Keeping it chilled

Pollen Consulting Group

By Scott Varker, Director, Pollen Asset Advisory*
Monday, 14 October, 2019



Keeping it chilled

When I first moved to Australia 12 years ago and started travelling, my first impressions were how big it was and how hot it was. Not exactly inspirational, but still two points we often fail to comprehend when we consider the cold chain in Australia.

We have a challenging marketplace where there is constant demand for new products, chasing the latest trends from both Europe and the US as well as our somewhat closer Asian neighbours, from ready meals to matcha ice-cream. How few of these new products make it from concept to success, with on-shelf quality and cost being major contributors to failure and deletion.

Understanding the consumer and developing a product to meet their evolving demands is challenging enough, but where we often fail is ensuring it reaches the point of consumption with the desired quality. We often consider that chill chain is a food safety requirement to ensure shelf life is maintained, but do we consider the impact on quality, the resulting consumer experience and the repurchase rate for new products?

If we are to manufacture a consistently high-quality product, then both our processes and our environments must be consistent, but is this really the case in most factories? While most companies producing chilled food have refrigeration systems cooling their production and storage rooms, how many of them continuously monitor and log this information for all rooms? It is also not uncommon to see these systems switched off “to save energy” or doors left open resulting in warm environments and dripping condensation. Progressive companies are linking SCADA and building management systems to ensure that the environment is consistent and meets both food safety and food quality requirements; however, at the other end of the spectrum a quick look up and you will see clogged evaporators and dirty air filters.

The starting point is to ensure that you are getting the most out of your existing systems. Planning and ensuring the service of refrigeration systems are completed on time by trained contractors is not rocket science, but can improve process control, reduce running costs and avoid costly equipment breakdowns. When was the last time you reviewed the cost and effectiveness of your refrigeration contractor?

Even if our manufacturing is well controlled, your product quality is still subject to the vast distances and high external temperatures through the supply chain. When we check the cold chain it is often limited to static checks in storage locations. Products may leave the manufacturing site and arrive at the customer DC at the correct temperature, but has this really been maintained for the complete journey? It is still not uncommon to see ambient cross docking of both chilled and frozen products, especially when transferring between third-party transport companies, in remote areas.

Often new product transport trials are completed to test the pallet and product stability and occasionally this will include temperature loggers. However, this is commonly a round trip and is not necessarily representative of the day-to-day operation, due to the difficulty of retrieving and returning data loggers. This is forecast to change over the next 5 years. With IoT open platforms, availability of sensor technology and the combination of pallet/carton RFID systems, it will soon be possible to track not only where the product is in the supply chain, but what temperature it is at, with confirmation it has not broken the chill chain at any stage. Imagine this could be built into every pallet, with access to the data for all three parties: manufacturer, 3PL and customer. With individual barcoding, how long before the consumer will have the ability to check this with an app for every product they buy?

With more than $26 billion spent annually on refrigeration in Australia, including equipment energy and refrigeration gas, this is a major cost to our industry. The questions you need to ask is how effective are my freight and refrigeration in supporting my product quality and how much are they costing me?

*Pollen Asset Advisory was born from Pollen Consulting Group as a service offering that focuses on supporting businesses across the spectrum of case development, capital planning and portfolio management. Director Scott Varker heads the business with a global background in engineering, project management and food manufacturing operations in several blue-chip companies as well as being an independent consultant. His 30 years of FMCG experience, ranging from hands-on maintenance to operations and strategic management roles, allows him to bring a unique perspective to both capital projects and asset lifecycle management to ensure delivery of benefits for the longer term.

Image credit: ©stock.adobe.com/au/Thidarat

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