Supply Chain Latency & Costs
Let’s take a look at a current supply chain and its impact. Below is a standard we can expect, however as Forbes noted above, there are many more parties involved. For the sake of argument, however, let’s look at the following:
Note that with each phase of the distribution model, huge amounts of time is wasted. Not only does this mean degrading quality of produce, but every time produce is transported or stored, embedded costs increase as well. Consider the cost of fuel, labor, distribution markups, maintenance. All these are factors in the price we pay for produce at the grocer, and produce that’s severely lacking in freshness.
Despite the actual costs of distribution, the greatest impact is felt in decay and shrinkage. In 2012, the National Resource Defense Council (NRDC) had this to say:
Getting food from the farm to our fork eats up 10 percent of the total U.S. energy budget, uses 50 percent of U.S. land, and swallows 80 percent of all freshwater consumed in the United States. Yet, 40 percent of food in the United States today goes uneaten. This not only means that Americans are throwing out the equivalent of $165 billion each year, but also that the uneaten food ends up rotting in landfills as the single largest component of U.S. municipal solid waste where it accounts for a large portion of U.S. methane emissions. Reducing food losses by just 15 percent would be enough food to feed more than 25 million Americans every year at a time when one in six Americans lack a secure supply of food to their tables.
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The result is astronomical, and the unbelievable fact is that today’s numbers are even worse. Far too much good produce is being wasted in our economy. This system has got to change. Here is what you can expect to find in a standard supply chain model in today’s market for leafy greens and herbs.
A shocking 52% is lost before it reaches your home. And another 15% wilts away there. Let’s also consider the actual quality of the produce you are eating. From the moment it was picked, it began to decay and lose its freshness. Even if appearance-wise it may look fresh, nutrients are diminishing everyday in the produce we buy.