Supply chain – The COVID 19 pandemic has definitely had its impact influence on the world. health and Economic indicators have been compromised and all industries have been completely touched in one of the ways or even another. Among the industries in which this was clearly noticeable would be the agriculture and food industry.
Throughout 2019, the Dutch extension and food industry contributed 6.4 % to the disgusting domestic product (CBS, 2020). Based on the FoodService Instituut, the foodservice industry in the Netherlands dropped € 7.1 billion within 2020. The hospitality industry lost 41.5 % of its turnover 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 big effects for the Dutch economy and food security as many stakeholders are affected. Despite the fact that it was clear to a lot of men and women that there was a significant impact at the conclusion of the chain (e.g., hoarding in food markets, eateries closing) and at the beginning of the chain (e.g., harvested potatoes not searching for customers), you will find a lot of actors in the supply chain for which the effect is less clear. It is thus imperative that you find out how properly the food supply chain as a whole is prepared to contend with disruptions. Researchers in the Operations Research as well as Logistics Group at Wageningen University as well as from Wageningen Economics Research, led by Professor Sander de Leeuw, studied the consequences of the COVID 19 pandemic all over the food supply chain. They based their analysis on interviews with about 30 Dutch source chain actors.
Need within retail up, found food service down It’s obvious and well known that demand in the foodservice stations went down on account of the closure of restaurants, amongst others. In some cases, sales for vendors in the food service business therefore fell to about twenty % of the first volume. As an adverse reaction, demand in the list channels went up and remained within a degree of aproximatelly 10 20 % higher than before the crisis began.
Products which had to come via abroad had their own issues. With the shift in desire from foodservice to retail, the need for packaging improved dramatically, More tin, glass or plastic was required for wearing in consumer packaging. As more of this packaging material ended up in consumers’ houses rather than in joints, the cardboard recycling process got disrupted also, causing shortages.
The shifts in demand have had a significant affect on production activities. In some cases, this even meant a total stop in production (e.g. within the duck farming industry, which arrived to a standstill as a result of demand fall out on the foodservice sector). In other situations, a big section of the personnel contracted corona (e.g. to the various meats processing industry), resulting in a closure of equipment.
Supply chain – Distribution activities were also affected. The beginning of the Corona crisis of China caused the flow of sea bins to slow down fairly shortly in 2020. This resulted in restricted transport electrical capacity throughout the first weeks of the issues, and expenses which are high for container transport as a consequence. Truck travel experienced various issues. To begin with, there were uncertainties about how transport will be managed at borders, which in the long run weren’t as strict as feared. The thing that was problematic in situations which are most, nevertheless, was the availability of drivers.
The response to COVID-19 – deliver chain resilience The supply chain resilience evaluation held by Prof. de Colleagues as well as Leeuw, was used on the overview of the core elements of supply chain resilience:
To us this particular framework for the assessment of the interview, the conclusions indicate that not many businesses had been nicely prepared for the corona crisis and actually mainly applied responsive practices. Probably the most notable source chain lessons were:
Figure 1. 8 best practices for meals supply chain resilience
For starters, the need to create the supply chain for agility and versatility. This appears especially complicated for smaller sized companies: building resilience into a supply chain takes time and attention in the organization, and smaller organizations often do not have the capacity to accomplish that.
Second, it was observed that much more interest was necessary on spreading threat and aiming for risk reduction within the supply chain. For the future, this means far more attention ought to be provided to the manner in which companies rely on specific countries, customers, and suppliers.
Third, attention is necessary for explicit prioritization as well as smart rationing strategies in situations where demand cannot be met. Explicit prioritization is necessary to continue to meet market expectations but in addition to boost market shares wherein competitors miss opportunities. This particular task isn’t new, but it’s in addition been underexposed in this specific problems and was usually not a part of preparatory pursuits.
Fourthly, the corona issues teaches us that the economic effect of a crisis in addition relies on the manner in which cooperation in the chain is actually set up. It’s often unclear precisely how extra costs (and benefits) are actually distributed in a chain, if at all.
Lastly, relative to other functional departments, the operations and supply chain works are in the driving seat during a crisis. Product development and marketing and advertising activities need to go hand deeply in hand with supply chain activities. Regardless of whether the corona pandemic will structurally switch the traditional discussions between logistics and generation on the one hand as well as advertising on the other hand, the potential future must tell.
How is the Dutch meal supply chain coping during the corona crisis?