Supply chain – The COVID-19 pandemic has certainly had the impact of its impact on the world. Economic indicators and health have been affected and all industries have been touched within one of the ways or perhaps some other. Among the industries in which it was clearly noticeable will be the agriculture as well as food industry.
In 2019, the Dutch extension and food sector contributed 6.4 % to the gross domestic product (CBS, 2020). As per the FoodService Instituut, the foodservice industry in the Netherlands lost € 7.1 billion within 2020. The hospitality business lost 41.5 % of its turnover as show by ProcurementNation, while at the same time supermarkets increased their turnover with € 1.8 billion.
Disruptions of the food chain have big effects for the Dutch economy and food security as lots of stakeholders are affected. Though it was apparent to many people that there was a great impact at the end of the chain (e.g., hoarding in food markets, eateries closing) and at the start of this chain (e.g., harvested potatoes not searching for customers), there are numerous actors in the source chain for that will the impact is much less clear. It is therefore imperative that you find out how effectively the food supply chain as a whole is actually equipped to contend with disruptions. Researchers from the Operations Research and Logistics Group at Wageningen University as well as from Wageningen Economics Research, led by Professor Sander de Leeuw, studied the influences of the COVID-19 pandemic throughout the food resources chain. They based the analysis of theirs on interviews with around thirty Dutch source chain actors.
Demand within retail up, in food service down It is evident and popular that demand in the foodservice channels went down on account of the closure of joints, amongst others. In a few cases, sales for suppliers of the food service industry therefore fell to about twenty % of the first volume. Being an adverse reaction, demand in the list stations went up and remained within a quality of aproximatelly 10 20 % greater than before the problems started.
Goods that had to come through abroad had their own problems. With the shift in need from foodservice to retail, the requirement for packaging improved dramatically, More tin, glass and plastic material was necessary for use in customer packaging. As much more of this particular product packaging material concluded up in consumers’ houses as opposed to in places, the cardboard recycling system got disrupted as well, causing shortages.
The shifts in desire have had an important affect on production activities. In a few instances, this even meant a total stop in output (e.g. in the duck farming business, which arrived to a standstill as a result of demand fall out in the foodservice sector). In other instances, a major portion of the personnel contracted corona (e.g. in the meat processing industry), resulting in a closure of facilities.
Supply chain – Distribution activities were also affected. The beginning of the Corona crisis in China caused the flow of sea canisters to slow down fairly soon in 2020. This resulted in restricted transport electrical capacity during the earliest weeks of the issues, and high costs for container transport as a result. Truck transport experienced different issues. Initially, there were uncertainties on how transport will be managed at borders, which in the end weren’t as rigid as feared. That which was problematic in cases which are a large number of, nevertheless, was the availability of motorists.
The response to COVID-19 – provide chain resilience The source chain resilience evaluation held by Prof. de Colleagues and Leeuw, was used on the overview of the main elements of supply chain resilience:
Using this particular framework for the evaluation of the interview, the findings indicate that not many companies were nicely prepared for the corona problems and in reality mainly applied responsive methods. The most important supply chain lessons were:
Figure 1. 8 best practices for food supply chain resilience
For starters, the need to design the supply chain for flexibility and agility. This looks especially challenging for smaller companies: building resilience right into a supply chain takes time and attention in the business, and smaller organizations oftentimes don’t have the capacity to accomplish that.
Next, it was discovered that much more attention was needed on spreading risk as well as aiming for risk reduction within the supply chain. For the future, this means more attention ought to be made available 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 strategies in cases where need cannot be met. Explicit prioritization is necessary to keep on to satisfy market expectations but in addition to boost market shares where competitors miss options. This task is not new, however, it’s additionally been underexposed in this problems and was usually not a part of preparatory pursuits.
Fourthly, the corona issues teaches us that the financial result of a crisis in addition relies on the manner in which cooperation in the chain is actually set up. It’s typically unclear how additional costs (and benefits) are actually sent out in a chain, if at all.
Last but not least, relative to other purposeful departments, the operations and supply chain characteristics are in the driving accommodate during a crisis. Product development and advertising and marketing activities need to go hand deeply in hand with supply chain activities. Whether the corona pandemic will structurally switch the basic considerations between logistics and production on the one hand as well as advertising on the other hand, the long term will need to explain to.
How is the Dutch meal supply chain coping during the corona crisis?