Supply chain – The COVID-19 pandemic has undoubtedly had its impact impact on the world. health and Economic indicators have been affected and all industries have been touched inside one of the ways or even another. One of the industries in which this was clearly noticeable will be the farming as well as food industry.
In 2019, the Dutch agriculture and food sector contributed 6.4 % to the gross domestic item (CBS, 2020). As per the FoodService Instituut, the foodservice business in the Netherlands dropped € 7.1 billion inside 2020. The hospitality trade lost 41.5 % of the turnover of its as show by ProcurementNation, while at the identical time supermarkets increased the turnover of theirs with € 1.8 billion.
Disruptions of the food chain have big effects for the Dutch economy and food security as a lot of stakeholders are affected. Despite the fact that it was apparent to most folks that there was a great effect at the end of the chain (e.g., hoarding doing grocery stores, eateries closing) and also at the start of this chain (e.g., harvested potatoes not searching for customers), you will find a lot of actors inside the supply chain for that the effect is less clear. It’s therefore imperative that you determine how well the food supply chain as a whole is actually armed to deal with disruptions. Researchers from your Operations Research and Logistics Group at Wageningen Faculty as well as from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the consequences of the COVID 19 pandemic throughout the food supplies chain. They based the analysis of theirs on interviews with around thirty Dutch supply chain actors.
Need in retail up, contained food service down It is apparent and popular that demand in the foodservice stations went down as a result of the closure of joints, amongst others. In some cases, sales for vendors in the food service industry thus fell to about 20 % of the initial volume. As a side effect, demand in the retail channels went up and remained at a degree of aproximatelly 10 20 % higher than before the crisis began.
Products which had to come from abroad had the own problems of theirs. With the shift in demand coming from foodservice to retail, the requirement for packaging improved considerably, More tin, cup and plastic was necessary for use in consumer packaging. As more of this packaging material ended up in consumers’ homes rather than in joints, the cardboard recycling process got disrupted too, causing shortages.
The shifts in demand have had a major impact on output activities. In certain cases, this even meant the full stop of output (e.g. within the duck farming industry, which arrived to a standstill as a result of demand fall-out inside the foodservice sector). In other cases, a significant part of the personnel contracted corona (e.g. in the meat processing industry), leading to a closure of equipment.
Supply chain – Distribution pursuits were also affected. The beginning of the Corona crisis of China sparked the flow of sea canisters to slow down fairly shortly in 2020. This resulted in transport capacity that is limited during the very first weeks of the issues, and expenses that are high for container transport as a consequence. Truck travel experienced different problems. To begin with, there were uncertainties on how transport would be managed at borders, which in the end weren’t as rigid as feared. That which was problematic in many situations, nevertheless, was the availability of drivers.
The response to COVID-19 – deliver chain resilience The supply chain resilience evaluation held by Prof. de Colleagues and Leeuw, was used on the overview of this primary components of supply chain resilience:
Using this particular framework for the analysis of the interview, the findings indicate that few companies had been nicely prepared for the corona problems and in fact mostly applied responsive practices. Probably the most notable source chain lessons were:
Figure 1. 8 best practices for meals supply chain resilience
First, the need to design the supply chain for agility as well as versatility. This seems particularly complicated for smaller companies: building resilience right into a supply chain takes attention and time in the organization, and smaller organizations oftentimes do not have the potential to do so.
Next, it was observed that more attention was required on spreading danger and also aiming for risk reduction inside the supply chain. For the future, meaning more attention should be made available to the manner in which businesses depend on specific countries, customers, and suppliers.
Third, attention is required for explicit prioritization and intelligent rationing techniques in cases in which demand cannot be met. Explicit prioritization is necessary to keep on to satisfy market expectations but also to increase market shares wherein competitors miss opportunities. This particular task is not new, although it’s also been underexposed in this problems and was often not part of preparatory pursuits.
Fourthly, the corona crisis shows us that the financial result of a crisis additionally depends on the manner in which cooperation in the chain is actually set up. It is typically unclear exactly how additional expenses (and benefits) are distributed in a chain, if at all.
Finally, relative to other functional departments, the businesses and supply chain operates are actually in the driving seat during a crisis. Product development and marketing and advertising activities have to go hand in hand with supply chain activities. Regardless of whether the corona pandemic will structurally change the classic considerations between creation and logistics on the one hand and advertising on the other hand, the long term will have to tell.
How’s the Dutch meal supply chain coping during the corona crisis?