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The case study, involving a team from all parts of the supply chain, is part of a lean thinking guide entitled ‘Cutting Costs – Adding Value in Red Meat.’

The team mapped the pork sausage chain from farm to checkout and uncovered tremendous scope for improvement:

• Waste from losses and defects in the chain (e.g. quality faults, part-loaded vehicles, damaged goods, theft) amounted to almost 20%

• Total time from farm to shelf was just over seven days, of which value-adding time was just 1.4 hours

• Average product availability on the shelf was less than 95%

• Stock in the system from abattoir to supermarket totalled seven days.

This is despite the fact that many practices in the supply chain were leading edge and highlights the scope for improvement in all food chains.

The group involving Tesco and its pork suppliers (Flagship Foods, Walkers Midshire Foods, Porcofram and pig farmer Jon Easey), examined how they could improve business efficiency and quality for the consumer. Any cost savings made will be shared equitably among the group members. The group was brought together by the Food Chain Centre and Red Meat Industry Forum as part of the Lean Thinking Initiative.

Richard Horsham, Senior Buying Manager, Tesco said, ‘The project has shown the tremendous potential to improve the performance of our supply chains by co-operation and we’re already considering applying this approach to other products’.

As a result, key projects have been identified as priorities over the next year. They include:

• Improving the system of pig production through better feed rations, reducing transport times e.g. by linking farms and abattoirs in the same area

• Using new technology to assess the value of producers’ animals more accurately

• A production line for sausage manufacture, which reduces physical handling of the product.

These projects affect all parts of the sausage supply chain and will form part of the continuous improvement process that Tesco and its suppliers are embarking upon.

Deirdre Hutton, Food Chain Centre Chairman, said: "This case study shows how companies can work in partnership to improve efficiency and deliver better quality to the consumer. It supports our philosophy at the Food Chain Centre that by sharing best practice we can give farmers a better understanding of the issues faced by retailers and vice versa."

Peter Barr, Red Meat Industry Forum Chairman said "We have a raft of work delivering change right up the supply chain. This work is delivering benefits where it matters, on the bottom line."

BPEX Chairman Stewart Houston said "This important work demonstrates how producers, processors and retailers can work together for mutual business benefit. This is particularly important for producers who are in the process of tentative recovery after several very difficult years."

Sourrce: Food Chain Centre - 8th June 2004