Supply chain – The COVID 19 pandemic has certainly had its impact influence on the planet. health and Economic indicators have been compromised and all industries are touched inside one way or some other. Among the industries in which it was clearly obvious would be the farming and food business.
In 2019, the Dutch extension and food industry contributed 6.4 % to the disgusting domestic product (CBS, 2020). According to the FoodService Instituut, the foodservice business in the Netherlands lost € 7.1 billion within 2020. The hospitality business lost 41.5 % of the turnover of its as show by ProcurementNation, while at the same time supermarkets increased their turnover with € 1.8 billion.
Disruptions of the food chain have big consequences for the Dutch economy as well as food security as lots of stakeholders are affected. Though it was apparent to many men and women that there was a big impact at the tail end of this chain (e.g., hoarding around food markets, eateries closing) and also at the beginning of the chain (e.g., harvested potatoes not searching for customers), you will find many actors in the supply chain for that will the effect is much less clear. It is therefore imperative that you find out how effectively the food supply chain as a whole is actually armed to cope with disruptions. Researchers in the Operations Research as well as Logistics Group at Wageningen Faculty and out of Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the influences of the COVID-19 pandemic throughout the food supplies chain. They based the analysis of theirs on interviews with around 30 Dutch supply chain actors.
Demand within retail up, contained food service down It is evident and popular that need in the foodservice channels went down due to the closure of restaurants, amongst others. In some cases, sales for suppliers of the food service industry therefore fell to about twenty % of the original volume. Being an adverse reaction, demand in the retail channels went up and remained at a quality of aproximatelly 10 20 % higher than before the problems began.
Products that had to come through abroad had the own issues of theirs. With the shift in need coming from foodservice to retail, the requirement for packaging improved considerably, More tin, glass or plastic was required for use in customer packaging. As more of this packaging material ended up in consumers’ homes instead of in places, the cardboard recycling process got disrupted too, causing shortages.
The shifts in need have had an important affect on output activities. In certain cases, this even meant a full stop in production (e.g. within the duck farming industry, which came to a standstill due to demand fall-out on the foodservice sector). In other situations, a big portion of the personnel contracted corona (e.g. to the meat processing industry), leading to a closure of equipment.
Supply chain – Distribution pursuits were also affected. The start of the Corona crisis of China sparked the flow of sea bins to slow down pretty shortly in 2020. This resulted in limited transport capability throughout the earliest weeks of the problems, and high costs for container transport as a direct result. Truck transport encountered different problems. To begin with, there were uncertainties regarding how transport would be managed at borders, which in the end weren’t as strict as feared. That which was problematic in instances that are a large number of , nevertheless, was the availability of drivers.
The response to COVID 19 – supply chain resilience The source chain resilience analysis held by Prof. de Leeuw as well as Colleagues, was used on the overview of the core components of supply chain resilience:
Using this particular framework for the evaluation of the interviews, the conclusions show that few companies had been well prepared for the corona crisis and actually mostly applied responsive methods. The most important source chain lessons were:
Figure 1. Eight best practices for meals supply chain resilience
To begin with, the need to design the supply chain for flexibility and agility. This seems particularly challenging for smaller companies: building resilience into a supply chain takes attention and time in the business, and smaller organizations usually do not have the capability to accomplish that.
Second, it was observed that much more interest was necessary on spreading danger and aiming for risk reduction within the supply chain. For the future, what this means is far more attention ought to be given to the manner in which companies count on suppliers, customers, and specific countries.
Third, attention is necessary for explicit prioritization and smart rationing techniques in situations in which demand can’t be met. Explicit prioritization is actually required to continue to meet market expectations but also to improve market shares in which competitors miss options. This particular challenge is not new, though it has also been underexposed in this specific problems and was often not a part of preparatory pursuits.
Fourthly, the corona issues shows us that the financial effect of a crisis also depends on the manner in which cooperation in the chain is actually set up. It’s usually unclear how extra expenses (and benefits) are actually distributed in a chain, in case at all.
Finally, relative to other purposeful 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 pursuits. Regardless of whether the corona pandemic will structurally change the classic discussions between production and logistics on the one hand and marketing on the other hand, the potential future will need to explain to.
How is the Dutch meal supply chain coping during the corona crisis?