A Domino-like Motion in the Potato Supply Chain System

A supply chain is a system that includes those activities and resources necessary to get a desired product from the supplier to the final customer.

Most fresh potato farmers and packers/shippers make use of supply chains to deliver products to a retailer or wholesaler, and they, in turn, receive and merchandise those potatoes. This includes various intermediate production, processing, distribution, and marketing processes. It can be viewed as a domino-like motion in which changes at any level in the chain affect the entire supply chain, and these changes frequently manifest themselves as price changes.

In a supply chain, resources and materials flow downstream for the production of goods and the provision of services, while consumer money flows in the opposite direction to the various elements involved in the chain. An efficient potato supply chain is also critical for ensuring rural prosperity and proper livelihood because it generates higher returns per unit of land, time, and man-hours.

Because fresh potatoes are fresh produce, and fresh produce prices are most sensitive to supply/demand balance, demand forecasting becomes fundamental to everything that follows in  supply chain management, and certainly in terms of increasing grower profitability.

In most cases, the product changes so many forms across different handling stations that the ball is bound to drop somewhere. Food traceability initiatives for the potato supply chain are a top priority for organizations worldwide, with such a diverse and complex system.

This ensures that the customers and food companies can access the best quality, sustainable, and ethically sourced potatoes in their chips, or fries.

Since 2019 and throughout the pandemic period, demand for potatoes has steadily increased due to their low cost and versatility for domestic consumers, as well as their widespread use in frozen foods and snacks for food processing/manufacturing companies.

Commercially, the primary reason for the potato's growing demand is the requirement coming from corporations in specialty foods such as canned foods, ready-to-cook frozen food varieties, fast food chains, and chip/snack manufacturers.

You can read the rest of this article in your complimentary e-copy of Issue 3 of Potato Business Digital 2022 magazine, which you can access by clicking here.