Supply chain – The COVID 19 pandemic has undoubtedly had its impact impact on the planet. health and Economic indicators have been affected and all industries have been touched within one way or perhaps some other. Among the industries in which this was clearly visible will be the farming as well as food business.
Throughout 2019, the Dutch farming as well as food industry contributed 6.4 % to the yucky domestic product (CBS, 2020). As per the FoodService Instituut, the foodservice business in the Netherlands dropped € 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 in the food chain have significant effects for the Dutch economy and food security as a lot of stakeholders are affected. Even though it was clear to majority of people that there was a big effect at the conclusion of this chain (e.g., hoarding in food markets, eateries closing) and also at the start of this chain (e.g., harvested potatoes not searching for customers), there are numerous actors inside the source chain for that the impact is much less clear. It is therefore imperative that you find out how effectively the food supply chain as being a whole is prepared to deal with disruptions. Researchers in the Operations Research and Logistics Group at Wageningen University and also out of Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the effects of the COVID-19 pandemic throughout the food supplies chain. They based their analysis on interviews with around 30 Dutch source chain actors.
Demand within retail up, found food service down It is obvious and well known that need in the foodservice stations went down due to the closure of places, amongst others. In some instances, sales for vendors in the food service industry as a result fell to about 20 % of the original volume. Being an adverse reaction, demand in the list channels went up and remained at a quality of aproximatelly 10 20 % greater than before the crisis began.
Goods that had to come via abroad had the own problems of theirs. With the change in desire coming from foodservice to retail, the need for packaging improved considerably, More tin, glass and plastic material was needed for use in consumer packaging. As more of this packaging material concluded up in consumers’ homes instead of in places, the cardboard recycling process got disrupted too, causing shortages.
The shifts in desire have had a major affect on output activities. In a few instances, this even meant a total stop in output (e.g. within the duck farming business, which came to a standstill due to demand fall out on the foodservice sector). In other cases, a significant portion of the personnel contracted corona (e.g. in the various meats processing industry), causing a closure of facilities.
Supply chain – Distribution activities were also affected. The start of the Corona crisis in China caused the flow of sea canisters to slow down fairly soon in 2020. This resulted in limited transport electrical capacity during the very first weeks of the issues, and high expenses for container transport as a direct result. Truck transportation experienced different issues. Initially, there were uncertainties regarding how transport would be managed for borders, which in the long run were not as strict as feared. What was problematic in instances that are a large number of , nonetheless, was the availability of drivers.
The response to COVID 19 – provide chain resilience The supply chain resilience analysis held by Prof. de Colleagues and Leeuw, was based on the overview of this primary elements of supply chain resilience:
Using this framework for the evaluation of the interview, the findings show that few companies had been well prepared for the corona crisis and in fact mostly applied responsive practices. Probably the most notable source chain lessons were:
Figure 1. 8 best methods for food supply chain resilience
First, the need to design the supply chain for flexibility and agility. This appears especially complicated for smaller sized companies: building resilience right into a supply chain takes attention and time in the organization, and smaller organizations oftentimes don’t have the potential to do so.
Second, it was discovered that much more interest was necessary on spreading danger and aiming for risk reduction inside the supply chain. For the future, what this means is far more attention ought to be made available to the manner in which companies depend on suppliers, customers, and specific countries.
Third, attention is required for explicit prioritization and clever rationing strategies in cases in which demand can’t be met. Explicit prioritization is required to keep on to satisfy market expectations but in addition to improve market shares wherein competitors miss opportunities. This challenge isn’t new, but it’s in addition been underexposed in this specific crisis and was usually not part of preparatory activities.
Fourthly, the corona issues shows us that the monetary impact of a crisis in addition depends on the way cooperation in the chain is set up. It’s often unclear precisely how extra costs (and benefits) are sent out in a chain, in case at all.
Lastly, relative to other functional departments, the operations and supply chain functionality are actually in the driving seat during a crisis. Product development and marketing and advertising activities need to go hand in deep hand with supply chain events. Whether or not the corona pandemic will structurally change the basic discussions between creation and logistics on the one hand and advertising and marketing on the other hand, the long term must tell.
How is the Dutch foods supply chain coping throughout the corona crisis?