Supply chain – The COVID-19 pandemic has certainly had its impact influence on the world. Economic indicators and health have been affected and all industries have been completely touched in one way or some other. One of the industries in which this was clearly noticeable would be the farming and food industry.
In 2019, the Dutch extension and food industry contributed 6.4 % to the yucky domestic product (CBS, 2020). As per the FoodService Instituut, the foodservice industry in the Netherlands shed € 7.1 billion within 2020. The hospitality industry lost 41.5 % of its turnover as show by ProcurementNation, while at the identical time supermarkets enhanced their turnover with € 1.8 billion.
Disruptions in the food chain have big consequences for the Dutch economy as well as food security as a lot of stakeholders are affected. Though it was clear to a lot of individuals that there was a big effect at the conclusion of the chain (e.g., hoarding around food markets, eateries closing) and also at the beginning of the chain (e.g., harvested potatoes not finding customers), there are many actors within the supply chain for that the effect is much less clear. It’s thus vital that you find out how effectively the food supply chain as being a whole is actually equipped to cope with disruptions. Researchers from your Operations Research as well as Logistics Group at Wageningen Faculty as well as coming from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the consequences of the COVID 19 pandemic throughout the food supply chain. They based the examination of theirs on interviews with around 30 Dutch supply chain actors.
Demand in retail up, found food service down It’s obvious and popular that need in the foodservice stations went down due to the closure of joints, amongst others. In some cases, sales for vendors in the food service business as a result fell to aproximatelly 20 % of the original volume. As a complication, demand in the list stations went up and remained at a quality of aproximatelly 10-20 % greater than before the crisis began.
Products that had to come via abroad had the own issues of theirs. With the change in desire coming from foodservice to retail, the demand for packaging improved considerably, More tin, glass and plastic was needed for use in customer packaging. As much more of this product packaging material concluded up in consumers’ houses as opposed to in places, the cardboard recycling process got disrupted as well, causing shortages.
The shifts in desire have had a big affect on output activities. In certain cases, this even meant the full stop of production (e.g. inside the duck farming business, which arrived to a standstill on account of demand fall out in the foodservice sector). In other instances, a significant part of the personnel contracted corona (e.g. in the various meats processing industry), resulting in a closure of equipment.
Supply chain – Distribution pursuits were also affected. The beginning of the Corona crisis in China caused the flow of sea canisters to slow down pretty soon in 2020. This resulted in limited transport capacity throughout the earliest weeks of the issues, and costs that are high for container transport as a result. Truck transport faced various problems. To begin with, there were uncertainties regarding how transport will be handled for borders, which in the end were not as rigid as feared. What was problematic in cases which are most, nevertheless, was the accessibility of motorists.
The response to COVID-19 – provide chain resilience The source chain resilience analysis held by Prof. de Leeuw as well as Colleagues, was used on the overview of the primary elements of supply chain resilience:
To us this framework for the analysis of the interviews, the conclusions show that few businesses had been well prepared for the corona crisis and in reality mostly applied responsive practices. Probably the most important source chain lessons were:
Figure one. Eight best methods for food supply chain resilience
For starters, the need to design the supply chain for versatility and agility. This looks especially complicated for smaller companies: building resilience into a supply chain takes attention and time in the organization, and smaller organizations often don’t have the capacity to accomplish that.
Next, it was discovered that more interest was required on spreading danger as well as aiming for risk reduction in the supply chain. For the future, meaning far more attention should be given to the manner in which organizations rely on suppliers, customers, and specific countries.
Third, attention is needed for explicit prioritization as well as intelligent rationing strategies in cases where demand cannot be met. Explicit prioritization is actually needed to continue to satisfy market expectations but also to boost market shares where competitors miss options. This challenge is not new, but it’s additionally been underexposed in this specific problems and was usually not a component of preparatory activities.
Fourthly, the corona problems shows you us that the financial effect of a crisis additionally relies on the way cooperation in the chain is set up. It is usually unclear exactly how extra costs (and benefits) are sent out in a chain, if at all.
Finally, relative to other purposeful departments, the businesses and supply chain capabilities are actually in the driving seat during a crisis. Product development and marketing activities have to go hand in hand with supply chain events. Whether or not the corona pandemic will structurally change the basic considerations between logistics and creation on the one hand as well as marketing and advertising on the other hand, the potential future will have to explain to.
How’s the Dutch meal supply chain coping during the corona crisis?