Supply chain – The COVID 19 pandemic has undoubtedly had its impact influence on the world. Economic indicators and health have been compromised and all industries are touched inside a way or some other. Among the industries in which it was clearly visible would be the agriculture as well as food industry.
In 2019, the Dutch agriculture as well as food niche contributed 6.4 % to the gross domestic item (CBS, 2020). Based on the FoodService Instituut, the foodservice business in the Netherlands dropped € 7.1 billion in 2020. The hospitality industry lost 41.5 % of its turnover as show by ProcurementNation, while at exactly the same time supermarkets increased their turnover with € 1.8 billion.
Disruptions of the food chain have significant consequences for the Dutch economy and food security as lots of stakeholders are impacted. Even though it was clear to most men and women that there was a huge effect at the tail end of this chain (e.g., hoarding around grocery stores, eateries closing) and at the beginning of this chain (e.g., harvested potatoes not searching for customers), there are a lot of actors inside the supply chain for that will the effect is much less clear. It is thus vital that you find out how effectively the food supply chain as being a whole is armed to cope with disruptions. Researchers in the Operations Research and Logistics Group at Wageningen Faculty and also coming from Wageningen Economics Research, led by Professor Sander de Leeuw, studied the consequences of the COVID 19 pandemic all over the food resources chain. They based the analysis of theirs on interviews with around thirty Dutch source chain actors.
Demand in retail up, contained food service down It is apparent and popular that demand in the foodservice stations went down on account of the closure of places, amongst others. In certain cases, sales for vendors of the food service industry thus fell to aproximatelly twenty % of the first volume. Being a complication, demand in the list channels went up and remained within a level of aproximatelly 10 20 % higher than before the problems began.
Products that had to come from abroad had their very own issues. With the shift in demand from foodservice to retail, the demand for packaging improved considerably, More tin, cup or plastic material was required for use in buyer packaging. As much more of this particular product packaging material concluded up in consumers’ homes rather than in joints, the cardboard recycling process got disrupted also, causing shortages.
The shifts in desire have had a major affect on output activities. In a few instances, this even meant a complete stop of output (e.g. inside the duck farming industry, which came to a standstill as a result of demand fall-out in the foodservice sector). In other cases, a big section of the personnel contracted corona (e.g. in the various meats processing industry), causing a closure of equipment.
Supply chain – Distribution pursuits were also affected. The start of the Corona crisis in China triggered the flow of sea bins to slow down fairly shortly in 2020. This resulted in transport capability which is restricted during the first weeks of the problems, and costs which are high for container transport as a result. Truck travel faced different problems. Initially, there were uncertainties about how transport will be handled at borders, which in the end were not as rigid as feared. What was problematic in many situations, however, was the accessibility of drivers.
The reaction to COVID-19 – deliver chain resilience The source chain resilience analysis held by Prof. de Colleagues and Leeuw, was based on the overview of the primary elements of supply chain resilience:
To us this particular framework for the assessment of the interview, the findings show that few organizations were nicely prepared for the corona crisis and in fact mostly applied responsive practices. The most important supply chain lessons were:
Figure one. Eight best methods for meals supply chain resilience
For starters, the need to develop the supply chain for agility and flexibility. This seems especially complicated for smaller companies: building resilience right into a supply chain takes time and attention in the organization, and smaller organizations usually don’t have the capacity to do so.
Next, it was observed that much more attention was required on spreading risk as well as aiming for risk reduction inside the supply chain. For the future, meaning far more attention should be given to the manner in which companies count on suppliers, customers, and specific countries.
Third, attention is necessary for explicit prioritization as well as clever rationing techniques in cases where need cannot be met. Explicit prioritization is required to continue to satisfy market expectations but in addition to improve market shares in which competitors miss opportunities. This particular challenge is not new, however, it has additionally been underexposed in this specific problems and was often not part of preparatory activities.
Fourthly, the corona problems shows you us that the monetary effect of a crisis also depends on the manner in which cooperation in the chain is set up. It is usually unclear exactly how additional costs (and benefits) are actually sent out in a chain, if at all.
Lastly, relative to other purposeful departments, the operations and supply chain works are actually in the driving seat during a crisis. Product development and marketing and advertising activities have to go hand in deep hand with supply chain pursuits. Regardless of whether the corona pandemic will structurally switch the traditional discussions between production and logistics on the one hand and marketing and advertising on the other, the long term will need to tell.
How is the Dutch meal supply chain coping during the corona crisis?