Supply chain – The COVID 19 pandemic has certainly had the impact of its impact on the world. health and Economic indicators have been affected and all industries have been completely touched within one of the ways or even yet another. One of the industries in which this was clearly visible would be the farming and food industry.
In 2019, the Dutch agriculture as well as food sector contributed 6.4 % to the yucky domestic product (CBS, 2020). Based on the FoodService Instituut, the foodservice business in the Netherlands shed € 7.1 billion inside 2020. The hospitality trade 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 in the food chain have significant consequences for the Dutch economy and food security as a lot of stakeholders are impacted. Even though it was apparent to many individuals that there was a big impact at the conclusion of this chain (e.g., hoarding in grocery stores, eateries closing) and also at the start of the chain (e.g., harvested potatoes not searching for customers), there are a lot of actors within the source chain for that the effect is much less clear. It’s therefore vital that you figure out how properly the food supply chain as a whole is equipped to deal 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 influences of the COVID-19 pandemic throughout the food supply chain. They based the analysis of theirs on interviews with around thirty Dutch source chain actors.
Need in retail up, that is found food service down It is obvious and popular that need in the foodservice channels went down on account of the closure of restaurants, amongst others. In some cases, sales for suppliers of the food service industry as a result fell to about twenty % of the first volume. Being a complication, demand in the retail stations went up and remained at a degree of aproximatelly 10 20 % higher than before the problems started.
Products that had to come through abroad had their very own issues. With the change in demand from foodservice to retail, the requirement for packaging improved dramatically, More tin, cup and plastic material was necessary for wearing in customer packaging. As more of this particular product packaging material ended up in consumers’ homes rather than in joints, the cardboard recycling system got disrupted also, causing shortages.
The shifts in desire have had an important effect on production activities. In certain instances, this even meant a total stop of production (e.g. within the duck farming business, which came to a standstill on account of demand fall-out on the foodservice sector). In other cases, a significant part of the personnel contracted corona (e.g. to the meat 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 bins to slow down fairly shortly in 2020. This resulted in transport capability which is limited during the earliest weeks of the issues, and high expenses for container transport as a result. Truck transportation experienced various problems. Initially, there were uncertainties about how transport will be handled at borders, which in the end were not as strict as feared. The thing that was problematic in cases that are most , nonetheless, was the availability of motorists.
The reaction to COVID-19 – deliver chain resilience The source chain resilience analysis held by Prof. de Leeuw and Colleagues, was based on the overview of this core things of supply chain resilience:
To us this particular framework for the evaluation of the interview, the conclusions indicate that few businesses had been well prepared for the corona problems and in reality mainly applied responsive methods. The most notable supply chain lessons were:
Figure one. 8 best methods for food supply chain resilience
To begin with, the need to design the supply chain for agility and flexibility. This appears particularly challenging for small companies: building resilience into a supply chain takes time and attention in the organization, and smaller organizations oftentimes don’t have the capacity to accomplish that.
Next, it was observed that much more interest was required on spreading threat as well as aiming for risk reduction inside the supply chain. For the future, meaning far more attention ought to be given to the manner in which organizations rely on specific countries, customers, and suppliers.
Third, attention is needed for explicit prioritization and intelligent rationing techniques in situations in which need can’t be met. Explicit prioritization is required to keep on to satisfy market expectations but additionally to increase market shares in which competitors miss options. This challenge is not new, however, it has additionally been underexposed in this specific crisis and was frequently not a part of preparatory activities.
Fourthly, the corona issues shows us that the monetary effect of a crisis also depends on the manner in which cooperation in the chain is actually set up. It’s often unclear precisely how additional costs (and benefits) are actually 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 advertising and marketing activities need to go hand in deep hand with supply chain events. Whether or not the corona pandemic will structurally change the classic considerations between logistics and generation on the one hand as well as advertising and marketing on the other hand, the long term will have to explain to.
How’s the Dutch foods supply chain coping throughout the corona crisis?