Supply chain – The COVID 19 pandemic has definitely had its impact impact on the planet. Economic indicators and health have been compromised and all industries have been touched inside a way or even some other. Among the industries in which it was clearly visible is the agriculture and food business.
In 2019, the Dutch farming and food niche contributed 6.4 % to the disgusting domestic item (CBS, 2020). According to the FoodService Instituut, the foodservice industry 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 the same time supermarkets increased their turnover with € 1.8 billion.
Disruptions of the food chain have big effects for the Dutch economy as well as food security as lots of stakeholders are impacted. Even though it was clear to many folks that there was a great effect at the tail end of this chain (e.g., hoarding in food markets, eateries closing) and at the beginning of this chain (e.g., harvested potatoes not searching for customers), you will find numerous actors in the source chain for that will the impact is much less clear. It’s thus imperative that you find out how well the food supply chain as a whole is actually prepared to cope with disruptions. Researchers from your Operations Research as well as Logistics Group at Wageningen Faculty and coming from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the consequences of the COVID-19 pandemic all over the food supply chain. They based their examination on interviews with around thirty Dutch source chain actors.
Demand in retail up, that is found food service down It is apparent and popular that demand in the foodservice channels went down due to the closure of joints, amongst others. In some cases, sales for suppliers of the food service business as a result fell to about 20 % of the initial volume. Being a complication, demand in the list stations went up and remained within a level of aproximatelly 10-20 % higher than before the problems began.
Products which had to come via abroad had the own issues of theirs. With the shift in demand from foodservice to retail, the need for packaging improved dramatically, More tin, glass or plastic was required for wearing in buyer packaging. As more of this packaging material ended up in consumers’ homes rather than in places, the cardboard recycling process got disrupted too, causing shortages.
The shifts in demand have had a major effect on output activities. In a few cases, this even meant a complete stop in output (e.g. in the duck farming industry, which arrived to a standstill as a result of demand fall-out inside the foodservice sector). In other cases, a big section of the personnel contracted corona (e.g. to the various meats processing industry), leading to a closure of facilities.
Supply chain – Distribution activities were also affected. The start of the Corona crisis of China triggered the flow of sea bins to slow down pretty shortly in 2020. This resulted in transport electrical capacity that is restricted during the very first weeks of the issues, and high costs for container transport as a result. Truck transport experienced different issues. At first, there were uncertainties regarding how transport will be handled at borders, which in the long run were not as stringent as feared. That which was problematic in cases that are a large number of , however, was the accessibility of motorists.
The reaction to COVID-19 – provide chain resilience The supply chain resilience evaluation held by Prof. de Colleagues as well as Leeuw, was used on the overview of this main things of supply chain resilience:
Using this framework for the analysis of the interview, the findings indicate that not many organizations had been well prepared for the corona problems and in reality mostly applied responsive practices. Probably the most notable source chain lessons were:
Figure one. Eight best methods for meals supply chain resilience
First, the need to create the supply chain for versatility as well as agility. This looks especially challenging for small companies: building resilience into a supply chain takes attention and time in the organization, and smaller organizations usually don’t have the potential to do it.
Second, it was discovered that much more interest was required on spreading threat and also aiming for risk reduction in the supply chain. For the future, this means far more attention should be provided to the manner in which companies rely on suppliers, customers, and specific countries.
Third, attention is necessary for explicit prioritization as well as clever rationing techniques in cases in which demand can’t be met. Explicit prioritization is actually necessary to keep on to meet market expectations but in addition to increase market shares in which competitors miss opportunities. This challenge is not new, but it’s additionally been underexposed in this specific crisis and was often not part of preparatory pursuits.
Fourthly, the corona issues shows us that the monetary effect of a crisis in addition is determined by the manner in which cooperation in the chain is set up. It’s usually unclear how additional expenses (and benefits) are distributed 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 replace the basic considerations between generation and logistics on the one hand as well as advertising on the other, the long term will have to tell.
How is the Dutch food supply chain coping during the corona crisis?