The internet has become a necessary tool for most small- to medium-sized enterprises (SMEs) working in the fresh produce supply chain, with email systems used by 92 per cent, 71 per cent operating a company website, and only four per cent claiming they do not have any internet access.

The findings come from a national survey of internet usage in the UK produce supply chain, called Vegnet, conducted by the Centre for Research in ICT Business Applications (RICTA) in the University of Bedfordshire’s business school.

Vegnet’s objectives were to investigate internet usage, benchmark supply chain management status for British fresh produce companies, and evaluate factors influencing internet usage in the produce industry. The survey was conducted via an online questionnaire and a paper-based questionnaire, delivered to 1,000 SMEs. There was a total of 112 valid responses.

The findings revealed that the use of websites is still static, with most company websites containing company information (96 per cent) and product information (78 per cent). Less than one-fifth of the company websites offered advanced functions such as online ordering (18 per cent), online payment (nine per cent), customer account management (four per cent) and supplier account management (three per cent).

Barcode system, Electronic Data Interchange (EDI) and Enterprise Resource Planning (ERP) are the most frequently used software packages by the SMEs, while Transportation Management Systems (TMS) and Geo-Tracking Systems (GTS) are the least frequently used software packages.

Radio Frequency Interactive Devices (RFID) will be more likely to be used in two years by 11 per cent of respondents, while eight per cent have plans to use GTS over the next two years. Nearly half of SMEs stated they have no plans to use TMS, and almost one-third said they have no need to use GTS.

Sufficient evidence was uncovered by the survey to show integration in the supply chain is very low. Over half of the SMEs believe they have no integration between the website and their back-office systems, and no electronic integration of the company database with their customers and suppliers.

Not all the SMEs have developed supply chain strategies, with 13 per cent claiming they have no strategy. Of those who did have a strategy, 20 per cent believe it is not aligned with their company strategy, and only six per cent believe the two are aligned.

Over half of the managers who responded believe they are very good in their IT skills and the understanding of supply chain management, but over half rate the skills and understanding of their employees as below average.

SMEs feel the biggest enabler to internet usage is “pressure from their customers for integration”, but the biggest barriers came from the “cost of implementation” and “lack of know-how”.

More than half of the companies who responded believe the internet has brought no change to their cost and revenue, while only two per cent believe the internet has brought significant change to their cost and revenue. Other benefits include real-time information, traceability, reduction of cost and manual work, improved information quality and marketing improvements.

A&C GOES DYNAMIC

organic delivery firm Abel & Cole has announced an investment of over £245,000 in Fresh Dynamics from Microsoft Gold Certified Partner Index Computer Systems Ltd (Index). The solution will supply a 90-user software and services system.

Abel & Cole has invested in the entire Fresh Dynamics AX suite of modules, which includes finance, trade and logistics demand planner, production portal and website order functionality. Fresh Dynamics uses the Microsoft Dynamics AX ERP solution. It is a modular solution developed exclusively by Index for the fresh produce industry, providing access to data to ensure rapid order processing, improved packhouse production and sophisticated quality control.

The Dynamic technology includes procurement modules that will assist Abel & Cole with stock and quality control, as well as help improve the company’s transportation planning and expenditure.

The deployment of Fresh Dynamics is a three-phase process - the first part went live in September 2007, when Dynamics AX replaced the company’s existing financial package. The second phase will go live at the end of August, with the organisation migrating to the Dynamics AX stock management, purchasing and production, sales order management and human resource management modules. The final phase will go live in late 2008.

Chris Gort, IT manager at Abel & Cole, said: “Fresh Dynamics was chosen by Abel & Cole as the result of a rigorous selection process. The main reason we needed a new ERP solution was the aggresive growth of the business, that was stretching both the internal IT team and the current bespoke in-house system to the absolute limit. Fresh Dynamics was the only suite that offered us the right combination of functionality and flexibility.”

Index managing director Bernard Godward said: “This is an important deployment for Index, and a major IT development for Abel & Cole.”

TESCO TOP ONLINE

online shoppers who buy their groceries at Tesco.com enjoy a better service than those using rival retailers’ websites, according to a survey from Keynote Systems.

The mobile and internet performance firm examined Waitrose.com, Ocado.com, Sainsburys.com, Asda.com and Tesco.com, in January and February.

Using data from 1,240 participants, Keynote assesses that Tesco’s site was the quickest to respond to requests, load pages and process transactions.

However, Waitrose came top in terms of uptime - the amount of time that the site is available online.

Ocado was judged to have the best brand impact, and Sainsbury’s won the customer satisfaction category.

Martin Stern of Keynote said: “Despite Tesco winning overall, this is not to say that it dominated. Indeed, in an age when competition is so great for online shopping,

e-tailers must ensure that not only do their sites look good, but crucially, perform well.

“Consumers will go to a better performing competitor if they have problems accessing the site, no matter how comprehensive the layout,” he added.

CONSOLIDATION HAPPENING IN SOFTWARE SECTOR TOO

This month, Anglia Business Solutions’ David Hurley explains how consolidation in the produce industry is being mirrored in the computer software business.

many commentators have remarked on the consolidation taking place within the fresh produce industry. The sheer scale of these activities has taken some by surprise. A similar situation exists within the business management software industry.

At a recent industry conference, an analyst revealed that five years ago, there were more than 4,000 global ERP suppliers. The figure now is down to 600, meaning that a massive 85 per cent of the market has been consolidated. This is quite remarkable in a worldwide industry forecast to grow from $176 billion (£88bn) to over $190bn this year.

However, according to analysts, the situation going forward looks far from rosy for many of the remaining vendors. Some had realised that they could not compete on a global basis with generic products against some of the larger players. They sensibly adopted a strategy of specialisation in particular markets as a means of leveraging their unique selling points. Now this vertical space is being targeted by the larger players, as the buying behaviour of customers changes.

In the past, 80 per cent of business management software solutions were purchased based on the facilities offered ‘out of the box’ by standard applications. Market research indicates that this is undergoing a radical change. The forecasts are that in future, 80 per cent of potential customers will seek solutions that have been written specifically for their industry sectors. There are a number of drivers for this behavioural change. As always, cost plays a big part in the decision. Nevertheless, it is just one factor in an ever-changing landscape.

The key reason is the growing importance of information technology as a business facilitator. In that scenario, what many senior managers need to help them manage low-margin produce against increasing customer demands is one version of the truth. Furthermore, in the fast-moving fresh food industry, they want to have access to that information as the product moves through the supply chain. Finding out that things went wrong yesterday is of little use, as the product has probably been despatched.

Traditional legacy business applications can do a good job in certain parts of an operation. However, where they sometimes fail is in the financial area, where a weak set of financial applications fail to monitor all of the costs as the products move through the operational cycle. As a result, users develop other means of tracking costs via tools such as spreadsheets, alternative financial applications, databases or even manual methods. The inevitable outcome is the creation of islands of data. This leads to the consequential increase in administrative costs, while interesting discussions take place on the profitability or otherwise of a deal.

The reality in the fresh produce sector, as we see it, is that market consolidation activities are creating some much larger enterprises. These have more sophisticated requirements than the smaller organisations, as they strive to manage the operational requirements of the enlarged business. As one would expect, having purchased a company, they have an abiding interest in how that business is performing from a financial perspective. After all, they would like to know when they can see a return on their investment. It is here that a powerful, enterprise-ready financial suite comes into its own.

There are many excellent operational systems in the market from independent vendors across all sectors of business. However, few have the necessary people and financial resources to develop the powerful but easy-to-use fully integrated applications that will be required by tomorrow’s customers. The $2.2bn invested annually by Microsoft provides an indication of the scale of the required investments.

As the larger vendors move into their vertical markets, the trend has been for the niche players to sell the business for the client base. The technology is then placed in maintenance mode, where future developments are halted and the customer maintenance fees are harvested over a period of time. While this may not be beneficial to the client, it can provide the acquiring company with a valuable source of recurring income against a low cost base.

In summary, when deciding on the business management systems of the future, it is worth bearing in mind the trends now taking place within the industry. After all, these systems should be expected to serve the company for between seven and 10 years. Global forces have raised the stakes as the big three of SAP, Oracle and Microsoft battle it out for the leading market share. With a $200bn market, which is forecast to grow at 15 per cent per annum, one can see the attraction.

USERFUL SOFTWARE ON HAND

userful corporation, a leader in public computing, has announced that in the past year, its software allowing up to 10 people to work from one computer has saved 29,000 tonnes of CO2 emissions - the equivalent of taking more than 5,000 cars off the road.

Modern desktop computers sit idle virtually the entire day while users read or type. Userful leverages this unused computing power to create an environmentally efficient alternative to traditional desktop computing. Up to 10 users can work on a single computer by simply attaching extra monitors, mice and keyboards.

Timothy Griffin, president of Userful, said: “Computer hardware production and disposal is one of the fastest-growing threats to our environment. Powering and cooling computers is an increasing contributor to global warming. It feels good to help people around the world go green. In fact, last year our users more than doubled the previous year’s savings, meaning that in the last two years, Userful technology has eliminated the equivalent CO2 of taking 7,300 cars off the road.”

Userful desktops have been deployed around the world with a typical configuration of six stations per computer. In the past year, Userful’s ability to minimise wasted computer power has eliminated 29,000t of CO2 emissions.

Reducing the number of computers in use has additional earth-friendly benefits, says Userful. Electronic waste is an increasing problem globally due to the quick obsolescence of electronics. This is compounded by the fact that computer waste is high in many toxic materials such as heavy metals and flame-retardant plastics, which easily leach into ground water and bio-accumulate.

Using Userful products can reduce electronic waste by up to 80 per cent, further decreasing its environmental footprint.

Userful gave away a free version of its software in time for Earth Day this week. “The free two-user giveaway doubles the utility and value of your existing computer with minimal cost,” said Griffin. “In fact, if you already have an extra monitor and keyboard, it’s like getting a computer free for Earth Day.”

For more information on the environmental benefits of Userful software, please visit Userful.com/greenpc