Lessons in Visibility, Accuracy and Automation from the QSR Industry
3 Min Read By Angela Fernandez
What if I told you that as restaurant operators, you have the potential to save $1.3 million annually and enhance the perception of your food’s freshness among key consumer demographics? It almost sounds too good to be true, but that is exactly what one of the largest quick service chains in the world recently achieved through a focus on operational efficiency and better data management.
In today’s hyperconnected, data-driven marketplace, it could not be more critical for foodservice businesses of all shapes and sizes to improve data accuracy.
Independent Purchasing Cooperative (IPC) is a SUBWAY® franchisee-owned and operated purchasing cooperative. Maintaining a laser sharp focus on their “Fresh Forward” theme, IPC has for several years worked to achieve the full traceability of suppliers’ products as they travel from their source into SUBWAY restaurants. Consumers today are not just concerned about foodborne illness outbreaks, they are empowered more than ever to learn about food origins, ingredients, and nutritional information. IPC and other foodservice industry stakeholders are laying the foundation to enable greater transparency and traceability to help those consumers stay informed and confident about their food choices.
The key to their traceability progress has been industry collaboration based on GS1 Standards. A significant driver of change and innovation for IPC, GS1 Standards enable the fast and accurate flow of data and goods between manufacturers, distributors, and other supply chain partners. The GS1 System of Standards includes unique product identification numbers, data capture methods such as barcodes, and the Global Data Synchronization Network (GDSN), which enables trading partners to globally exchange product information in an electronic and efficient way. IPC also plays an active role in the Foodservice GS1 US Standards Initiative, working together with its partners and peers on traceability, as well as driving waste out of the foodservice supply chain and improving product information.
Dennis Clabby, executive vice president, purchasing, of IPC, recently discussed the company’s innovative traceability program and described three supply chain efficiencies gained through the common language of global standards.
“Knowing exactly where a specific lot code of food product is in the supply chain is our goal. If a product is a risk to our brand, and our customers, the benefits of adopting the use of standards are immeasurable,” said Clabby.
IPC leverages a particular kind of barcode—the GS1-128 barcode—which includes pertinent traceability information such as the product’s global identifier called a Global Trade Item Number (GTIN), date, and lot/batch number. Restaurant operators have the option to scan GS1-128 barcodes at time of delivery and then again during inventory. This could provide near real-time information to the supply chain about the product, including remaining shelf life and whether there are any quality concerns associated with this product.
“By scanning GS1- 128 barcodes, we can have full supply chain visibility which enables us and our trading partners to make informed decisions about production, forecasting and inventory which drives efficiencies in our supply chain. Scanning GS1- 128 barcodes reduces the opportunity for errors in receiving, inventory management, stock rotation and picking processes,” Clabby explained.
In today’s hyperconnected, data-driven marketplace, it could not be more critical for foodservice businesses of all shapes and sizes to improve data accuracy. IPC leverages the GDSN for real time access to product details.
“GDSN enables us to gain significant ROI with logistics optimization by having one source of truth. We have been able to quantify $1.3 million dollars in annual cost avoidance by making sure that the source data is always accurate,” Clabby said.
Industry standards and best practices are not just for major corporations either. Widespread trading partner collaboration—from large, small and mid-sized companies—to eliminate bad data helps ensure a laser-sharp focus on the consumer and benefits everyone’s goals for winning and maintaining loyalty.
To give IPC the speed they need to keep up with the demands of today’s digital world, the automation gained through the GDSN replaced error-prone manual data transmission methods. Technology, IPC said, is essential in being able to continuously improve supply chain process and products.
“We have strived to eliminate communicating item information via email, in Excel sheets, or phone calls,” explained Clabby.
If there is a new product to be launched, trading partners use the “one to many” benefits of the synchronized network, as opposed to tedious “one to one” manual communication. This means that information exchanged among networked trading partners is continually updated and accurate—any change made to one company’s database is immediately shared with the other partners.
This automation helps feed the right information at the right time to IPC’s innovative SubVentory app. It is used by SUBWAY restaurants to receive and inventory products. “Receipts and inventories are automatically updated and provide detailed and aggregated product visibility,” explained Clabby.
Ultimately, IPC made several tweaks and learned many lessons on its journey toward improved traceability. By leveraging GS1 Standards, IPC has made food products in their supply chain more visible and traceable, thus supporting the company’s priority to bolster consumer confidence in the freshness of their food.