Are Traasdahl of Crisp: How We Are Helping To Create A Resilient Food Supply Chain

An Interview With Martita Mestey

Develop contingency plans — Suppliers need to identify which raw materials they are most reliant on and identify backup suppliers. Many suppliers recently learned the hard way not to put all of their eggs in one basket.

The cascading logistical problems caused by the pandemic and the war in Eastern Europe have made securing a reliable supply chain a national imperative. What must agriculture companies and policymakers do to ensure secure and resilient food supply chains? In this interview series, we are talking to business leaders who can share insights from their experiences about how we can address these challenges. As a part of this series, I had the pleasure of interviewing Are Traasdahl, founder and CEO of Crisp.

Are has more than 20 years of experience in mobile and digital technology. He was the Founder & CEO of Tapad Inc. In 2016, Telenor Group acquired Tapad for $360M, making it the fifth largest venture-backed M&A exit in New York since 2009. Prior to Tapad, he founded Thumbplay, a mobile entertainment service that he grew to more than $100M in revenue in less than 3 years before he exited the company. The company, later acquired by Clear Channel, is now called iHeartRadio.

Traasdahl is a frequent contributor for outlets such as CNBC and Bloomberg News, and he has been featured in Forbes, the Wall Street Journal, Ad Age and other major news publications. He was named Global Startup Awards™ Founder of the Year in 2016 and EY Entrepreneur of the Year in 2014.

Thank you so much for joining us in this interview series! Are you working on any exciting new projects now? How do you think that will help people?

Strained supply chains and a challenging economic climate make it more important than ever to allocate media spend effectively. Brands are starting to use Crisp to optimize spend based on what’s selling and what’s in stock. This will help them reduce waste and make sure they are selling what’s actually in-store, strengthening their relationship with consumers.

Ok super. Thank you for all that. Let’s now shift to the main focus of our interview. To ensure that we are all on the same page let’s begin with some simple definitions. What does the term “supply chain” encompass?

Today’s supply chain is actually not a linear “chain” at all. It’s an interconnected, multi-layered web or network of producers, suppliers, sub-suppliers, and multi-level manufacturing points that requires the engagement of multiple organizations and functions to bring food from field to fork. Ideally, this network shares the common goal of delighting consumers while optimizing working capital and controlling operating costs. However, the status quo of incomplete, disconnected, and siloed information and processes impedes transparency, agility, resilience, and, ultimately, shopper satisfaction.

Can you help articulate the weaknesses in our current food supply chain systems?

Anticipation of challenges exacerbates disruption. From ingredients to packaging materials, food manufacturers and retailers are still feeling supply chain pain. In response, they are executing a variety of short-term tactics to help meet demand such as reducing assortments based on ingredient availability and/or volume; moving from “just-in-time” to “just-in-case” production and inventory; adjusting procurement lead-times; buying larger upfront quantities; over-ordering, etc. Retailers are encouraging online shopping; it’s easier to stock digital shelves, and they want to avoid the negative visual impression created by empty store shelves. While essential to meet short-term demand, these actions can further exacerbate the bullwhip effect by distorting true demand timing and levels.

Can you help define what a nationally secure and resilient food supply chain would look like?

A strategic approach is needed to restore demand/supply equilibrium and transition from fast turn, “whatever it takes” fixes to operationally sustainable processes that support real-time, predictive visibility, agility, and resilience. Data is the foundation.

With real-time data-sharing in place, food companies can leverage the power and potential of data, technology, and collaboration to better connect demand with supply, create transparency, imbed agility, and build resilience. With better collaboration, food companies can get and stay ahead of rapidly evolving consumer behavior, identify potential disruptions, deploy resources, predict shopper traffic, track inventory and product performance, understand store conditions, replenish virtual and in-store shelves at speed and scale, and better prevent, prepare, sense, and respond to future disruptive events. They can build a reliable and transparent supply chain that will serve them, their suppliers, their customers, and their consumers today and into the future.

Can you share with our readers a few of the things that your organization is doing to help create a more secure food supply chain?

• Improved visibility and planning. Crisp enables better supply and demand forecasting by providing visibility into actual consumer demand down to the SKU and store level in real-time so there is a better long-term plan based on ‘real’ and actual demand. For example, one of our customers reported that with Crisp, they have “dramatically improved sales and operational planning. We overlay store-level distribution by SKU onto velocity numbers to create a forecast that is now 99% accurate, improving production processes and cash flow.”
• Reduced out-of-stocks. Real-time data means customers are able to readjust quickly and adapt to demand and track out-of-stock, increasing allocation of product to higher performing areas of the country. NotCo, a wildly successful food tech company, uses Crisp to find areas of low supply and work with distributors to avoid critical out-of-stock issues.

What are a few threats over the horizon that might disrupt our food supply chain that we should take action now to correct? Can you please explain?

Effective Scenario Planning. We have talked a lot about predicting demand but there are also unanticipated shocks to supply — whether it is nature (i.e., weather) or human-made. Brands and retailers need to create contingency plans to be able to react quickly. We don’t know what is going to happen, but we can be sure that ‘something’ will so we need to be constantly communicating with our partners. The better contingency plans we can create, the better we can react. In anticipation of future disruptions, leading food companies will create digital supply chain twins and run a range of “what-if” scenarios through AI/ML algorithms to quickly calculate the impact of various responses, recommend a course of action, and help ensure every decision is aligned horizontally and vertically throughout the network.

Ok, thank you. Here is the main question of our interview. What are the “5 Things We Must Do To Create Nationally Secure And Resilient Food Supply Chains” and why?

1 . Lean into partners — Communicate better to understand where you have opportunities to improve. For example, Aura Bora’s sales team uses Crisp to check inventory by SKU and weeks of supply daily at key warehouse locations. Then, they overlay this inventory data with other retailer data sources and category data, giving them
a full picture of where sales are growing and which DCs those key accounts pull from. With this full-picture view, they can proactively work with their distributor relationship manager to be prepared. Aura Bora estimates that Crisp has helped save tens of thousands of dollars in revenue by avoiding stock-outs.

2 . Develop contingency plans — Suppliers need to identify which raw materials they are most reliant on and identify backup suppliers. Many suppliers recently learned the hard way not to put all of their eggs in one basket.

For example, if all my wheat comes from Ukraine, I probably had a very challenging 2022. But if you can diversify, then as soon as something goes wrong, you can pivot and implement a contingency plan.

3 . Prioritize sustainability — Proactively identify about-to-expire products — with that visibility you can see which items will expire and you can take different actions. For example, you can run a promotion if you are four weeks out. If you are only two weeks out, you can donate the inventory. We are proud partners with Greenleaf, who uses Crisp to monitor sales and on-hand inventory at distribution centers to identify possible spoilage incidents before they occur.

4 . Increase transparency — The more we can share data across trading partners, the faster the industry can react. Using real time data piped through Crisp, RxSugar can accurately gauge demand to inform production and ordering of raw materials. They were able to go from next-day ordering to 12-week lead times on materials and packaging.

5 . Continue to grow — For decades, suppliers and retailers focused on ‘just-in-time’ inventory planning. During the pandemic, that system got turned onto its head to ‘just-in-case.’ The companies that were able to navigate through the pandemic were those who were communicating across teams and able to remove data silos within the organization so that everyone is operating from the same source of truth. For example, challenger chocolate brand Mid-Day Squares uses data to ‘wow’ retail buyers and be proactive with distributors and retailers if there is a dip in distribution of velocity compared to prior weeks. They can also use predictive analytics to identify stores where product should be selling but isn’t. Ultimately it is about using data to strengthen retailer relationships.

How can our readers further follow your work online?

www.gocrisp.com or https://www.linkedin.com/company/gocrisp or https://www.instagram.com/go.crisp

This was very inspiring and informative. Thank you so much for the time you spent with this interview!