Supply chain – The COVID-19 pandemic has undoubtedly had its impact influence on the world. health and Economic indicators have been affected and all industries are touched within one way or some other. One of the industries in which it was clearly apparent is the farming and food industry.
Throughout 2019, the Dutch extension as well as food niche contributed 6.4 % to the disgusting domestic item (CBS, 2020). According to the FoodService Instituut, the foodservice business in the Netherlands lost € 7.1 billion in 2020[1]. The hospitality trade lost 41.5 % of the turnover of its as show by ProcurementNation, while at the identical time supermarkets enhanced the turnover of theirs with € 1.8 billion.
Disruptions of the food chain have major consequences for the Dutch economy as well as food security as lots of stakeholders are impacted. Though it was clear to many folks that there was a huge effect at the conclusion of the chain (e.g., hoarding in grocery stores, eateries closing) and at the start of this chain (e.g., harvested potatoes not searching for customers), there are numerous actors within the supply chain for which the effect is less clear. It’s thus important to determine how properly the food supply chain as a whole is actually equipped to deal with disruptions. Researchers from your Operations Research as well as Logistics Group at Wageningen University and from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the effects of the COVID 19 pandemic throughout the food resources chain. They based their examination on interviews with about 30 Dutch supply chain actors.
Need within retail up, contained food service down It is evident and widely known that demand in the foodservice stations went down as a result of the closure of joints, amongst others. In some cases, sales for suppliers of the food service business thus fell to about 20 % of the initial volume. As an adverse reaction, demand in the list stations went up and remained at a level of aproximatelly 10 20 % greater than before the crisis began.
Goods that had to come from abroad had their very own problems. With the shift in need from foodservice to retail, the demand for packaging improved dramatically, More tin, cup or plastic was required for use in buyer packaging. As more of this particular product packaging material ended up in consumers’ houses rather than in places, the cardboard recycling process got disrupted too, causing shortages.
The shifts in need have had a major impact on output activities. In a few cases, this even meant a full stop in output (e.g. in the duck farming industry, which emerged to a standstill on account of demand fall out on the foodservice sector). In other cases, a big portion of the personnel contracted corona (e.g. in the various meats processing industry), leading to a closure of facilities.
Supply chain – Distribution activities were also affected. The beginning of the Corona crisis of China caused the flow of sea bins to slow down fairly soon in 2020. This resulted in transport capacity which is restricted throughout the first weeks of the issues, and costs that are high for container transport as a consequence. Truck transportation faced different problems. Initially, there were uncertainties on how transport will be managed for borders, which in the end were not as rigid as feared. The thing that was problematic in instances that are many , nevertheless, was the accessibility of motorists.
The response to COVID 19 – supply chain resilience The source chain resilience analysis held by Prof. de Colleagues and Leeuw, was used on the overview of this core elements of supply chain resilience:
Using this particular framework for the assessment of the interview, the findings show that not many businesses had been nicely prepared for the corona crisis and in fact mostly applied responsive methods. The most notable supply chain lessons were:
Figure 1. Eight best methods for food supply chain resilience
To begin with, the need to design the supply chain for agility as well as versatility. This appears particularly complicated for smaller companies: building resilience into a supply chain takes attention and time in the organization, and smaller organizations often do not have the capability to accomplish that.
Second, it was observed that more interest was required on spreading threat and aiming for risk reduction within the supply chain. For the future, what this means is more attention should be provided to the way companies count on specific countries, customers, and suppliers.
Third, attention is needed for explicit prioritization as well as intelligent rationing strategies in cases where demand can’t be met. Explicit prioritization is necessary to keep on to meet market expectations but also to increase market shares wherein competitors miss options. This particular task isn’t new, however, it’s in addition been underexposed in this crisis and was usually not part of preparatory pursuits.
Fourthly, the corona problems shows you us that the financial impact of a crisis additionally is determined by the way cooperation in the chain is actually set up. It’s usually unclear exactly how additional costs (and benefits) are actually sent out in a chain, if at all.
Finally, relative to other purposeful departments, the operations and supply chain functionality are in the driving accommodate during a crisis. Product development and advertising activities need to go hand deeply in hand with supply chain pursuits. Regardless of whether the corona pandemic will structurally replace the classic discussions between logistics and production on the one hand and marketing on the other, the potential future will have to tell.
How is the Dutch foods supply chain coping throughout the corona crisis?
