Supply chain – The COVID 19 pandemic has undoubtedly had its impact impact on the planet. Economic indicators and health have been compromised and all industries are touched in one way or even yet another. Among the industries in which it was clearly noticeable is the farming as well as food industry.
In 2019, the Dutch extension as well as food industry contributed 6.4 % to the yucky domestic item (CBS, 2020). As per the FoodService Instituut, the foodservice industry in the Netherlands dropped € 7.1 billion in 2020. The hospitality industry lost 41.5 % of its turnover as show by ProcurementNation, while at the identical time supermarkets increased the turnover of theirs with € 1.8 billion.
Disruptions in the food chain have significant effects for the Dutch economy as well as food security as many stakeholders are affected. Even though it was clear to majority of folks that there was a big impact at the end of the chain (e.g., hoarding doing food markets, restaurants closing) and also at the beginning of this chain (e.g., harvested potatoes not finding customers), you will find numerous actors within the source chain for that will the effect is much less clear. It is therefore vital that you figure out how effectively the food supply chain as a whole is actually equipped to deal with disruptions. Researchers in the Operations Research and Logistics Group at Wageningen Faculty as well as from Wageningen Economics Research, led by Professor Sander de Leeuw, studied the effects of the COVID-19 pandemic throughout the food resources chain. They based their examination on interviews with about thirty Dutch supply chain actors.
Demand within retail up, found food service down It’s obvious and widely known that need in the foodservice channels went down on account of the closure of joints, amongst others. In a few instances, sales for vendors in the food service industry as a result fell to aproximatelly twenty % of the original volume. Being a complication, demand in the list stations went up and remained at a degree of aproximatelly 10 20 % higher than before the problems started.
Products which had to come through abroad had the own problems of theirs. With the shift in demand coming from foodservice to retail, the demand for packaging changed dramatically, More tin, glass and plastic material was necessary for wearing in buyer packaging. As more of this product packaging material concluded up in consumers’ homes rather than in restaurants, the cardboard recycling process got disrupted as well, causing shortages.
The shifts in demand have had a significant impact on production activities. In some cases, this even meant a full stop in output (e.g. inside the duck farming industry, which emerged to a standstill as a result of demand fall-out in the foodservice sector). In other instances, a major part of the personnel contracted corona (e.g. to the various meats 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 soon in 2020. This resulted in restricted transport capacity during the first weeks of the issues, and expenses that are high for container transport as a direct result. Truck travel experienced different issues. At first, there were uncertainties regarding how transport would be handled for borders, which in the end weren’t as rigid as feared. What was problematic in most instances, however, was the accessibility of drivers.
The response to COVID 19 – deliver chain resilience The source chain resilience analysis held by Prof. de Leeuw and Colleagues, was used on the overview of the key things of supply chain resilience:
To us this framework for the analysis of the interviews, the findings show that few organizations were nicely prepared for the corona crisis and in fact mostly applied responsive practices. The most notable source chain lessons were:
Figure 1. 8 best practices for food supply chain resilience
To begin with, the need to design the supply chain for agility and flexibility. This appears particularly challenging for smaller sized companies: building resilience into a supply chain takes attention and time in the business, and smaller organizations oftentimes don’t have the potential to accomplish that.
Next, it was discovered that more interest was needed on spreading threat as well as aiming for risk reduction within the supply chain. For the future, this means far more attention ought to be given to the manner in which businesses depend on specific countries, customers, and suppliers.
Third, attention is required for explicit prioritization as well as clever rationing techniques in situations in which demand cannot be met. Explicit prioritization is actually required to continue to satisfy market expectations but also to improve market shares in which competitors miss options. This particular task isn’t new, though it has also been underexposed in this crisis and was often not a part of preparatory activities.
Fourthly, the corona crisis teaches us that the monetary impact of a crisis also depends on the way cooperation in the chain is actually set up. It is typically unclear exactly how extra costs (and benefits) are sent out in a chain, if at all.
Lastly, relative to other functional departments, the businesses and supply chain capabilities are actually in the driving accommodate during a crisis. Product development and advertising activities have to go hand deeply in hand with supply chain activities. Regardless of whether the corona pandemic will structurally replace the classic discussions between logistics and creation on the one hand and marketing and advertising on the other, the future must explain to.
How’s the Dutch foods supply chain coping during the corona crisis?