Supply chain – The COVID 19 pandemic has undoubtedly had its impact impact on the planet. health and Economic indicators have been affected and all industries have been completely touched inside a way or yet another. One of the industries in which it was clearly apparent will be the farming as well as food business.
Throughout 2019, the Dutch farming and food sector contributed 6.4 % to the gross domestic item (CBS, 2020). According to the FoodService Instituut, the foodservice business in the Netherlands lost € 7.1 billion in 2020. The hospitality industry lost 41.5 % of the turnover of its as show by ProcurementNation, while at exactly the same time supermarkets increased their turnover with € 1.8 billion.
Disruptions in the food chain have big effects for the Dutch economy and food security as a lot of stakeholders are impacted. Though it was apparent to a lot of folks that there was a huge impact at the conclusion of the chain (e.g., hoarding in supermarkets, eateries closing) and at the beginning of the chain (e.g., harvested potatoes not finding customers), there are a lot of actors within the supply chain for that will the effect is less clear. It is therefore important to determine how effectively the food supply chain as a whole is actually prepared to cope with disruptions. Researchers from your Operations Research and Logistics Group at Wageningen University as well as out of Wageningen Economics Research, led by Professor Sander de Leeuw, studied the influences of the COVID-19 pandemic throughout the food supply chain. They based the analysis of theirs on interviews with about 30 Dutch source chain actors.
Need in retail up, in food service down It’s obvious and widely known that need in the foodservice channels went down as a result of the closure of places, amongst others. In certain cases, sales for vendors in the food service industry thus fell to about twenty % of the original volume. As a complication, demand in the list channels went up and remained within a quality of about 10-20 % greater than before the problems started.
Products that had to come from abroad had the own problems of theirs. With the change in desire coming from foodservice to retail, the demand for packaging changed dramatically, More tin, cup or plastic material was required for wearing in consumer packaging. As much more of this product packaging material ended up in consumers’ houses as opposed to in joints, the cardboard recycling process got disrupted too, causing shortages.
The shifts in desire have had a big impact on output activities. In some instances, this even meant a full stop of production (e.g. inside the duck farming business, which emerged to a standstill due to demand fall out inside the foodservice sector). In other cases, a significant 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 beginning of the Corona crisis of China caused the flow of sea canisters to slow down pretty soon in 2020. This resulted in transport capability which is limited during the earliest weeks of the crisis, and high expenses for container transport as a result. Truck travel encountered different issues. At first, there were uncertainties regarding how transport would be managed at borders, which in the long run weren’t as strict as feared. The thing that was problematic in most situations, however, was the availability of drivers.
The response to COVID 19 – deliver chain resilience The supply chain resilience analysis held by Prof. de Colleagues as well as Leeuw, was used on the overview of the core things of supply chain resilience:
Using this particular framework for the analysis of the interview, the conclusions indicate that not many organizations had been nicely prepared for the corona problems and in fact mostly applied responsive methods. The most important supply chain lessons were:
Figure one. 8 best practices for meals supply chain resilience
To begin with, the need to create the supply chain for flexibility as well as agility. This seems especially challenging for smaller companies: building resilience into a supply chain takes time and attention in the organization, and smaller organizations usually do not have the potential to do so.
Next, it was observed that much more interest was needed on spreading risk and also aiming for risk reduction in the supply chain. For the future, what this means is more attention ought to be provided to the manner in which companies rely on specific countries, customers, and suppliers.
Third, attention is required for explicit prioritization and smart rationing techniques in situations in which need can’t be met. Explicit prioritization is actually required to continue to meet market expectations but also to boost market shares where competitors miss opportunities. This particular task is not new, but it’s also been underexposed in this problems and was frequently not part of preparatory pursuits.
Fourthly, the corona crisis teaches us that the financial impact of a crisis also depends on the way cooperation in the chain is set up. It is often unclear precisely how additional costs (and benefits) are sent out in a chain, if at all.
Lastly, relative to other functional departments, the operations and supply chain capabilities are actually in the driving seat during a crisis. Product development and advertising activities need to go hand in deep hand with supply chain events. Whether the corona pandemic will structurally change the traditional considerations between logistics and creation on the one hand as well as marketing and advertising on the other hand, the future will need to tell.
How is the Dutch meal supply chain coping during the corona crisis?