FARM-TO-FORK FOCUS: SPAR SHANDONG’S SOURCING SUCCESS
As food quality and safety becomes increasingly top of mind for shoppers around the globe, in China, SPAR Shandong’s farm-to-fork strategy is meeting these demands by raising the bar in direct sourcing.
Tobias Wasmuht, SPAR International’s Managing Director, said that this approach is boosting efficiency, transparency, and traceability along the whole supply chain.
“More than ever, shoppers want to know what they are buying, where it came from, and how it was produced,” Wasmuht said. “These growing consumer demands are impacting global agri-food supply chains from upstream farming to downstream retailing.”
SPAR Shandong partner Jiajiayue Group maintains an innovative direct sourcing strategy to meet evolving supply chain needs, which it first implemented in 1999.
Wasmuht said: “Thanks to ongoing learning and development, over 500,000 fresh growers and 1,600 preferred farming fields currently participate in this farm-to-fork initiative. Fresh produce from these participating suppliers is delivered to over 137 SPAR stores, as well as various other retail locations, via its central and regional distribution centres in Northern China.
“Through the programme, suppliers benefit from knowledge exchange and economies of scale, while SPAR shoppers gain access to traceable, high-quality products.”
Key to supply chain development
Food security has long been a central objective of China’s agricultural policy. In recent years, its policy has shifted from prioritising quantitative increases in food production to strengthening food safety, farmers’ income, and competitiveness. Another area of focus is the improvement of the environmental performance of agriculture.
In 2011, the Chinese Ministry of Commerce and Ministry of Agriculture and Rural Affairs released guidance on promoting farm-to-fork initiatives to boost modern supply chain and agriculture development.
To support local sourcing programmes, China’s central and local governments continue introducing VAT redemption and simplification procedures for agricultural products. Other policies include subsidies on farm machinery and the creation of so-called ‘green channels’ for smooth transportation of fresh produce.
Speaking of the importance of collaboration to ensure the process meets objectives of all parties in the chain, SPAR’S Wasmuht said: “Knowledge exchange and increased efficiency are critical in ensuring fresh produce can go from field to store in mere hours. SPAR China collaborates with research organisations and agricultural authorities at both the municipal and prefectural level.
“Onsite training programmes help fresh suppliers improve their farming techniques to sustainably deliver quality and efficiency. SPAR Shandong has also entered strategic cooperation agreements with local authorities and village committees to establish village cooperatives in rural agri-food producing regions.”
Modern agricultural tools are a key component in boosting quality and traceability.
Wasmuht said: “By installing smart farming systems and automated temperature systems, SPAR Shandong’s fresh producers can monitor the environment, soil, water, fertiliser, and real-time temperatures. These tools help to grow more organic products.
“A remote visual monitoring system in the fields of exclusive suppliers allows SPAR Shandong’s Central Office to monitor fields and support the whole production process.”
Wasmuht said that a field-based purchasing management system and a B2B order and supply management system are instrumental in simplifying farming site selection, supplier-buyer coordination, market access review, certificate approval, daily work process, and finance.
“At local sourcing bases, the group has established various report forms and management tools for agricultural materials and machinery, enhanced chemical and contaminant residue testing, and standard sales processes,” he said.
“Once the fresh produce has reached the store, SPAR’s direct sourcing programmes provide customers with more product transparency through technologies such as QR-codes on retail shelves and packaging. Using these in-store innovations, customers can gain insight into products’ provenance and contents through a simple click on a smartphone or other handheld device.”
The agricultural sector in China continues to develop rapidly in terms of scale and food quality standards. Retailers are gradually extending their business toward the front-end supply chain and back-end consumption databases and consumer research are becoming increasingly important tools in farming and production.
Wasmuht said: “Recognising the power of data, SPAR Shandong shares global industry insights with upstream farmers and suppliers to keep up with industry trends and production structure changes.”