E-business in European food and beverages industry: current applications & future trends

Vlachos, Ilias (2004) E-business in European food and beverages industry: current applications & future trends. In: 2nd Haicta Conference: International Conference On Information Systems & Innovative Technologies In Agriculture, Food And Environment, 18-20 March, 2004, Thessaloniki, Greece.

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Abstract

This study examined a number of key issues regarding applications of e-business and Information & Communication Technologies in European Food and Beverage Industry. For this purpose a pan European survey was conducted during the period October-November 2002.
The role and use of ICT technologies mirrors the structure of the industry: dominance by large multinationals, where the creation of industrial groups (tied to mergers and subsidiaries) has encouraged the installation of interconnected local networks.
The main factors that push companies in the food sector to consider ICT solutions include greater efficiency in internal processes (productive, administrative, delivery of orders, etc) as well as integration of internal processes with external organisations to improve logistics and reduce costs.
E-business solutions (ICTs & software) focus predominately on the business interface and on integrating activities such as accounting, administration, and stock control. Large software houses have developed flexible ERP systems for many food manufacturers. It is mostly the larger agribusinesses that deploy this software, though there are examples of bespoke applications created by small in-house IT teams (often in medium-sized enterprises). Core sector business areas are: supply, production, logistics, services, and marketing & sales. Other critical areas now being targeted for improvement are: packaging processes, the control of quality in Hazard Analysis and Control Critical Points (HACCP), the quality of the product, and the reverse supply chain management of returned products.
Recently there has been a growing trend for larger companies to concentrate on improving logistics, by upgrading inventory management and storage capacity and trying to improve the flows of input and output in order to avoid stock breaches and guarantee more punctual deliveries. Sophisticated electronic infrastructures have been installed to improve distribution.
However, whilst there is a demand for increased ICT integration, the current diffusion of applications is believed to be low outside of large multinationals and their larger suppliers. For the most part, suppliers have more traditional relationships and communication techniques, and the operational focus is on quantity, quality, and delivery schedules.
The study concludes with recommendations for further research.

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