In recent blogs we have considered why big retailers are moving to the convenience store market, and what makes for an effective building control and monitoring solution. In this blog we contemplate what increased demand for home delivery in food retail could mean for those in the cold food chain - and what steps might they need to implement to adhere to food safety legislation, while minimising stock loss and ensuring a quality product is presented to consumers.
What is the Cold Chain?
Cold chain logistics is the management of a temperature controlled supply chain. Used to transport food, pharmaceuticals and other perishable items. It sub-divides into two major sectors: Food and bio-pharmaceutical. We will explore the bio-pharmaceutical aspect in a future blog.
In food retail, the cold chain starts with raw ingredients, processing, storage, transportation, storage and finally display. Home delivery adds an additional facet to this, in that items but must be transported again. A wide-range of refrigerated equipment and refrigerated vehicles will be required to support the home delivery in food retail cold chain.
Home Delivery in Food Retail
Poised for growth globally, according to Forrester Research, the global online grocery market is predicted to double from $150 billion in 2017 to $334 billion by 2022. So far, for example, consumers in South Korea purchase 28% of their groceries online compared to 25% in metro China. Consumers in the UK purchased 16% of food and beverages online.
In the UK, online food retail is forecast to be the fastest growing channel, anticipated to rise in value by 52.4% to reach £17.3bn by 2023, IGD Research has found.
Online grocery will play out differently in each country and for each retailer depending on margins, current market share, and other factors, but in general, the value at stake is high, and the market will change rapidly. Retailers must adapt to thrive. In the UK Marks and Spencer recently entered into a £1.5 billion deal with online grocery firm Ocado. The new joint venture will begin trading in September 2020, when Ocado’s deal to supply Waitrose products expires.
US consumers are less convinced of the benefits, online orders amounted to just 2-4.% of all U.S. grocery sales last year, although it is predicted that online grocery sales will amount to $100 billion sales, and will make up 20% of total grocery retail by 2025.
Amazon dominates online grocery retail in the US, capturing 18% of all sales, although Walmart has made great strides in the last year, posting an impressive 60% year-over-year growth in e-commerce. Offering delivery from 800 stores, with another 800 planned this year, mostly by joining with firms like DoorDash that crowdsource drivers. Target acquired delivery service Shipt in December and is rolling out same-day delivery service to most stores this year, while Kroger continues to expand its Kroger Pickup (nee ClickList) locations rapidly.
RDM Refrigerated Solutions for Retail Food Delivery Cold Chain
RDM solutions are used by a wide variety of companies and retailers worldwide, to control and manage HVACR equipment at each stage of the cold chain. Since developing the first refrigeration controller, with IP connectivity, in 2004 our range of control solutions for refrigeration applications has grown significantly. Our broad range of products can be used to control every aspect, from cold room storage, right through to display cases and chillers, with CO2 options also available.
Using our products, one customer, a food processor, implemented a solution that not only controls the lighting, heating and refrigeration across their site but improved efficiency on the production line. To do this they used our Intuitive TDB range of Programmable Logic Controls, which give them the ability to create control strategies on our free-to-download desktop editing software. They then used this to automate functions.
During distribution and transport, our USB shuttle can capture data for manual upload to control system front-end DMTouch. This temperature data can be stored for anything up to five years, way more than the minimum legislative requirement. Our new Bluetooth Battery Powered Temperature Logger, to be released later this year, will facilitate the automatic transfer of temperature data, when then the refrigerated vehicle returns to the distribution centre. Minimising any possibility of human error.
For retailers our hardware and monitoring products present an end-to-end solution. The Mercury range can be used as the first step of temperature due diligence, to control display cabinets and cases. These can then be connected to either our DMTouch or Intuitive controllers for automated control. Users can then view and manage devices remotely, or alternatively for complex requirements, remote monitoring and predictive maintenance software ActiveFM™ presents a full suite of software options for asset maintenance and protection.
Speak to a Technical Sales Team Member to find out which products might best match your needs
Read the convenience store blog - Why are Big Retailers Getting Smaller?