Supply chain – The COVID 19 pandemic has undoubtedly had the impact of its impact on the planet. health and Economic indicators have been affected and all industries have been touched in a way or another. One of the industries in which it was clearly visible is the agriculture as well as food industry.
Throughout 2019, the Dutch extension and food industry contributed 6.4 % to the disgusting domestic item (CBS, 2020). Based on the FoodService Instituut, the foodservice business in the Netherlands lost € 7.1 billion within 2020[1]. The hospitality trade lost 41.5 % of the turnover of its as show by ProcurementNation, while at the same time supermarkets enhanced the turnover of theirs with € 1.8 billion.
Disruptions of the food chain have major effects for the Dutch economy and food security as a lot of stakeholders are affected. 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 doing grocery stores, eateries closing) and also at the start of this chain (e.g., harvested potatoes not finding customers), there are many actors within the source chain for which the impact is less clear. It’s therefore important to determine how properly the food supply chain as being a whole is actually prepared to deal with disruptions. Researchers from your Operations Research and Logistics Group at Wageningen University as well as coming from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the influences of the COVID 19 pandemic all over the food resources chain. They based the analysis of theirs on interviews with about 30 Dutch source chain actors.
Demand within retail up, contained food service down It is obvious and popular that need in the foodservice channels went down on account of the closure of restaurants, amongst others. In a few cases, sales for vendors in the food service industry therefore fell to about twenty % of the first volume. Being an adverse reaction, demand in the list channels went up and remained at a quality of about 10 20 % higher than before the crisis began.
Products which had to come from abroad had the own problems of theirs. With the shift in desire coming from foodservice to retail, the demand for packaging changed considerably, More tin, cup or plastic material was required for wearing in customer packaging. As more of this packaging material concluded up in consumers’ homes rather than in restaurants, the cardboard recycling system got disrupted too, causing shortages.
The shifts in demand have had a significant effect on production activities. In some cases, this even meant a total stop of output (e.g. in the duck farming industry, which arrived to a standstill on account of demand fall out on the foodservice sector). In other instances, a big portion of the personnel contracted corona (e.g. in the various meats processing industry), resulting in a closure of equipment.
Supply chain – Distribution activities were also affected. The beginning of the Corona crisis in China caused the flow of sea bins to slow down pretty soon in 2020. This resulted in transport capability which is limited throughout the first weeks of the issues, and high costs for container transport as a consequence. Truck transportation encountered different problems. At first, there were uncertainties on how transport will be managed for borders, which in the end weren’t as strict as feared. What was problematic in situations which are many, however, was the accessibility of motorists.
The response to COVID 19 – supply chain resilience The supply chain resilience evaluation held by Prof. de Leeuw and Colleagues, was based on the overview of the main things of supply chain resilience:
To us this framework for the analysis of the interviews, the conclusions indicate that few businesses had been well prepared for the corona crisis and in reality mostly applied responsive methods. Probably the most important supply chain lessons were:
Figure one. Eight best methods for food supply chain resilience
To begin with, 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 attention and time in the organization, and smaller organizations usually do not have the potential to do so.
Second, it was found that much more attention was needed on spreading danger as well as aiming for risk reduction in the supply chain. For the future, this means more attention ought to be given to the way organizations rely on suppliers, customers, and specific countries.
Third, attention is needed for explicit prioritization and clever rationing techniques in situations in which demand can’t be met. Explicit prioritization is needed to keep on to meet market expectations but in addition to boost market shares in which competitors miss opportunities. This particular challenge isn’t new, although it’s in addition been underexposed in this specific problems and was frequently not a part of preparatory pursuits.
Fourthly, the corona crisis shows you us that the economic effect of a crisis also relies on the way cooperation in the chain is actually set up. It’s often unclear precisely how further costs (and benefits) are actually sent out in a chain, in case at all.
Last but not least, relative to other purposeful departments, the businesses and supply chain features are actually in the driving accommodate during a crisis. Product development and advertising and marketing activities need to go hand in deep hand with supply chain events. Regardless of whether the corona pandemic will structurally change the classic discussions between logistics and creation on the one hand as well as advertising on the other hand, the long term will have to tell.
How’s the Dutch foods supply chain coping during the corona crisis?
