Supply chain – The COVID 19 pandemic has certainly had its impact effect on the planet. health and Economic indicators have been compromised and all industries are touched inside one of the ways or even some other. Among the industries in which this was clearly obvious will be the agriculture and food business.
In 2019, the Dutch extension and food industry contributed 6.4 % to the yucky domestic product (CBS, 2020). As per the FoodService Instituut, the foodservice industry in the Netherlands lost € 7.1 billion inside 2020. The hospitality industry lost 41.5 % of the turnover of its as show by ProcurementNation, while at the identical time supermarkets increased the turnover of theirs with € 1.8 billion.
Disruptions of the food chain have big effects for the Dutch economy as well as food security as a lot of stakeholders are impacted. Even though it was clear to majority of people that there was a great effect at the tail end of the chain (e.g., hoarding doing grocery stores, eateries closing) as well as at the beginning of the chain (e.g., harvested potatoes not finding customers), there are many actors within the supply chain for that the effect is less clear. It is thus important to determine how well the food supply chain as being a whole is prepared to contend with disruptions. Researchers from the Operations Research and Logistics Group at Wageningen University and also coming from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the influences of the COVID 19 pandemic throughout the food supplies chain. They based their analysis on interviews with about 30 Dutch supply chain actors.
Need within retail up, in food service down It is evident and popular that demand in the foodservice channels went down on account of the closure of restaurants, amongst others. In a few cases, sales for vendors in the food service industry thus fell to aproximatelly twenty % of the initial volume. Being a side effect, demand in the list stations went up and remained at a degree of aproximatelly 10 20 % higher than before the problems began.
Products which had to come via abroad had their own issues. With the shift in demand from foodservice to retail, the demand for packaging improved considerably, More tin, glass or plastic was necessary for wearing in buyer packaging. As much more of this product packaging material ended up in consumers’ homes instead of in joints, the cardboard recycling system got disrupted also, causing shortages.
The shifts in demand have had a significant affect on output activities. In some cases, this even meant the full stop in output (e.g. within the duck farming industry, which arrived to a standstill on account of demand fall-out inside the foodservice sector). In other instances, a big part of the personnel contracted corona (e.g. in the meat processing industry), leading to a closure of facilities.
Supply chain – Distribution activities were also affected. The beginning of the Corona crisis in China caused the flow of sea bins to slow down fairly shortly in 2020. This resulted in transport capacity which is limited during the first weeks of the problems, and costs that are high for container transport as a result. Truck transport experienced different problems. To begin with, there were uncertainties regarding how transport would be managed for borders, which in the long run were not as strict as feared. The thing that was problematic in cases which are many, nonetheless, was the accessibility of motorists.
The reaction to COVID 19 – deliver chain resilience The supply chain resilience evaluation held by Prof. de Colleagues and Leeuw, was used on the overview of the key things of supply chain resilience:
Using this particular framework for the analysis of the interview, the results show that few companies had been nicely prepared for the corona crisis and in reality mainly applied responsive practices. Probably the most notable source chain lessons were:
Figure one. 8 best practices for meals supply chain resilience
To begin with, the need to create the supply chain for flexibility and agility. This appears especially complicated for smaller companies: building resilience into a supply chain takes time and attention in the business, and smaller organizations usually do not have the capacity to do it.
Second, it was discovered that much more interest was necessary on spreading danger and aiming for risk reduction within the supply chain. For the future, what this means is more attention ought to be made available to the manner in which companies count on suppliers, customers, and specific countries.
Third, attention is necessary for explicit prioritization as well as clever rationing strategies in cases where need cannot be met. Explicit prioritization is actually needed to continue to satisfy market expectations but also to improve market shares wherein competitors miss options. This particular challenge is not new, though it’s in addition been underexposed in this specific crisis and was usually not a part of preparatory pursuits.
Fourthly, the corona problems teaches us that the economic result of a crisis in addition is determined by the way cooperation in the chain is set up. It is typically unclear exactly how further costs (and benefits) are sent out in a chain, if at all.
Lastly, relative to other purposeful departments, the operations and supply chain operates are actually in the driving accommodate during a crisis. Product development and advertising activities have to go hand deeply in hand with supply chain events. Whether the corona pandemic will structurally change the traditional discussions between creation and logistics on the one hand and advertising and marketing on the other, the future must tell.
How is the Dutch meal supply chain coping during the corona crisis?