VÖLUR – AI SOFTWARE FOR A MORE OPTIMIZED AND SUSTAINABLE MEAT INDUSTRY
Völur is a global software company headquartered in Norway that revolutionizes how the meat industry operates with data and AI, creating a more optimized and sustainable industry.
Their advanced AI technology enhances sorting, cutting, planning, and scheduling processes, resulting in benefits such as a more profitable balance between supply and demand, increments in the value per pound of the finished products, meeting service levels towards customers, and up to 10% higher utilization of animals.
Interview with Robert Ekrem, CEO & Co-Founder of Völur.
Easy Engineering: What are the main areas of activity of the company?
Robert Ekrem: Völur’s vision is a world with optimal use of all resources in the meat industry, thereby creating a more sustainable industry.
24% of all meat is wasted, and on top of that, the meat industry accounts for 14.5% of all CO2 emissions. Between 20-50% of sales in the meat industry are push-driven, which means that companies push products into the market with discounts because they struggle to balance supply and demand.
In addition, the meat value chain is very complex, driven by the vast number of possible cutting and processing combinations for each carcass. That’s why it has been challenging to make optimal decisions. This leads to ineffective production, overstocking of materials, and food waste through the value chain.
With Völur, meat producers can better utilize each carcass, reducing waste and contributing to a more sustainable meat industry. Meat producers can address sustainability by reducing the number of products being pushed to the market with negative margins, producing the right number of products at the right time, and better utilizing animals to satisfy demand. Völur’s solution has the potential to meet the exact same demand with 9.8% fewer animals. Delivering those numbers industry-wide can potentially reduce greenhouse gas emissions by 426 million tons, equivalent to grounding the entire commercial airline industry for a year.
E.E: What’s the news about new products?
R.E: Earlier this year, JBS USA, a leading global meat producer, agreed to implement our AI solution to maximize carcass value and optimize animal utilization. Following a successful proof-of-concept (POC) agreement, JBS USA has decided to implement our solution to showcase value creation. We aim to demonstrate a more profitable plan that optimizes the balance between supply and demand.
Initially, we provide JBS USA with feasible and optimal daily production plans and intend to expand to long-term production planning. Upon completing the proof of value phase, we anticipate scaling the implementation of the Völur solution to other JBS USA plants and business units.
E.E: What are the ranges of products?
R.E: We provide AI software for meat producers to maximize carcass value and ensure optimal use of each animal.
Our approach is unique to the industry. We provide an optimal decision-making system, making the meat industry more sustainable and profitable.
Daily production planning: Optimal sorting, cutting, and processing plans for a given demand.
Tactical inventory planning: Enabling the right inventory levels to meet future demand for every product. Connected with daily production plans a year ahead.
Sales & Operations Planning: Völur enables the industry to utilize its data and scale it to different production facilities. Their solution is tailored to their customer’s business goals and constraints.
Benefits we bring:
Increased revenue by weight: 3% increased carcass value because of optimized production planning
Increased sales: 5% increased sales due to better-met demand
Saved time: Save hours on your production planning.
Reduced waste: With higher utilization of each carcass, you will reduce waste and contribute to a more sustainable meat industry.
E.E: At what stage is the market where you are currently active?
R.E: Völur targets a significant market in the meat industry, focusing on customers involved in both cutting and processing of meat and those specializing in either process. Our target market includes customers in the Americas and European regions.
The US market consists of five major meat producers (Tyson, Cargill, National Beef, JBS, Smithfield), and numerous other large processors. There are approximately 30 meat processors with revenues exceeding one billion USD and over 100 processors surpassing 100 million USD, while there is a long tail of smaller processors.
In the European market, competition exists within each country, with many players also engaging in substantial exports to other European countries and global regions. The European meat producer market features several prominent players, and a long tail of medium and small processors in each country.
Furthermore, Völur identifies extensive market opportunities in Canada, South America, Asia, and Oceania. These regions offer significant potential for expanding and adopting our solutions within the meat processing industry.
E.E: What can you tell us about market trends?
R.E: The meat industry has been slower in adopting new data driven technologies than other sectors like finance, media, or technology, partly due to the complex nature of the meat value chain and strict regulations. However, the industry now recognizes the need for sustainable and efficient production, leading to a growing acceptance of technology to streamline operations and enhance profitability.
As global meat demand rises with a growing population, meat processors must produce more with fewer resources. Optimized carcass balancing becomes crucial for their success in the future.
Although many meat producers still rely on multiple internal systems, know-how, and Excel sheets to execute their production plans, the data is available and needs to be harnessed. Gathering and contextualizing data are vital for digitalization efforts, including high-value use cases such as staffing, maintenance, and (in the case of Völur) optimized production planning.
While the meat industry has yet to embrace the benefits of digitalization and available technologies fully, the use of advanced solutions is gradually increasing. As the industry evolves, we will definitely see innovation and exciting technological developments that benefit producers, consumers, and the environment.
E.E: What are the most innovative products marketed?
R.E: Völur is currently the only data-driven AI platform that helps the meat industry optimally plan sorting, cutting, and processing of meat to meet current and future demand.
Our competition has been unable to deliver a solution for the optimal utilization of animals. Today’s methods use know-how based on written and unwritten rules and simple calculations.
There is industry-agnostic production planning software that has limitations in applying the kinds of constraints and rules that meat producers are under. For example, they fail to provide visibility into yields, prices, freight rates, etc., which greatly impacts profitability for meat processors.
There are also bespoke ERP systems. Though these systems are quite comprehensive, the producers need to decide what cutting pattern and recipes will be used, and then the system calculates the need of animals. This requires much industrial knowledge about the meat industry and becomes dependent on individuals.
E.E: What estimations do you have for 2023?
R.E: In the next 12 months, we plan to make our solution operational and scalable for beef and pork customers and launch it for a larger part of the value chain.
We have recently become a Microsoft Independent Software Vendor and entered the Azure marketplace, which provides us with a fantastic opportunity to reach a wider audience and showcase the value of our solution to meat producers, landing new customers and entering new markets.
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