Supply chain - The COVID-19 pandemic has undoubtedly had its impact impact on the planet. Economic indicators and health have been compromised and all industries have been touched in a way or perhaps yet another. One of the industries in which it was clearly apparent would be the agriculture as well as food industry.
In 2019, the Dutch extension as well as food niche contributed 6.4 % to the yucky domestic product (CBS, 2020). According to the FoodService Instituut, the foodservice industry in the Netherlands lost € 7.1 billion within 2020. The hospitality business lost 41.5 % of the turnover of its as show by ProcurementNation, while at exactly the same time supermarkets increased their turnover with € 1.8 billion.
Disruptions of the food chain have big consequences for the Dutch economy as well as food security as lots of stakeholders are affected. Even though it was apparent to majority of people that there was a great effect at the end of this chain (e.g., hoarding around grocery stores, eateries closing) and also at the start of the chain (e.g., harvested potatoes not searching for customers), there are numerous actors in the source chain for which the effect is less clear. It's therefore important to figure out how effectively the food supply chain as a whole is actually prepared to deal with disruptions. Researchers from your Operations Research and Logistics Group at Wageningen University as well as out of Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the influences of the COVID-19 pandemic throughout the food supply chain. They based the analysis of theirs on interviews with around thirty Dutch supply chain actors.
Demand in retail up, that is found food service down It is apparent and widely known that demand in the foodservice stations went down as a result of the closure of places, amongst others. In certain instances, sales for vendors in the food service industry therefore fell to aproximatelly twenty % of the first volume. Being a side effect, demand in the list stations went up and remained within a level of aproximatelly 10 20 % higher than before the crisis started.
Products that had to come via abroad had the own issues of theirs. With the shift in need from foodservice to retail, the demand for packaging changed considerably, More tin, glass and plastic material was required for use in consumer packaging. As much more of this packaging material concluded up in consumers' homes as opposed to in restaurants, the cardboard recycling process got disrupted as well, causing shortages.
The shifts in need have had an important affect on production activities. In a few cases, this even meant a total stop in output (e.g. in the duck farming industry, which arrived to a standstill as a result of demand fall out inside the foodservice sector). In other cases, a significant portion of the personnel contracted corona (e.g. in the meat processing industry), causing a closure of equipment.
Supply chain - Distribution pursuits were also affected. The start of the Corona crisis in China triggered the flow of sea canisters to slow down pretty shortly in 2020. This resulted in transport capability that is limited throughout the first weeks of the crisis, and costs which are high for container transport as a direct result. Truck travel encountered different issues. To begin with, there were uncertainties on how transport will be handled for borders, which in the end were not as rigid as feared. That which was problematic in most cases, nevertheless, was the accessibility of motorists.
The response to COVID 19 - deliver chain resilience The supply chain resilience evaluation held by Prof. de Leeuw and Colleagues, was based on the overview of the primary components of supply chain resilience:
To us this framework for the analysis of the interviews, the conclusions show that not many companies had been nicely prepared for the corona problems and actually mainly applied responsive methods. The most notable supply chain lessons were:
Figure one. Eight best practices for food supply chain resilience
First, the need to design the supply chain for agility and versatility. This looks particularly complicated for smaller companies: building resilience into a supply chain takes attention and time in the business, and smaller organizations oftentimes don't have the potential to accomplish that.
Next, it was discovered that much more interest was necessary on spreading threat and aiming for risk reduction inside the supply chain. For the future, what this means is more attention ought to be provided to the way companies depend on suppliers, customers, and specific countries.
Third, attention is needed for explicit prioritization and smart rationing techniques in cases in which demand cannot be met. Explicit prioritization is required to keep on to meet market expectations but in addition to increase market shares wherein competitors miss options. This particular task isn't new, although it has additionally been underexposed in this crisis and was frequently not part of preparatory activities.
Fourthly, the corona issues teaches us that the financial impact of a crisis also is determined by the manner in which cooperation in the chain is set up. It's typically unclear how further expenses (and benefits) are actually distributed in a chain, in case at all.
Finally, relative to other purposeful departments, the businesses and supply chain capabilities are actually in the driving seat during a crisis. Product development and advertising and marketing activities need to go hand deeply in hand with supply chain activities. Regardless of whether the corona pandemic will structurally replace the classic considerations between production and logistics on the one hand as well as marketing and advertising on the other, the future will have to explain to.
How's the Dutch foods supply chain coping during the corona crisis?