The Global Supply Chain: A Self-Interested Network Working to Deliver Fresh, Safe, and Affordable Food
The global food supply chain is complex and interconnected. Independent and associated producers, brokers, distributors, truckers, and front-line personnel collectively and seamlessly network to deliver phenomenal results to businesses and consumers. The system works. Well more times than not it works. And by working, I mean delivering fresh, safe, and fairly priced food products on a global basis.
The global supply chain starts with farmers who nurture plants and animals destined to feed the world. These commodities are then sold to processors who clean, package, and transform them for distribution. Distributors, leveraging systems, deliver the finished goods for sale and consumption,
Other than safety regulations, this system works mostly without government interference or design. Self-interested persons from various sectors work together to solve challenges for people they will never meet. The global supply chain is based on classic market principles, with producers responding to consumer demand and competition driving effectiveness and efficiency.
As many of you know, I travel upwards of 100 days per year. Regardless of country or continent, this mostly decentralized supply chain delivers. I marvel at Starbuck’s capacity to deliver consistent quality on six continents, hundreds of countries, and thousands of locations. Restaurants, hotels, airlines, and grocery stores all receive supplies on an almost just-in-time basis.
When I was touring a South African Township, outside of Cape Town, stores that sold Coca-Cola was perceived as superior to those that didn’t. It wasn’t because they sold vast amounts of Coca-Cola, it was a signal that this store was well-managed and part of the system of supply. That demonstrates the power of a brand, but more importantly, the value of the supply lines to deliver that brand. Without the supply, the panache of being a Coca-Cola-branded store would be meaningless.
Sure the supply chain gets tested. Weather and natural disasters frequently occur. Regardless of these disruptions, the resiliency is demonstrated by its ability to cure any shortages without reducing safety or price gouging. Covid-19 tested all supply chains.
Modern systems that trade manufacturing effectiveness (labor rates, land/building capacities/, government red tape, tax incentives, pollution variances, and other localized differences) for ultimately cheaper prices, are at greater risk of systemic challenges.
Pandemics may disrupt at more widespread speed and impacts, as we have witnessed, time and market forces will harmonize the system back to equilibrium. The lessons learned will drive change and we should all benefit from these improvements.
I recommend you take a few moments and simply marvel at the modern miracle of our global supply chains. Products and services appear when we most frequently need them, at fair prices, and with our consumer-based experiences at the ultimate forefront of the supply chain value position. In other words, the next time you are at your local Safeway or Krogers, look up and down the aisles and you will see thousands of products ready for your enjoyment.
And then stand back and thank the thousands of strangers that allowed you to enjoy that Greek Yogurt with fruit from an organic farm located 300 miles away with a phenomenal texture that you moved from the store shelf to your shopping basket.
- In order to provide fresh, secure, and reasonably priced food goods to businesses and customers globally, a complex network of independent and related farmers, brokers, distributors, truckers, and front-line staff members collaborate smoothly.
- The supply chain is built on the fundamentals of the free market, with producers responding to consumer demand and competition promoting effectiveness and efficiency.
- Even in the face of disruptions like bad weather, natural disasters, or pandemics, the supply chain’s ability to fill any shortages without compromising safety or raising prices serves as evidence of its resilience.
- This was evident during the COVID-19 epidemic, modern systems that sacrifice production efficiency for eventually lower pricing are more susceptible to systemic problems.
- The power of a brand and the value of the supply lines to deliver that brand is demonstrated by the example of stores that sold Coca-Cola being perceived as superior to those that didn’t in a South African Township outside of Cape Town.
From farmers to stores, the entire food supply chain is a wonderful illustration of collaboration, efficiency, and innovation.
In the face of challenges like pandemics and natural calamities, the system has proven its toughness.
Let’s pause to recognize the countless total strangers who deliver us fresh, secure, and reasonably priced meals.
The global supply chain is a wonderful achievement of our time.
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