloud’ information storage for both importers and exporters to provide a freshness knowledge-base for the industry.  

IMD Professor, Ralf Seifert, who specialises in digitalization trends in the supply chain explains that: “Having digital records for the entry and exit of products at each stage of the supply chain can help ensure a ‘first in, first out’ policy for fresh produce, which will decrease inventory age – and therefore reduce shrinkage due to spoilage."

“Digital supply chain solutions, therefore, provide enormous potential for accurate demand forecasting and better inventory management. “

Dr. John Ryan, a global food safety expert, agrees that digital-tracking is the way of the future, adding: “When food enters a transportation area, it basically becomes invisible. Nobody knows where it is. Nobody knows what conditions it’s being shipped under. The old adage rings true; you can’t manage what you can’t measure.”

2. Robotics in agriculture
The lack of seasonal workers has, over recent years, been a huge bone of contention for UK growers, so its no surprise that innovation in this arena is set to make a huge impact.

Fieldwork Robotics, a spin-out from the University of Plymouth, have recently made headlines with the successful trial of their raspberry picking robot, developed in partnership with Hall Hunter, one of Britain’s main berry growers, who supply Tesco, Marks & Spencer and Waitrose.

Excess inventory occurs when a merchant orders an inaccurate supply of inventory (too much). Excess inventory can also result when the demand for a product unexpectedly drops so that the business is left with more product than can be sold.

This is a problem many merchants face – and can be especially problematic when it comes to perishable produce like fresh fruit, vegetables, and quality meat and seafood. Wasting money, food, and shelf space is an issue that can be avoided (read more about how to properly track inventory here). However, if like many merchants you find yourself in an overstock situation, we outline some practical suggestions below.

Why holding excess inventory is a problem

Stocking excess inventory can be problematic for a variety of reasons:

  1. Competing (or limited) Shelf Space. Excess inventory takes up space. As a grocer or small business owner, you need to be able to introduce new, better products into your system to appeal to your customer base. By having excess inventory taking up space on the shelves, you’re preventing better (more valuable or popular) products from being available on the floor.
  2. Reduction of Profits. If you have too much of one item, you’re probably going to have to put the product on clearance to get rid of it! This will reduce your bottom line so that you are spending more money on buying this product than you should be.
  3. Competing (or limited) Storage Space. Not only will the excess inventory be taking up space on your shelves, but it’ll also take up space in storage! This usually comes with storage costs as you may have to expand your storage space to account for the excess inventory.
  4. Waste of Inventory. The biggest problem with fruits and vegetables is that they are perishable or can expire. They will go to waste if you have too much of it. In this case, you will have to throw the inventory away and will not be able to make any profit on it.

There are some advantages to holding abundant inventory. Having more inventory means that it will always be available should customers request it (it’ll have a high fill rate, so orders are filled as soon as they are put in), this product will have higher safety stock levels, and suppliers usually give discounts for products purchased in bulk. While these advantages do exist, having excess inventory is generally disadvantageous, and overstock much is dealt with as soon as it happens. It is better to have systems in place to collect data so that you are able to order the correct amount of inventory to fill customer needs – rather than over or under-stock. You can read more about that in our “Inventory 101 post”.

What do I do with excess inventory?

Reducing overstock and responsibly handling excess inventory is possible with some organization, creativity and by connecting with your customers. Here is Mercato’s advice for resolving excess inventory issues:

  1. Reduce price on overstocked items. Offer a promotion or sale. Use your customers to help to get the item off the shelves by selling the product with a discount.
  2. Get your customers interested in the product. Everyone loves free food! Give your customers food samples and ask them to taste the product. This will not only show customer appreciation but also be great for customer service and engagement. You can even do giveaways of products to incentivize customer loyalty. Cook the produce! Prepare some food USING the overstocked ingredient, even featuring it. This will not only incentivize your customers to buying the overstocked product (they can try to make the recipe themselves!) but also get rid of excess inventory without substantially cutting profits.
  3. Return the product to the seller. Some shipment agencies will allow you to return a product for a refund on a percentage of the cost. Some will allow for returns with payment of shipping costs. Take advantage of the manufacturer or shipper’s policies and keep your stock level maintained.
  4. Discount the product by including it in a package deal. Group this product with other products to give customers ideas on how to use the product, as well as create bundles and sell other products.
  5. Sell the product to other retailers or trade products with other retailers. Aldi buys overstock from Trader Joe’s and other outlets as secondhand produce, and restaurants buy meat that’s still good but doesn’t look as bright red as customers expect.
  6. Liquidate the product. Sell your product to an online marketplace or to a company that will liquidate your items.
  7. Give the food to a charity that collects food. Charities like Hungry Harvest or City Harvest “rescue” your produce so that it doesn’t go to waste, and distribute it to people in need. This can also be a great marketing point for your business, as well as tax deductible.
  8. Finally, DON’T let the product go to waste! Produce can be good for the environment, and even useful as fertilizer (old coffee grounds for growing tomatoes). Find a way to make the product be of use to your business, customers, or the environment, and use your creativity to make the product usable!

How to avoid collecting excess inventory in the future?

  1. Figure out what went wrong. Are you paying attention to customer needs? Are you closely managing your inventory using real-time or digital software? Do you need to hire a stock controller? Make sure you have all of the answers to these questions while buying inventory the next time around.
  2. Use inventory management software to assess supply and demand for your product. Work with the vendor and use your own inventory management software to assess a product’s historical sales. Use cloud-based inventory management software like Square Retail to forecast demand for the product from previous sales.
  3. Assess your customers’ interaction with the product and place orders strategically. Keep track of which products are more popular among customers, what comments customers make as they are buying specific products, and which products need higher quantities because of their popularity.
  4. Use drop shipping with a wholesaler or manufacturer. A wholesaler may be able to send the item directly to the customer! Check with your manufacturer to see if this option is available for you, as well as if this works for your specific product.
  5. Create stronger connections with customers. Create and maintain strong relationships with your customers so they continuously return to your business or service and continue buying products! This will ensure more accurate predictions for the forecasted demand of the product, as you will be working with the same customer base every time.
  6. Reach out to Mercato’s helpful team for recommendations and advice on these or any other questions. Mercato is here to assist.  

Perishable inventory management fruit vegetables

handling, packing, and logistics.

Product perishability is of major concern in many industrial sectors. Fresh food, blood products, meat, chemicals, composite materials and pharmaceuticals are all examples of perishable products that can deteriorate and become unusable after some finite time[2; 8; 15]. Other industries supplying services also deal with variety of perishable products such as airfares, hotels and concerts [1]. This complex issue supports the rationale for investigation into perishable inventory control in several industries as well as most countries. Handlings of perishable inventories occur naturally in many practical situations. The perishable products are naturally managed in practice, as the length of the lifetime of the product defines the maximum length between the order frequency [15]. However, not many inventory control models take perishability of the products into account which is a weakness in these models. Most inventory control models assume that stock items can be stored indefinitely to meet future demands as in the case of the EOQ model. However, when dealing with perishables, the product lifetime must betaken into account in inventory models. Perishable inventory is a challenge for companies both from a managerial and an operational point of view. The retail industry in Denmark deals with perishable inventory on a daily basis. The challenges arise when unsold perishable items approach their expiration date. Then management has to decide whether or not to sell the items at a lower price than expected or simply consider the remaining inventory as waste. To investigate these issues a single case study hasbeen conducted in the Danish retail industry.When the inventory holds the same product variant, but with different expirationdates, then the challenge occurs since the items have different quality level due to thedifferent length of remaining shelf life. Decisions can be difficult, as the remaining items needs to be taken into account, when making replenishments. In order to ensurea higher profit, when dealing with perishable items, the shelf life must be taken intoaccount. According to Gürler [8] a significant reduction in the cost function can beobtained by explicitly taking into account the randomness of the shelf life and thesystem costs differ drastically among various shelf life distributions, which imply thata precise estimation of the shelf life distribution is desirable.

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