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Importance of understanding your shelf life while navigating supply chain uncertainty

As the levels of uncertainty are rising in the supply chain and

the constraints keep growing, the management of availability

and quality of products is getting challenging. In the beverage

business, it's hard to have a conversation about product

inventory or supply chain without bringing shelf life into

consideration.


Shelf life is a rather complicated topic when it comes to running

a beverage business. At the core of this business, your shelf

life should be able to support the safety and quality of your

beverage. The brand's reputation is impacted by retailers and

the sustainability of your beverage business.


What is shelf life?


Shelf life is defined as “the period of time during which the food

product will remain safe; be certain to retain its desired sensory,

chemical, physical, microbiological, and functional characteristics;

where appropriate, comply with any label declaration of nutrition

data, when stored under the recommended conditions.”


The endpoint of your beverage shelf life needs to be determined to

ensure that the sensory profile and quality of your product are maintained.

Moreover, to meet quality specifications, your beverage needs to comply

with the guidelines of the industry and best practices that are established

by a variety of government levels, retailers, and labeling organizations.

Whilst there is no federal law required for products to have “sell by” or

“best by” dates, companies must follow all safety rules and standards

and maintain truth in advertising for every product they sell. The shelf life

of your product should be shared with your retailers and distributor

partners.


How do you measure shelf life?


A shelf life study that is well designed can be helpful to brands to avoid the risks and

meet requirements while optimizing their product's shelf life as a result supporting the

sustainability of their business and environment.

Moreover, while looking at a product and the food safety standards, many beverage

brands are well aware of how well their product manages its appearance, smell,

taste, and texture over time. After conducting a sensory analysis at various points

provides data that ensures a consistent and satisfying customer experience.


How do you manage shelf life?


As you consider shelf life, beverage brands have to think through the trade-offs

between the risk of having a larger quantity of product that may need to be gotten rid

of from the shelves due to expiration dates approaching resulting in loss of revenue,

out of stock situations at retail, and potentially the loss of customers.

It is not much of a challenge to plan for products that have an extended shelf life,

high order frequency, and high demand volume as the risk of obsolescence becomes

very little; however, shelf life planning and management of the inventory of the products

with more infrequent orders and lower order quantities are trickier. If your business

has an inventory nearing its shelf date, then it is time for you to prioritize orders for

high volume business partners or offer deep discounts that incentivize product

orders in an effort to compensate for a portion of their production cost.


The High Cost of Out of Date Products


Your inventory that has reached or is approaching its best before date can result in

the creation of significant costs and hassle for beverage brands. Distributors and

retailers are doubtful of buying products that are nearing their end dates because

they do not want to be left with products they cannot sell. That would mean that the

sales would be forfeited and many factors would destroy the out-of-date product.

So while some brands may feel the dire need to bring down costs by exceeding

their product manufacturing than required, there are risks that come with letting your

beverages get too close to their sell-by date.


A Comprehensive Approach


The planning of shelf life and execution enables you to recognize and plan for risks

throughout your supply chain that could affect your ability to deliver your product

while decreasing the risk of carrying obsolete inventory.

There’s no one-size-fits-all formula to follow. The management of product inventory

requires a detailed end to end process that collects together data and insights from

every business area, that includes the development of products, assurance of

quality, procurement, logistics, sales, customer service, and management of inventory.

As beverages contain more complex ingredients and create cleaner functional

formulations, the shelf life challenges increase.


Navigating Supply Chain Challenges


Though shelf-life planning is a very complex part of the beverage system and its

management now is not the time to oversee it. The crisis of the economy, the

pandemic, and other critical times affect the supply chain. It is a critical time to rethink the sourcing and production practices and come up with ways to optimize and more effectively manage your supplier network to become more proficient at forecasting demand.


Feel free to reach out to get help with sourcing ingredients for your current or next project!