Designing Value Chains for fresh fruits and vegetables

Chain, chain, everywhere a chain

Holdin’ up my goodies, drivin’ me insane

Buy this, don’t buy that, can’t you break the chain?

With apologies to the Five Man Electric Band

Something goes wrong these days. Blame it on the supply chain! That delivery supposed to be arriving today is out of stock. Backlogged! Blame it on the supply chain! Empty spaces on the shelves of the supermarket. Blame it on the supply chain! People not eating enough fruits and veggies. Blame it on the supply chain! Can’t manufacture that special processed food. Blame it on the supply chain!

Today I describe three types of chains—supply, cold, and value. How do they differ from each other? How do they affect the delivery of goods? How do they differ in delivering fresh foods from distributing processed products? What is so special about fresh fruits and vegetables? What are the consequences when we break each type of chain? Inquiring minds want to know! To find answers I revisit our recent book Postharvest Handling: A Systems Approach.

A chain is a series of links. Each link plays a role in moving a product from its origin to its destination. Some chains are short. Others are long. A chain is only as good as it’s weakest link. Without a chain, delivery is unpredictable. Without a chain, chaos ensues. When running smooth no one notices. When a chain becomes inefficient or breaks everyone suffers. Everyone in the chain blames everyone else. Deliveries are slow or non-existent. Information may or may not flow. Lessons may or may not reveal themselves. Similar problems in the future may or may not happen. Business may or may not slow. Future transactions may or may not occur.

Supply chains. A supply chain delivers a product from source to consumer. When working well supply chains move items from point A to point X in a swift, efficient manner. To a casual observer supply chains become invisible, that is, until there is a problem. For a processed food the supply chain connects ingredient sources to finished product. For ingredient suppliers, each ingredient has a chain running from supplier to processor. Finished product chains run from processor to consumer. For a fresh fruit or vegetable, the chain stretches from harvest to consumption. In supply chains the grower or processor push items through the chain to the consumer (1).

Supply chains are special. They keep an organized, smooth flow of product from start to finish. Once an item enters the chain it comes out the other end with little trouble. Every link performs a specific function. Delivery is predictable. Feedback keeps links informed of potential delays or problems. Good supply chains function on auto-pilot. There are always items in the chain to please buyers and their needs.

Supply chains work well with finished products. They don’t work as well with living organisms such as fresh fruits and vegetables. Chain complexity increases with fresh foods. Fresh foods exhibit biological variability at harvest. Procession through the chain amplifies these differences (2). Handlers attempt to ensure uniformity in a shipment (3, 4). Biological variation results in differences when a shipment reaches the store. The most difficult links to study in a chain for fresh foods are the interfaces at harvest and the point of sale (5). Many businesses operate within a supply chain to get the item to market. Each firm wishes to maximize profit so adversarial relationships can develop (6).

Fresh foods are perishable. They cannot withstand delays that nonliving entities can (6). Microbes are at work that can lead to spoilage or safety hazards (7). Management of supply chains is all about logistics (8). Monitoring microbial activity (9) and quality changes (10) require more effort. Tracing potential safety outbreaks is beyond most supply chain management.

What happens when we break the supply chain? The most common outcome is a delivery delay. Processed products are stable. Even a package of frozen blueberries can withstand a delay if kept frozen. Fresh foods spoil within days even when kept refrigerated. Stores can experience a Bullwhip effect when chains break down. For example, a store orders an item such as toilet paper. There is a shortage of rolls of tissue available. The store orders more, but supplies are still limited. Manufacturing plants rev up production. When supplies become available, stores that kept ordering get swamped. Too many packages of fluffy rolls that they can’t sell overtake their storerooms. Vacant buildings may be able to store the excess toilet tissue. What can a merchant do with mounds of shrink-wrapped cauliflower heads? The Beergame, designed at MIT, illustrates this effect.

Cauliflower on a supermarket display.
Imagine a seven-foot mountain of cauliflower waiting on your back dock on a hot sunny day! Where do you store them?

Cold chains maintain a low temperature of chilled fresh foods from farm to retail. Most cold chains start at a packinghouse and end at the point of sale. To maintain freshness, the cold chain should continue in the home refrigerator (8). Maintaining a cold chain is most important in delivering quality to the consumer. It also extends shelf life (8, 11). Ensuring an appropriate relative humidity for the crop(s) shipped is also important.

The cold chain is special as it works wonders when maintained. It invites disaster when breached. Operators study the temperatures of produce though an item’s entire chain. Downloading temperature records help determine when and where breaches occurred. Data obtained from many trips feed simulation models. These models help predict changes in quality (12).

Maintaining a cold chain is the best tool in the postharvester’s toolbox, but it has limitations. Field heat and the heat of respiration are two enemies of the cold chain. Crops in the field are as hot as the temperature in the field. The hotter the fresh-picked item in the field the faster that fruit or vegetable respires. The faster it respires, the more heat it generates. Refrigeration removes field heat and slows the heat of respiration. Quick precooling is necessary for fast-respiring fruits like strawberries (8, 11). Temperature abuse during handling shows up when the consumer buys the item (11).

A word of warning about cold chains involves fresh meat. Ideal refrigerated conditions for meat and produce are similar. It is tempting to maintain a simultaneous cold chain for them. We assume that harmful microbes are present on raw meat. Cooking kills these microbes. Handlers work to prevent contamination of fresh fruits and vegetables from disease-causing organisms. Intermingling raw meat and fresh produce invites cross contamination. Many fresh produce items are not cooked. Consumption of raw foods represents a safety hazard.

Management of a cold chain is complex. Communication between links can be difficult. Monitoring of temperatures in the chain is critical. Loading of trucks backed up to a bay the refrigerated warehouse is essential. Cold chains are energy intensive and an added expense (8). The cold chain does not stop when these items arrive at the back dock of a supermarket or restaurant. Quick movement from the truck to dock to storage room is necessary. Otherwise, we waste much of the effort from field to store. The consumer extends this chain by limiting time perishable items are in a hot vehicle. Consumers can extend the cold chain by quick transport home and refrigeration. The home can be the least dependable link in a cold chain (11).

What happens when we break the cold chain? Spoilage and other bad things. An ideal cold chain operates from start to finish. The quicker it starts and the longer that it lasts the more effective it will be. Vegetables tend to be more forgiving than fruits. A two-hour spike in temperature anywhere in the chain can ruin a batch of strawberries (8). One complication involves chilling-sensitive produce. Bananas, tomatoes, peppers, and many more living plant tissues are chilling sensitive. Handling chilling-sensitive fruits and vegetables at higher temperatures prevents these problems (5).

Strawberries on display in a supermarket.
A two-hour spike in temperature can ruin a load of strawberries.

Value chains add value to the food shipments from source to final sale. Chains add value in many ways. First, the focus is on consumer satisfaction rather than on the amount of food shipped (5). In a value chain demand for the food pulls it forward rather than the push noted in supply chains (1, 12). Value chains consider price, convenience, quality, and perishability (5, 6). Next, more management attention becomes critical (6). Within the chain, technicians measure quality at checkpoints (11). Management provides tools to optimize quality including enforcing quality specifications (3, 13). A fresh fruit or vegetable can change hands as many as 12 times in a value chain (14). Sharing information between different links in the chain is paramount (13). Competition is possible within a supply chain. Cooperation is necessary in a value chain. Information flow provides more opportunities for continuous improvement to please the consumer.

Value chains are special as they place more emphasis on quality as delivered to the consumer (1). Long shelf lives are not as important as keeping quality within a reasonable time after sale (5). There is less concern about price but more about value at a a given price point (6). Value chains limit waste, loss, (5, 6, 13, 15) and safety risks (5, 16). Management gains with feedback from each link in the chain (1). This information improves responsiveness to consumers and chain efficiency. Information flow also reduces risks (5, 6). Numbers gathered help develop simulations and game scenarios to improve chain performance (12). Unlike segregated links in a supply chain, integrated links occupy a value chain (1). These patterns permit more precise tracing items backward or tracking them forward (13).

What happens when we break a value chain? A broken value chain reverts to a supply chain. The quickest, most devastating way to break a fresh-produce value chain is to break the cold chain. Even short periods of time at higher temperatures defeat all other efforts (8). Gaps in information flows prevent improvements and responsiveness to consumer needs and demands.

Why postharvest handling is about value chains. Fresh produce is perishable. It is on a time clock. Consumers are pickier in their demands for top quality fresh fruits and vegetables. Supply chains are not capable of meeting these demands. Value chains of fresh produce are not only local, they incorporate transcontinental shipments. Value chains are not only for elite consumers with high disposable incomes. Other chains must meet the requirements of low-income consumers who eat fresh. Value chains can optimize quality within price constraints.

Bottom line. A supply chain is not good enough for fresh fruits and vegetables. Value chains meet the needs and demands of fresh-produce consumers. They work backward from the consumer to the grower. Understanding the consumer desires, chain mangers check quality. They also use the flow of information to deliver expected quality at a reasonable price.

Next week: Do food systems exist?

CODA

Unchain my food

Trucker send it to me

‘Cause you don’t care

well, please

Set me free

Unchain my food

Truck send it to me

Unchain my food

‘Cause you don’t need it no more

With apologies to Joe Cocker and Ray Charles

References:

(1) Aggarwal, D., R.L. Shewfelt, and S.E. Prussia, 2022. Systems approaches for postharvest handling of fresh produce. Postharvest Handling: A Systems Approach 17-49.

(2) Tijskens, P. and R. Schouten, 2022. Modeling quality attributes and quality-related product properties. Postharvest Handling: A Systems Approach 99-133.

(3) Bollen, A.F. and S.E. Prussia, 2022. Sorting for defects. Postharvest Handling: A Systems Approach 377-398.

(4) Snowden, A.L., 2022. Investigating losses occurring during shipment; forensic aspects of cargo claims. Postharvest Handling: A Systems Approach 469-484.

(5) Shewfelt, R.L. and S.E. Prussia. 2022. Challenges in handling fresh fruits and vegetables. Postharvest Handling: A Systems Approach 167-186.

(6) Collins, R. and B. Dent, 2022. Value chain management and postharvest handling. Postharvest Handling: A Systems Approach 319-341.

(7) Fallik, E. and Z. Ilic, 2022. Mitigating contamination of fresh and fresh-cut produce. Postharvest Handling: A Systems Approach 621-649.

(8) Dodd, M.C. and J. Bouwer, 2022. Cooling fresh produce. Postharvest Handling: A Systems Approach 435-468.

(9)  Tonutti, P., C. Bonghi, and S. Brizzolara, 2022. Multiomics approaches for the improvements of postharvest systems. Postharvest Handling: A Systems Approach 251-276.

(10) Bowen, A. and A. Grygorczk, 2022. Consumer eating habits and perceptions of fresh produce quality. Postharvest Handling: A Systems Approach 487-515.

(11) Nicola, S., G. Cocetta, A. Ferrante, and A. Ertani, 2022. Fresh-cut produce quality: implications for postharvest. Postharvest Handling: A Systems Approach 187-250.

(12) Aggarwal, D. and S.E. Prussia, 2022. Models for improving fresh produce chains. Postharvest Handling: A Systems Approach 135-164.

(13) Bollen, A.F. and M. Adkins, 2022. Plant to plate—achieving effective traceability in the digital age. Postharvest Handling: A Systems Approach 343-361.

(14) Emond, J-P., 2022. Managing product flow through postharvest systems. Postharvest Handling: A Systems Approach 363-375.

(15) Banks, N.H., 2022. Postharvest systems—some introductory thoughts. Postharvest Handling: A Systems Approach 3-16.

(16) Walsh, K., 2022. Postharvest regulation and quality standards on fresh produce. Postharvest Handling: A Systems Approach 51-98.

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