Supply chain – The COVID-19 pandemic has undoubtedly had the impact of its impact on the planet. health and Economic indicators have been compromised and all industries have been touched in a way or yet another. One of the industries in which it was clearly visible will be the agriculture as well as food industry.
Throughout 2019, the Dutch agriculture and food industry contributed 6.4 % to the yucky domestic item (CBS, 2020). According to the FoodService Instituut, the foodservice business in the Netherlands shed € 7.1 billion within 2020. The hospitality industry lost 41.5 % of its turnover as show by ProcurementNation, while at the same time supermarkets increased the turnover of theirs with € 1.8 billion.
Disruptions of the food chain have major consequences for the Dutch economy as well as food security as many stakeholders are impacted. Though it was clear to majority of men and women that there was a significant effect at the conclusion of this chain (e.g., hoarding around supermarkets, restaurants closing) and also at the beginning of this chain (e.g., harvested potatoes not finding customers), you will find many actors inside the source chain for that will the effect is less clear. It’s therefore imperative that you determine how well the food supply chain as being a whole is prepared to deal with disruptions. Researchers from the Operations Research as well as Logistics Group at Wageningen Faculty and also coming from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the effects of the COVID-19 pandemic throughout the food resources chain. They based the examination of theirs on interviews with about thirty Dutch supply chain actors.
Need in retail up, in food service down It is obvious and well known 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 business as a result fell to about 20 % of the first volume. Being an adverse reaction, demand in the list stations went up and remained within a quality of aproximatelly 10-20 % greater than before the crisis began.
Products which had to come from abroad had the own problems of theirs. With the change in demand from foodservice to retail, the requirement for packaging improved considerably, More tin, glass or plastic was necessary for wearing in customer packaging. As more of this particular packaging material concluded up in consumers’ houses instead of in joints, the cardboard recycling system got disrupted too, causing shortages.
The shifts in need have had an important affect on output activities. In some cases, this even meant a complete stop in production (e.g. within the duck farming industry, which came to a standstill on account of demand fall out in the foodservice sector). In other cases, a major section of the personnel contracted corona (e.g. in the meat processing industry), leading to a closure of facilities.
Supply chain – Distribution pursuits were also affected. The beginning of the Corona crisis in China sparked the flow of sea containers to slow down pretty soon in 2020. This resulted in restricted transport capability during the earliest weeks of the crisis, and expenses that are high for container transport as a consequence. Truck transport encountered various issues. Initially, there were uncertainties on how transport would be managed at borders, which in the end were not as rigid as feared. The thing that was problematic in most instances, however, was the accessibility of motorists.
The reaction to COVID-19 – provide chain resilience The supply chain resilience analysis held by Prof. de Leeuw and Colleagues, was based on the overview of this key things of supply chain resilience:
To us this particular framework for the assessment of the interviews, the findings indicate that not many organizations were nicely prepared for the corona crisis and in reality mostly applied responsive practices. The most important supply chain lessons were:
Figure 1. 8 best methods for food supply chain resilience
First, the need to design the supply chain for agility as well as flexibility. This looks particularly complicated for smaller companies: building resilience into a supply chain takes time and attention in the organization, and smaller organizations usually don’t have the capacity to accomplish that.
Second, it was observed that much more interest was necessary on spreading danger and also aiming for risk reduction in the supply chain. For the future, this means more attention ought to be provided to the way businesses count on specific countries, customers, and suppliers.
Third, attention is needed for explicit prioritization and clever rationing strategies in cases in which need can’t be met. Explicit prioritization is actually necessary to keep on to satisfy market expectations but also to increase market shares wherein competitors miss opportunities. This particular challenge is not new, but it has additionally been underexposed in this specific crisis and was frequently not a part of preparatory pursuits.
Fourthly, the corona crisis shows us that the economic impact of a crisis additionally depends on the manner in which cooperation in the chain is actually set up. It’s often unclear precisely how extra costs (and benefits) are actually distributed in a chain, in case at all.
Last but not least, relative to other functional departments, the businesses and supply chain works are actually in the driving accommodate during a crisis. Product development and advertising activities have to go hand in hand with supply chain events. Whether or not the corona pandemic will structurally switch the classic discussions between production and logistics on the one hand and advertising and marketing on the other hand, the long term will have to explain to.
How is the Dutch meal supply chain coping throughout the corona crisis?