Supply chain - The COVID-19 pandemic has definitely had its impact effect on the planet. health and Economic indicators have been compromised and all industries have been completely touched within a way or another. One of the industries in which this was clearly apparent will be the farming and food industry.
Throughout 2019, the Dutch extension and food sector contributed 6.4 % to the yucky domestic item (CBS, 2020). Based on the FoodService Instituut, the foodservice industry in the Netherlands lost € 7.1 billion within 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 significant effects for the Dutch economy as well as food security as a lot of stakeholders are affected. Though it was apparent to most folks that there was a significant effect at the end of the chain (e.g., hoarding around supermarkets, restaurants closing) and also at the beginning of this chain (e.g., harvested potatoes not searching for customers), there are numerous actors inside the supply chain for that will the impact is much less clear. It's therefore important to determine how effectively the food supply chain as a whole is actually prepared to cope with disruptions. Researchers from the Operations Research and Logistics Group at Wageningen Faculty as well as out of Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the influences of the COVID-19 pandemic throughout the food supply chain. They based the analysis of theirs on interviews with about 30 Dutch source chain actors.
Demand within retail up, contained food service down It's apparent and well known that need in the foodservice channels went down on account of the closure of restaurants, amongst others. In certain cases, sales for suppliers in the food service business therefore fell to about 20 % of the initial volume. As a complication, demand in the list channels went up and remained at a quality of aproximatelly 10-20 % greater than before the crisis started.
Products that had to come via abroad had the own problems of theirs. With the change in demand coming from foodservice to retail, the requirement for packaging changed considerably, More tin, glass or plastic was needed for use in customer packaging. As more of this particular product packaging material ended up in consumers' houses as opposed to in joints, the cardboard recycling function got disrupted also, causing shortages.
The shifts in need have had a significant effect on output activities. In some instances, this even meant a total stop of production (e.g. in the duck farming industry, which arrived to a standstill on account of demand fall out on the foodservice sector). In other cases, a major section 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 beginning of the Corona crisis in China caused the flow of sea canisters to slow down fairly shortly in 2020. This resulted in limited transport electrical capacity throughout the first weeks of the issues, and high costs for container transport as a direct result. Truck transportation encountered different problems. At first, there were uncertainties about how transport will be handled for borders, which in the long run were not as stringent as feared. That which was problematic in situations that are most , nonetheless, was the accessibility of drivers.
The response to COVID 19 - supply chain resilience The supply chain resilience analysis held by Prof. de Leeuw and Colleagues, was used on the overview of this main elements of supply chain resilience:
To us this particular framework for the evaluation of the interview, the conclusions show that not many companies had been nicely prepared for the corona crisis and actually mostly applied responsive methods. Probably the most notable source chain lessons were:
Figure one. 8 best practices for meals supply chain resilience
To begin with, the need to design the supply chain for versatility as well as agility. This looks especially complicated for smaller sized companies: building resilience into a supply chain takes attention and time in the organization, and smaller organizations oftentimes do not have the capability to do so.
Second, it was observed that much more attention was necessary on spreading threat and also aiming for risk reduction within the supply chain. For the future, what this means is far more attention has to be provided to the manner in which companies rely on specific countries, customers, and suppliers.
Third, attention is required for explicit prioritization as well as intelligent rationing strategies in situations in which need can't be met. Explicit prioritization is actually necessary to continue to meet market expectations but also to improve market shares wherein competitors miss opportunities. This particular challenge is not new, although it's in addition been underexposed in this specific problems and was usually not a component of preparatory pursuits.
Fourthly, the corona crisis shows us that the monetary result of a crisis in addition relies on the way cooperation in the chain is set up. It is usually unclear precisely how extra costs (and benefits) are distributed in a chain, if at all.
Last but not least, relative to other functional departments, the businesses and supply chain operates 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 pursuits. Whether the corona pandemic will structurally change the basic considerations between creation and logistics on the one hand as well as marketing on the other hand, the long term must tell.
How is the Dutch foods supply chain coping throughout the corona crisis?