Sustainable supply chains and weathering shocks

Sustainable supply chains and weathering shocks: five key lessons from Nestlé Professional’s MD Katya Simmons. Report by Amy Fetzer 

  1. Go digital for distribution

Digital distribution centres can be highly valuable in managing shocks such as global pandemics, according to Katya Simmons, Managing Director, Nestlé Professional UK and Ireland. Harnessing innovative technologies such as augmented reality to operate in the greenest, most efficient way, Nestlé’s new digital distribution centre helped keep 4,000 outlets, from small shops and supermarkets to small businesses and vets, stocked during the UK’s spring lockdown.

It also enabled the company to donate £4m pounds worth of food and drink to food banks and key workers across the UK and Ireland. This is because LEAN thinking and just in time production and delivery minimises stock and wastage whilst providing a high level of transparency. Less stock needs to be held as production can be more closely matched to customer and consumer demand, making Nestlé highly reactive and adaptable, whilst reducing costs and climate impacts.

  1. Find partners for workable solutions

Disposable coffee cups might not seem front of mind when we’re still celebrating the fact we can actually buy a hot beverage out of home, but cracking the disposable cup waste nut is a persistent challenge. And it is more important than ever when some outlets are wary of accepting reusables; compostables often require industrial facilities that aren’t readily available and standard disposable paper cups aren’t generally recyclable. Nestlé thinks it may have found the answer. It’s working with its supply chain to support and provide a guaranteed market for a new cup, due to launch this Autumn, that can go through the normal paper recycling system. It could be the product the industry has been waiting for…

  1. Set tough targets for supply chain impacts

“When we looked across the whole value chain – every product, ingredient, packaging - most emissions sit upstream,” explains Simmons. So Nestlé set itself science-aligned targets to be zero net emissions by 2050. This includes working with its supply chain to reduce emissions, enhance biodiversity, and build resilient agricultural communities. With a recent Footprint Trends report identifying the trend that “your supply chain is your brand”, being proactive about supply chain impacts is a smart business move.

  1. Be prepared to create your own solutions

Before coronavirus, ensuring that packaging didn’t end up as waste was one of the biggest issues in the foodservice industry. But when Nestlé couldn’t find the answer to the question: what is the packaging of the future?, to ensure it achieved the company’s commitment to make 100% of its packaging recyclable or reusable by 2025, it established its own Institute of Packaging Sciences.

“We would previously rely on suppliers to innovate,” says Simmons, “but in this instance, the issue was so important to us, and we felt the issue was so urgent, we established our own Institute.” The solutions, says Simmons, will not be easy. But, “even if we fail with something it will not kill us. We will still keep doing the right things. Not everything will be successful, but it is only through trying that we can change things.”

  1. Work together to create unforgettable experiences

The question for foodservice, in a Covid-19 world, Simmons says, will be: “How do you deliver an affordable, healthier solution that people can’t replicate at home, something that really embraces the difference between out and in home life?

“Out of home has to compliment and provide variety and brightness of life. But to make it work for the consumer, we in foodservice have to work together and learn. If one foodservice operator implements certain practices, and another doesn’t – it’s confusing for the public. They need to recognise how they should be behaving in the new normal.” The key, says Simmons, is talking to each other, participating with round tables, and finding ways to be consistent across the industry so it doesn’t confuse consumers.

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