When purchasing mushrooms from retail stores, we pondered whether we would purchase the same product again if it were on sale. As we moved, retail distributor promotions made Toad & Fungi struggle to meet demand. Upstream supply chains were uninformed. As per market viability, this affected product freshness, lead times, and inventory turnaround. To reduce lead time, we tried combining a compost plant with mushroom farms, but it didn’t specify where the compost came from.
In the supply chain, I felt that focusing on matching supply and demand while maintaining a buffer and inventory storage was limited because the quality of the supply (mushroom) products would deteriorate. In this case, horizontal integration or horizontal collaboration between toad and fungi and other mushroom processors is desired. If they are a part of larger corporations, they can increase sales. When considering hybrid supply chain strategies, consider that lean works best in predictable and stable environments, whereas agile strategies work best in volatile and responsive markets. We were unfamiliar with material and information decoupling points. It took time to decide to maximize company profits.
Quality and cost constraints were two major factors influencing the postponement of the packaging or labeling process further downstream. Methods such as vacuum packaging to keep the product fresh and prevent cross-contamination are expensive. We can make agreements with other mushroom processors to outsource these specific needs when internal production is low, and orders exceed our capacity. We gain the advantage of bringing a level of operations that will provide stability throughout the year. If I need more, I’ll get it from somewhere else, so coordination in packaging as well as strategic inventory placement, as in situation 2, are appropriate in this scenario.
Toad & Fungi relies on future predictions to guide decisions about retail store product assortments and in-store promotions, as demand is primarily driven by promotional activities. Lesson learned: distributors and manufacturers need to work together to learn about tactical supply chain movements to meet retail customer demand. Building a resilient supply chain is becoming increasingly important as the supply chain becomes more susceptible to disruptions in a volatile, uncertain, complex, and ambiguous (VUCA) world.