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 within one way or perhaps yet another. One of the industries in which it was clearly noticeable is the agriculture and food industry.
Throughout 2019, the Dutch farming as well as food industry contributed 6.4 % to the yucky domestic product (CBS, 2020). Based on the FoodService Instituut, the foodservice industry in the Netherlands lost € 7.1 billion within 2020. The hospitality business lost 41.5 % of its turnover as show by ProcurementNation, while at the identical time supermarkets enhanced the turnover of theirs with € 1.8 billion.
Disruptions of the food chain have major consequences for the Dutch economy and food security as many stakeholders are impacted. Even though it was apparent to numerous people that there was a big effect at the end of this chain (e.g., hoarding around supermarkets, eateries closing) and at the start of the chain (e.g., harvested potatoes not finding customers), there are many actors in the source chain for that the impact is much less clear. It’s thus imperative that you find out how properly the food supply chain as being a whole is actually armed to deal with disruptions. Researchers from the Operations Research and Logistics Group at Wageningen University and also from Wageningen Economics Research, led by Professor Sander de Leeuw, studied the consequences of the COVID 19 pandemic all over the food resources chain. They based their analysis on interviews with around thirty Dutch supply chain actors.
Demand in retail up, contained food service down It is apparent and popular that demand in the foodservice stations went down on account of the closure of joints, amongst others. In some instances, sales for vendors of the food service industry thus fell to aproximatelly 20 % of the original volume. Being a complication, demand in the retail stations went up and remained at a quality of aproximatelly 10 20 % greater than before the crisis started.
Products which had to come from abroad had their very own problems. With the shift in desire from foodservice to retail, the demand for packaging changed dramatically, More tin, glass and plastic material was necessary for use in customer packaging. As much more of this particular packaging material ended up in consumers’ homes instead of in joints, the cardboard recycling system got disrupted also, causing shortages.
The shifts in need have had a big affect on output activities. In a few cases, this even meant a total stop of output (e.g. inside the duck farming business, which came to a standstill as a result of demand fall-out in the foodservice sector). In other instances, a big portion 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 start of the Corona crisis of China triggered the flow of sea canisters to slow down pretty soon in 2020. This resulted in restricted transport electrical capacity throughout the first weeks of the problems, and high expenses for container transport as a direct result. Truck transportation faced different problems. At first, there were uncertainties regarding how transport will be managed for borders, which in the long run weren’t as strict as feared. That which was problematic in many situations, however, was the availability of motorists.
The response to COVID-19 – supply chain resilience The supply chain resilience evaluation held by Prof. de Colleagues and Leeuw, was used on the overview of this main elements of supply chain resilience:
To us this framework for the assessment of the interview, the results indicate that not many organizations had been well prepared for the corona crisis and actually mostly applied responsive practices. Probably the most important source chain lessons were:
Figure 1. Eight best methods for meals supply chain resilience
First, the need to design the supply chain for versatility as well as agility. This looks particularly challenging for smaller sized companies: building resilience into a supply chain takes attention and time in the organization, and smaller organizations usually don’t have the capability to accomplish that.
Next, it was observed that much more attention was needed on spreading danger as well as aiming for risk reduction inside the supply chain. For the future, this means more attention should be made available to the manner in which organizations count on suppliers, customers, and specific countries.
Third, attention is required for explicit prioritization and clever rationing techniques in situations in which demand can’t be met. Explicit prioritization is actually needed to keep on to satisfy market expectations but additionally to increase market shares wherein competitors miss opportunities. This particular challenge is not new, although it’s also been underexposed in this problems and was usually not a component of preparatory pursuits.
Fourthly, the corona issues teaches us that the monetary effect of a crisis additionally is determined by the manner in which cooperation in the chain is actually set up. It’s usually unclear precisely how extra expenses (and benefits) are sent out in a chain, in case at all.
Finally, relative to other purposeful departments, the businesses and supply chain characteristics are in the driving seat during a crisis. Product development and marketing and advertising activities need to go hand in deep hand with supply chain events. Regardless of whether the corona pandemic will structurally replace the traditional considerations between creation and logistics on the one hand and marketing on the other, the long term will need to explain to.
How is the Dutch meal supply chain coping during the corona crisis?