Originally printed in the January 2020 issue of Produce Business.
A little research and planning can help ensure the best choice.
Choosing which software to use can be a headache for even the most tech-savvy produce buyers, because every company is unique and there is no one-size-fits-all solution.
From ordering to traceability to inventory management to predictive analytics, there is a raft of software options in existence for the fresh produce industry, but that’s no excuse to pass the buck to IT departments to make the big calls.
“Yes, the IT department should vet technology and carry out due diligence and provide the platform to support the ERP (enterprise resource planning),” says Mick Heatherington, vice president of sales at Prophet in Bakersfield, CA. “However, at Prophet we have found through 30 years of experience across the world that the operational and commercial departments should be at the front and center of any software implementation and design.”
Automation and simplification are among produce software’s advances, says Marc Hatfield, national sales manager of Woodridge, IL-based Produce Pro Software, a software and technology company that provides integrated and customizable software, training and business consulting to North American fresh produce companies. “EDI (electronic data interchange) continues to grow; something that once was an option is now becoming a requirement,” he says. “Automation is the key to saving money for both the supplier and the buyer. Business intelligence reporting is a great tool to bridge that gap of information to make key decisions.”
Shelvia Smith, marketing manager at FreshByte Software in Houston, says the produce industry often views technology as a necessary evil.
“What do I deem as more important to spend money on? A new truck or software?” she says. “Software positioned as a service without the obligation to purchase it outright will lessen the monetary impact.
“The goal is to find a solution that will grow with a company. The software should not be too advanced or too far behind,” adds Smith. “FreshByte Software is willing to work with companies and facilitate a smooth transition.”
Such transitions are not always easy though. Heatherington says older database technologies are still widely used within the produce industry.
“While these have been solid systems back in the day, they now have serious drawbacks as they are developed in structurally closed databases and require a great deal of interfacing and manipulation to open access to the data,” he says.
Heatherington proposes produce buyers find software that is compatible and can enhance business process flows without major foundational alterations.
“If you are developing from scratch or largely modifying what’s there, then you need to step back and ask yourself whether this is the right thing to do?” he says. “In many cases produce businesses buy what we call Tier 1 or big ERP and try and reinvent the wheel.
“This is a risky strategy, and the industry is littered with tales of massive budget overruns and failed implementations.”
Violet Kiss, chief financial officer at Produce Magic Software based in San Diego, says it is critical for produce buyers to get online demos of any software they are considering before integration.
“One of the most fundamental challenges is that many, if not most, produce companies do not have smart, data-driven software that fits exactly what they do.”— Violet Kiss, Produce Magic Software
“At Produce Magic we think the software company should be able to set up common products similar to what you use and sell,” says Kiss.
She notes a test case can be used to mimic a produce company’s situation while software customization can be applied if needed, often within the same day.
“For larger projects, it is very rare for [the test case] to take days, or weeks,” she adds.
Managing Orders And Inventory
For ordering and inventory management and many other aspects of produce operations, (EDI) has played a major role for decades and will stand the test of time, along with barcoding, according to FreshByte’s Smith.
“EDI allows the exchange of business documents like purchase orders and acknowledgements, invoices, and price catalogs between computer systems,” she says. “Barcoding provides true traceability by capturing inbound lot information and outbound sales information.”
She says FreshByte Software gives warehouse personnel the ability to scan a pallet label instead of scanning each individual box, thus saving time and ensuring food chain traceability.
Kiss also highlights how EDI has stood the test of time — in fact for 36 years and counting at her company — but in her view one must keep up with growing technology as well.
The Produce Magic executive notes that her company’s EDI now integrates with commonly used mobile workforce solutions platform iTrade, as well as back-office and e-commerce streamliner TruCommerce.
“We also use EDI applications for imports to link manifests to our customers’ inbound purchase orders, which automatically are placed into inventory directly to save extra work or doubling the work,” she says.
These developments all relate to improving convenience for users. With Produce Software, managers can enter all their information if they so desire, but normally everything is automated.
“One of the most fundamental challenges is that many, if not most, produce companies do not have smart, data-driven software that fits exactly what they do,” she says. “The proper software product should fit everything you do and automate all areas of your company.”
“In today’s faster and faster world, our customers expect and get less and less keystrokes, and more and more paperless processes,” she says.
As is the case in the economy at large, online ordering has also become an important development for the produce trade, at the consumer level and also business-to-business.
However, Kiss notes online ordering has historically not been very popular in the sector as it typically took longer to enter an order than to just call the order in.
“For ordering ease, Produce Magic has broken the mold for online ordering and has made it much easier and much faster,” she says. “Large orders with hundreds of line items can be entered quickly and accurately with our new online ordering apps for Windows, Mac, iOS and Android.”
Half Moon Bay, CA-based dProduce Man Software has also made moves in this arena.
“Online ordering is another option available with dProduce Man Software. Wholesalers and distributers can enter orders directly, thereby eliminating necessity of re-entering the orders that came by email, fax or telephone,” says the company’s president Charles Shafae. “Customers can download a free app and use any smartphone or other devices to accomplish this task. This communication speeds up the process of ordering while maintaining the accuracy of orders.”
Shafae also draws attention to the importance of cloud accounting for the modern fresh produce trading operation, thus eliminating the huge initial outlays for hardware and maintenance that are associated with in-house networks and operators.
“Use of outside accounting services are minimized by the efficiency and comprehensive nature of the software,” he says. “The subscription model avoids a large one-time purchase cost. Data is backed up nightly and strong encryption and firewalls assure peace of mind.”
Randy Fields, chairman and chief executive of Salt Lake City-based Park City Group, says the latest tools optimize inventory positions by using a combination of forecasting and artificial intelligence (AI).
The NASDAQ-listed group is the parent company of ReposiTrak, Inc., a compliance, supply chain and e-commerce platform.
“These solutions have improved greatly at predicting consumer demand, so companies can order appropriately to ensure the right product is available in the produce section while minimizing waste,” says Fields. “In fact, four out of five vendors using ReposiTrak’s solution saw an average reduction in out-of-stocks of 40 percent or better in just less than three months.”
Fields notes all trading and vendor-managed inventory systems feature alerts based on historic sales activities, but those now using AI have the ability to proactively change orders to reflect a wide variety of triggers including weather or competitive activity.
The latest trends in software, whether through key reports or tools including forecasting, are helping produce companies make better decisions. “The interesting thing is what’s new from a technical perspective,” says Produce Pro’s Hatfield. “The reality is that ‘what’s new’ is companies in the past have not put a priority on technology. Now, new technologies and improved business processes are a must. You’re not going to survive if you haven’t invested in the right solution for your company, which then allows you to concentrate on communicating and providing service to your company.”
Heatherington of Prophet underscores the importance of forecasting given the produce industry is “acutely aware knowing about yesterday’s problem today is simply too late.”
“Prophet at its core has a produce-focused live forecasting, demand and resource planning engine fully integrated and updated by all functions of the business in real time,” says Heatherington. “This technology is ground-breaking in that produce businesses using Prophet can reliably schedule or execute to production plans, capacity, procurements, sales and even packaging weeks out.”
He says as supply, sales and quality changes happen, the module refreshes and adjusts production plans, schedules, sales and other metrics.
“This provides the ability to get ahead of and solve the potential variables and any problems coming down the tracks,” says Heatherington.
The executive explains replenishment systems have been in place for a few years now and are used by many retailers that collate sales and inventory data. In some cases, these systems issue automated instructions or purchase orders (POs) to the suppliers and central distribution facility for replenishment.
“Prophet works with a number of major retailers in Europe providing the procurement and logistics software and systems enabling this,” he says. “There is no doubt that this is the future direction of the supply chain.”
Kiss of Produce Magic notes her company’s software allows users to adapt to unexpected changes as they occur.
“Optimizing inventory by allocating product available when expected product does not arrive in time is an example where Produce Magic Software lets you instantly see the ‘shorts’ in product codes in your inventory totals programs,” she says. “You can display all the sales lines for that product that are scheduled to ship today, then you can quickly allocate the quantity available to those sales lines based on the customers.
“Today advancements in power and speed in our software as well as the newer regulations for all of the world’s safety, have only sharpened our programming.”
Assists With Compliance
Compliance is part of keeping up with food safety regulations, and many software providers have solutions to make it easier.
“Inventory management is very important especially when it comes to perishable products,” says Shafae of dProduce Man Software.
He says the company is working on updates including functions that can provide a quick overview of stock locations, throwing up warnings for impending critical distribution or use-by dates, and systems to help effectively manage inventory while maintaining traceability and profitability.
At ReposiTrak, Fields says a functionality has been added to its compliance solution to improve automated document review accuracy, thus delivering time savings in reviewing and accepting documents.
“Suppliers can now readily submit image-based documents and picture files such as jpegs directly for uploading into ReposiTrak’s cloud-based compliance management system,” he notes.
ReposiTrak’s optical character recognition (OCR) engine can convert a document image into text, which the software then scans to make sure it’s acceptable.
“An artificial intelligence engine then finds the relevant information and performs a verification check,” says Fields. “Proprietary algorithms finally adjudicate whether the document meets the user’s compliance requirements.”
The executive says 2,000 companies in the produce industry are now using ReposiTrak’s automated compliance solution to reduce risk.
“Compliant companies make fewer mistakes when it comes to food safety, so they are less likely to involve themselves in situations that impact safety or their brand.”
It is a solution that has proven useful for Associated Wholesale Grocers, one of the country’s leading supermarket cooperatives, in its work to comply with the Food Safety Modernization Act (FSMA).
“After conducting a thorough search of document management companies specializing in food safety, they selected ReposiTrak, which helps companies manage regulatory, financial and brand risk associated with safety issues in the global supply chain,” says Fields.
“As a result of implementing the ReposiTrak solution, AWG now has an accurate list of suppliers and is increasing the document requirements from trading partners to manage and reduce risk for its members,” adds Fields.
“Supplier compliance is now at more than 60% and improving every month.”
When asked about challenges for software in the fresh produce industry, Fields says there are still several disconnects between suppliers and the store, not the least of which is demand forecasting and item-level planning.
“We need to give credit to retailers that are at least trying to get closer to some of their customers, even if they’re not always successful,” he says. “The worst thing a retailer can do is to sit back, buy on the deal and expect the stores to sell everything.”
He notes marketing and merchandising departments need to work together if retailers are to get over the barriers posed by the adoption of new software and technology.
“The difference is the realization that using good technology is becoming a priority,” says Produce Pro’s Hatfield. “It sounds funny, but it is very true. We have seen a lot of companies really adopt technology as a way of life. I think a lot of companies are seeing this as an absolutely essential component of their business.”