#Japan #Fresh Produce #Toyonaka #Synops #Automated Ordering

Transforming Fresh Produce Logistics: The Role of Synops

In an age where efficiency and sustainability are paramount, Synops, a software developer based in Toyonaka, Osaka, is making significant strides in fresh produce logistics. The company has joined forces with a consortium aimed at optimizing vegetable and fruit distribution in Shikoku, reflecting a growing need for innovative solutions in the agricultural supply chain. The collaborative effort, supported by a grant from the Ministry of Agriculture, Forestry, and Fisheries, aims to introduce a demand forecasting and automated ordering system that will streamline the procurement of fresh produce and significantly reduce food waste.

Background Challenges

The perishability of fresh produce poses unique challenges to retailers, including supermarkets and drug stores. The limited shelf life of fruits and vegetables necessitates meticulous ordering and swift delivery, typically reliant on seasoned professionals in the field. However, the retail sector is facing a persistent labor shortage, leading to a decline in the number of experienced order managers. This shortage, coupled with reduced lead times for deliveries, has led to a situation where meeting delivery deadlines often takes precedence over optimizing transportation efficiency. Consequently, this inefficiency is exacerbated by the looming '2024 Logistics Crisis,' which points to an acute shortage of drivers.

Additionally, the tendency for over-ordering within the wholesale and retail sectors contributes to food waste, particularly in produce. While many retailers employ automated ordering systems based on past sales data, fresh produce can fluctuate significantly in quality and price due to seasonality and weather effects, making it difficult to accurately forecast demand based solely on historical data. This complexity is one reason why the automation of demand forecasting and ordering for fresh produce has remained elusive.

Details of the Demonstration Project

In collaboration with a major drugstore chain in Western Japan, Synops has embarked on two distinct demonstration projects aimed at reducing food waste, enhancing operational efficiencies, and alleviating logistical burdens within the fresh produce supply chain. By incorporating a fresh produce forecasting logic into their already successful automated ordering system, known as 'sinops-R,' Synops hopes to revolutionize how fresh produce is ordered and tracked.

Demonstration 1: Demand Forecasting and Automated Ordering

This initiative involves adding a specialized demand forecasting logic that considers market fluctuations unique to fresh produce. Fifteen essential items, including onions and potatoes, were chosen for testing.

Implementation:

• - Stores Involved: 2
• - Duration: November 21, 2024, to February 2, 2025
• - Key Outcomes: Maintaining current sales levels while achieving a 50% reduction in ordering time and a 25% decrease in food waste.

Demonstration 2: Improving Fresh Produce Logistics Through Forecasting

The second project focuses on reducing logistical burdens caused by short lead times in fresh produce ordering. By evaluating various scenarios, Synops aims to identify ways to extend delivery lead times while minimizing excess inventory and food waste.

• - Scenario 1: Extending Lead Time from 2 Days to 4 Days - This adjustment isn't without its challenges, as competitors can influence pricing, but initial estimates show a potential 46% reduction in planning, picking, and loading tasks without increasing food waste or deliveries.
• - Scenario 2: Pre-sharing Weekly Ordering Data - By providing predicted weekly orders to wholesalers, planning and logistics can be improved, potentially achieving a 40% decrease in various operational burdens.
• - Scenario 3: Adjusting Delivery Times - Deliveries can be rescheduled to later in the day to increase truck efficiency by up to 35%, aiming for a reduction in truck use by 47% even with potential increases in store workload.

Future Aspirations

The results from these projects serve as a springboard for Synops's future endeavors, with goals set for the next three years to reduce temporary truck use by 30% and cut processing times through the supply chain by over 30%, while also aiming to decrease food waste in the wholesaling and retailing stages by 30%.

About Synops Inc.

Synops Inc. is a software manufacturer dedicated to reducing global waste by 10%. Their flagship service, demand forecasting and automated ordering solution 'sinops', is pivotal for handling products with short shelf lives like dairy and prepared foods, providing vital IT solutions to optimize inventory management. With their stock listed on the Tokyo Stock Exchange (Code: 4428), Synops is committed to enhancing efficiency and sustainability across the food retail sector.

In conclusion, by harnessing advanced technology like synops-R, Synops is not only improving operational efficiencies but also setting the standard in responsible food retailing that champions sustainability and reduces waste.