Supply chain – The COVID 19 pandemic has undoubtedly had the impact of its effect on the world. Economic indicators and health have been compromised and all industries have been completely touched within one way or yet another. Among the industries in which this was clearly noticeable would be the farming as well as food industry.
In 2019, the Dutch farming as well as food industry contributed 6.4 % to the disgusting domestic item (CBS, 2020). As per the FoodService Instituut, the foodservice business in the Netherlands lost € 7.1 billion in 2020. The hospitality industry lost 41.5 % of the turnover of its as show by ProcurementNation, while at the same time supermarkets increased the turnover of theirs with € 1.8 billion.
Disruptions in the food chain have significant consequences for the Dutch economy and food security as many stakeholders are impacted. Even though it was clear to most men and women that there was a big effect at the conclusion of this chain (e.g., hoarding around supermarkets, eateries closing) as well as at the start of this chain (e.g., harvested potatoes not finding customers), there are many actors in the source chain for that the effect is less clear. It’s therefore imperative that you figure out how well the food supply chain as a whole is actually equipped to cope with disruptions. Researchers in the Operations Research and Logistics Group at Wageningen University and 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 the analysis of theirs on interviews with around thirty Dutch supply chain actors.
Need within retail up, in food service down It is evident and well known that need in the foodservice channels went down as a result of the closure of restaurants, amongst others. In some instances, sales for suppliers in the food service industry as a result fell to about 20 % of the first volume. Being a side effect, demand in the retail stations went up and remained within a degree of about 10 20 % higher than before the crisis began.
Products that had to come through abroad had the own problems of theirs. With the shift in need from foodservice to retail, the requirement for packaging improved dramatically, More tin, cup or plastic was required for use in buyer packaging. As more of this particular packaging material concluded up in consumers’ houses as opposed to in joints, the cardboard recycling function got disrupted also, causing shortages.
The shifts in demand have had a big impact on output activities. In certain instances, this even meant the full stop in output (e.g. in the duck farming industry, which emerged to a standstill as a result of demand fall-out in the foodservice sector). In other situations, a big portion of the personnel contracted corona (e.g. in the meat 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 bins to slow down pretty soon in 2020. This resulted in transport capability which is limited during the very first weeks of the problems, and expenses which are high for container transport as a result. Truck transport encountered various problems. Initially, there were uncertainties regarding how transport will be managed for borders, which in the long run weren’t as rigid as feared. What was problematic in cases that are most , nevertheless, was the accessibility of motorists.
The reaction to COVID 19 – provide chain resilience The source chain resilience evaluation held by Prof. de Leeuw as well as Colleagues, was based on the overview of the primary things of supply chain resilience:
To us this particular framework for the assessment of the interview, the results indicate that few companies had been well prepared for the corona problems and in reality mostly applied responsive methods. The most notable source chain lessons were:
Figure 1. Eight best methods for meals supply chain resilience
For starters, the need to design the supply chain for versatility as well as agility. This appears especially challenging for smaller sized companies: building resilience into a supply chain takes time and attention in the organization, and smaller organizations often do not have the capacity to do so.
Next, it was discovered that more attention was needed on spreading threat as well as aiming for risk reduction inside the supply chain. For the future, meaning far more attention ought to be given to the way businesses count on suppliers, customers, and specific countries.
Third, attention is required for explicit prioritization and intelligent rationing techniques in situations in which need can’t be met. Explicit prioritization is needed to keep on to meet market expectations but in addition to boost market shares where competitors miss options. This challenge isn’t new, however, it’s also been underexposed in this specific crisis and was often not part of preparatory activities.
Fourthly, the corona crisis shows us that the economic impact of a crisis in addition relies on the manner in which cooperation in the chain is set up. It’s typically unclear precisely how extra expenses (and benefits) are actually sent out in a chain, in case at all.
Lastly, relative to other functional departments, the operations and supply chain operates are actually in the driving seat during a crisis. Product development and advertising activities need to go hand deeply in hand with supply chain activities. Whether the corona pandemic will structurally switch the traditional considerations between production and logistics on the one hand and advertising on the other, the future will need to explain to.
How is the Dutch food supply chain coping during the corona crisis?