Baking & Snack - February 2023 - 102

SUPPLY CHAIN
alleviate the labor shortage need patience, which also
may be in short supply. Mr. Warren noted new equipment
delivery time has increased between 50% and 90%
in the past two years for most suppliers. Most delays
have come from components, especially electrical controls,
and manufacturers don't expect much improvement
in 2023.
" The good news is that equipment system suppliers
have gotten better at managing these issues, " Mr. Warren
said. " Now, when they need one item, they'll order four,
then put three in inventory. Suppliers know that electrical
components and controls need to be the first parts
ordered when a new equipment order is received. When
they can't source a needed part, they will be creative and
think outside the box. While other materials like steel
are also experiencing long delays, those extended material
timelines tend to fall within the extended electrical
components' delivery time frames. "
Mr. Warren pointed out bakeries often must adjust
production schedules on the fly due to the varying number
of employees available on a given day, which negatively
affects bakers' abilities to consistently fulfill orders.
R&D adapts to
shifting supply
chain issues
When it comes to innovation,
bakers need to keep in mind what
ingredients and packaging are
available now and possibly for
the future. That's why Brentwood,
Tenn.-based Crown Bakeries relies
on " ingredient optimization " when
creating new items for the foodservice
and retail channels, noted
Clay Mullins, vice president of
supply chain and logistics for the
company.
" As we are developing a new
product, we are cautious as to
what we put into it, " he explained.
" If we believe we're going to be
short in supply longer term, we're
going to limit our exposure to that
ingredient. "
Prior to the pandemic, new
" It's become a 'ship what you can, when you can' mentality,
realizing that your competitors are experiencing
the same problems, " he explained.
To stabilize their operations and future-proof them,
he added, bakery equipment and production lines are
now designed with automation and versatility in mind.
" Bakers want to run production lines without having
to rely on a large workforce, and they want to be
able to run a variety of products on one system, " Mr.
Warren said.
Seeking a steady supply
Ms. Sanders noted larger, multi-plant companies have
more flexibility and can better forecast their production
needs, which allows them to buy out further in the
market. However, smaller companies struggle with high
prices because of their size or financial constraints.
" They have to count on the spot market and can't find
the ingredients they need, so they're having to reformulate
differently or see how they can barter to get what
they need, " she said.
To manage the supply chain more predictably, Mr.
product development was vital
to holding onto consumer brand
loyalty, but now it's a lower priority
for some bakeries, said Jim
Warren, BEMA chairman and vice
president, Exact Mixing, Reading
Bakery Systems.
" Most companies aren't as focused
on developing new products
but rather trying to fulfill orders
for their best-selling products, " he
said.
The American Bakers
Association (ABA) discussed a
wide range of health and supply
chain issues with government officials
during last fall's White House
Conference on Nutrition that rolled
out the government's national
strategy and vision on nutrition
policy moving forward, noted Lee
Sanders, ABA's senior vice president
of government relations and
public affairs.
One announcement that
emerged at the meeting involved
the long-awaited " healthy " claim
definition. While the stringent
definition is restrictive for many
products, Ms. Sanders said some
bakeries may be able to use the
claim as an opportunity to create
lower-sodium or reduced-sugar
products or find new ways to market
" healthy " items to children as
the policy rolls out.
She added the Food and Drug
Administration is also looking at
new front-of-pack labeling but
needs to conduct more research.
Another issue involves extended
producer responsibility for packaging.
Ms. Sanders pointed out that
22 states are expected to introduce
a patchwork of legislation in 2023
that may extend a company's
responsibility for post-consumer
management of products and
packaging and even obligate them
for recycling them.
" During the first part of the year,
you are going to see a lot of state
activity around packaging, " she
said.
102 Baking & Snack February 2023 / www.bakingbusiness.com
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