Behind The Scenes: How An Efficient Supply Chain Is Vital To Franchise GrowthAuthor: Smoothie King
There were many lessons learned amid the pandemic for business owners. One in particular had been a visible issue for years, only exacerbated by COVID’s impact on the workforce – the supply chain. A combination of the labor shortage, stop-and-go supply and demand, and inflation, caused cracks in the supply chain to grow exponentially.
Like many industries, smoothie chains were not immune to the disruptions seen in the supply chain. As demand increased for healthy meal and beverage options, supply of good-for-you products and packaging had to be carefully navigated. It began with a shortage of tropical fruit imports from international countries, to port congestion once products reached the shoreline, with limited freight carriers and drivers able to move the product domestically.
Luckily, Smoothie King prioritized an efficient supply chain years prior to the pandemic, knowing how vital a smooth supply chain is to the growth of a franchise brand. An efficient supply chain helps to keep franchisee costs low and eliminates spoilage especially for the fresh ingredients our brand serves up. Smoothie King hired Barbara Mayrand, VP of Supply Chain for Smoothie King, in 2013, where her team then built out a robust analytics system that runs supply chain diagnostics for our top smoothie franchise to thrive.
Staying ahead of the curve
Since 2013, Smoothie King has doubled in size. A main factor that has enabled that growth is that fact that our supply chain can support expansion from region to region. Leaning into technology, our analytics system helps to identify supply chain pain points prior to them developing so, our teams can strategically find solutions before a shortage becomes an issue. For years, this technology has helped keep our products at a decent price for both franchisees and consumers as well as ensured our quality ingredients are as fresh as possible.
Specifically, during the pandemic, our analytics system came in handy to anticipate pain points and solve them in advance. As a best-in-class smoothie franchise, Smoothie King did not alter any menu items due to the labor shortage except for a lack of raspberries which only lasted for three weeks. Of course, there were several solutions that allowed us to adapt to unexpected conditions in order to keep our supply chain running like a well-oiled machined.
Smoothie King already practiced diversification of suppliers prior to the pandemic but, had to really expand in this area as suppliers were spread thin. As mentioned previously, there was a gap in access to our raspberry supply. Unexpectedly, this was not a result of international import issues but rather because of an out-of-season heat wave that disrupted domestic crops. As a result, Smoothie King approved of more products from more suppliers, now doubling our countries of origin and suppliers for raspberries.
It is also vital to leverage relationships built over the years and work closely with suppliers that have the same interests as your brands. Our system and research and development team was able to identify if a shortage was expected for certain products, allowing us to flag these issues to our manufacturers who could then stock up on items to support both parties. We were also able to reformulate ingredients if they were not available, providing the same nutritional benefits at a lower cost.
Lastly, we built reserves across the country using analytics. Leaning into available resources such as freezers, trucks, freight, and more, Smoothie King had spread excess items across the country near locations which were soon to experience a supply chain shortage.
Communicating with franchisees
Of course, our brand is nothing without our franchisees. Therefore, it was crucial to keep them in the loop of supply chain updates that would impact their day-to-day.
Smoothie King publishes weekly newsletter updates to our franchise partners with events and timely challenges. In those updates, we would share details on product adaptations to look out for. At one point during the pandemic, our team had identified a cup shortage and invested in similarly sized cups that did not have the Smoothie King branding. Smoothie King used these new cups temporarily and notified our franchisees through the newsletter to expect the use of these cups for the time being.
Supply chain analytics have supported our top smoothie franchise thus far so we plan to take our analytics to the next level. The innovative predictive analytic systems we plan to implement will be able to look for pain points farther in advance and update inventory in real-time for our system and for manufacturers.
Interested in joining an innovative brand that keeps franchisees top-of-mind? Contact us today to learn more about opening a Smoothie King in your area!