Supply chain – The COVID 19 pandemic has undoubtedly had the impact of its impact on the world. Economic indicators and health have been compromised and all industries are touched in one way or perhaps some other. One of the industries in which this was clearly obvious will be the agriculture and food business.
In 2019, the Dutch agriculture as well as food industry contributed 6.4 % to the gross domestic product (CBS, 2020). As per the FoodService Instituut, the foodservice business in the Netherlands shed € 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 enhanced their turnover with € 1.8 billion.
Disruptions of the food chain have big consequences for the Dutch economy as well as food security as many stakeholders are impacted. Though it was clear to numerous folks that there was a significant impact at the tail end of this chain (e.g., hoarding doing food markets, eateries closing) as well as at the beginning of the chain (e.g., harvested potatoes not finding customers), you will find numerous actors inside the supply chain for that will the effect is much less clear. It’s thus important to find out how properly the food supply chain as being a whole is actually armed to contend with disruptions. Researchers from your Operations Research as well as Logistics Group at Wageningen Faculty and also coming from 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, in food service down It’s apparent and well known that need in the foodservice channels went down due to the closure of restaurants, amongst others. In some instances, sales for vendors of the food service industry thus fell to aproximatelly twenty % of the first volume. Being a complication, demand in the list stations went up and remained within a quality of aproximatelly 10 20 % higher than before the crisis started.
Products that had to come from abroad had their very own problems. With the change in demand from foodservice to retail, the demand for packaging changed considerably, More tin, cup and plastic was required for wearing in consumer packaging. As much more of this particular product packaging material concluded up in consumers’ homes rather than in places, the cardboard recycling function got disrupted too, causing shortages.
The shifts in desire have had a major impact on output activities. In a few cases, this even meant the full stop in production (e.g. inside the duck farming industry, which arrived to a standstill on account of 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), leading to a closure of facilities.
Supply chain – Distribution pursuits were also affected. The beginning of the Corona crisis of China caused the flow of sea containers to slow down pretty soon in 2020. This resulted in limited transport capability during the first weeks of the problems, and high expenses for container transport as a result. Truck travel faced various issues. At first, there were uncertainties on how transport would be handled at borders, which in the long run weren’t as rigid as feared. The thing that was problematic in situations that are many , nevertheless, was the availability of motorists.
The response to COVID-19 – supply chain resilience The supply chain resilience analysis held by Prof. de Leeuw and Colleagues, was used on the overview of this key things of supply chain resilience:
To us this framework for the assessment of the interviews, the results show that few companies had been well prepared for the corona problems and in fact mainly applied responsive methods. The most notable supply chain lessons were:
Figure 1. Eight best methods for meals supply chain resilience
First, the need to develop the supply chain for agility and versatility. This appears especially challenging for smaller sized companies: building resilience right into a supply chain takes time and attention in the organization, and smaller organizations usually don’t have the capability to accomplish that.
Second, it was discovered that much more attention was necessary on spreading threat and aiming for risk reduction within the supply chain. For the future, this means more attention should be given to the way businesses depend on specific countries, customers, and suppliers.
Third, attention is required for explicit prioritization and intelligent rationing strategies in cases where need cannot be met. Explicit prioritization is actually necessary to continue to meet market expectations but additionally to increase market shares where competitors miss opportunities. This particular task isn’t new, but it’s additionally been underexposed in this specific crisis and was usually not a part of preparatory pursuits.
Fourthly, the corona problems teaches us that the financial impact of a crisis also is determined by the way cooperation in the chain is actually set up. It’s often unclear exactly how further expenses (and benefits) are actually distributed in a chain, if at all.
Finally, relative to other functional departments, the businesses and supply chain capabilities are in the driving accommodate during a crisis. Product development and advertising and marketing activities need to go hand in hand with supply chain pursuits. Regardless of whether the corona pandemic will structurally replace the traditional considerations between logistics and creation on the one hand as well as advertising on the other hand, the long term will need to explain to.
How’s the Dutch food supply chain coping throughout the corona crisis?