Supply chain – The COVID-19 pandemic has definitely had the impact of its impact on the planet. Economic indicators and health have been compromised and all industries are touched in one way or perhaps yet another. One of the industries in which this was clearly apparent would be the agriculture and food business.
Throughout 2019, the Dutch agriculture as well as food industry contributed 6.4 % to the disgusting domestic item (CBS, 2020). Based on the FoodService Instituut, the foodservice business in the Netherlands lost € 7.1 billion within 2020. The hospitality industry lost 41.5 % of the turnover of its as show by ProcurementNation, while at the same time supermarkets enhanced the turnover of theirs with € 1.8 billion.
Disruptions of the food chain have significant consequences for the Dutch economy and food security as lots of stakeholders are affected. Despite the fact that it was apparent to majority of individuals that there was a huge impact at the end of this chain (e.g., hoarding doing grocery stores, restaurants closing) and also at the start of the chain (e.g., harvested potatoes not searching for customers), there are many actors within the source chain for that will the impact is much less clear. It is thus vital that you figure out how properly the food supply chain as being a whole is equipped to cope with disruptions. Researchers in the Operations Research and Logistics Group at Wageningen Faculty and also from Wageningen Economics Research, led by Professor Sander de Leeuw, studied the consequences of the COVID-19 pandemic all over the food supply chain. They based the examination of theirs on interviews with around 30 Dutch source chain actors.
Demand within retail up, found food service down It is evident and widely known that need in the foodservice channels went down on account of the closure of joints, amongst others. In some instances, sales for vendors of the food service business therefore fell to aproximatelly 20 % of the initial volume. Being a complication, demand in the list channels went up and remained within a quality of aproximatelly 10 20 % higher than before the crisis began.
Goods that had to come from abroad had the own issues of theirs. With the change in need coming from foodservice to retail, the demand for packaging changed dramatically, More tin, glass or plastic was needed for wearing in buyer packaging. As more of this product packaging material concluded up in consumers’ homes as opposed to in joints, the cardboard recycling system got disrupted too, causing shortages.
The shifts in desire have had a major impact on production activities. In certain instances, this even meant a complete stop of output (e.g. within the duck farming industry, which came to a standstill due to demand fall-out on the foodservice sector). In other instances, a significant part of the personnel contracted corona (e.g. to the various meats processing industry), causing a closure of facilities.
Supply chain – Distribution activities were also affected. The beginning of the Corona crisis in China caused the flow of sea canisters to slow down fairly soon in 2020. This resulted in restricted transport electrical capacity throughout the first weeks of the problems, and expenses which are high for container transport as a direct result. Truck transport faced various issues. Initially, there were uncertainties on how transport would be managed for borders, which in the end weren’t as rigid as feared. That which was problematic in a large number of instances, nevertheless, was the availability of motorists.
The reaction to COVID-19 – provide chain resilience The source chain resilience analysis held by Prof. de Leeuw as well as Colleagues, was based on the overview of the core components of supply chain resilience:
Using this framework for the assessment of the interviews, the findings show that few companies were well prepared for the corona problems and in fact mostly applied responsive methods. The most notable supply chain lessons were:
Figure 1. Eight best methods for meals supply chain resilience
For starters, the need to create the supply chain for flexibility as well as agility. This appears particularly complicated for smaller sized companies: building resilience right into a supply chain takes time and attention in the business, and smaller organizations oftentimes don’t have the capacity to do it.
Next, it was discovered that more attention was needed on spreading danger and aiming for risk reduction inside the supply chain. For the future, what this means is more attention should be made available to the way businesses rely on suppliers, customers, and specific countries.
Third, attention is required for explicit prioritization and intelligent rationing techniques in cases where need cannot be met. Explicit prioritization is required to continue to meet market expectations but also to boost market shares wherein competitors miss opportunities. This challenge isn’t new, though it has also been underexposed in this problems and was frequently not a part of preparatory pursuits.
Fourthly, the corona issues teaches us that the financial result of a crisis additionally relies on the manner in which cooperation in the chain is set up. It’s typically unclear precisely how extra expenses (and benefits) are actually distributed in a chain, in case at all.
Lastly, relative to other functional departments, the businesses and supply chain capabilities are actually in the driving accommodate during a crisis. Product development and advertising activities have to go hand deeply in hand with supply chain activities. Regardless of whether the corona pandemic will structurally switch the classic discussions between logistics and creation on the one hand and advertising and marketing on the other hand, the future must tell.
How’s the Dutch meal supply chain coping throughout the corona crisis?