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🍏 "Solving Fresh Food Inventory Management"


Photo by nrd | Unsplash

Table of Contents

Host: Silas Mähner
Guest: Johannes Olejnik | Head of Business Operations | Afresh
Category: 🍏 Sustainable Food | Inventory Management

Podcast’s Essential Bites:

[8:09] JO: "The observation [the co-founders] had was that essentially, there's two major dynamics at play. One is that there's an increased focus on fresh as a category within grocery, but really food broadly speaking. [...] And then the second observation [...] was that [...] pretty much all of the technology that's built for these grocers was built for the center of the store categories, your boxes of Cheerios and cans of Coke, things that have a barcode and don't really expire. [...] And if you apply that same technology to the fresh categories, your apples and avocados and prime ribs, it just doesn't work. [...] It can't handle the seasonality, the perishability."

[9:46] JO: "The company is really founded [around], let's take cutting edge technology, really advanced AI and ML models and apply them to this specific problem. Let's help grocers and the food supply chain at large manage how stuff moves through the supply chain as quickly as possible from farm to consumer. So we're wasting as little as possible throughout that process."

[11:26] JO: "There's a store level employee that every day has to make a decision for hundreds of items in their category, [e.g. in fruit and vegetables]. How much of each item do I want to order from my distribution center? [...] That decision right now really relies on experience, on gut feeling, on intuition of the store level employees. And it's incredibly hard."

[12:53] JO: "We're essentially introducing machine learning algorithms into all of that. Both from forecasting how much inventory we believe the grocer has at any given time, to forecasting how much we think the demand will be for a given item at any given day. And then using those two data points, and a little bit of input from the store level employee and making the best decision. And ultimately, what we're optimizing for is, we always want the sales floor of the store to be full. And we want the back room to be empty."

[18:09] JO: "The three major categories of impact we're having are one, we're reducing waste at the store. [...] The second category is you're also getting better at not under-ordering. [...] The third is really on the labor side. We're really not in the business of replacing labor. We're there to enhance labor."

[24:27] JO: "In the US [...] about 40% of food that's produced at the farm [...] that's being wasted throughout the supply chain. [...] That roughly breaks down [to] 30% at the farm, 40% in the supply chain, so between distributors, transportation, and the retailers, and then 30% at the consumer level. [...] The biggest category is [the] distributors, transportation, and retailers, and so we're tackling that. [...] With our existing grocers, we have pretty good insight into how much we're reducing their waste and it's about 25%."

Rating: 🍏🍏🍏

🎙️ Apple | Spotify | Google
🗓️ 10/25/2022
✅ Time saved: 52 min