Supply chain – The COVID 19 pandemic has definitely had its impact influence on the world. Economic indicators and health have been affected and all industries have been touched in one of the ways or even some other. Among the industries in which this was clearly obvious will be the farming as well as food industry.
Throughout 2019, the Dutch extension as well as food industry contributed 6.4 % to the disgusting domestic product (CBS, 2020). According to the FoodService Instituut, the foodservice industry in the Netherlands shed € 7.1 billion in 2020. The hospitality trade 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 in the food chain have significant consequences for the Dutch economy as well as food security as many stakeholders are impacted. Though it was clear to most folks that there was a great impact at the tail end of the chain (e.g., hoarding around supermarkets, eateries closing) as well as at the start of this chain (e.g., harvested potatoes not searching for customers), there are many actors in the supply chain for which the impact is less clear. It’s thus important to determine how well the food supply chain as being a whole is actually armed to deal with disruptions. Researchers in the Operations Research as well as Logistics Group at Wageningen Faculty as well as from Wageningen Economics Research, led by Professor Sander de Leeuw, studied the effects of the COVID-19 pandemic throughout the food supply chain. They based the analysis of theirs on interviews with about thirty Dutch source chain actors.
Demand in retail up, contained food service down It is obvious and well known that need in the foodservice channels went down on account of the closure of joints, amongst others. In some cases, sales for vendors of the food service business as a result fell to aproximatelly twenty % of the original volume. As a side effect, demand in the retail stations went up and remained within a quality of aproximatelly 10-20 % greater than before the problems began.
Products which had to come through abroad had the own issues of theirs. With the shift in desire coming from foodservice to retail, the requirement for packaging improved dramatically, More tin, glass or plastic was required for wearing in customer packaging. As more of this product packaging material concluded up in consumers’ houses rather than in places, the cardboard recycling process got disrupted as well, causing shortages.
The shifts in desire have had a major affect on production activities. In some instances, this even meant a full stop in production (e.g. in the duck farming industry, which came to a standstill as a result of demand fall out on the foodservice sector). In other cases, a big part of the personnel contracted corona (e.g. to the meat processing industry), leading to a closure of equipment.
Supply chain – Distribution activities were also affected. The beginning of the Corona crisis of China caused the flow of sea canisters to slow down pretty soon in 2020. This resulted in limited transport capability during the earliest weeks of the crisis, and expenses that are high for container transport as a consequence. Truck transport faced different problems. To begin with, there were uncertainties about how transport would be handled for borders, which in the end weren’t as rigid as feared. That which was problematic in cases which are most, nonetheless, was the availability of drivers.
The response to COVID 19 – provide chain resilience The source chain resilience analysis held by Prof. de Leeuw and Colleagues, was used on the overview of this main things of supply chain resilience:
Using this framework for the assessment of the interviews, the findings indicate that not many companies had been well prepared for the corona crisis and actually mainly applied responsive methods. Probably the most notable supply chain lessons were:
Figure 1. 8 best practices for food supply chain resilience
First, the need to develop the supply chain for agility and flexibility. This appears particularly complicated for smaller companies: building resilience right into a supply chain takes attention and time in the organization, and smaller organizations oftentimes don’t have the capability to accomplish that.
Next, it was discovered that more attention was necessary on spreading danger and aiming for risk reduction inside the supply chain. For the future, meaning more attention ought to be given to the manner in which businesses depend on specific countries, customers, and suppliers.
Third, attention is necessary for explicit prioritization as well as intelligent rationing techniques in situations where need can’t be met. Explicit prioritization is necessary to continue to meet market expectations but also to increase market shares in which competitors miss opportunities. This challenge is not new, however, it’s additionally been underexposed in this specific crisis and was usually not a part of preparatory activities.
Fourthly, the corona issues shows you us that the monetary result of a crisis in addition is determined by the way cooperation in the chain is set up. It’s typically unclear exactly how additional expenses (and benefits) are distributed in a chain, in case at all.
Lastly, relative to other purposeful departments, the operations and supply chain capabilities are in the driving seat during a crisis. Product development and advertising activities need to go hand in hand with supply chain activities. Whether or not the corona pandemic will structurally change the classic discussions between creation and logistics on the one hand as well as marketing on the other, the future must tell.
How is the Dutch meal supply chain coping throughout the corona crisis?