Supply chain – The COVID-19 pandemic has undoubtedly had its impact effect on the world. Economic indicators and health have been compromised and all industries have been touched within a way or even some other. One of the industries in which this was clearly obvious would be the farming as well as food industry.
Throughout 2019, the Dutch agriculture as well as food niche contributed 6.4 % to the disgusting domestic item (CBS, 2020). According to the FoodService Instituut, the foodservice industry in the Netherlands shed € 7.1 billion in 2020. The hospitality industry lost 41.5 % of the turnover of its as show by ProcurementNation, while at the identical time supermarkets enhanced the turnover of theirs with € 1.8 billion.
Disruptions in the food chain have big consequences for the Dutch economy and food security as many stakeholders are impacted. Though it was apparent to majority of men and women that there was a big impact at the end of this chain (e.g., hoarding around food markets, restaurants closing) and also at the beginning of this chain (e.g., harvested potatoes not finding customers), there are numerous actors in the supply chain for that will the effect is much less clear. It’s thus important to determine how properly the food supply chain as a whole is prepared to contend with disruptions. Researchers from the Operations Research and Logistics Group at Wageningen Faculty and from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the consequences of the COVID 19 pandemic throughout the food supply chain. They based the analysis of theirs on interviews with around 30 Dutch supply chain actors.
Need in retail up, in food service down It is apparent and popular that need in the foodservice stations went down due to the closure of restaurants, amongst others. In a few instances, sales for vendors of the food service industry as a result fell to aproximatelly 20 % of the first volume. Being an adverse reaction, demand in the retail stations went up and remained at a quality of aproximatelly 10-20 % higher than before the problems began.
Products that had to come via abroad had the own issues of theirs. With the shift in demand coming from foodservice to retail, the demand for packaging improved considerably, More tin, cup and plastic was needed for use in customer packaging. As more of this particular packaging material concluded up in consumers’ homes instead of in restaurants, the cardboard recycling function got disrupted as well, causing shortages.
The shifts in need have had a major effect on output activities. In a few instances, this even meant a complete stop of output (e.g. within the duck farming business, which emerged to a standstill as a result of demand fall-out in the foodservice sector). In other situations, a major section of the personnel contracted corona (e.g. to the various meats processing industry), resulting in a closure of equipment.
Supply chain – Distribution pursuits were also affected. The beginning of the Corona crisis in China triggered the flow of sea containers to slow down pretty soon in 2020. This resulted in transport electrical capacity that is restricted throughout the very first weeks of the issues, and expenses that are high for container transport as a consequence. Truck transportation faced various issues. At first, there were uncertainties on how transport will be managed for borders, which in the end were not as strict as feared. What was problematic in instances that are many , nevertheless, was the availability of motorists.
The response to COVID 19 – supply chain resilience The source chain resilience evaluation held by Prof. de Leeuw and Colleagues, was used on the overview of this main elements of supply chain resilience:
Using this particular framework for the evaluation of the interview, the results indicate that few businesses were well prepared for the corona crisis and in fact mainly applied responsive methods. The most notable source chain lessons were:
Figure one. Eight best practices for meals supply chain resilience
First, the need to create the supply chain for versatility and agility. This appears especially challenging for small companies: building resilience right into a supply chain takes attention and time in the organization, and smaller organizations usually don’t have the capacity to do so.
Next, it was discovered that more interest was necessary on spreading risk as well as aiming for risk reduction within the supply chain. For the future, what this means is more attention has to be given to the way organizations depend on specific countries, customers, and suppliers.
Third, attention is necessary for explicit prioritization and intelligent rationing strategies in cases in which 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 particular challenge is not new, but it’s in addition been underexposed in this crisis and was often not part of preparatory activities.
Fourthly, the corona issues shows us that the economic impact of a crisis additionally is determined by the way cooperation in the chain is actually set up. It’s often unclear how further expenses (and benefits) are actually distributed in a chain, if at all.
Finally, relative to other functional departments, the businesses and supply chain operates are actually in the driving accommodate during a crisis. Product development and advertising activities need to go hand in deep hand with supply chain events. Regardless of whether the corona pandemic will structurally change the basic considerations between production and logistics on the one hand as well as advertising on the other hand, the long term must explain to.
How’s the Dutch meal supply chain coping throughout the corona crisis?