Supply chain – The COVID 19 pandemic has definitely had its impact effect on the planet. health and Economic indicators have been compromised and all industries have been completely touched inside one of the ways or even some other. One of the industries in which this was clearly obvious is the agriculture as well as food industry.
In 2019, the Dutch farming and food industry contributed 6.4 % to the yucky domestic item (CBS, 2020). Based on the FoodService Instituut, the foodservice business in the Netherlands shed € 7.1 billion inside 2020. The hospitality trade lost 41.5 % of its turnover as show by ProcurementNation, while at the same time supermarkets enhanced their turnover with € 1.8 billion.
Disruptions of the food chain have big consequences for the Dutch economy as well as food security as lots of stakeholders are affected. Despite the fact that it was apparent to majority of people that there was a big impact at the tail end of the chain (e.g., hoarding around grocery stores, eateries closing) as well as at the start of the chain (e.g., harvested potatoes not finding customers), there are a lot of actors inside the supply chain for that the effect is much less clear. It’s thus important to determine how properly the food supply chain as a whole is equipped to contend with disruptions. Researchers from your Operations Research as well as Logistics Group at Wageningen University and from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the influences of the COVID-19 pandemic all over the food supply chain. They based the examination of theirs on interviews with around thirty Dutch supply chain actors.
Need within retail up, in food service down It’s apparent and popular that demand in the foodservice channels went down as a result of the closure of restaurants, amongst others. In certain instances, sales for suppliers in the food service industry as a result fell to aproximatelly twenty % of the first volume. As a complication, demand in the retail stations went up and remained within a degree of about 10-20 % greater than before the crisis began.
Goods that had to come through abroad had the own issues of theirs. With the shift in demand from foodservice to retail, the need for packaging changed considerably, More tin, cup and plastic material was required for wearing in buyer packaging. As much more of this particular product packaging material ended up in consumers’ homes as opposed to in restaurants, the cardboard recycling process got disrupted as well, causing shortages.
The shifts in need have had an important affect on output activities. In certain cases, this even meant a complete stop of production (e.g. in the duck farming business, which emerged to a standstill as a result of demand fall out in the foodservice sector). In other instances, a big section of the personnel contracted corona (e.g. in the various meats processing industry), causing a closure of facilities.
Supply chain – Distribution pursuits were also affected. The start of the Corona crisis of China sparked the flow of sea canisters to slow down fairly shortly in 2020. This resulted in restricted transport electrical capacity during the earliest weeks of the crisis, and expenses which are high for container transport as a consequence. Truck transportation faced various issues. To begin with, there were uncertainties regarding how transport will be handled for borders, which in the end weren’t as strict as feared. What was problematic in situations which are a large number of, however, was the availability of drivers.
The response to COVID 19 – provide chain resilience The supply chain resilience evaluation held by Prof. de Leeuw as well as Colleagues, was used on the overview of the key components of supply chain resilience:
Using this framework for the evaluation of the interviews, the conclusions indicate that not many organizations were nicely prepared for the corona problems and in fact mostly applied responsive methods. The most notable source chain lessons were:
Figure one. Eight best practices for meals supply chain resilience
For starters, the need to design the supply chain for agility and flexibility. This seems especially complicated for smaller sized companies: building resilience right into a supply chain takes time and attention in the business, and smaller organizations usually don’t have the capacity to do so.
Next, it was discovered that more interest was necessary on spreading danger and aiming for risk reduction inside the supply chain. For the future, what this means is far more attention ought to be given to the manner in which organizations count on suppliers, customers, and specific countries.
Third, attention is needed for explicit prioritization as well as intelligent rationing strategies in cases where demand cannot be met. Explicit prioritization is needed to continue to meet market expectations but also to improve market shares where competitors miss options. This challenge is not new, though it has in addition been underexposed in this specific problems and was often not a part of preparatory pursuits.
Fourthly, the corona problems shows you us that the monetary impact of a crisis in addition relies on the way cooperation in the chain is actually set up. It is often unclear how extra expenses (and benefits) are distributed in a chain, if at all.
Last but not least, relative to other functional departments, the businesses and supply chain functionality are in the driving accommodate during a crisis. Product development and marketing activities need to go hand in hand with supply chain pursuits. Regardless of whether the corona pandemic will structurally replace the basic considerations between generation and logistics on the one hand as well as marketing on the other, the long term must tell.
How is the Dutch meal supply chain coping throughout the corona crisis?