Dairy Processing - November/December 2023 - 56

SUPPLY CHAIN
manufacturer, wholesaler, distributor and retailer to get the end
products to consumers. The retail sales model often involves
lengthy negotiations at each stage and can result in a long lead
time for new product launches.
The D2C model ignores that traditional path, allowing
companies to cut out wholesalers and the distributors and
instead harness the power of social media and the rise of
e-commerce to sell their products directly to end consumers.
D2C eliminates the barrier between producer and consumer,
giving greater control over the company's brand, marketing and
sales tactics.
Although the retail distribution channel currently accounts
for around 60% of the dairy products market share, many dairy
companies are now adopting D2C sales.
Several dairy companies, particularly cheese and ice cream
processors, have found success in adding a D2C sales model
to their distribution channels. Notable cheese processors
including Tillamook Country Creamery Association, Tillamook,
Ore., Cabot Creamery Cooperative, Cabot, Vt., and Sweet Grass
Dairy, Thomasville, GA, all offer direct buying options on their
respective websites. Likewise, ice cream companies such as
Ben & Jerry's, South Burlington, Vt., Jeni's Splendid Ice Cream,
Columbus, Ohio, and Graeter's, Cincinnati, Ohio, have all
developed successful D2C operations for their products.
With the ability to ship nationwide, processors are no longer
restricted by geography when selling D2C.
SHIPPING CONSIDERATIONS
Shipping products will be, for many small dairy processors, a
new and additional piece to the business that will likely require
adjustments to existing marketing and sales processes.
Shipping dairy products imposes major challenges mainly
due to the perishable nature of most of the dairy products.
Managing the shipping involves managing the inventory,
distribution network and supply. Each of the steps require
As the logistics sector moves
forward from years of supply chain
challenges and bottlenecks, our report
shows that now is the time to begin
thinking seriously and proactively when
it comes to building strategic capacity. "
Balika Sonthalia, Kearney
proper storge of the dairy products.
During the pandemic the supply chain of dairy products was
hindered causing major losses to the processors. This resulted
in the need for better supply management and in order to gain
higher profit margins and brand loyalty.
US supply chains responded to the global volatility of
the past few years by transforming supply chain networks
to improve resilience against future disruption, according to
the 34th annual State of Logistics Report, commissioned by
the Reading, Pa.-based Council of Supply Chain Management
Professionals, conducted by global consulting firm Kearney and
presented by Penske Logistics.
While last year's report highlighted the need to get back in
sync, the 2023 version focuses on how logistics operations can
build long-term resilience in an effort to best serve customers
through a variety of distribution channels.
" As the logistics sector moves forward from years
of supply chain challenges and bottlenecks, our report
shows that now is the time to begin thinking seriously and
proactively when it comes to building strategic capacity, "
said Balika Sonthalia, senior partner at Kearney and
co-author of the 2023 State of Logistics Report. " Although
the market has swung back ... we cannot emphasize enough
the importance for all industry participants to begin
planning for geopolitical tensions, cybersecurity threats,
56 NOV-DEC 2023 | DAIRYPROCESSING.COM
©Rose Makin-stock.adobe.com
http://www.DAIRYPROCESSING.COM
Dairy Processing - November/December 2023

Table of Contents for the Digital Edition of Dairy Processing - November/December 2023
