Study exposes weak links in grain chain

Detailed analyses of the cereals supply chain have revealed shocking inefficiency, a resistance to change and poor communications, according to the organisation tasked with improving the sector.

While there were many progressive companies operating in the UK cereals sector, many remained stuck in the past, claimed the Cereals Industry Forum (CIF), which was awarded a government grant of £1.4M three years ago to improve competitiveness in the grain chain.

Chris Barnes, manager of CIF, said that recent value chain analyses conducted by Coors, Carling and United Biscuits, had identified serious shortcomings in the upstream supply chain.

Speaking at a conference in London on availability and demand planning, hosted by grocery think-tank IGD, he said: "Walking the value chain from plough to plate is a great way of highlighting non value-added activity, and there is a lot of it in this sector. The complexity of the cereals supply chain is incredible, which can lead to delivery errors, transport inefficiencies, no shows, rejections on the basis of quality problems and overstocking."

He added: "The information flow is consistently inefficient, the workforce is resistant to change and there are low levels of staff empowerment, recognition and reward, plus a general lack of benchmarking and electronic commerce."

Feedback from 12 companies that took part in master classes and 48 firms that benchmarked their performance against world-class operators exposed communication problems and a "reluctance and resistance to change at all levels and in all companies", said Barnes. "Data collection and analysis are not part of normal working practice."

Equally depressing was the lack of transparency in the chain, he suggested. "Growers don't know the destination of their crops until they find out from the lorry driver who arrives to take them away. There is also a perceived lack of interest from food producers and retailers in the provenance of cereals. This we want to change."