Supply chain – The COVID 19 pandemic has undoubtedly had the impact of its effect on the planet. Economic indicators and health have been affected and all industries have been touched within one way or perhaps another. One of the industries in which it was clearly obvious will be the agriculture and food industry.
Throughout 2019, the Dutch extension as well as food industry contributed 6.4 % to the gross domestic item (CBS, 2020). As per the FoodService Instituut, the foodservice business in the Netherlands shed € 7.1 billion within 2020. The hospitality industry lost 41.5 % of its turnover as show by ProcurementNation, while at exactly the same time supermarkets enhanced 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 lots of stakeholders are affected. Though it was clear to most individuals that there was a significant effect at the tail end of the chain (e.g., hoarding doing supermarkets, restaurants closing) as well as at the start of the chain (e.g., harvested potatoes not finding customers), there are numerous actors within the source chain for that will the effect is less clear. It’s therefore important to figure out how effectively the food supply chain as being a whole is prepared to contend with disruptions. Researchers in the Operations Research and Logistics Group at Wageningen University and also from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the consequences of the COVID-19 pandemic throughout the food resources chain. They based the examination of theirs on interviews with around thirty Dutch source chain actors.
Demand in retail up, that is found food service down It’s apparent and well known that demand in the foodservice channels went down as a result of the closure of places, amongst others. In a few cases, sales for vendors in the food service industry thus fell to aproximatelly twenty % of the original volume. Being an adverse reaction, demand in the retail stations went up and remained within a level of aproximatelly 10 20 % higher than before the crisis began.
Products that had to come via abroad had their own problems. With the shift in desire coming from foodservice to retail, the requirement for packaging improved considerably, More tin, cup or plastic material was required for use in customer packaging. As more of this product packaging material concluded up in consumers’ houses instead of in restaurants, the cardboard recycling function got disrupted as well, causing shortages.
The shifts in desire have had a significant affect on production activities. In a few instances, this even meant a total stop of output (e.g. within the duck farming business, which arrived to a standstill as a result of demand fall-out on the foodservice sector). In other cases, a major section of the personnel contracted corona (e.g. to the various meats processing industry), resulting in a closure of facilities.
Supply chain – Distribution pursuits were also affected. The start of the Corona crisis of China caused the flow of sea bins to slow down fairly soon in 2020. This resulted in limited transport capability during the earliest weeks of the issues, and costs that are high for container transport as a direct result. Truck travel encountered various issues. Initially, there were uncertainties on how transport would be managed for borders, which in the end were not as strict as feared. The thing that was problematic in many instances, nevertheless, 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 the core things of supply chain resilience:
Using this particular framework for the assessment of the interviews, the findings show that few companies were well prepared for the corona problems and in reality mostly applied responsive methods. Probably the most notable supply chain lessons were:
Figure 1. Eight best practices for meals supply chain resilience
To begin with, the need to create the supply chain for agility and flexibility. This seems particularly complicated for smaller companies: building resilience right into a supply chain takes time and attention in the business, and smaller organizations oftentimes do not have the capability to do so.
Next, it was discovered that more interest was necessary on spreading danger and aiming for risk reduction inside the supply chain. For the future, what this means is more attention has to be given to the manner in which companies rely on suppliers, customers, and specific countries.
Third, attention is required for explicit prioritization as well as smart rationing strategies in cases in which need can’t be met. Explicit prioritization is necessary to keep on to satisfy market expectations but also to boost market shares where competitors miss options. This particular challenge isn’t new, although it’s also been underexposed in this problems and was usually not a part of preparatory pursuits.
Fourthly, the corona crisis shows us that the economic result of a crisis also relies on the way cooperation in the chain is actually set up. It’s typically unclear precisely how further expenses (and benefits) are sent out in a chain, if at all.
Lastly, relative to other purposeful departments, the operations and supply chain functions are in the driving accommodate during a crisis. Product development and marketing and advertising activities need to go hand deeply in hand with supply chain events. Whether the corona pandemic will structurally change the basic considerations between logistics and creation on the one hand as well as marketing and advertising on the other, the long term will have to tell.
How is the Dutch food supply chain coping throughout the corona crisis?