Distribution is the final line of defense in the fight to protect perishables profits. Mishandling, temperature variations or delays within the system can spell disaster not only for a retailer's bottom line but in the sensitive food-safety arena as well.
In addition to traditional "weapons" such as refrigerated trucks and multi-temperature distribution centers, retailers and wholesalers are using newer technologies that make perishables distribution faster and more accurate, such as transmitting purchase orders electronically.
"A critical piece of the process is how to compress the time element," said Bruce Peterson, vice president of perishables merchandising at Wal-Mart Stores, Bentonville, Ark. "Just being able to transmit POs with precision and timeliness saves time."
In addition, some retailers and suppliers are employing the concepts used in such trading-partner initiatives as collaborative planning, forecasting and replenishment in perishables distribution. Wal-Mart has run pilot programs of CPFR with nonperishable items, but the idea of greater cooperation could have even more application in this area.
"Retailers are not the only ones concerned with the time it takes for product to get through the system," Peterson said. "We have recognized that we can jointly try to accomplish the same thing.
"To date the only point we have talked about is the cost of goods," he added. "There are other ways to reduce costs, and logistics is one. Whole cold-chain management is a more significant issue with value-added products. Temperatures must be within a narrow range and there needs to be a more collaborative effort."
Distributors agreed that while achieving speedy distribution is a common goal, proper handling throughout the process is also crucial.
"With perishables especially, distribution is key," said Jack Brown, president and chief executive officer of Stater Bros. Markets, Colton, Calif. "You need the people who know what to do and how to do it for successful perishable distribution."
"Time is critical," said Jeff Fairchild, produce buyer at Nature's Northwest, Portland, Ore. "Timeliness, consistency and quality are all hinged on distribution. To control quality you have to get fast turnover."
To both speed up the system and maintain controls, Nature's Northwest buys most of its produce items directly from growers. In addition, the retailer receives more than 70% of its produce via direct-store delivery. O'Malia Food Markets, Carmel, Ind., uses DSD for its complete deli line.
Both chains use systems at the store level to ensure that cold items stay cold and hot items stay hot.
"Perishable-food distribution is not a glamorous thing," said Tim Pettygrove, O'Malia's director of deli operations. "It is a necessary thing. The key to everything is not to add more time into the system."
"It is key to any refrigerated product that it always remains within a controlled environment from the manufacturer to delivery at our units," said Stater Bros.'s Brown. "We receive the product from refrigerated trucks into a refrigerated dock area to ensure the integrity of the product."
At the distribution facility four different temperature levels await the arrival of perishable products. "Everything can't be at 34 degrees," said Brown. "Perishables are a living, breathing thing.
"Customers won't know the difference our attention to temperature controls makes for a day or two, but on the third day when the produce is inedible they discover the difference," he added. "Quality has a long memory and when you chisel off of refrigeration, customers will know."
Retailers often have strict procedures following Hazard Analysis Critical Control Point models. These procedures include evaluating all possible time and temperature abuse points of perishables from farm to table -- including distribution systems.
Checks for temperature abuse and delays are made at several points during distribution. Designated product checkers can refuse shipments due to failures within the distribution system.
Variables in the system do exist depending on how the distributor brings perishables to market. Chains that process and package items for home-meal replacement programs must keep items between 140 degrees and 180 degrees, or below 40 degrees, depending on the specific item. At Stater Bros., produce and meat are inspected at the perishables warehouse and again at each supermarket. The major reason product is refused at any point is generally due to temperature abuse, Brown said.
"Bagged salad items and precut produce still need care, despite the fact that they look like a grocery item," he said. "They have to be handled like fresh produce. They are in trouble when handled like grocery."
"Precooled trucks are a must," said one distributor who centrally produces prepared foods. "We cool our refrigerated trucks at least two hours ahead of them leaving the dock to make sure that the temperature of the unit matches the temperature of the cooler the items are being stored at."
Often, various perishables are merged for unit delivery. Food safety and HACCP again play an important role in how these items are moved through the distribution system. There can be no cross contamination between cooked and raw items.
"This sounds simple, but a lot of areas can slip and break down," said one retailer who requested anonymity. "It takes a lot to ensure that leaking and dripping is eliminated."
Another component to perishables distribution is ensuring that the right product gets to the right store in the right shape.
"Many of these items can't be crushed," said a retailer who requested anonymity. "If sauce gets all over the lid of prepackaged home-meal replacement items, they can't be sold. If we put all the effort into doing the product right, we have to put the same amount of effort into making sure the right product gets to the right unit in perfect shape."
One distributor spends more for extra-strong cardboard to use as shipping containers for its prepared food items. These products, produced centrally and then shipped to supermarkets, are used to make sure that products are not crushed during transit. "You are just never sure what will be put on top," said the distributor.
The cardboard shipping containers were selected because it was felt that a one-way system would suit the distribution while eliminating any food-safety concerns associated with cleaning of returnable cages.