Cold Supply Faces Challenges In Cost, Temperature: Experts

Transporting or supplying food is not that difficult, but when it comes to supplying in temperatures of -25 degrees or lower, it becomes a challenge and a costly affair," said supply chain leaders.

The supply cost in the cold chain business varies based on the temperature, said Shampayan Ghosh, Head of Supply Chain Management at Mother Dairy Fruit and Vegetable. He added, "If we talk about the supply chain cost of any ambient trade business, it generally operates at a cost of three to four per cent. When we discuss the cold chain business, depending on the temperature you're working with, the costs can go up to 15 per cent. 

Discussing challenges in the cold chain, Ambika Satapathy, Co-founder, FreshR said, "We entered the Delhi market just about a year ago, we were primarily focused on East India. It took us a few months to understand the challenge with the region. The conversation around the cold chain is a conversation around trust. The frozen meat market is mainly serviced by the mandiwalas because they are the cheapest in the country." 

Satapathy added, "There are also some organised suppliers—large meat processors whom quality-conscious clients prefer. What the market lacked was a mid-market player, somebody who could offer mid-market pricing while maintaining quality and trust."

He added, "In India, particularly at -20 degrees to -25 degrees, there is no traceability."

In discussions about policies, regulations and global practices, Jaikishan Gianani, Head of Supply Chain at Nanjangud & Choladi Factories, said, "Policy, regulation and financing go hand in hand. There were times when people used to buy unbranded pulses, but as the consumer matured, we moved on to branded pulses and flour. Similarly, in the cold chain, we were stuck with a cold storage concept as there was no demand to go beyond that."

He also added, "The time has come to define the rules of how this industry should be run. From a policy perspective, we have to adopt an integrated end-to-end cold chain concept. Regulations should be defined to support every level of player in the industry. The biggest challenge we face is financing; it’s not cheap to create these value chains. We are witnessing a growing demand for imported products or products that need to move from one part of the country to another. For example, we now expect seasonal fruits to be available to us all year round."

When discussing the use of technology in cold chains, especially regarding packaging, Darpan Khurana, INSWA Supply Chain Operations Lead at Coca-Cola India, mentioned, "One of the things which a lot of organisations are starting to work upon is leveraging AI and utilising blockchain. Blockchain, in itself, is a huge topic, but specifically for cold chain, the traceability and monitoring it brings can easily be leveraged in this industry."

She added, "We work extensively on packaging, and there is a conversation in the industry about packaging that goes beyond sustainability; it's active and smart packaging. Active packaging involves enzymes that get released into the product, ensuring that the moisture and oxygen levels inside the packaging remain ideal. It’s exciting and it's essential for government regulators and industry associations to come together and ensure that there is enough conversation happening around this."

Speaking at the BW Supply Chain Summit & Awards 2023, Girish Krishnakumar, Vice President of Sourcing and Supply Chain at Barbeque Nation Hospitality, discussed how the industry will shape up going forward. He mentioned, "We are in 81 cities and have a network of about 30 cold rooms. For us, the challenge arises when you go beyond the metros, as people handling cold chains lack the necessary skills in terms of product knowledge. Such gaps can impact the product itself, so we need to build the skill set of individuals working with cold chain products. We are actively working with some vendors ourselves to educate them and make them more adept at handling cold chain products."