Food Security in Food Distribution




Vertical Integration
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Anthony Jackson
Professor, Korea (South)

Food Security in Food Distribution

🔥NEW What is implied by: food security?
When we talk about "food security" it is usually in the context outlined by the United Nations that people of every nation regardless of who they are should have physical, social and economic availability to food that is adequate, safe, and nutritious, and that also meets their liking and needs to enable them to have an active and healthy life.
But since the outbreak of the coronavirus, we can surmise that some are wondering what impact it will have on our food supply. Before globalization started the majority of our food supply was domestic, but now our food supply is obtained from many sources throughout the world, creating a global supply chain in the food industry.

Nevertheless, some of the reasons why we haven’t heard of any dire warnings or felt a dramatic impact is because over the years since ±2007 (when there were several recalls on food products like contaminated seafood, vegetables, imported ingredients that were tainted, and ground beef that was contaminated with E. Coli), the food industry learned from these recalls and took measures to develop food safety processes into their supply chain.

According to Surak, Cawley, and Gavoor, the food industry made food safety and quality in the production and manufacturing processes a priority. They use the principles of Hazard Analysis and Critical Control Points (HACCP). HACCP has worked well for several years:
  • When food processors raised food safety and quality to a strategic level, the result was also IMPROVED RELATIONS among suppliers in the supply chain. Customers usually develop a system to assess the effectiveness of the suppliers in meeting critical requirements.
  • Developed EFFECTIVE COMMUNICATIONS among suppliers which is critical for success in managing the supply chain. Communications show that the supplier knows and understands all the verbal and implied requirements for the product.
  • Most food processors have made food safety and quality a STRATEGIC ISSUE rather than managing by crisis. Managing strategically creates the proper association for the food processor. One possible option requires that suppliers implement an official food safety management mechanism using the International Organization for Standardization 22000 requirements for any company in the food supply chain.
The majority of companies in the food supply chain management system use a process approach that integrates the following:
• Identifying critical food safety, quality, and logistic requirements;
• Guaranteeing effective communication of supply chain requirements;
• Using SPC to evaluate compliance to requirements;
• Connecting SPC requirements to continuous improvement in order for suppliers to improve quality and reduce operational costs;
• Using trend analysis to alleviate problems before they occur in the supply chain; and
• Ensure that the supply chain management process includes a strong accountability system.

Source:
Surak, Cawley, and Gavoor, "Protect the Food Supply Chain".
 

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More on Vertical Integration:
Summary
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Integration Strategy
Examples and Case Studies of Vertical Integration
Symbiotic Resource Interdependencies
(Legal) Limits to Vertical Integration
👀Food Security in Food Distribution
Orthogonal Integration
Vertical Integration Cum Diversification
Advantages of Vertical Integration
Disadvantages of Vertical Integration
Flexible Integration Strategy
Alternatives of Vertical Integration?
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Quasi Vertical Integration
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