Supply chain – The COVID 19 pandemic has undoubtedly had the impact of its impact on the planet. Economic indicators and health have been affected and all industries have been touched inside one of the ways or perhaps yet another. Among the industries in which this was clearly apparent would be the farming as well as food industry.
Throughout 2019, the Dutch farming as well as food industry contributed 6.4 % to the disgusting domestic item (CBS, 2020). According to the FoodService Instituut, the foodservice business in the Netherlands lost € 7.1 billion inside 2020. The hospitality trade lost 41.5 % of the turnover of its as show by ProcurementNation, while at the identical time supermarkets enhanced their turnover with € 1.8 billion.
Disruptions of the food chain have major effects for the Dutch economy as well as food security as a lot of stakeholders are affected. Even though it was clear to many people that there was a big impact at the tail end of the chain (e.g., hoarding around supermarkets, eateries closing) and also at the beginning of the chain (e.g., harvested potatoes not finding customers), there are many actors in the source chain for that will the effect is less clear. It is therefore important to determine how properly the food supply chain as being a whole is actually prepared to deal with disruptions. Researchers from your Operations Research as well as Logistics Group at Wageningen University and coming from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the influences of the COVID 19 pandemic throughout the food resources chain. They based the analysis of theirs on interviews with about thirty Dutch source chain actors.
Need within retail up, that is found food service down It’s evident and well known that demand in the foodservice channels went down due to the closure of restaurants, amongst others. In a few cases, sales for vendors in the food service business therefore fell to about 20 % of the original volume. Being a complication, demand in the list stations went up and remained within a level of about 10 20 % greater than before the problems started.
Goods that had to come via abroad had their own problems. With the change in demand from foodservice to retail, the demand for packaging improved considerably, More tin, glass or plastic material was necessary for use in buyer packaging. As more of this packaging material ended up in consumers’ houses instead of in joints, the cardboard recycling process got disrupted too, causing shortages.
The shifts in demand have had a major impact on production activities. In a few cases, this even meant a total stop in production (e.g. within the duck farming industry, which came to a standstill due to demand fall out on the foodservice sector). In other cases, a major portion of the personnel contracted corona (e.g. in the meat processing industry), leading to a closure of facilities.
Supply chain – Distribution pursuits were also affected. The beginning of the Corona crisis in China triggered the flow of sea containers to slow down pretty soon in 2020. This resulted in restricted transport capacity throughout the first weeks of the issues, and expenses which are high for container transport as a consequence. Truck travel experienced various problems. To begin with, there were uncertainties regarding how transport will be handled for borders, which in the end were not as strict as feared. The thing that was problematic in most cases, nonetheless, was the availability of drivers.
The reaction to COVID 19 – supply chain resilience The source chain resilience evaluation held by Prof. de Colleagues as well as Leeuw, was used on the overview of the core components of supply chain resilience:
To us this framework for the assessment of the interview, the results indicate that few organizations were nicely prepared for the corona problems and actually mainly applied responsive practices. The most notable supply chain lessons were:
Figure 1. 8 best practices for meals supply chain resilience
First, the need to design the supply chain for agility and flexibility. This seems particularly challenging for smaller companies: building resilience right into a supply chain takes time and attention in the business, and smaller organizations often don’t have the potential to accomplish that.
Second, it was observed that much more attention was required on spreading risk as well as aiming for risk reduction in the supply chain. For the future, what this means is more attention ought to be made available to the manner in which businesses count on specific countries, customers, and suppliers.
Third, attention is necessary for explicit prioritization as well as smart rationing techniques in situations where need can’t be met. Explicit prioritization is actually necessary to keep on to meet market expectations but additionally to increase market shares where competitors miss opportunities. This particular challenge isn’t new, but it has also been underexposed in this specific crisis and was usually not a component of preparatory pursuits.
Fourthly, the corona problems shows us that the financial impact of a crisis additionally depends on the manner in which cooperation in the chain is set up. It is typically unclear how extra costs (and benefits) are actually sent out in a chain, in case at all.
Lastly, relative to other functional departments, the operations and supply chain functions are actually in the driving accommodate during a crisis. Product development and advertising activities need to go hand deeply in hand with supply chain pursuits. Regardless of whether the corona pandemic will structurally switch the traditional discussions between logistics and production on the one hand as well as advertising on the other hand, the long term must explain to.
How is the Dutch meal supply chain coping throughout the corona crisis?