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Optimizing Every Square Foot

A primer on facilities management

As I vacationed in northern Michigan this summer, I watched the tart cherry crop being harvested. For a few weeks hydraulic tree shakers, conveyor belts, and trucks loaded with lugs of cherries continuously paraded past. The sheer volume of inventory being generated in such a short time made me acutely aware of the need for high quality, proximate processing and cold storage facilities.

Positioning fresh produce in production- and market-facing positions, goods are readily available when and where demand exists. Shorter lead times can be achieved, availability increased, and delivery costs reduced, increasing the effectiveness and efficiency of the supply chain network. Such capabilities can help growers and distributors enhance their competitive position.

In this installment of our ‘back to basics’ series, you’ll rediscover the importance of facilities to supply chain success. Insightful commentary from produce industry experts highlights the key roles, challenges, and facilitators of these activity nodes in the fresh produce network.

Between the field and the retail shelf, facilities are strategically positioned to carry out five fundamental functions: accumulation, sortation, production, allocation, and assortment. Accumulation involves the consolidation of fresh produce from a variety of fields and growers. Sortation focuses on the assembly of like products for storage in a distribution facility or transfer to customers. Production focuses on the washing, cutting, mixing, and packaging of ready-to-eat fruits and vegetables. Allocation matches available inventory to orders, allowing customers to purchase needed quantities. And, assortment involves the assembly of multiple SKU (stock keeping unit) orders to minimize the number of customer deliveries.

To support these varying roles, fresh produce facilities must have the appropriate physical infrastructure. Required elements include proper climate control systems, adequate washing and processing equipment, sufficient lighting, and related features, notes Sandra Aguilar, marketing and strategic planning manager at Nogales, AZ-based Ciruli Brothers, LLC.

The climate control system must be designed to handle peak inventory requirements and external temperature extremes. Higher volumes of local produce, which are not precooled prior to arrival, boost the need for cooling capabilities according to Ed Treacy, vice president of supply chain efficiencies for the Produce Marketing Association. Proper sizing and design of the facility are also important infrastructure elements. Key considerations include the volume and variety of items that will flow through the facility.

“Each different item has an ideal storage temperature, humidity level, ethylene level, and consideration for odors,” explains Treacy. “The number and variety of items stocked at your facility will determine the number of temperature and humidity level chambers needed. In a retail distribution center, there may be as many as seven different chambers.”

The ability to manage water in a facility is also a critical design element. Any presence of water, including ice and cleaning products, increases the vulnerability of the facility to a listeria outbreak, notes David Gombas, senior vice president of food safety and technology at United Fresh Produce Association. Hence, it is imperative to have proper floor drainage and water collection capabilities, as well as an environmental monitoring program. “Otherwise, you’re just looking for trouble,” he adds.

Facility operations must promote safe handling and timely flows of fresh produce. Human resources and well-established procedures are the keys to operational success, according to Aguilar. Your people and processes must achieve consistent productivity, protect product integrity, and support customer requirements.