Regulatory compliance and costly documentation, raw material costs, and increasingly demanding customers present the flavor and fragrance industry with myriad supply chain stresses—not to mention the growing importance of ethical practices.
As noted in a supply chain analysis co-authored by Vincent Keller of Firmenich and Randy Burgess, an Ottawa-based supply chain journalist, “Extensive commercial collaboration up and down the supply chain, as well as between production facilities and distribution channels are critical business issues. Companies in the space also have a reverse pyramid of supply and demand requirements from normal industry. Rather than requiring a great many raw materials to produce a few finished products, the industry requires comparatively few raw materials that are common to many products.”
In a presentation at the 2012 symposium of the International Federation of Essential Oils and Aroma Trades (IFEAT) in Singapore, Trevor Rahill (Focus International LLC) said, “Excess and redundant inventory permeates the ingredients industry.” By his measure, this excess impacts 15–25% of inventories.
