Orders are pouring in. It’s time to create a plan to fulfill them quickly and accurately — here’s how.
This probably isn’t news to you, but meal kits got pretty popular starting quarter two of 2020. To give specific numbers, by the beginning of 2021, the meal kit industry had largely been stagnating at 0.6% growth before the COVID-19 pandemic, then expanded by 18.7% vs. the same time last year. The pressure on meal kit providers was suddenly and unexpectedly enough to turn raw carbon into diamonds. While others may have folded under pressure, you are here right now, reading this article and looking for a path to pushing production and packaging line performance. Good for you!
As much as we’d like to pat you on the back, though, there’s no time to waste. Because you need ways to meet demand, we’re going to discuss how you can create a strategy for your meal kit production as well as six key performance indicators (KPIs) you can hone in on to keep ahead of the competition.
Developing Your Strategy
What's your end goal? I can hear some of you saying, "Profits, duh." Ok, let me rephrase the question. How are you going to achieve your end goal? Developing your strategy — the plan of action to increase your production to meet demand — means you have to take concrete steps to address your facility's shortcomings. Keep in mind that every change you make can have unintended consequences. For every piece of machinery added, you need to examine training procedures, safety concerns, and maintenance routines. For every process altered, you need to think about employee hours and added costs for additional personnel. Whatever you change and whatever steps you take to increase your meal kit yield must result from massive data collection and serious forethought.
Research the meal kit industry. What are others doing that's successful? What has failed? Meal kits in grocery stores withered on the vine while direct-to-consumer sales exploded. What will the future hold as the effects of the pandemic fade into the past? Will meal kits in grocery stores succeed next time? What new and exciting technology can you implement that will allow you to keep track of your ingredients and raw materials, so nothing goes to waste?
Analyze your corporate goals (beyond profits) so that your strategy fits with your mission and brand image. Is sustainability important to your core identity? Is your packaging going to have to withstand the rigors of taking frozen food intact and ready to eat anywhere in the world with any possible delivery method? Once you've gone through every possible step of your production to determine the most effective, efficient, least costly, and safe way of doing every process, then you can move forward with your strategy.
Establishing Key Performance Indicators
To ensure you're measuring what's necessary for determining your ultimate packaging line strategy, here are six KPIs that should be carved into the wall of your facility so you never forget them as you march toward your goal.
- Unscheduled Downtime: Equipment breaks. Ingredient shipments are late. Vendors make deliveries to the wrong address. Employees call off sick. These are all unavoidable and not your fault — except that's it's on you to plan for unscheduled downtime and situations like these. You can't eliminate it entirely, but you can minimize it. You can purchase further in advance, increase shipping lead times, change delivery companies, or hire new or more employees. Regarding line-related downtime, you can plan scheduled equipment maintenance and keep parts kits on hand to eliminate mechanical downtime. Anything you can do to head off unproductive time in your facility is time well spent.
- Rework: Say an employee inadvertently wasted time, product, and money by repeatedly putting the wrong ingredients in the wrong box. You'd have to tear apart every box packed. The best-case scenario is that the wrong ingredients would be swapped with the right ones. In the worst-case scenario, you'd have to throw it all in the garbage and start over. Putting measures into place to avoid this issue in the future, such as adopting a poka-yoke methodology, means you can keep this kind of error from causing massive amounts of rework. Perhaps individual containers come prelabeled or color-coded, or another employee does a visual check before the box moves to the next station.
- Overall Equipment Effectiveness(OEE): Understanding OEE could be an entire educational course unto itself, but to distill it down for a bullet point, it measures productive manufacturing time as a percentage, whether for your whole production line or an individual piece of equipment. Peak OEE would, of course, be 100%, meaning only good quality products are produced as fast as possible without ever stopping.
- Quality: How is quality determined in regards to meal kits? When the meal kit arrives to the customer, is it fresh, complete, undamaged, aesthetically pleasing, a good value for money, and safe to eat? You may have a fast packaging line capable of explosive output, but if the end product doesn’t meet the customer’s definition of quality, then all you’ve done is find a way to craft an unacceptable package efficiently.
- Inventory Accuracy: Because you’re producing food, you must be aware of the entirety of your inventory at all times. How long have your ingredients been in storage? Have items that need refrigeration been subjected to unsafe temperatures because of poor handling or power outages? Do you have the proper amounts of ingredients to meet your meal kit demand? You also need to make sure you have enough ancillary materials, as well. Boxes, tape, labels, recipe cards/inserts, cold packs, etc., all need to be in proper levels and readily available for use. Using a warehouse management system is a wise idea.
- Safety: Whether you’re looking to consumer safety by delivering them food they can trust or employee safety by creating a working environment free of danger, safety at every aspect needs to be a top priority. Every piece of equipment on your floor should have thorough procedures for keeping workers safe through proper use as well as methods of keeping them from contaminating the meal kits.
Feel free to modify or add to these KPIs to make them fit your meal kit business. While it may take time to establish them, having KPIs in place will help keep you on track to meet customer demand, hit your output and financial goals, and fulfill your mission.
As you work through each of these pieces, consider how your equipment can impact each. For instance, to make your meal kit production faster and more profitable, you may need to factor in moving from manual to automatic or from an older model to a newer one. If labeling equipment is on your list, read the article, How to Choose a Labeler That Fits Your Packaging Line and Meets Your Operational Goals, first for some time-tested advice. And when you're ready to explore labelers to increase your line's efficiency, check out our Food & Beverage and Fresh Food labeling equipment.
- Meal Kit Challenges and Opportunities in 2021
- How to Successfully Introduce and Market a Meal Prep, Delivery, and Meal Kit Subscription Business
- Packaging Operations: The Good, The Bad, The Ugly
- Strategic Objectives for Manufacturing
- Top 10 Packaging Line KPI’s
- Explore labelers for meal kit services